Factory owners in the 19th century deliberately produced false data in a bid to stop the British government restricting the extent to which they could employ child labour, a new study suggests.
The research, carried out by Steven Toms and Alice Shepherd from Leeds University Business School, explored financial data presented to parliament by prominent Lancashire mill owners including Robert Hyde Greg, Holland Hoole and Henry and Edmund Ashworth between 1833 and 1845. Toms and Shepherd compared the actual profits of the firms with the figures they presented to show the supposed effects of reducing the working hours of young employees.
The resulting discrepancies point to both a systematic under-reporting of profit and an over-estimation of the fixed costs required to run the businesses. These latter figures were particularly key, as they would have added weight to claims that long working hours were needed to produce a reasonable rate of return.
“Even by modern standards of creative accounting, this was a pretty cynical attempt to head off regulation,” Toms told BBC History Magazine. “These were among the leading businessmen of their time, and they worked to carefully co- ordinate the financial evidence presented to parliament to show that regulation would supposedly destroy their profits and ruin their trade. All were avowedly laissez-faire and opposed in principle to the factory reform movement, led by labour reformer Richard Oastler, radical Tory MP Michael Sadler, and Anthony Ashley-Cooper, later Lord Shaftesbury.”
Debates about child labour came to prominence in the early 19th century. The initial Ten Hours Bill, introduced in 1833, proposed that factories should be barred from employing children under the age of nine, and that people younger than 18 should not work more than 10 hours a day. However, lobbying from industrialists – including those featured in the study – led to parliament relaxing the legislation, and the working hours of young people were not reduced significantly until the act was passed in 1847.
“These findings are not difficult to believe,” says Emma Griffin, author of Liberty’s Dawn: A People’s History of the Industrial Revolution (Yale, 2013). “Child labour was widespread in the 1830s, and was in many people’s eyes just a normal part of life – these factory owners were certainly not the only ones who feared government regulation.
“The science of statistics was also in its infancy. Without well-established, widely understood accounting procedures, there was inevitably considerable scope for creative accounting of the kind that Toms and Shepherd have revealed.”