ds in payment
for them. Further, the production of commodities needed for the prosecution
of the war, will increase the volume of employment. Goods of all kinds are
required not only for the British armies but for the Allies generally. The
manner and extent to which these factors have influenced unemployment will
be considered presently.

[Footnote 1: According to an Admiralty statement, corrected up to Sept. 23,
1914, 12 British ships had been sunk by German cruisers, 8 had been sunk
by mines, whilst a few fishing boats had been destroyed. British ships
detained and captured by Germany numbered 86, with a total tonnage of
229,000. On the other hand, 387 German vessels had been detained or
captured, the total tonnage being 1,140,000. According to _The Times_ (Oct.
9, 1914), up to date 1.6 per cent of the tonnage registered in the United
Kingdom had been lost. The figures for Germany and Austria were 18 and 13
per cent respectively. The Committee which prepared the State War Insurance
Scheme estimated that the loss during the first six months of the war might
be about 10 per cent of all British steamers employed in foreign trade.]

[Footnote 2: _Round Table_, Sept. 1914, p. 704.]

Now the demand for the goods hitherto supplied by Germany to her foreign
customers, though abated, will still continue. As we have seen, she cannot
for the present supply them. By whom will she be superseded?[1] The
Government of this country early in the war took steps to co-operate with
British traders in an attempt to obtain some share of this trade, and the
United States also strove to make the fullest use of the opportunity. In
this country goods previously imported from Germany will, if still needed,
either be bought from the next cheapest importer or produced at home.
Commodities which we have in the past produced for German consumption are
not now required from us. If they continue to be made, it must be for other
countries. In other words, whether the volume of British foreign trade
remains the same or not, a proportion of it will be diverted into new
channels during the progress of the war. In a less degree, the trade of
other states will be deflected from its accustomed channels. Beyond this,
special influences will be felt in the case of certain new countries, as
for example Canada. "Canada's annual balance of trade is probably about
L60,000,000 against her: L30,000,000 being the excess of her trade imports
over her trade exports a