Publications

- September 1, 2021: Vol. 8, Number 8

The home of the square deal: CEOs didn’t always believe in 40-hour workweeks or medical benefits

by Mike Consol

What does a person need do to attract 40,000 people to his or her funeral? There is a precedent for this. And, no, the person in question is not a deceased dictator from a totalitarian state with compulsory attendance by its party members or local citizenship. This is a business executive named George F. Johnson, who, in 1899, became co-owner of Endicott-Johnson Shoe Co. along with Henry B. Endicott.

George F, as he was popularly called, ran the largest shoe manufacturer and retailer in the United States, and to great effect. He was a man ahead of his time, offering his immigrant workforce what he dubbed a “square deal.” The cities of Endicott and Johnson City, N.Y., (named after Henry Endicott and George F. Johnson, respectively) have since been known as the Home of the Square Deal, as declared by the arches over the cities’ main streets, built by employees in honor of the many things the owners and company did for their livelihoods and families.

Start with a 40-hour workweek, which is heralded to be the first in the nation. George F built affordable housing for his employees, which they could buy for a $1 down payment, and those homes are, to this day, referred to as “EJ homes.” The company offered profitsharing to its people, as well as company doctors and clinics. EJ employees received healthcare services solely at the company’s expense. EJ also established parks with carousels and swimming pools for its local communities, as well as sponsoring parades and concerts. Employees’ children were provided with shoes.

The Endicott-Johnson factories needed a large labor pool to manufacture its shoes, so immigrants were recruited, mostly from southern Italy and Slavic countries. The mostly non-English-speaking newcomers were said to ask: “Which way EJ?” One of those people was my paternal grandfather, Daniel Consilvio, whose surname was shortened to Consol at Ellis Island, like so many other immigrants. These immigrants worked with caustic chemicals in harsh factory settings. It was the nature of shoe manufacturing, and likely one of the reasons U.S. shoemakers took their manufacturing operations overseas, in addition to cheaper labor costs.

I got a summer job in the last surviving EJ factory. I worked there one day. It was dark and depressing in there, and was populated mostly by older men without the skills for any other kind of work. I called the following morning to quit. The kind and understanding man on the other end told me, “That’s okay, Mike. This kind of work isn’t for everybody.” A year or two later, I worked the full summer in an Endicott-Johnson Shoes’ retail store, a setting that was much more to my liking — stocking shoes and selling them to the public.

During its heyday, an estimated 20,000 people worked in the company’s factories, and an even greater number worked there during the boom years of the mid-1940s when — helped by footwear it produced for the military during the war years — it was producing 52 million pairs of shoes per year.

Sadly, EJ had to follow other shoe manufacturers in sending manufacturing overseas if it hoped to offer competitively priced shoes. The great company that George F built and operated in historic fashion began to shrivel, though this happened after his death in 1948 at age 91. During the 1950s, the company still employed about 17,000 people. But over time — and devoid of George F’s enlightened leadership — EJ lost its stride. Today, EJ Footwear, LLC, operates as a subsidiary of Ohio-based Rocky Brands.

George F’s funeral was called one of the largest displays of emotional outpouring in American history, with attendance outnumbering funerals for U.S. presidents and Hollywood actors.

This captain of industry is long gone but hardly forgotten, as many things bear his name, including the town of Johnson City, the George F. Johnson elementary school and memorial library and so on. There have been many other business leaders over the years who proved to be ahead of their time. Still, there is something enduring about a company that manufactured a product as basic and necessary as shoes, outfitted U.S. military troops with boots, and helped (along with Thomas J. Watson and IBM, another company founded in Endicott) build a region’s economy.

Who will be the next business executive ahead of his or her time, especially during this period of monumental economic and social change? And what does it mean today for American workers to get a “square deal.”

 

Mike Consol (m.consol@irei.com) is editor of Real Assets Adviser. Follow him on Twitter @mikeconsol to read his latest postings.

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