(Updated, 12/12/16: fixed broken links, updated cross-references)  

This post, like the previous one, comes from my recent Ahab-lite obsession with whaling, as well as the recent general interest in Hermann Melville’s monumental Moby Dick – which celebrated its 161st anniversary in 2012 (including my slow plod through it over many months, the Google doodle of October 18, the San Francisco Opera’s staging of an opera based on the novel, and the Moby Dick Big Read project) – and the various articles I read that cover economic and business topics (namely, how workers and executives are paid).

The brave, industrious, desperate, ignorant and/or foolhardy men (and the rare woman)¹ who traversed vast expanses of often uncharted ocean in the 19th century didn’t work for fixed wages – they didn’t get a paycheck every week or month – but instead worked for a share of the profit that resulted from the voyage, plus room and board on the ship². In essence, it was a full-scale profit sharing arrangement, but unlike today’s profit sharing at GM or a worker-owned company, a movie star’s contract that guarantees a percentage of the movie earnings, or the stock grants to a big-time corporate executive, there were no regular wages to provide an earnings safety net.

“They were one man, not thirty”

One theory is that the system was intended to increase solidarity and improve teamwork among the crew, something quite important on a whaling ship, where it took a coordinated effort by many men to capture a whale and process it into oil. A few slackers could lead to escaped whales and even injury or death for the crew. In essence, the profit-sharing arrangement was a long-term team-building exercise.  Hermann Melville, in Chapter 134 of Moby Dick, puts it this way, as the crew of the Pequod bear down on the white whale:

They were one man, not thirty. For as the one ship that held them all; though it was put together of all contrasting things—oak, and maple, and pine wood; iron, and pitch, and hemp—yet all these ran into each other in the one concrete hull, which shot on its way, both balanced and directed by the long central keel; even so, all the individualities of the crew, this man’s valor, that man’s fear; guilt and guiltiness, all varieties were welded into oneness, and were all directed to that fatal goal which Ahab their one lord and keel did point to.

Whalemen were generally given an advance at the time of sailing – money that could be left at home for a wife and children, or brought aboard to gamble with, to hire women during port visits, or to buy tobacco, clothing, medicine and etc. from the captain’s “slop chest.” This advance, of course, was logged in the tally book at the docks and subtracted from that crew member’s proceeds at the end of the voyage (with interest).

After the ship returned home and the products were sold (a process that could be manipulated in favor of the crew or ship owners), various expenses were subtracted, including loading and unloading fees, any loans taken from the captain, various charges for replacement clothing or medical treatment, and a recruitment fee for the shipping agent. Occasionally, a crew member could get his payment as whale oil, and other physical proceeds from the voyage, and then go and sell it himself, hoping that he could get a better price.

Shifting Incentives and Variability

If a crewman was lost at sea or died during the voyage, his estate was given a prorated share. Until the 1860s, ship owners were not legally required to make post-voyage payments to deserters.  This, plus the advance given to crew before the ship sailed, set up an interesting dynamic.  Many voyages involved three distinct phases: 1) a several month voyage from New England around The Horn to the vast Pacific Ocean, 2) many months hunting and processing whales, and finally 3) another long voyage back to New England, ideally with the hold full of barrels of oil, stacks of baleen, and maybe a few pieces of ambergris.  With the advance in his pocket, a crewman might consider deserting during a supply stop on the outbound voyage (or even before the ship sailed from New England!).  But on the way back, the tables turned, and the captain (or his distant superiors) had a financial incentive to force sailors to desert, perhaps by restricting their rations or imposing unusually strict discipline, or intentionally leaving a crewman behind during a supply stop.

The overall wages were highly variable, as Davis et al. write in In Pursuit of Leviathan,

The effect of business and physical risks on earnings is illustrated by the experience of 1,082 captains of whaling vessels that sailed from New Bedford in the years 1840-58. Their monthly earnings averaged $98.31, but ranged from a low of $0.66 to a high of $345.34.

It turns out, as illustrated by painstaking analysis by Davis et al, that these highly variable wages were significantly less than on-shore jobs paid, even compared with unskilled factory work (see chapter 7 of Davis et al.).

So why would anyone join a dangerous, dirty, and boring whaling voyage when on-shore work paid so much more? For some, it was pure ignorance about what they were in for. Others undoubtedly loved the sea (see the Appendix for Ishmael’s connection to the sea). Some were running away from something or someone.  And some were hoping for great luck:  the highly variable payments mentioned above offered the possibility that you could strike it rich, returning to home port with a full hold when whale oil prices are at record highs.

Appendix
People like Melville’s Ishmael were called by the sea, as he explains in the first paragraph of Chapter 1 of Moby Dick:

Call me Ishmael. Some years ago — never mind how long precisely — having little or no money in my purse, and nothing particular to interest me on shore, I thought I would sail about a little and see the watery part of the world. It is a way I have of driving off the spleen and regulating the circulation. Whenever I find myself growing grim about the mouth; whenever it is a damp, drizzly November in my soul; whenever I find myself involuntarily pausing before coffin warehouses, and bringing up the rear of every funeral I meet; and especially whenever my hypos get such an upper hand of me, that it requires a strong moral principle to prevent me from deliberately stepping into the street, and methodically knocking people’s hats off — then, I account it high time to get to sea as soon as I can. This is my substitute for pistol and ball. With a philosophical flourish Cato throws himself upon his sword; I quietly take to the ship. There is nothing surprising in this. If they but knew it, almost all men in their degree, some time or other, cherish very nearly the same feelings towards the ocean with me.

Somewhere in the archive of To the Best of Our Knowledge, there’s a wonderful reading of this passage, but I can’t seem to find it.  If you know where it is, please let me know in the comments.

Image credit
The Northern Whale Fishery: The “Swan” and “Isabella”, by John Ward of Hull, c. 1840, from the National Gallery of Art, public domain

Notes

1. In the mid-19th century, it was not uncommon for the captain to bring his wife and children along.  As for women in the crew, that was much less frequent:  in Leviathan, Dolin cites an estimate that a woman (disguised as a man) was member of the crew in at least one out of every thousand whaling voyages.
2. The room and board were typically quite terrible – with most of the crew sharing a cramped, mostly dark and airless compartment – and primarily eating food that could survive the long voyages (think hard tack and salted meat).