[158] Hoover expanded the Commerce Department to make it more useful to business. This was consistent with Hoover's view that the private sector should take the lead in managing the economy.[159] Harding greatly respected his Commerce Secretary, often asked his advice, and backed him to the hilt, calling Hoover "the smartest 'gink' I know".[160]
Widespread strikes marked 1922, as labor sought redress for falling wages and increased unemployment. In April, 500,000 coal miners, led by John L. Lewis, struck over wage cuts. Mining executives argued that the industry was seeing hard times; Lewis accused them of trying to break the union. As the strike became protracted, Harding offered compromise to settle it. As Harding proposed, the miners agreed to return to work, and Congress created a commission to look into their grievances.[161]
On July 1, 1922, 400,000 railroad workers went on strike. Harding recommended a settlement that made some concessions, but management objected. Attorney General Daugherty convinced Judge James H. Wilkerson to issue a sweeping injunction to break the strike. Although there was public support for the Wilkerson injunction, Harding felt it went too far, and had Daugherty and Wilkerson amend it. 