Survey of Current Business September 1953
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SEPTEMBER 1953 U. S. DEPARTMENT OF COMMERCE OFFICE OF BUSINESS ECONOMICS SURVEY OF CUKMENT BUSINESS DEPARTMENT OF COMMERCE FIELD SERVICE Albuquerque, N. Mez. Los Angeles 15, Calif. No. 9 204 S. 10th St. 112 West 9th St. SEPTEMBER 1953 Atlanta 3, Ga. Memphis 3, Tenn. 86 Forsyth St. NW. 229 Federal BIdg. Boston 9, Mass. Miami 32' FIa' 261 Franklin St. 36 NE' Fir8t St' Minneapolis 2, Minn. Buffalo 3, N. Y. 607 Marquette Are, 117 Silicon St. New Orleans 12, La. Charleston 4, S. C. Area 2. 333 St. Charles Are. PAGE Sergeant Jasper Bldf. New York 13. N. Y. THE BUSINESS SITUATION 1 Cheyenne, Wyo. 346 Broadway 307 Federal Office Bldf. Capital Goods Demand in Late 1953 . 3 Philadelphia 7, Pa. Trends in Retail Sales . 5 Chicago 1, III. 1015 Chestnut St. 221 N. LaSalle St. The Volume of Government Purchasing ... 9 Phoenix, Ariz. 137 N. Second Ave. Balance of Payments Cincinnati 2. Ohio 105 W. Fourth St, During the Second Quarter ........ 11 Pittsburgh 22, Pa. 717 Liberty Are. Cleveland 14, Ohio 925 Euclid AT* Portland 4, Oreg. * * * 520 SW. Morrison Sj, Dallas 2, Tes. 1114 Commerce Si, SPECIAL ARTICLES Reno, NOT. 1479 Wells Are. Changes in Public and Private Debt . 13 Denver 2, Colo. 142 New Custom House Transportation in the Balance of Payments . 20 Richmond, Va. 409 East Main St. Detroit 26, Mich. * * * 1214 Griawold St. St. Louis 1, Mo. 1114 Market St* El Paso, Tex. MONTHLY BUSINESS STATISTICS . S-l to S-40 Chamber of Commerce Salt Lake City 1, Utah Statistical Index ....... Inside back cover Bldg. 109 W. Second St. So. Houston, Tex. San Francisco 2, Calif. 430 Lamar St. 870 Market St. Jacksonville 1. Fla. Savannah, Ga. 311 W. Monroe St. 125-29 Bull St, Published by the U. S. Department of Commerce, SINCLAIR WEEKS, Kansas City 6, Mo. Se&ule 4, Wash. Secretary. Office of Business Economics, M. JOSEPH MEEHAN, 911 Walnut St. 909 First Ave. Director. Subscription price, including weekly statistical supplement, is $3.25 a year; Foreign, $4.25. Single copy, 30 cents. Send remittances to any Department of Commerce Field Office or to the Superintendent of Docu- ments, United States Government Printing Office, Washington 25, D. C. Special subscription arrangements, including changes of address, should be For local telephone listing, consult section made directly with the Superintendent of Documents. Make checks payable devoted to U. S. Government to Treasurer of the United States. SEPTEMBER 1953 By the Office of Business Economics BUSINESS activity continued in high gear through August as employment, income, and sales matched or exceeded the Plant and Equipment rates of the earlier months. The basic sources of demand were undiminished, with the major changes associated with seasonal influences. Consumer purchases, backed up by Investment estimated at $28 billion higher incomes, have advanced moderately. Business out- lays for plant and equipment in the current quarter exceed in 1953 vs. $26 V2 billion in 1952 the high first-half rate. However, management anticipates BILLIONS OF DOLLARS BILLIONS OF DOLLARS some easing from this record rate in the fourth quarter. 30 While total output has been steady since midyear, here 30 and there in scattered industries—chiefly durables—output was trimmed to avoid further inventory accumulation. Total business inventories were unchanged in July as the 20 usual seasonal decline did not occur. On a seasonally ad- 20 justed basis, the $0.6 billion book-value increase was below y ANTICI- the average second quarter experience, and of this advance lRATED about half was due to higher replacement costs. Thus the physical increment was well below the high second-quarter 10 10 rate. Automotive retailers accounted for half of the total book-value inventory change in July. Price firmness characterized wholesale commodity markets. A major exception was the renewed weakness in the farm group where a decline occurred in livestock prices in late I960 1951 1952 1953 1953 August and early September. Consumer prices moved up ANNUAL TOTALS QUARTERLY TOTALS,SEASONALLY ADJUSTED, AT ANNUAL RATES fractionally in July, primarily due to small increases in food prices and a continued advance in rents. Federal rent All major industries except transportation controls were dropped on July 31. are up in 1953-some groups plan Construction large lower fourth quarter outlays Construction activity, at $3.3 billion in August, continued BILLIONS OF DOLLARS BILLIONS OF DOLLARS to exceed the amounts of new construction put in place in 15 15 comparable periods of any past year. Because of the unusu- ally open winter, however, the industry had gotten off to an MANUFACTURING* exceptionally fast start by last March. Most of the monthly gains since then have been less than usual, as a consequence 10 10 of which the seasonally adjusted data have shown a steady COMMERCIAL AND MISCELLANEOUS downtrend with the August total 7 percent below the March peak. Divergent trends are still evident in residential and non- tPUBLIC UTILITIES residential construction. Private residential building con- »•••••• tinues to lag, the August volume of $1.1 billion being a little below the June top if no allowance is made for seasonal influences and 8 percent below the seasonally adjusted second-quarter rate. Private nonresidential construction 1950 1953 reached a new high in August, as did public utility QUARTERLY TOTALS, SEASONALLY ADJUSTED, construction. AT ANNUAL RATES Public construction was below the volume of last spring ® ANTICIPATED after allowance for the usual seasonal changes. U. S. DEPARTMENT OF COMMERCE1. OFFICE OF BUSINESS ECONOMICS 53"/l4"l Total civilian employment reached 63.4 million in August as agricultural employment receded less than is usual for the 267170°—53 1 SURVEY OF CURRENT BUSINESS September 1953 month while nonagricultural employment experienced the In the basic steel industry, there has been some easing in typical August rise. the overall demand for finished and semifinished steel The recent steady advance of wage and salary disburse- products. With some exceptions, steel products are now in ments, the largest component of personal income, has been ample supply relative to demand. This improvement in largely attributable to the increase in the payrolls of the the overall supply-demand relationship is reflected in the commodity-producing group. Growing employment at current scheduled rate of steel operations. In August, mills higher wage rates accounts for most of the increases. operated at around 94 percent of rated capacity in effect The number of employees in nonagricultural establish- on January 1, 1953, equivalent in terms of tonnage to around ments this summer was 49.4 million persons, approximately 2 million higher than in 1952, the previous peak. Though all major groups but contract construction contributed to this rise, two-thirds of it is attributable to durable goods manu- facturers. Manufacturing workweek longer than in 1952 Average weekly hours, over the past 12 months, have :>'';-/ > / -X ^""V^A? >/.*. ..*; <^-<"/ sy ^^J^&'fr'firtR declined or remained stationary in many industries. In ^'\Yf''-vM^v manufacturing, however, weekly time rose one-half hour or 1.3 percent from July 1952 to July 1953. This increase was in part fortuitous, reflecting a low level of hours last year in industries affected by the protracted steel stoppage; it was, however, in line with an upward trend. Weekly hours in each of the first 7 months of this year have been higher than AVERAGE HOURLY in the comparable months of last year, and over the period EARNINGS this month-to-month gain has averaged 1.0 percent. The advance was shared by both the durable and nondurable goods groups. As can be seen in the chart the movement of hours, aside from seasonal variation, has shown much less change than the movement in employment. Manufacturing production workers averaged $1.77 an AVERAGE WEEKLY HOURS hour in July, an increase of more than 7 percent over a 12-month period. This rise, which was slightly above the \ \ 7-year average beginning with July 1946, represented a continuation of a long-term increase in earnings, which since PRODUCTION WORKERS 1933 had been halted under adverse economic conditions but \N at no time reversed. Hourly earnings reflect not only changes in basic hourly and incentive wage rates but also such factors as premium pay for overtime and late-shift work, and changes in the output of workers paid on an incentive basis. The increase in gross earnings over the past year reflects increases in y y> i'^:/*',?J-i'; ' overtime payments as well as in wage rates and other factors. The average spread between gross hourly earnings and hourly earnings excluding overtime, for the first half of this year as compared with the first half of last year, increased from 5.5 to 6.5 cents, a gain shared by both the durable and non- durable groups. Real average hourly earnings, that is earnings adjusted for the cost of living, continued their long-term increase. Over the period of the last 12 months the movement was essen- tially parallel to that of money earnings, because of the negligible rise in the cost of living. Consumer prices rose less than 1 percent so that all industry groups gained in real earnings. Industrial production stable Industrial production in July and August has been main- tained on a high plateau after full allowance for the usual summer seasonal influences. The rate of output in August was little different from the record pace of the first half of the year. Output of durable manufactures in August was moderately below the monthly average of the January-June 9.4 million ingot tons. While this rate was higher than in period while production of nondurable manufactures was July, it was slightly lower than in June and about 5 percent about the same.