f some portion
of net profits among all the wage-earners. The per cent of net profits to
be thus distributed is matter of agreement, and the basis of distribution
is naturally the scale of wages accepted by the employes in their contract
for employment. The particular methods of applying these principles vary
with circumstances, but in all cases depend upon the actual confidence of
employes in their employers. The effects seem to be good, bad or
indifferent, in proportion to the general intelligence and stability of
the employes. With really skilled workmen, established in homes and
feeling responsibility as citizens, profit-sharing stimulates to the
highest energy. With weak and irresponsible wage-earners it is likely to
bring waste and sometimes false notions in regard to wealth production.

The weakness of the whole system is the lack of provision for fairly
sharing burdens in the constantly recurring periods of loss. If the
employe's share of the profits is consumed upon comfort or luxury, he is
even less prepared than without such profits to meet the loss of not only
profits, but his wages, in times of depression. If these additional
earnings shared as profits become an insurance to the wage-earner, a sort
of reserve for sustenance and safety in the necessary times of weakness in
any industry, they stimulate the best characteristics of saving and
character-building, and cultivate a disposition to meet all emergencies in
patience. It is quite customary, therefore, in any system of
profit-sharing to provide also an investment for the employes in a reserve
fund, from which the necessities of the business and the needs of the
whole community of workers may be met. Such a method, if wisely managed,
makes the interests of the employes coincide with those of the employer.
If added to this there is ample opportunity for suggestions as to
enlargement and improvement of the business in all minutiae, the best
abilities of the workmen are called out and the heartiest sympathy is
possible. There still remains against such a system the objections, that
losses are not shared as truly as profits, and that employes are liable to
require too intimate an acquaintance with the condition of their
employer's business to foster the success of the enterprise. Its
successful application is so far confined to lines of business easily
comprehended and direct in their methods.

_Sliding scales of wages._--Another device for connecting directl