IN WIN Ml? WIN UMI'IH’ ! l 3-353 ll'll HTHS FARM MACHENERY AND lTS RELA'FION TO EFFICIENT FARM MANAGEMENT 31133;; {w fho Deg?” @f M. S. KWCZ'HGAN 3-?ATE COLLEGE Eta-ems??? Afibéa Swanson 1948 \Am .. __.___.-. _ 0' I u “M W I1W¥Eéfl. ' l 3 12854<3321 Q 1:. -9 1v" 1. .O' §V\:sh K ”‘K m - a I l l i This is to certifg that the .I l- ' thesis entitled 2 "Fair“. flackirez‘g' and Its. I’Lelafitm to . | Lff;c;v:t harm garagemeit" I presented hg file-INCL}. AI": i: Shane-3:“. has been accepted towards fulfillment * of the requirements for Ll. 30 ' - 761177; Edit}? ‘befibi .. J ,.degree 1u_ ,// I‘ x nae/444 it Major professor 7‘ l ,. Date_ L‘ : LII-795 I IA- ." ”HE'- . . 4"..‘4113‘ -: '1 .o—. - ‘1“ l" , 5 n I I 334MH‘TJI". I II '.. III'Iijf-I II‘_I ' '. . . fig? If {gig .. .. jIIs-III'I IR; {In . .- ,-£Ij ‘. II “III {‘QVMV 41% . . ~. III {l I'll" '1. ' I-I . I‘ III- II: I ,I.I‘. [I . I III\_ a I . I’IIIII .; t , 16' . .7» I. l If I .1 Il II II‘\ .‘QI If“ rl ' l 'g‘, HI‘. . \ i“; , ‘ . 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I f ‘V‘Il‘I I '\, ‘- ‘l Q "~-\ . ' g. I (.4’5 “¢ “-l’1~ Rx \, l \\( If: I .II"I ' 'A‘ ' . l’ ’ ‘ .".. --‘ I . ' . . ' I’. ' n . .I ’7' _ 4. « . -, I.‘ .I I. . . ' - I ...2' xv " "I-I'l I7"’s1" 4‘4 .‘ . ‘ 1’4} h i’ ll‘j. \ "'34 'I‘ “'/.'~ -.-\~ l o J I} T. 7. _ f . . I l . _ I . \I o - .,\' I. I - .. I . M, t I ‘ o‘l . . .1 l u -. . - -‘ . “t l I ' ‘H' 'l . ’ ‘ ‘ l' . ' "4 ll . ' “'1 '1.~ .. W l I ‘ . I "\ ~ "5 H t . l f . . w - - ' :i' ' I : .4 z- -.t . u- \I .w- - t P I J l- l I"., u t It; VIJII ’ " 9 I\‘ I J . . I . ' ‘7 1b . . I! I" "I I h '15,] 4 '. .‘ ;-: l 'l II . - .-J l 3%l " ' II {II I. “.I' / I 1"l’~II'~" l-"~ I 'I' :\ . 'I It, I' \I‘IlIB ’ I ’:II ('I‘h ' I It. ' '. - I A f ’1' l ' I I“. . '. l I ‘. ‘ fl _!I‘ l“. I! I: ..'I~ J . Li“ 'X I ‘- g“; .7 I . . \' .I t . _ - \ . 5. Ill». t a I. I 9. ‘ l. ; I I . I_ I I I ‘ ' I ’ ‘l, x .2 l 3-. - n , - - .mln'l, . MI I ,. . .. I f _, - n I I. {Kn I - ‘5 ' . .- - 1' | I- h t .' I c a - - o ‘4 . ‘ 1‘ l r l II I ,/ In .I ‘ l I r '| ' "lI I ".\ I,‘ I- I II I -I | ' <|\JI . s 1“ .§ l’.’ s\ lI ’lI.‘ ‘ - - '. . a l' l ' . \ . I . Il'v 0] J] \I | . \I t I, ‘ I .r \I ' t I 'l I L t o . - ‘< I o. l \ )IIIII'II . vaI o 0‘ I r, ) h . I r . l ' . c1“, . t ' ' I. . '3'. I’M/21%,” ’I" ' .I'I'II..I"~It . w'lII 139‘“ t Ml '.\I. {1'th \ fl 1529‘“. ' I/ x. , IIJ'hlthII FARM LLLCHIKLLLY A1313 me RLLALION ‘1‘ o ILLIL‘I CIENT FARE LLLLLAGLLLNT by mm. ETH ALBIN DIIILQELJQ or: A THESIS Submitted to the Scnool of Graduate Studies or'Micnigan State College or Agriculture and Applied Science in partial fulfillment of the requirements for the degree of LASTER OE SCIENCE Department of Farm.Management 1948 THR§§. VITA Kenneth A. Swanson rERSONAL Age: 34 . Religion: Erotestant Birthplace; Morley,.michigan height: 5' ll” Nationality! American Weight: 170 lbs. Marital status: Married Health: Excellent EDUCATION Morley'high School, Morley,.michigan, graduated 1931. berris lnstitute, big Rapids Michigan, completed a stenographic course in 1952 Central .Michigan College of Education, Mt. Pleasant, Michigan, 956-38. Michigan btate College, East Lansing, Michigan, graduated with a bachelor of bcience Degree, .majoring in agricultural education, June 1940. Prawn» c1; Reared on a general farm in.Mecosta County,.Michigan. Five season 'S'work and partial management of a 36-acre cherry orchard in.Mecosta County 1935-37. Taught vocational agriculture and sh0p'worK at Farxell Ifiichigan, 1940-42. Thirty-seven months in the army, thirty months of this service was in the racific lheater, 1942-46. Taught vocational agriculture at Morley,.michigan, July 1946 to June 1947. 202031 101m U‘u‘"’JI.JEJDGI-.1‘EMT Grateful acknowledgment is given to Dr. K. T. Wright, Professor E. 3. Hill and to other members of the Earm.hanagement Department of Michigan State College for assistance in the conduct of this study and in giving advice and counsel in the preparation of this manuscript. Also to William b. Lutz, formerly a graduate stu- dent in Farm.management at Michigan state College and now Extension specialist in Dairy husbandry assigned to the Upper Benin— sula, for early work done in gathering data for the study. Appreciation is expressed to farmers from whose farm accounting records basic data was obtained for use in this study. TABLE OF COKTEMTS Introduction: The problem . . . . . . . . . . . . . . . The need for the study . . . . . . . . . The purpose of the study . . . . . . . . The source of data . . . . . . . . . . . A Review of the Literature . . . . . . . . . . . helationship of nachinery investment to Farm barn- ings, Labor Efficiency and Uther ractors . . helationship of.machinery Expenses to flarm Marn- ings, and Uther factors . . . . . . . . . . . Relationship of Labor-saving machinery to Labor EffiCiency O O O O O O O O O O 0 O O O O O neport on Machinery furchases in 1946 . . . . . 0 mary O O O O O O O O O O O O O O O O O O O Apyendix o o o o o 0’ o o o o o o o o o o o o o bibliography O O O O O O O O O O O O O O O O O O O‘JCRNNF’ 22 29 54 52 56 6O FARM L‘ECHII‘IERY AND ITS FLEMTION _‘I‘_C_)_ EFFICIENT FARM.MANAGEMENT henneth.A. Swanson MTRODUCTION 231121911211 michigan farmers are buying large amounts of machinery. investments in certain types of machinery are so high as to cause concern among farmers and others as to just how much it is practical to invest in machinery on different sizes of farms. What are the effects of increased investments in machinery on labor costs? On the volume of farm business? On farm expenses? and finally, on farm earnings? The answers to these problems depend on a number of involved factors. It is hOped that this study of the mach- inery situation on 285 farms in south central Michigan will, however, supply information which will provide some basis for answering the general problem of "MOW'much.machinery can a farmer afford?" In addition to the Specific data presented in this report, the amount of machinery a farmer can afford depends somewhat on whether it is being bought for cash or on time, alternative uses for his money, the future of the general price level and the relationship of prices of farm and non- farm products. The Need for the Study In the years between the depression of the early 1950's and the beginning of World War 11, farm prices and incomes were so low that most farmers were unable to buy as much machinery as they needed for efficient operation. The war time wear and tear on machinery and the inability to get replacements during that time has resulted in abnor- mal demands for farm.machinery. The progressive decline in numbers of horses and mules and their replacement by tractor power and equipment have increased the importance of mach- inery on farms. Available farm labor is now limited and expensive and farmers are a xious to know to what extent the increased use of machinery would offset these higher labor costs. Michigan farmers now have the purchasing power and are buying farm.macnines in large numbers again. Their proolems in selection of the right Kind and amounts of machinery reveal a need for this study of the effects of the machinery invest- ment on farm expenses and earnings. 3132 Purpose pi p_1_1_e_ 5tgdy most studies have shown the principal purpose of having farm machinery is to reduce farm labor requirements per unit of output. lhis increase in labor efficiency could be utilized to shorten the length of the worx day and maKe farm life more enjoyable, or to increase the volume of busi- ness per worker and, therefore, farm earnings. 1he purpose of this study is to determine if an increase in the use of farm.machinery on Michigan farms actually does result in improved labor efficiency and increased farm earnings. specific objectives of this study are as follows: (1) To determine the effect of varying amounts and kinds of machinery upon labor efficiency on a farm. (2) To determine if increased investments in farm machinery result in increased farm earnings. (3) To determine the effect of machinery operating expense upon farm earnings and labor efficiency. (4) To study the trends in the mechanization of michigan farms. The Source 9_f_ 2.5.1.123 Farm accounting records on 285 farms in south central Michigan for the year 1946, provided the basic information for this study. The farm account books were kept by the farm Operators in cooperation with the harm.hanagement Uepartment Extension bervice of Michigan State College. The farms were located in Type of Farming Areas 1 "Corn and Livestock", 2 "Small grains and Livestock", and 3 "Dairy and General farming". The location and numbers of farms by counties are shown in figure 1. All farms in these areas on which records were kept were used in this study with the exception of a few farms specializing in enterprises such as orcharding or trucx crOps. Ihese farms averaged 160 tillable acres per farm. According to the U. 5. Census heports for 1945 on these same counties, the average number of acres per farm was 104 acres and 68 percent of the farm land was tillable, making an average of 71 tillable acres per farm. wherefore, the farms in this study were about 235 percent above the average size of farms in south central Michigan. fhe data for eaCh farm consists of a summary sheet showing aoreages, receipts, machinery expenses, labor incomes and a number of efficiency factors. in addition, there was a complete machinery and equipment inventory for each farm, a list of all machinery purchases in 1946, and a record of receipts from custom work performed Off the farm. COpies of these forms are in the appendix. 1. Type of Farming Areas in Michigan 14614 ICON Corn and Livestock 2. Small Grains anmivestock 3. Soulhwefiern 131111 ancfl ruck Crops 4. Poultry, Dairy and Truck Crops 5. Dairy and General Farming KTDairy and Cash Cfops 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. Dairy, Hay, and Special Crops Beans, Sugar Beets, and Dairy Cattle, Sheep, and Forage Central Potato and Dairy Northern Fruit and Dairy Northern Potato and Dairy General, Selt-Sutficing, and Part-Time Cattle, Potatoes, and Self-Sufficing Cattle, Hay, and Spring Grains Dairy and Potatoes Potatoes, Dairy, and Part-Time Jamal. con/r 1 —— .13... K... \ ‘L 4: DNA 1 “(\Pacm ‘ 1 9 Insco Innvu Ntmrco /0 t Mtco: ra lust u ‘ Manna" ‘ MM Haul; ~ \ Gexnor 5 6 .3. 7 fiz~r ' l ‘ llfll‘. (um Orin” I a . ON 5 t l t .. . Alton: 1 "Mahi\ anlév [lfOH [Na/v.0}1' l. m aé‘ug H ‘ ‘\\ \\\ \ L \ 1,... Va; 1 14 ‘56 '7 If mum a , .(flsc;\ My” r O, ~§\, \\ 5 \\Emn . N“ a”. \ \ h’uuuu l~uuc\ \ \\\l§ NBA 3%; mu. m i\ V fig. 1 - Location by counties of farms used in this study. A REVILT: or TIT-m LITERLTDRE Tgends gnuyggm.Mechgnization -- During the past few years of high farm incomes, farmers have been buying about all the maChinery that has been available. farmers in the United States spent approximately $800,000,000 in 1946 for farm machinery other than tractors, according to estimates by the U. S. Department of agricultural/. This is about twice as much as their annual average expenditure for these machines in 1955-59, and is almost twelve times that amount spent in the bottom year of the depression in 1952. rarmers' cash outlay for new equipment in 1946 totaled over 5 percent of their net income. This compares with an annual average of 7 or 8 percent in 1955-59. More machinery was bought in 1946, but net incomes were also much higher than in the pre- war yeajrs of 1950-59. The increasing use of labor—saving maChines such as combines, pick-up hay balers, and milking machines gives farmers enough equipment to do about twice as much work by machine as they could before the war. flarm.machinery prices on dune 15,1947 were 58 percent above the 1955-59 average but fgrm.wage rates as a whole had risen six times that much . As a result, it is good farm.management practice to make full use of labor-saving machinery. 1n considering whether or not to invest in a major lj'A. R. nendall, p800,000,000 For NeW'Farm.Kachinery, Agricultural Situation, 51 (8): 11. av Ibid., p. 11. type of farm.machinery, proper weight should be given to prices of farm products. farmers are nOW'getting about two and one-half times the preawar prices for farm products. iherefore, only about half as much farm output is needed compared to preawar prices to buy most kinds Of farm.mach- inery. On July 15,1947 the proceeds from 171 pounds Of butterfat would pay for a cream.separator, but at 1955-59 prices a farmer had to sell 515 pounds. .About 82 bushels of corn would buy a two-bottom.tractor plow in 1946, and at preawar prices he had to sell 175 bushels to pay for the plow. Since the beginning of World war II farm.machinery prices have increased only about one-half as much as the index of all prices paid by farmers. This means that some other things farmers buy have increased relatively more than the price of most farm.machines. because Of the improved financial conditions many farmers are now in a position to pay cash for their machinery. This reduces risks, as debt payments tha:t seem reasonable at present incomes could be burdensome if incomes fell off sharply. Operating expenses for tractors have gone up much less than feed costs for animal power in the past decade. because Of the greater size of power unit and speed of trac- tors far less labor is required to Operate them.than when using horses or mules. .nigh'wage rates for farm labor in itself would make animal power comparatively much higher in cost. Horse and mule numbers reaChed their peak during world war 1 and have since decreased two-thirds. As a re- sult more than 55 million acres of crop land are now avail- able to grow food and fiber for human use which once was used for growing horse and mule feed. Production from these released acres accounted for about 50 percent of the increase in output of farm products for human use during the period between the two World'Wars'§/. Figure 2 shows the almost continuous decrease in nume ber of horses and mules on farms in the United States and the corresponding increase in numbers of tractors. in re- cent years, approximately four head of work stock that have disappeared from.farms have been replaced by one tractor. This ratio will gradually decrease as work stock numbers decrease. an estimate made by the U. S. Department of Ag- riculture states that tractors on farms in the United States will probably number 5.5 million by 1955, and by 1974, about 5.0 million . Reflecting the smaller demand for horses and mules, prices per head in 1947 were below preawar. Large exports and increased slaughter have contributed to the high rate Of decline of horse and mule numbers in recent years. Only 255,000 colts were raised in the united States in 1946, the smallest crOp in more than a century. .Many farmers who 29/ M. R. U00per, Cr. '1'. barton, and A. 1:”. brodell, Progress of harm.mechanization, U. S. Department of Agriculture, Miscellaneous Publication No. 650, 1947, p. 26 _4;/ 335.13" P0 79 _ w _ . b ..-.71. _.‘_ 1 _. ,At- ._ . 5— 4._—.-_ , l 10 formerly produced workstock now find it more profitable to use theirfeed and other resources for producing meat ani- mals or animal products for sale. Despite the decrease in numbers Of work animals on farms in the past two decades, the flow of tractors and other machines onto farms has given to farmers an increasing volume of power and machinery. Volume of power and equipment now on farms is probably about 40 percent above the 1955-59 average Q]. The tremendous advance in the mechanization of so many farms in recent years is an important factor in increas- ing agricultural production. In 1947 there were over 2 mil- lion tractors on farms in the United States, which is more than double the number a decade ago. Today at least a third of the farmers have tractors compared with 14 percent in 1950 and the pr0portion is increasing rapidly _§/. The in- creasing use of the tractor as motive power is an important influence affecting both the changes in field machines and the amount of labor required for crOp production. In gener- al, the tractor has made for the adoption of wider machines and for higher operating speeds. It has also enabled farm- ers to plant and harvest crOps that would otherwise be lost by permitting a longer workday in critical seasons of un- favorable weather. Uevelopment of the general-purpose tractor and its 5/ A. P. Brodell, Farm Machinery.krospects, Agricultural Situation, 32 (1): 1. p] S. E. Johnson, The Revolution in Farming, Agricultural Situation, so (10): 1 11 complement of tools in the 1920's, and the extensive use of rubber tires on tractors and implements in the 1950's helped_great1y in advancing the speed and effectiveness of farm.machines. Demand for modern farm.machinery has far exceeded the supply since the beginning of the World War II. The biggest demand has been for harvesting machines such as small combines adaptable to a variety of crOps and field conditions, corn pickers suitable for small acreages, and other major labor-saving machines. Pick-up hay balers or field chOppers, with special wagon boxes for hauling and an elevator or blower, that almost completely mechanize hay harvesting are sought by farmers with large acreages and by custom.Operators. According to the U. S. Department offlAgriculture, the types of farm.machines that increased in numbers most rapidly in the United States from 1942 to 1945 were hay balers 167%), milking machines (43%), combines (5gb), corn pickers 129%), and tractor drawn or mounted mowing machines ‘ (26b), cultivators 151%), and planters (24%) 2/, .Although pick-up hay balers have had the greatest percentage increase they are a comparatively recent development and are still few in number. Numbers of milking machines on farms in 1946 were about double those in 1942. Milking machines often reduce labor needs about 50 percent so they were especially helpful during the severe labor shortage of World war II. 2/ COOPer, O . Cit., Table 20, p. 57 12 Some of the major farm.machinery manufacturing companies have recently introduced tractor models with a full complement of adapted tools which are smaller than any made previously and are designed to replace a team.of horses on our smallest farms. These are expected to open new markets for farm machinery and may considerably hasten . the end Of animal power on our farms. There has been a great expenditure for research in recent years to solve the problems involved in mechanizing cotton and sugarbeet growing and harvesting. Self-propelled combines and corn- pickers are a recent develOpment. There is much interest among machinery designers to consider the tractor as a powered platform, Which will run equally well backward or forward, and on which all kinds of tillage and harvesting units can be quickly mounted as needed. We can expect as great improvements in farm machinery in the future as we have seen in the past. rrogressive farmers will always be on the alert to adOpt new machines that will increase the efficiency of their labor supply. 15 Efiregtg 2£_Mechanigation gppaboz Efficiency,ang gggg,hgrning§ -- The goal of farm meChahizatiOh is to accomplish more productive work in less time with less human effort. It has been estimated that in 1820 one farm 'worker supported himself and only about 5 other persons. by 1920 this had increased to himself and 9 other persons. In 1945 each farm worker in the United States produced enough food and fiber to support himself and 15 other per- sons. 1n the 5-year period from.1940 to 1945 there was an increase in productive output per farm worker of nearly 2/ 45 percent. , not all of this increase in production per worker was due to mechanization. about 52 percent or the saving in man-hours per unit or prOduction was due to increased prOduction per acre of cropland, increase in size or live- stock enterprise, increase in production per animal, spread- ing of overhead over a larger business, and several other factors,1Q/. as mechanization of farms progresses the time requir- ed for various farm operations has become less and less. for example, a corn farmer can prepareand plant three acres of land with tractor and power equipment in the same time he could do only one acre with horse equipment. 1f in rush seasons he wishes to put the tractor on a 24-hour schedule, ‘2/ Cooper ,gp. cit. p. 4 ;g/ Ibid.,,p. 18 ’ 14 not feasible with work animals, he can do the job 7 times faster than with animal powerll/, According to one source, "A modern tractor and its equipment now saves about 850 man-hours of labor compared ‘with the time required with the animal power and equipment used a generation ago. On the average, each automobile or truck saves the farmer more than 400 man-hours a year, com- pared with the time it would take to do the same hauling With horses or mules 2.". This illustration indicates why mechanization has been the most important single factor in the rapid rise in productivity of farm labor. figure 5 illustrates the estimated man-hours used to produce an acre of wheat and corn from.1840 over the period of a century until 1940. Labor requirements for wheat are now reduced to nearly as low as it is possible to go. .much further progress in reducing labor require- ments can be made in sugar beet growing and in haying Oper- ations. The greatest gains in the future can be expected in reducing man-hours required to care for livestock. In spite of all the advances so far made, 60 percent of all farm work is still done with the hands or with hand tools. Further mechanization of farm jobs will reduce the amount of hand work used in farming and the greatest challenge will be in livestock work, 75 percent of which is how hand ga/ labor , 12/ Uooper,,gp. cit., p. 19 lg/ Ibid., p. 28 VJ . 1 4 . :11 1 4 A 1 A _ . . 1 . . 1 x A _ . _ _ . . _ _ . . u . . . . t . . L . U . . . . .. . . c 4 _ . _ _ _ _ _ . . _ _ . . _ . . . . . . . ‘ . . . . _ . _ ._ . ~ _ . . . . .. — . . ~ . . . _ _ l _ . . . . , _ _ n 4 - . . . . . . . - _. _ . . . 4 . 1 . _ 4 . . . . . . l _ 1 . . . _ . 4 l 1 .. . l . . . m _ .W . l . . l . u . l . . . _ . _ . . . . _ _ . _ l . . . . . l . 7.: 1‘1 1 V1 .I- 01.1] .. ‘1. 11 v - | I! .1 1 11- 11111 .. v. I .1- o 1 I .1 l . I . | L1 . p v 1'1. 1. - .1 .. I: ... _1 1. ..... n . 1 - v1! I1..-||..v. 111.I1t a .1 ..| . , 1. 11‘ :.. >1 1 It. 0| 1 I a . 1’1- 1 1t I1I-l1 I». I . II . _ l _ L 4 . p u . l 4 . _ _ _ . . . . . 4 . . ~ A . d . . 4 . 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L . _ n . . . . . . . - -. . h . . . . . . . . . . . . . . l . .. . . . ._ _ . . . l . . . . . . . . . H . . l . _. . . . . . . . . . . . . . . . l . . . . . . . . . . . . . . _ . 4 _ L > .1 1:. 16 r0 1L' 1'} l3 16 According to Dr. K. T. Wright, "The principal pur- poses of having machinery is to reduce the amount of man labor needed to Operate the farm or to do more work'with the same labor. bometimes machinery is purchased to get the job done quicker or better. In this study the farms having the highest machinery investment had about 15 per- cent more workers per farm and there W's 25 to 55 percent. more work on the farm. Therefore, the work units accomr plished per man were about 10 percent higher where the machinery investment was highest than where the lowest. . . . having a higher investment in machinery improved the labor efficiency, made possible the handling of a larger business, and seemed to be associated with higher crOp yields, and higher labor incomes. It should be pointed out, however, that these are averages, and that Some indiv-' idual farmers had too much machinery and too high machin- _1_4_./ ery expenses ," In this same study it was also revealed that labor incomes on farms with tractors averaged @144 higher on small farms and $426 more on large farms. Ur. Wright was extremely cautious though about attributing the higher labor incomes to a result of using tractors, as shown in the fol- lowing remarks. "It should be pointed out that this diff- erence in earnings was the result of several things, and 14/ K. T. Wright, Dollars and Sense in Farming,.Michigan bpecial Bulletin 524, p. 31 17 not Just that of the tractor alone. Ihe men with tractors Operated business about a fourth larger as a result of farming more acres and keeping more livestoch, and increased their labor efficiency at least l0 per cent. if these results are not accomplished, getting a tractor will not give the increased earnings Shown." ;§/ In another study in Michigan by nebman entitled, "Improving harm.Labor Efficiency”, there was found to be 'a close relation between the use of labor-saving equipment and labor efficiency. the author states, "The principal method or increasing labor efficiency in crop production, is by the greater use of labor-saving equipment.” This greater efficiency was ascribed to both a larger amount and greater width of equipment used. 0n the high labor efficiency group of farms plows 6 inches wider and harrows that averaged 2 feet wider than the average for the low labor efficiency group were used. This enabled the high group to complete a season's tillage Operations in 20 per- cent less time than the low group with their smaller equip- ment. The same author concludes, "For those farms that lack labor-saving machinery and equipment, the purchase or use of this equipment will go a long way toward greater labor efficiency. Outright purchase in some cases, however, is entirely out of the qubstion from the standpoint of the investment. In such cases, going into partnership with 15/ Wright,.gp cit., pp. 32-55 18 a neighbor or two is sometimes the solution as it will spread the investment and cost over more acres. Ihe other alternative is to hire a neighbor wno has this equipment to do the particular jOD. whatever system is employed, however, labor efficiency will be improved and also the gpy net farm.income." The labor efficiency Of farm machinery can be greatly increased by the selection Of machines of large capacity. It requires no more labor to operate a three-plow than a one-plow size tractor. Ihe capacity Of a farm machine is dependent upon rate Of travel and the width Of the implement. The acceptance of rubber tires on tractors and implements has greatly increased their speed of Operation. most till- age Operations with tractors in preparing the soil for plant- ing are about twice the Speed Of horse Operations. bmall combines have only a 5 or 6-foot width of cut, but depend upon high Speeds for their remarkable capacity. There are practical limitations to the speed that can be used on some farming Operations. when cultivating, human reaction time in dOdging small plants will limit speeds, and excessive coverage caused by high speeds will affect the quality of work. high speed plowing results in greater pulverization of the soil but also increases power require- ments. who tricycle type of general purpose tractor is easily 16/ E. F. hebman, improving Farm Labor Lfficiency, michigan Special bulletin 354, pp. 11-13 19 upset if turned sharply at high hauling speeds. most field Operations will continue tO be limited to about 5 or 6 miles per hour. width of implement is important in increasing capacity but also has limitations. Hide machines are difficult to house, inconvenient at gates and lanes, and a hazard on the highways. Each unit Of working width added to a machine results in a decreased saving in time. lhis is because when one unit of a machine is in need of servicing, such as for a broken plowshare, this stOps the whole machine and it is therefore Operating a lower percentage Of the time. Excessively wide machines may cause poor quality of work unless the topography is almost level. Ihe principal advantage Of large capacity machines is in reduced labor requirements and greater timeliness. Timeliness is of great importance in some years Of wet springs, when the increase in length of growing season by a few days can have great effects on yields. 20 mgthodg Qf_ngering.machinexy.gg§§§ -- machinery expense was the second highest expense item on farms in 1946 according to farm accounting records kept on 858 farms in cOOperation with the rarm.Management Department of Mich- igan State uollege. tower and machinery expense per till- able acre averaged 96.92 and there was a machinery invest- 12/ ment of @2,872 per farm from.these records . because machinery expense was second only to labor costs, and also has a direct influence on labor costs as well, it is impor- tant to give careful consideration to methods Of lowering machinery costs, consistent with good farm management. home of the different methods by which use of farm machines may be Obtained at reduced costs are by purchase of secondhand equipment, cooperative use of machines, hir- ing, and by exchanging use of machines with a neighbor. bome studies have shown that 40 to 45 percent of machinery on farms was bought secondhand, usually at auctions l§/. lf bought wisely with regard to price and quality and kept in good repair, it will usually give cheaper service than new machines because the overhead costs Of interest on the investment and depreciation are so much lower. The princi- pal drawbacks tO cooperative use of machines are uncertainty of tenure of the owners, disagreements between neighbors as tO care and repair or machines and‘WhO is to use it first. 17/ J. boneth m. smith and L. Llwood, warm busines he ort for 1946, gugrteglz ngggiletin, Michigan, 30 «2 2 3. 18/ d. r. Hertel and r. Williamson, uosts Of rarm.rower and Equipment, bornell bulletin, 1941, no. 751, pp. 25-30. 21 Owners Of small farms can benefit most from OOOperative ownership, as their Operations are so small they could not, otherwise acquire ownership. an Iowa bulletin states, "It is easily recognized that the two most effective ways to reduce the cost of farm machines per day, which is so largely dependent upon over- head Or fixed charges, is first to extend the life of the machine and second to extend the use of the machine in num- ber of day's service per year l2/." To extend the use of a machine it is necessary to increase the size Of farm.so the fixed costs may be spread over more acres, or to do custom work off the farm. If a farm is now Operating with the most efficient combination of enterprises it may not be either practical or desirable to increase the size by buying or renting additional land. Depreciation and interest charges are the two largest items of expense in figuring costs of farm.machinery. Ihese are fixed charges and are little affect- ed by days use per year, but must be prorated accordingly. The number Of days use per year does not affect the life of a machine as much as might be supposed. TO extend the life Of machines they should be always well lubricated, adjusted, and promptly repaired. adequate housing is usually justified but studies have shown it does not pay to house some kinds of machines if they are kept 20/ painted or Oiled . 12/ d. D. uavidson and b. henderson, Life, Service and the Cost Of Service of farm.machines on 400 Iowa Farms, Iowa bulletin P37, 1942, p. 297. gg/ Ibid., p. 289 22 RELATIOHSHIP OF‘EACHILERY’INVESTLLNT TO FERM EARNINGS, LABOR EFFICIENCY, AND OThLR FACTORS In this section Of the study the 285 farms on which records were available were first ranked in order from the smallest to largest according to number of tillable acres. The three largest farms were then ranked by size of total machinery investment, then the three next largest farms were similarly divided into these low, medium and high machinery investment groups, and this was continued until all farms were so arranged. This procedure held the size Of farm, as measured by number of tillable acres, constant within a range of two acres for each of the three groups. following this sort into three groups, tabulations were made on various factors which would be Of interest in a study Of farm machinery investments. machinery investment on the one-third of the farms ‘with the most machinery was d4,170, or twice the investment of those with the least, w2,098. machinery investment per tillable acre ranged from.pl$.22 on the low machinery in- vestment farms to p25.80 on those farms with the most mach- inery.l This is a really significant variation and provides a good basis for this section of the study. The annual machinery expense per farm was about 50 percent greater on the farms with the most machinery. This Operating eXpense ranged from §5.24 per tillable acre on the farms with the 23 Table l - Relationship Of hachinery Investment to Uther factors with Tillable Acres held uonstant on 285 harms in southern.michigan, 1946. I» P p n. iotal machinery investment "Id ltem. per farm Low 1/5 Iledium_l/5 nigh 115 Number of farms . . . . . . . 95 95 95 Tillable acres . . . . . . . 159 160 161 Machinery investment . . . . w2,098 95,025 $4,170 machinery investment per till- 915.22 518.95 n25.80 able acre machinery Operating expense . 9851 5989 51,198 machinery expense per tillable m5.24 56.20 57.41 Numggieof tractors per farm . 1.0 1.2 1.4 number Of horses per farm . . 1.2 1.0 1.0 number Of farms without horses 57 47 48 number Of men . . . . . . . 1.6 1.6 2.0 IumlW.U. per man . . . . . . 516 558 506 crop P.M§W.U. . . . . . . . 200 216 210 Livestock r.h.W.U. . . . . . 288 505 575 Total man labor charge . . . 91,852 w2,050 52,622 Value Of unpaid family labor #264 @521 e428 Total productive man work units 505 540 612 Labor income . . . . . . . 95,411 @211,er 94,054 Total receipts . . . . . . . #8,426 @9,081 512,046 uustom work receipts . . . . 5127 9100 5591 custom'work receipts per farm @509 5506 $744 doing the work (only) age Of Operator (years) . . . 45.6 42.5 44.2 24 lowest machinery investment to 57.41 on those farms with the most machinery. One cause Of the higher machinery investment and expenses is indicated by the fact that the high machinery investment farms had 55 percent more tractors. Farms with the low'machinery investment had 22 percent more horses than the high group. About 50 percent more of the farms with the most machinery were without any horses. having more tractors and fewer horses did not show a need for fewer men on those farms, nor improve the productive man work units accomplished per man. ggpgp efficiency: The high machinery investment group had more men, 2.0 compared to 1.6 for the low group (25 percent greater), which cancelled the advantage of a higher total number of productive man work units. Eroduc- tive man work units per man were lowest Of all on those farms with the most machinery, and were highest on the middle group of farms. If a large machinery investment were actually labor-saving, then the productive man work units per man should be higher on those farms with the most machinery, whereas in this study they actually showed less work accomplished per man. These results do not agree with those reported in studies made by Wright related on page 16, and by Hebman on page 17 of this report. Apparently farmers are not buying machinery only, or even principally, to reduce labor costs or increase the _‘ ‘ ¢ I o l >~4~~ v». o sex 1946* he a. _ . l 8 u a-— >4—9— w 26 amount Of work accomplished per man. rerhaps farmers are more concerned with reducing drudgery or having more lei- sure time tO enjoy. Certainly, many farmers buy milking machines not only to save time and reduce labor costs but also because they just, plainly, hate to milk cows by hand. A small grain elevator may not always save much.time but it surely eases an arduous task and does a lot to make farm life more enjoyable. We cannot know from the source of the data in this study whether a farmer bought a machine to make a larger income, or if it was because he had a large income that he was therefore able to buy expensive machinery. A special study would be required to knOW'whether a large machinery investment is the cause or the result Of a large labor income. Unless we recognize these intangible values we are ignoring one of the principal reasons why farmers buy’machinery. There was little difference between the groups in crop productive man work units per farm. host farm.machin- ery is used in crop production but having more machinery on these farms did not result in increasing crop production. The increase in total productive man work units per farm on the high machinery group was due to having more or more intensive types of livestock, about 50 percent more livestock productive man work units. Labor incomes on those farms with the most machinery were also about 18 percent higher than the low group. This may'have been due almost entirely to a larger volume of bus- 27 iness, as those farms with most machinery also had about 18 percent more total productive man work units. Figure 4 shows the effect of increasing the number of total productive man work units on labor incomes. These data were taken from.summaries of farm accounting records kept by farmers in connection with the Farm.uanagement Depart- nent hxtension Service of Michigan State College in 1946, covering Type Of Farming Areas 1, 2 and 5. The data, when averaged, shows that each additional 100 productive man work units above the average for the lowest one-third of the farms was associated with an average increase Of @621 in labor income (§5,045 divided by 4.9 equals p621). This assumes that other factors remained constant and the total number of productive man work units was the sole cause of the increased labor incomes. As the above data are for the same year and Type of Farming Areas, comparisons may be made with the data on the 285 farms of this study on machinery investments. In this study on machinery investments there was a difference of 107 total productive man work units and p645 labor income between the one-third of the farms with the lowest invest- ment in machinery and the one-third Of the farms with highest machinery investment. 1f the assumption is true that 100 total productive man work units caused a 9621 increase in labor income, then the increased labor income on the high invest- ment farms would be completely cancelled out and no increased labor income could be attributed to having a higher machinery investment. 28 The value Of unpaid family labor was higher on farms 'with most machinery but this was not a large item in any 'group. The extra family labor was probably utilized in doing more livestock chores as there was more livestock on this group Of farms. Total receipts were nearly 50 percent higher on the farms with most machinery. This larger gross income would well permit a higher machinery expense per farm. custom'work receiptg'were three times as great on farmS'with most machinery as those with the least, but low- est Of all were those farms in the middle group. This high receipts is to be expected and is part of the reason why although machinery investment is nearly 100 percent higher, machinery expenses were only about 50 percent higher on those farms with most machinery. When only those farms are considered which actually did custom work, the high machinery group receipts are 2% times greater than on the low machinery investment group of farms. Thelggg pf Operators ranged from 42.5 to 44.2 years of age so there was no significant difference between the groups. It might be thought that younger Operators would use and demand more machinery. If this were true it was possibly offset by the fact that many farms which had accum- ulated the capital to purchase large amounts of machinery were Operated by father-and-son partnerships and the father was considered as the Operator. 29 RELATIONSHIP UF‘KACHINh; EAEENBES T0 FARM EARNINGS AND OTKER FACTORS In this study of the relation Of machinery expenses to other factors in the farm organization the same proced- ure Of sorting was followed as in the preceding section on machinery investments. The 285 farms were first ranked in order Of size based on the number of tillable acres. Then the three largest farms were separated and ranked according to size of total machinery Operating expense per farm. The next three farms were divided into the same groups, and this process was continued until all farms were arranged into either low, medium.or high machinery expense groups. The results of the tabulations are shown in Table 2. The size Of farm as measured by number of tillable acres was held constant for the three groups within a range of two acres. The number Of farms was the same in all three groups so direct comparisons may be made. machinery expense pg; farm was more than twice as high on the high-expense group of farms as those with the least expense. machinery expense is usually the second highest expense item on farms, second only to labor costs. Un these farms, the low group had a machinery expense only one-third that Of the total man labor charge, but for the high machinery expense group it was 60 percent as much as the total labor charge. It would seem reasonable to assume that if machin- ery supplants labor, then those farms that spend most on Table 2 - nelationship of machinery Expenses to Uther factors with Tillable Acres held Uonstant on 285 farms in Southern Lichigan, 1946. } 3:: Machinery expense per tillable acr ltem T LOW'l/5 medium.1[5 nigh 1/5 number Of farms . . . . . 95 95 95 Tillable acres . . . . . 160 159 161 machinery expense . . . . e655 9942 $1,451 machinery expense per V4.09 95.92 w8o87 tillable acre machinery investment . . 52,875 w5,07l 95,555 number Of tractors per 1.2 1.2 1.5 farm Tractor Operating expense p256 h279 9298 per tractor . Tractor Operating expense 9282 9551 5585 per farm number of horses per farm 1.1 1.0 1.0 number of farms without 42 49 40 horses number Of men . . . . . 1.6 1.7 1.9 Total man labor charge . 91,944 ' 92,084 p2,458 Total productive man work 516 565 570 _ punits P.h.w.b. per man . . . . 520 550 500 Urop acres per man . . . 96 78 71 urOp P.m.W.U. . . . . . 215 205 206 Livestock P.L.W.U. . . . 274 544 547 Labor income . . . . . $5,471 55,947 p5,648 51 machinery should have lower total labor charges, but this was not the case. Of course, some allowance must be made for the 10 percent more total productive man work units on the high expense farms. Machinery exnense per tillable acre was 58.87 on the high group compared to only 54.09 for those farms with the lowest expense. imachinery investment was 5462 higher on the farms with highest machinery expense. This shows those' farmS'with highest machinery expenses had more machinery. Interest on investment cost was not included in machinery expense. Tractors‘pgp.:agp'were 8 percent more numerous on the high expense group than the low group, but this would have helped to increase the Operating expense of those farms. Tractor Operating expense was higher on the high expense group which a:lso had the most tractors. Tractor operating expense per tractor was also higher on this group of farms, indicating those tractors were used more hours per year or were of lazrger capacity. Nggber 2; horses per farm.was slightly higher, about 5 percent, on those farms with the lowest machinery expense. The middle group had the most farms without horses and the high machinery expense group the least, but this difference was too small to be significant. As these farms average only about one horse per farm, it can reasonably be concluded that horses have ceased to have much effect on the farm Operations. 52 Number 2: Egg was higher on the farms with highest machinery expenses. Total man labor charge was h514, or 26 percent, higher on the farms with highest machinery ex- pense. Ihis compares with about 19 percent more men on those farms. The total labor charge on the high expense farms shows no reduction from the use of more machinery. 223g; productive man work units were slightly higher on the high machinery expense group than on those farms with medium.machinery expenses, and were materially greater than the low machinery expense group. froductive man'work units per man were lowest of all on the farms that spent the most on machinery. This was because they had 19 percent more men to do only 10 percent more work than on the low expense group of farms. There were 500 productive man work units per man on the high expense group, 520 on the low expense group, and 550 per man in the group with medium.expenses for farm.mach- inery. 91132 m p_e_;' map were also lowest on the farms with the greatest machinery expense, 71 crOp acres for the high expense group compared to 96 crOp acres per man on farms with the lowest machinery expenses. host farm.machinery is used in crOp production and this indicates that those farms which spent most on machinery were actually the least efficient in- use of labor in so far as crop acres per man are a measure. UrOp productive man work units were only slightly greater on the low machinery expense group which indicates those farms raised less intensive crOps. 55 Livestock productive man work units were considerably higher on the medium and high machinery expense groups than on the low expense group, 27 percent more on the high.mach- inery expense group than on the low group of farms. This was likely the greatest factor influencing labor incomes. Labor income was highest, 45,947, on the medium.mach- inery expense group of farms, 95648 on the high expense group, and @0471 on those farms with lowest machinery expenses. 1f other factors had been constant and this difference in labor incomes was associated with machinery expenses, then the ex- penditure of a moderate amount on machinery, as shown in the medium.expense group would seem.to result in the greatest farm earnings. however, other factors do not remain constant and these other factors, especially amount or intensity of livestock enterprises, apparently had a greater influence on farm earnings than the amount spent on machinery Operating expenses. 34 RELATIONSHIP OF LABOR-SAVINGAMACHINERY TU LABOR EhrlCIENCY- An attempt is made in this section to establish an index of mechanization to rate farms according to the labor- saving efficiency of their machinery investment. lt is assumed that the amount or quantity of machinery may not necessarily be the best measure of quality or efficient kinds and types of machines that will save the most labor. In so far as a review of literature revealed, and through discussions with agricultural engineers, there has never been an attempt to rate the different kinds and types of farm.machinery according to its degree of labor-saving efficiency. This may not be feasible. it most certainly is difficult to devise a reliable rating scale. Eerhaps the best method would be to determine the number of hours required to perform an Operation by hand methods, then compute the number Of hours required by the use of the machine and rate machines on a percentage basis of time saved. ouch an undertaking is beyond the SOOpe of this study. it would also be handicapped by the necessity or evaluating the effectiveness of the Operations, quality of work, and so forth. the rating scale used here is based on the number of certain major labor-saving machines listed on the beginning of the year inventories of these farms. because of the lack of any previous study concerning efficiency ratings an arbi- O trary device was constructed to rate the labor-saving effic- 55 iency of the machinery on a farm. rartially because of the nature of the data available for this study only major mach- ines were considered. it was desired to choose machines that would not ordinarily be found on every farm, such as a manure spreader, so there could be gradations in the ratings. farming enterprises were divided into four groups and those machines most typically labor-saving, as revealed in the review of literature, in each group were selected as standards. 1n addition, a group of service tools were added, and weight was given for those farms having more than one tractor. the six points in the index of mechanization with the kind of enterprise the machine is used in are as follows: 1. Combine ------------- small grains 2. Corn picker ----------- corn 5. Pick-up baler, forage chopper, or a buck rake -------- hay 4. milking machine --------- dairy 5. manure loader or a gutter cleaner - service tools 6. Two or more tractors - - a measure of power avail- able Ihe combine and cornpicker are undoubtedly the great- est labor savers in harvesting small grains. hay making methods are at present in an evolutionary state of flux. agricultural engineers are by no means agreed as to which method will eventually emerge as most pOpular. come studies have indicated that there is more variation in labor require- ments and time saved within a method of hay-making than be- 56 gg/ tween different methods . ihe hay loader has not been included as it is too common and probably saves less labor than the other three machines. many tools such as litter carriers and feed carts are not included with service tools because they are but minor investments. Although two small tractors may require more labor to do the same amount of work as one large tractor, and number of tractors will be largely proportional to size of farm, it was deemed advisable to include the sixth point in the rating scale to show the amount of power available to operate other labor-saving machines. an abundance of power is required to most effectively utilize labor-saving machines. Une of the greatest labor-saving devices, an adequate automatic water system, is not included as it is usually listed under the improvement inventory in farm accounts rather than as mooninery and equipment. Ihe 285 farms in this study were first divided into three groups according to size as measured by number of tillable acres. ihere were 94 small farms, 29-119 tillable acres; 91 medium-sized farms, 120-169 tillable acres; and 100 large farms, 170-666 tillable acres. Ihe grouping by numbers of farms according to the number of major labor— saving macnines per farm is shown in Iable 5. ihis shows the logical trend toward more labor-saving macnines on the larger farms. the farms in each size class were then divided 21/ b. h. bookhout,.naymaking JOb analysis, Journal 2_ farm aconomics, 29 \5): 761-67, 1947. 37 into four groups to tabulate the data. iable 5 - number or farms with Different Amounts of major Labor-saV1ng machinery, 285 harms in bouthern.michigan, 1946 5126 of Number Number Of major labor-saving machines farm of are farm farms 0 ] 1 I 2 5 7 4 L 5 i 6 Number of farms bmall 94 12 50 ’ 22 e 2 - - Medium 91 10 55 34 10 2 2 - Large 100 4 20 16 51 19 6 4 Small gggmg A tabulation was made of each size group to show the effect of the number of labor-saving machines per farm on labor income and other factors. Table 4 is a record Of thse data on small farms. Only two farms in this size group had more than three major labor-saving machines. Those having only one machine were the largest group and this was in most cases a milking machine. There was a range of 11 acres or only 14 percent in the size of farms among the four groups.. Labor income was highest on those farms having the most machines with p5,105, but was lowest on the second group with only §2,299. Total productive man work units were one-third higher on the farms having most labor-savin equipment and this would account for most of the increase 58 Table 4 - Effect of Labor-saving machines on Labor income and Other factors on 94 bmall farms in bouthern Michigan, 1946 m Small farms (29-119 tillable acres) Number of major labor-saving machines —-:-- Item .per farm 0 1 2 5-4 Number of farms . . . 12 50 22 10 Tillable acres . . . 80 84 89 91 Labor income . . . . 52,550 a2,299 52,854 95,105 Labor income per till- able acre . . . . 551.82 527.45 552.05 554.25 Total productive man 'work units . . . . 518 556 405 425 Number of men . . . . 1.0 1.5 1.4 1.5 rah5W.U. per man . . 518 278 287 279 Livestock P.K.W.U. . 184 227 261 252 013012) POLIL.OT{VOUO o o o 3.22 .115 123 126 rroductive animal units . . . . . 22 22 26 26 rotal man labor charge 41,590 91,547 51,750 91,950 machinery investment 51,457 $1,916 $2,855 55,767 machinery investment 2 per tillable acre 518.08 522.86 551.84 :54l.58 machinery expense . . 5528 5595 5874 5594 Eachinery expense per A tillable acre . . 56.64 57.07 59.81 56.55 59 labor income. Number 9; _m__e_3p_ was 50 percent greater for the group 'with meat machines than for the least. This resulted in the lowest rated machinery group having the most productive man work units per man,518. The group with two labor-saving machines per farm.had the most livestock productive man work units but had the same number of productive animal units, 26, as the high group. Total man labor charge was in proportion to the number of men and was highest on the group having most machinery. 1 Machinery investment was considerably higher in the group hatying most labor-saving machinery, over 2% times as much as the group with none. 1nvestment per tillable acre was in similar ratio. machinery Operating expense shows quite different results. The high-rated group had only slightly higher total machinery expense than the low group and was actually lower in expense per tillable acre. The reason the high machinery group had such low expense was possibly because those farmers performed more custom.work. This added income would counter-balance the extra cost of the larger investment in equipment. In summary it may be said those farms with the most labor-saving machines had the highest incomes but also had a la rger volume of busineSs as shown in total productive man work units. The farms with most machines had a larger number of men per farm resulting in no gain in labor effic- iency per man. Mediumrsiged Fapms This size class shows the most pronounced results of all from the use of labor-saving machines. There was little difference in size among the four groups, ranging from 158 to 146 tillable acres. The labor income on those farms with most labor-saving machinery was nearly twice as great, 95,165 compared to 92,674 for those farms without any. it is remarkable that merely sorting on the basis of labor-saving machines per farm should result in such decided differences in earnings. one of the associated causes of the increased earn- ings is a 44 percent greater total productive man work units, 416 on farms without labor-saving machines to 599 on farms with most machines. There were 25 percent more animal units on the highamachinery group of farms than on the low group. These must have been more intensive types of livestock as there were about 50 percent more livestock productive man work units on the farms with most machinery. The group with no labor-saving machines had 260 productive man work units per man which was noticeably less than the other groups. Machinery investment was about two and one-third times as great for the high machinery group as on the low group. The machinery expense was nearly twice as large, 98.51 per tillable acre compared to only $4.66 on the low group. 1n this size of farm class there was a large increase in farm earnings on those farms with most labor-saving mach- ines. This increase was far greater than could be accounted for by the larger volume of business on those farms. 41 lable 5 - Effect of Labor-saving.machines on Labor lncome and Other factors on 91.nedium-sized farms in bouthern.Michigan, 1946. (29-119 tillable acres) W number of major labor-saving machines Item. per farm 0 l 2 5-4 number of farms . . . 10 55 54 14 Iillable acres . . . 141 158 146 146 Labor income . . . . 52,674 52,956 55,617 55,165 Labor income per till- , , able acre . . . . 518.95 521.57 524.81 555.58 Iotal productive man work units . . . . 416 465 521 599 Number of men . . . . 1.6 1.4 1.6 1.8 P4M.W.U. per man . . 260 525 557 552 Livestock £.M.W.U. . 250 267 514 566 UI'OP f'l‘ilOIU‘I'TOUO o o o 155 184 192 214 Productive animal units . . . . . 27 28 54 54 Total man labor charge 51,925 $1,715 51,826 $2,517 machinery investment 51,722 $2,182 52,910 54,055 Machinery'investment , per tillable acre 512.20 915.77 519.97 527.77 machinery expense 5658 $778 5925 51,214 machinery expense per tillable acre . . 54.66 55.62 56.54 58.51 .£Q§8§.£Q§E§ as farms increase in size there is a natural trend toward the use of more labor-saving machines and a higher machinery investment. There were only four out of the 100 farmS'with no major labor-saving machines, and there were also four that met the requirements of all six points in the rating scale. There was considerable difference in the size of farms in this class, 212 tillable acres for the group with least machinery to 521 tillable acres for the well equipped group. This variation in size makes compar- isons less valid. papgr income was nearly twice as great for the farms 'with.most labor-saving machinery, 56,865 compared to 55,779 on the low rated farms. Labor income per tillable acre was more nearly uniform reflecting the difference in size of farms. 223;; productive man;wgr§,unip§ of 1,108 on the high rated farms compared to 592 on the farms with one or no mach- ines show that the well equipped farms also had a much larger volume of business. The productive man'work units per man were high on all four of these groups but was exceptionally high on those farms with 5 or 6 major labor-saving machines which had an average of 406 per man. This evidences an assoc— iation between use of labor-saving machinery and labor effic- iency. Drop productive man.wg;§,ugit§ ranged from.580 for the high rated farms down to 270 on those with least machinery but this was in line with the smaller size of farms. The high machinery group of farms had 65 percent more productive animal units and more than twice as many livestock produc- 45 Table 6 - Lffect of Labor-saving machines on Labor Income and Other factors on 100 Large Farms in bouthern Michigan, 1946. (170-666 tillable acres) -: number of major labor-saving machines ltem. ,per farm 0-1 2-5 4 5'6 number of farms . . . . 24 47 19 10 Tillable acres . . . . 212 240 244 521 Labor income . . . . . 55,779 54,826 55,709 56,865 Labor income per till- able acre . . . . . 517.82 520.06 525.55 521.58 Total productive man work units . . . . . 592 751 840 1108 number of men . . . . . 1.8 2.5 2.5 2.7 ruM.W.U. per man . . . 515 519 568 406 Livestock P.M.W.U; ... 515 455 450 646 brop r.M.W.U. . . . . . 270 500 555 580 rroductive animal units 40 51 55 66 Total man labor charge 52,255 55,145 52,977 55,571 machinery investment . 52,874 54,165 54,672 57,049 machinery investment per tillable acre . . . 515.55 517.50 519.11 521.95 machinery expense . . . 51,052 51,647 51,444 91,597 machinery expense per tillable acre . . . 5 4.86 56.84 55.91 54.96 44 tive man work units, 646 compared to 515 for the low group. machineryiinvestment was exceptionally high with 57,049 on farms with most labor-saving machines compared to only 52,874 on the low group. 1nvestment per tillable acre ranged from.ml5.55 to 921.95 on farms with most mach- ines. Machinery expense per tillable acre was nearly as low With 54.96 on farms with most machines as the $4.86 on farms'with least machines. IhiS'would indicate that a farm can Justify a large machinery investment if there is a large volume of business to utilize the macnines. it can reasonably be concluded that most or the in- creased earnings on the farms with most labor-saving mach- inery were due to having a larger volume of business on those farms rather than to the use or more labor-saving machinery. §gmgggx 9g affects pg;g§;ng_Labor-savigg flagging; some or the more important factors in the use or labor-saving macninery on all three sizes of farms have been brought together here for further comparative studies. rigure 5 shows the close relationship between num- bers of.labor-saving machines per farm and the size or maCh- inery investment. it also shows that machinery investment per tillable acre is much higher on.small farms than on large farms, and this differential increases as more macninery is added. if machinery costs per tillable acre are to be kept 45 .. _-_ 1.1 .1 _ 1 _ 1 a _ 1 . . . . 1. . .1 a 1 1 . _ a . .1 .. 1. . 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Table 7 - Relationship of Labor-saving hachinery to Labor bfficiency on 285 Farms in Southern1nichigan, 1946. .Size Range in Number number of major labor-saving of tillable of machines per farm farm acres farms 0717 1 I 2 _L_5-4_J_ 5 6 Productive man work units per man bmall (29-1191 94 518 278 287 1 279 - - medium (120-169) 91 260 523 7 532 - - ()3 (51 Large (170-666) 100 525 314 '5 553 432 Cf] U1 Cfl Q U! Weighted average - of all farms 285 297 299 331 324 452 573 The relationship of the use of labor-saving machinery to labor efficiency is shown in Table 7. where was a range from.an average of 297 productive man work units per man on those farms with the least number of major labor-saving mach- ines to 432 on those farms with 5 labor-saving machines per farm. where were only six farms in group 5 and four farms in group 6 so the results in those columns may not be reli- able. It must not be deduced from this table that the great- er labor efficiency on farms with.most machinery is due only to the use of the labor-saving machinery. The improved effic- iency was also influenced by the larger volume of business on those farms as shown in Tables 4 - 6. 47 The relation of size or business and use of labor- saving machines on farm earnings is shown in the scatter diagram, Figure 6 on page 48. AS the total number of produc— tive man work units increases there is an increase in labor incomes. For each size of farm it will be noted that as labor incomes increase, there is an accompanying increase in numbers of major labor-saving maChines per farm. This does not show whether the increased numbers of machines on the high income farms were a cause of the increased earnings, or merely an accompanying effect. Ihe greater use of mach- inery may have helped increase the volume of business by increasing labor output per worker and thus, indirectly, con- tributing to the increased farm earnings. That the greater use of machinery does not increase labor efficiency is shown in the study on machinery investment with size of farm held constant, on page 24 of this report. whe results Shown in Table 7, page 46, are considered inconclusive as the size of farm.was not held constant. Table A in the appendix presents an account of the numbers or the difrerent kinds of labor-saving machines used in setting up the rating scale, which.were round on these 285 farms. This same material is shown_graphically in big- ures 7-12 on a percentage basis. These graphs were presented to snow a comparison of the amounts of the different Kinds of macnines on small, medium.and large sized farms. [It 'llqlulfl I i- 18 I7 I3 ._'_ ,— '. I ._ l 1 . . .1 J. . . . h 1. 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I 52 hLPORT ON KACHIKERY PURUHASES IN 1946 This section is a study concerning the kinds and amount of machinery farmers in Southern.hichigan were buying in 1946. The farms were divided into three groups according to the number of tillable acres per farm. The numbers of principal machines purchased in 1946, and the cost of the machines to the farmers are shown in Table 5 in the appendix of this report. Both new and used machines are included in this report so an average price would not have much meaning with relation to the price of new machines. Lajor repairs which would affect the life of the machine and could not be charged to annual operating expense are included in these costs. These repairs were mostly on the power and transpor- taZtion machines. lt was not always possible to determine from.the records whether an item was a major repair or the full cost price of a used machine so the numbers of machines may not be accurate. It is not believed that the inadequacy of the data in this reSpect would greatly affect the accuracy of derived comparisons. The machines were grouped according to type of use made of the machine. Livestock equipment includes not only feeders, brooder houses, milking machines and other miscel- laneous livestock equipment, but also feed grinders and manure Spreaders. miscellaneous machinery has everything in it that could not be fitted into one of the other groupings. Table 8 shows the percent of the total purchase cost 58 spent for the different kinds of farm machines. The most money was spent for the purchase of power and transportation machines, although on small farms a little more was spent for harvesting machinery. The farmers on large farms spent one-third of the total amount of their new machinery pur- chases to buy tractors. The source of the data for this study does not show the size of all the tractors but many of these were larger capacity, three-plow types with greater output per unit of labor. Automobiles and trucks were in short supply in 1946 and the major portion of the expendi- tures shown were for used machines and major repairs on those already owned. harvesting machinery was the other group which account- ed for a large share of purchases. Two-thirds of the amount spent for machinery purchases was spent for these two groups of machines. Farmers on small farms spent 56 percent of all machinery purchases for harvesting machines but those on large farms spent only 20 percent on these machines. Uombines accounted for 16 percent of all purchases on small farms, but only 5 percent on large farms. The large farms possibly were already well equipped with combines, but they were just being introduced on many of the smaller farms. rurther studies should be made to determine if these combines on small farms are Dantam-sized machines, or if they were purchased to do custom work to increase the volume of business on limited acreages. Only two pick-up balers were bought in each size grouping in 1946. 54 Table 8 - Percent of Total.Machinery Purchase Uosts For Different hinds of machines on 285 harms in southern.michigan, 1946 V—__-» ‘— f S' e of far: . .Kind Small .medium Large of (29-119) (120-169) (170-666) machinery tillable tillable tillable acres acres acres rercent of total machinery purchase cost number of farms . . . . . . 4 94 91 100 Power and transportation: lractors . . . . 18 20 53 automobiles (farm share) . 9 5 5 TI‘UCKS o o o o o o o o d __.7_ ._.—Q _Q TOtal O O O O O O O O 0 O 33 51 454 Harvesting machinery: Combines . . . . . . . . . 16 14 5 PiCk-up balers o o o o o q 6 4: 3 Corn picl :ers . . . . . q 5 6 5 Other harvesting machines .‘ ._g __6 _;Z TOtal o o o o o o o o o 0 W 36 50 20 Livestock equipment: Milking machines . . . . . 3 4 2 Llilk COOIBrS o o o o o a 2 l 2 Other livestock equipment a ._6 lg, ._2 TOtal O O O O I O O O O 0 q 11 15 13 Drills and planters . ... . . l 2 3 Tillage machinery . . . . . . 6 8 6 Wagons and trailers . . . . . 5 5 5 miscellaneous machinery . . . 8 9 9 TOTALS . . . . . . . . . . . 100 100 100 55 furohases of drills and planters was a small item, ranging from 1 to 3 percent of purchases. Tillage tools accounted for 6 to 8 percent of machinery purchase costs. hany rubber-tired wagons were bought and this pusned the purcnases for wagons and trailers’up to 5 percent of the total. Livestock equipment expenditures were mostly for milking machines and manure handling machinery. No complete data vane available for other years on these farms so a study of trends in machinery purchases could not be made. Two-thirds of the machinery purchases in 1946 were for power or tranSportation machines and harvesting machinery. farmers on small farms spent three times as high a percentage of their total purchases on combines as those on large farms. farmers on the large farms spent relatively more on tractors. 56 b‘Uflzhfl-QY AND C01“.T CLUSIOI‘IS michigan farmers are facing the problem of deciding how much machinery it is practical for them to have on their farms. lt was thought that a study of farm accounting records on farms of bouthern.michigan would provide information to answer some general problems of how much machinery a farmer can afford. The purpose of this study was to determine the effects of the use of farm machinery on labor efficiency and farm earnings. The data wan taken from farm accounting records on 285 farms in south central hichigan for the year 1946, which were kept in connection with the farm accounting project of the harm Lanagement Department of Lichigan State College. These farms averaged 160 tillable acres so‘they'were more than twice as large as the average size of farm in this area. machinery investments -- Ihe first section of this study is on the relationship of machinery investments to labor efficiency and farm earnings. machinery investments vper farm on the one-third of the farms with the most machin- ery were $4,170, or nearly twice the investment on those farms with the least machinery, 62,098. The farms with most machinery had 20 percent more total productive man work units and 25 percent more men per farm than those with the least machinery. Ihis resulted in 316 productive man work units per man on farms with the smallest macninery investment, 558 units on the medium 57 one-third, and only 306 on farms with the largest investment. r"his shows no gain in labor efficiency from the use of more than the normal minimum.needs of machinery. Labor income was n4,054 on the farms with most macnin- ery compared to 95,411 on the third with the smallest machin- ery investment. A comparative study of Type of Farming Area reports on these farms shows this difference was due to the larger volume of business, therefore, no increase in labor incomes could be attributed to the larger amounts of machinery. Machinegy.Egpenses -- The section on the relation- ship of machinery expenses to labor efficiency and farm earn- ings gave results similar to those in the study of machinery investments. Labor incomes averaged 93,947 on the farms with medium expense per tillable acre, decreased to @3,648 on the farms with highest machinery expense, and were lowest on farms with the least expense, 95,471. Iotal productive man work units were lowest on the farms with the lowest machinery expenses and labor incomes. Iotal productive man work units were about the same on the medium and high investment groups, but the higher man labor charge on the farms with highest machinery expense decreased the labor income a like amount. rroductive man work units per man were 300 on farms with highest machinery expense compared to 520 on farms with lowest expense. Labor-saving machines -- an attempt was made to rate farms on the degree of labor-saving effectiveness of the machinery investment. no claim is made as to the validity 58 of the rating scale used. The results from this study showed no effect on labor incomes or labor efficiency that was not proportional to the volume of business on the small and large size groups of farms. 0n the mediumssize farms there was a large increase in labor income from §Z,674 on the farms with the least, to w5,165 on farms with the most labor-saving machinery. This increase was accompanied by a 44 percent larger total productive man work units. The greater labor income on farms with most labor-saving machin- ery was far greater than could be accounted for by the larger volume of business on those farms. Machinery Purchases -- From.the report on farm machinery purchases for 1946 it was ascertained that two- thirds of the cost of purchases were for power or transpor- tation machines and harvesting machinery. farmers on small farms spent 16 percent or three times as high a percentage of their total purchases for combines as those on large farms. Farmers on the large farms spent 33 percent of their machin- ery purchase costs for tractors. Conclusions -- In general, it can be said that the results from.this study of 285 Southern Michigan farms show no increase in labor efficiency or farm earnings that can be attributed to a machinery investment above the normal, minimum.needs. Neither do these results show a decrease in labor earnings from.investments in above normal amounts of machinery as might be expected in more normal price periods. FarmS'with the most machinery usually had larger 59 labor incomes, but at the same time also had a larger volume of business. This does not indicate whether a large machin- ery investment was a cause of the increased farm earnings, or merely an accompanying effect. 1f the greater use of machinery helped to increase the volume of business by in- creasing output per worker it would, indirectly, increase farm earnings. however, the results from.this study show no increase in labor efficiency from the use of'more than the normal minimum.amounts of machinery. These results indicate that investments in farm machinery above the normal, minimum needs are not justified purely from.the standpoint of increasing economic returns. Apparently, the desire to shorten the number of hours of work per day, reduce drudgery, and make farm life more en- joyable are just as important considerations by farmers in the purchase of additional machinery as is the economic mo- tive. Unless we recognize these intangible values we are ignoring one of the principal reasons why farmers buy machinery. 1t must not be construed from these conclusions that farm.machinery does not save labor. Innumerable surveys have shown a great reduction in man-hour requirements over the past century in raising various crOps, which were due in large measure to the increase in mechanization. The farms in this study with the lowest machinery investment probably had enough machinery for their normal minimum needs, and in addition may have hired additional machinery on a 60 custom basis. They would thereby have received benefits from.the use of machinery which did not increase their machinery investment. It can be concluded, therefore, that results from this study show no positive relationship between the size of machinery investment on these farms in bouthern.michigan and labor efficiency or farm earnings. Limitations of the data must be considered but results indicate that large investments in machinery on typical Southern.Michigan farms do not result in prOportional economic returns. The impli- cations from this study show the need for more research on farm machinery investments. APPENDIX 60 Table A - Numbers of the Different kinds of Major Labor- saving.Macnines on 285 farms in Southern.Michigan, 1946. number of .nind ofrmajor labor-saving machines labor- .Manure saving number Pick- loader, Two or machines of Corn- up Milking Gutter more per farm farms Combine icker baler* machine cleaner tractors Number of farms with the machines bmall farm? (29-119) tillable acres 127 machi es) 0 12 - - F - - - - l 50 10 2 1 35 1 1 2 22 10 3 7 l9 2 3 3-4 10 7 2 7 9 4 4 Total 94 27 7 15 63 7 8 Medium-sized farms (120-169 tillable acres) (151 machines) 0 (t 10 _ - - - - - - 1 33 3 l l 27 - l 2 34 19 7 6 29 2 5 3-4 14 13 10 7 l3 3 4 Total 91 35 18 14 69 5 10 Large farms (170-666 tillable acres) (275 mgpggpms) O 4 - - - - - - l 20 6 4 - 9 - 1 2 16 9 6 1 l3 2 1 3-4 50 37 25 13 46 7 41 5 6 5 6 3 6 5 5 6 4 4 4 4 4 4 4 Total 100 61 45 21 78 18 52 Total all farms 285 123 70 50 210 30 70 * Pick-up baler, a forage chopper, or a buck rake (one only). 61 Table B - Eumbers and cost of uifferent.ninds of new and Used machines Burchased in 1946 on 285 harms in Southern.michigan Small farms .mediumrsized Izarge farms (29-119 till- (120-169 till- (170-666 till- able acres) able acres) able acresz No. Uosp: No. Cost No. Cost__ Harvesting machinery: . Uombines . . . . . 8 910,464 9 910,420 6 55,482 Uorn pickers . . . 5 3,280 8 4,560 10 6,370 rick-up balers . 2 3,349 2 3,251 24 3,617 uther harvesting 30 5,927 27 4,195 56 8,927 machinery . Total harvestlns 45 25,020 46 22,426 55 24,396 machinery costs Drills and planters . 8 898 11 1,360 19 3,287 tower and Transport: Tractors . . . . . 9 10,278 13 14,197 30 35,151 Major repairs . - 1,236 - 1,340 - 3,831 Total cost . . ' ll.514 15,557 38,981 Autos (farm share) 7 4,411 5 2,557 4 5,525 Ma or repairs - - 1.9.8.90 - ...993. - 1.9.99. To a 1 cost . . 5,731 3,109 4,858 lI‘IlCKS o o o o o o 5 4,288 3 4,570 7 7,175 Major repairs . - 7Q - 551 - 1*166 Total cost . . 4,358 5,121 8,341 Tillage machines . . 39 3,503 55 6,202. 66 6,619 Livestock equipment: Milking machines . 7 1,798 13 3,355 10 2,397 hilk coolers . . 6 1,516 2 660 8 2,844 Other livestock - 3,959 - 7,581 - 10,166 equipment . . . Total cost . . . . - 7,273 — 11,596 - 15,407 wagons and trailers . 29 3,345 26 3,954 43 6,531 Miscellaneous ma;chinery - 5,077 ~ 6,587 - 11,401 Total of all machinery - 64,718 -' 75,892 - 119,821 1 fl ‘ If.“ \ ~ ,f‘" ‘ x....e f1 ”116645) I :0 (‘fiw‘l‘h‘L :JL l_i inning yr. Inn of yr. Sales . C. . — v1 ‘-rc1fi-\ 1-. .J...‘..-L ‘u ‘1‘.-- I 1 T; a K ’- ‘ f‘lf‘ r~. -."'r- .' 2. 1....L'rc. 1JCHH L‘uLn-t, 63C. H K a. Trs-:.——CI‘ 4. Truck '-J }.J t—J F1}; l4 (J }_J 6) C1 0 6. Auto farm snare r“- ,FLA ._- r1 fl 'Jo ‘. ("" on “'62 C. I“*"““c stars . " plot 3. Trrcter low 4. Trrctor Sine Trtotsr cultivator fi° . 1-, .. - .. "l? C ..LL'.11‘(_)1. H r“ ‘ a ——~-l—"~ " r ' t <,r;rr taut“ “arrow - b. O r -7 '1 a 501:9 tooth harrow 19. C It; acknr or roller T1 ' F J- ,1-.. O. 1101; CL;6_VubUl C 25. F'wr-_T,-Lgr I . ‘—-~‘— ,_. (,arr‘lm, .r 1‘3 .31 —' -'.— ho. :TF._. C CUoobr (‘\." i,‘ ... ’ EU. ( H‘TT‘ ...: -C I“ 1"? (4.1 o u‘ -_‘_‘ _: ‘ _ I ‘9‘! C. _ ..... .1. 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"fl 7 . = 3111‘, 3. r (TL-YT: I 't I“ I r ‘ J ' V X.-- , .- .- p‘ 1' \ "‘ . ' '('~“. — --./ O V“- ...\.' «'- '- - . —~ 0...» o'wo Jv-~ "ann‘ A“ :‘7" t' u‘ - ‘ .4 ~ _-- \: \. I W (‘W‘,\ (\ ' ri‘l‘r- V! y r I" w 0 .aA.‘ \ -.. L t, ,\ ‘. A L A. .L _‘ V? . '1 A. fifi‘. Fd-"Iv‘. \ ’_ Q ,‘ - ‘v C o - " H “ - J- . ‘_ t . J m _— 1 1‘ 1-: - I“ "\‘d -- n _.___. ‘ ‘2 9 AJ.._ . u/J... . \. L .1 {‘7' "13“; "1 ' F' 1 I ‘l ‘y'yfi l'f"' V. -‘ _.\I. i-‘ k k - . K -1. a '\. . wt .0. 5.4- 4 _ ‘V': ‘ . 3" 1!}.,)-,‘ :4,-, r‘ (.-.. "f. v‘ ._‘".-1_ . ”L4 0 -. « A; . g ..~ ,. . C.-~ A. N. “I- »J.a.-‘.....L..I-A -_ .. O \ - * 1,“ 7". .:, . :1. 1- f 3‘. . D t ‘ ,_ ._L .I . 7.“ .A. » . \J I BIBLIOGRAJRHX 65 BIBLIOGRAPHY Books Black, d. D., clawson,‘m., Sayre, U. K., and Wilcox, W. 1947 mhe Management of Harm Equipment. garm.ggnagement. hacmillan 00., N.Y. pp., 521-43 Forster, G. V. 1946 Farm Organization and hanagement. frenticeenall, Tnc., NJY: 475 pp. hart, v. 5., bond,.M. U., and Uunningham, L. 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Lippincott, U0., Chicago. 424 pp. 66 bulletins and Articles Atchley, E.ln. 1940 Tractor Costs in.Michigan 1939. hicnigan Agr. Exp. btation, Quarte311 bulletin, 25 (2}: 99-105 Brodell, A. P. 1946 Machinery on Farms. Azricultural bituation, 30 (7li9 b3rers ’ U. D. 1946 uosts of Owning and Operating Farm Implements and Lachinery in.Lentucky. Ly; agr. hxp. bta. Lul. 484 Dowell, Austin A. 1945 Effect of Size of Farm on investment. do eggnallgg the :smsrican.2291421.g:._azm4sisssers.a_4._unal '86 8. LA (2): 95- 99 flaystead, L. 1946 van Farmers Afford Their New Tools? Fortune, 54 (9 : 177 heady, E. 0., Hopkins, d. A., and E. mchibben 1944 Use and Cost of Use of fiarmihachinery. Iowa Agr. pr. bta. bul P62 hertel, J. P., and'fiilliamson, P. 1941 Costs_of Farm.fower and Lquipment. uornell Univ. Agr. Exp. Sta, bul. 751 James, H. B., and Barlow, F. D. 1944 Farm.Mechanization. North Uarolina Agr. Exp. bta., bulletin 548 Kendall, A. R. 1947 0800, 000, 000 fl'or mew lb‘arm.hachinery. agricultural bituation, 31 (8)- Larsen,.H. C. 1946 How Farm.hachinery Gan Larn its May. agriculture situation, so (9): 5 lxiusselman, H. h. 1942 Efficient Use of Farm Production Equipment. Lichigan Agr. Exp. bta., Uircular bulletin 183 rond, u. A. 1944 uustom Rates for Farm Operations. Linnesota Agr. LXp. bta., ramphlet 154 fiebman, E. E. 1944 Doing uustom Dork. nichisan farmer, 205 (July 1) p. 5 Rebman, E. F. 1945 Improving farm Labor Lfficiency. Michigan mgr. Exp. bta. , bpecial bulletin 534 67 whisler, rau1.A. 1947 Wilcox, 1943 Wilson, 1943 Wright, 1943 The Field florage uarvester. Apricultural Engineer- in , 28 (11): 497 R. H. Expense of Farm.machines horns basis for Loan Uharge Uhen.Lach1nes are borrowed by'meighbors. lllinois garmlEconoiics, (92): 413-415 J. B. Uost fer flour of using barm.macnihery. Aiaoama agr. Extension circular 238 h. T. Dollars and Sense in harming. Lichigan.Agr. pr. Sta., Special bulletin 324 l 19- ,7 T? be"? vi". '5; a 4' "h '5 :~ 1 ‘1 i' R 33': 11. .1 "1...“, . h 1. J“ Novll '45 {.19 lint. , J ) “ r ‘ 3 .11“... ; . " ‘ ' I ' "-. “av-3 r 1‘35 ’1- l “R, ; .3 ;% ' I s2; 1 . H ‘A . "ai‘A; "7'71 11111111111111 1'71 'TS