The Year of Delays, 1938
Shortages appeared where they had been least expected, partly in raw-materials but chiefly in labour. The former were due to earlier underestimates of requirements and to insufficient provision of fabricating capacity for light alloys. The remedy was to expand the light alloy industry, and this was done. Future experience was to show that even then the fabricating branches of the light alloy industry were not expanded far enough. But apart from this fault of under-provisioning, the remedy was simply and, in so far as it was adopted, sure.
More stubborn and more complicated was the problem of labour. At the end of 1937 the country had over 1.5 million unemployed, and there was some unemployment even in the engineering industry. But such was the rate of expansion in the aircraft industry that special labour problems, especially those of absorption, became acute. It took longer to train the new entrants and to assimilate them into aircraft production than manufacturers’ experience of the ‘lean years’ had led them to expect. When in the spring of 1938 the firms promised 12,000 aircraft within two years, they based themselves largely on rough estimates of how much labour they could obtain and digest. These estimates turned out to be too optimistic. The intake of labour was well below the programme and so consequently was the output of aircraft. The programme assumed an average monthly output of 333 aircraft rising from the 210 produced in March 1938 to 690 by June 1939. But as in the first four or five months labour was absorbed to the extent of about seventy percent behind the estimates, the production output stood still at about 200 aircraft per month.
Remedies were sought and found, and in the process of adopting them in the summer of 1938 the Air Ministry took yet another step away from the methods of peacetime production and towards those of wartime economy by joining the responsibilities for aircraft production, designs and development under the newly-created office of the Air Member for Development and Production, with Air-Marshal Sir Wilfred Freeman in charge. The new office became to all intents and purposes a fully self-contained production department, the embryo of the Ministry of Aircraft Production which became so famous under future years and the leadership of Lord Beaverbrook.
The new unit rapidly expanded its functions and tightened its contacts with industry. Between 1936 and 1938, while the aircraft manufacturers could still be relied upon to fulfil their contracts more or less on time, it was not perhaps necessary for the Air Ministry to keep a close check on them manage their labour, materials and capacity. By 1938, however, orders had become so large that the industry reached the limit of its resources and began to run into all kinds of shortages. Something more was needed than a mere watch over progress. A civilian Director General of Production was appointed and soon found himself not only mediating between firms and the Ministry in technical matters but assuming the general planning of production, reshaping and rearranging the plans of the companies themselves.
In September a report to the Air Council stated that the industry was failing in its production and deliveries, partly through shortage of raw materials, but chiefly through its inability to absorb and to train skilled labour with all the necessary speed. To enable it to complete the current programme in time its labour force would have to rise from just over 60,000 in September 1938 to a peak figure of well over 180,000 in January 1939, a whopping three-fold growth in the space of only five months. Contrary to their expressed intentions the aircraft firms had proved unable to assimilate new labour at a rate higher then 8% per month. If production was to be raised above the limit set by the direct recruitment of labour the industrial methods would have to be revised.
The main point of the revision was subcontracting. In the early days of the expansion programme subcontracts were not planned for. At that time, enforced transfer of labour to war production was as yet impossible; but the alternative method, that of utilising the resources of general industry, was also thought to be of little use. The technical view, for the time being accepted by the Air Staff, was that the production of aircraft was so complicated that it could not be entrusted to firms without previous experience of aircraft production. The expansion of aircraft production was therefore to come from additional factories under the direct management of the same companies.
In 1938 this assumption was revised from the ground up. Subcontracting carried the possibility of ‘bringing the orders to the labour’, thus easing the problem of labour recruitment. The proposal was that the ‘parent’ firms should entrust to subcontractors at least 35% of the outstanding orders. With these and other less radical improvements in the supply of raw materials and in the position of individual aircraft factories, it was hoped that the programme could be fulfilled in the second half of 1940, i.e. some three months later than its original date.
These hopes were to be fully realised. With the sense of emergency in the background, subcontracting and the other measures taken at the time soon began to produce results. The end of September and the beginning of October 1938 were marked by a great burst of production and by the end of the year the industry began to outstrip its own promises and programmes.
By the beginning of 1939 the official management of aircraft production took the general shape, if not yet the overall dimensions, which they were to keep throughout the war years.