SURVEY OF JANUARY 1942 STATES DEPARTMENT OF COMMERCE OF FOREIGN AND DOMESTIC COMMERCE Special Announcement of Publishing Policy The Bureau of Foreign and Domestic Commerce announces a sim­ plified publishing program for the duration of the war. The Reference Services, special reports, and cooperative studies which have been pub-, lished separately for industries or for groups interested in special projects will be consolidated into three periodicals, each of which is designed to, serve a particular function. The Survey of Current Business will continue to provide economic and statistical information to the business and professional community. Publishable foreign trade information will be concentrated jn ,Forei~ Commerce Weekly. Industry and business will find in the pages of Domestic Commerce those commercial reports which can be made public, The contents of the Bureau periodicals may be abridged in botli e:xtdnt and variety. In not all instances will information heretofore available be published. In the present issue of the Survey, for example, ~lJ foreigri trade statistics and certain other statistical data which are of particular military significance have been discontinued. Moreover, because a large proportion of the Bureau personnel is engaged in providing necessary information for war agencies, it will be impossible to draw as completely upon the staff's specialized knowledge. On the other hand, it is hoped that an increasing flow of information helpful to the efficient functioning of business during the war economy will be derived from the fact-finding, fact-analyzing activities of the Bureau for the war agencies. Subscribers should expect changes in format and paper, as the publications will cooperate with the Government Printing ()ffice in the most efficient and economical use of its equipment and paper stocks. Unexpired subscriptions to the Reference Services and r~ports which will be consolidated into the three periodicals will be credited to the periodical which covers the same field. SURVEY OF CURRENT BUSINESS JANUARY 1942 ECONOMIC HIGHLIGHTS.. 2 THE BUSINESS SITUATION...................................... 3 Industrial mobilization accelerated . • 3 Metal shortages retard income advance........................................ 3 Machine tools an arms bottleneck. 4 Recent inventory accumulation . 5 Rubber...................................................................... 7 Sugar outlook. 9 The supply of lead........................................................... 10 DIRECT PRICE CONTROL IN GREAT BRITAIN.................. 12 STATISTICAL DATA: Canadian indexes of cost of living-table 35. • . • . • 19 Standard and Poor's corporate bond prices-table 36........................... 19 Standard and Poor's stock price indexes-table 37. 20 Shipments of electrical household appliances-table 38. 21 Standard and Poor's high grade preferred stock yields-table 39............... 22 Indexes of the value of manufacturers' inventories-table 40.................. 22 Monthly business statistics . S-1 General index ...................................................... Inside back cover Published by the Department of Commerce, JEssE H. JoNES, Secretary, and issued through the Bureau of Foreign and Domestic Commerce, CARROLL L. WILSON, Director. Volume 22 Number 1 Subscription price of the monthly and weekly issues of the SuRVEY OF CuRRENT BusiNESS $2 a year. Single-copy price: Monthly, IS cents; weekly, 5 cents. Foreign subscriptions, $3.50. Price of the 1940 Supplement is 40 cents, Make remittances only to Superintendent of Documents, Washington, D, C. 1 2 SURVEY OF CURRENT BUSINESS January 1942 Economic Highlights Second- and Third-Shift Operations Lag Sales of Savings Bonds Changes in second- and third-shift operations have been Sales of Defense savings bonds from May through Decemb~r small ... bulk of employment gains are in first shift and over­ totaled $2.6 billion ... more than twice sales of old type savings time. December-September shipbuilding employment dou­ bonds in fiscal year 1940. Series E is available only to indi­ bled . • with three-fourths of workers on first shift . and viduals, issued in small denominations, with yield of 2.9 percent proportion working overtime (10 hours over the normal 40) if held to maturity. Purchases averaged approximately $120 MILLIONS OF DOLLARS MILLIONS OF MAN-HOURS 500 12 10 OVERTIME IN ALL SHIFTS ~!ilk 400~~-------------------------- 3rd SHIFT STRAIGHT•T/ME 2nd SHIFT ~SERIES E { SOLO TO INOIVIOUALS 8 /sf SHIFT 300 g~L¥i: .o\~?o"'d~ATIONS -SERIES FBG 6 200 SOLO TO INDIVIDUALS, T,_USTS, AND UNINCORPO· RATED OR INCORPORATED 8001ES, EXCEPT COMMEA• 4 ~~.t.NLK:A,\~T w~~~~~~~O AS DEMAND OEPOSIT;e IN 100 f-- -- f-- 1- f-- 1-- DENOMINATIONS 0~ $100- $10,000 2 O MAY!.__ JUNE-JULY'-- AUG.'--- SEPT~ OCT.L__ NOV. --'LDE:-C'-.----------.-..J 0 1941 SHIPBUILDING BRASS, BRONZE, MACHINE TOOLS CHEMICALS CD41-666 (PRIVATE YAROS) 8 COPPER PRODUCTS J/ DEC. 1940 NOT AVAIL.ABL£. D0.41-66if Sales of United States Defense Bonds. Man-Hours Worked per Week of Strai~ht-Time in Each Shift and of overtime in All Shifts. million monthly until December, when buying more than doubled ... 8 months' total was $1.15 billion. Series F and G are nsmg from three-fifths to four-fifths. Machine tool workers available to institutional investors other than commercial banks, increased one-fourth . two-thirds still work first shift ... 96 with interest rate, or approximate yield, of 2.5 percent ... are percent average 14 hours overtime. Chemicals, brass, bronze, issued in small denominations (with series F) only after Decem­ and copper products show no change in labor distribution ber 23. May sales volume of $364 million had been reduced to between shifts and on overtime. First shift often handles $124 million in November ... with a moderate December ad­ maintenance, supply, other special operations ... should be vance ... 8 months' total was $1.44 billion. Sales must be largest. Plant bottlenecks, including skilled labor, hold back stepped up if fiscal control of prices is to succeed. Curtailment three-shift operations . must be removed to realize full of consumer durable supplies will force much of this needed war potential. saving by small income groups. Shipments of Steel and Steel Products Level Off BILLIONS OF DOLLARS of 88 million ... with 2 mil­ New orders for iron, steel, I 6 and their products have been lion additional tons now under construction. Operations fluc­ reduced a third since May by 1.4 growing restriction and control tuated between 96 and 99 per­ • . now approximate ship­ cent of capacity for most of year ... but this perform­ ments. Backlogs of 5 billion ance may be cut. Uncertain dollars exceed 4 months' out­ and tight scrap supplies are the put at present rate. Though problem. Pig iron capacity shipments are double early ... interchangeable with scrap 1940 volume they show no in some processes ... expanded gain since July. Basic reason INCReASe IN UNFILLeD ORDeRS only 1.8 million tons in 1941. ••• relatively stable.steel ingot Now being built is additional production. Record ingot and 04 pig iron capacity of 5.3 million steel for castings output for tons ... but 15 to 20 months year was 82.9 million tons .•. are required for construction one-fourth above 1940. Re­ . so scrap supplies must 1940 1941 C£'41-6/S ported capacity increased not diminish if steel output is, New Orders and Shipments of Iron and Steel and Their Products, Not about 4 million tons to a total lncludin~ Machinery. to be maintained. January 1942 SURVEY OF CURRENT BUSINESS 3 The Business Situation AR at the new year marks another turning point government control over the imports of 13 strategic W for the American economy. Eighteen months materials, including antimony, chromium, copper, lead, ago the Nation began preparation for the conflict finally tungsten, and zinc, as well as import control over all thrust upon it on December 7. Great forward strides fats and oils. have been made in the intervening period. But a truly In transport, the President set up the Office of De­ Herculean task still confronts the country in mobilizing fense Transportation to coordinate existing facilities. its maximum war potential. Rationing of new automobiles and rubber tires pointed A maximum effort in the shortest possible time is to deep changes in the structure of domestic transport essential. As the Supply, Priority, and Allocations with the necessity for achieving a maximum efficiency Board has declared: of all available facilities. From this moment ... Victory is our one and only objective, Metal Shortages Retard Income Advance and everything else is subordinate to it . It is clear that a vastly expanded national effort is imperative. Production sched­ The best general measure of economic progress is ules for all manner of military items must be stepped up at once. the national income. In 1941 net income was about Every activity of our national life and our civilian economy one-fifth higher than in 1940, but about a third of the must be immediately adjusted to that change. To attain advance was the result of higher prices. Income rose victory we aim at the greatest production which is physically possible; we call for the greatest national effort that can possibly throughout the year, though by the fourth quarter the be made. pace of the expansion in real income had slowed appre­ ciably. It is clear, however, that the ceiling of this The military potential of the country is very great. income has not yet been reached. Unemployment as The net national