Survey of Current Business October 1981
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OCTOBER 1981 / VOLUME 61 NUMBER 10 SURVEY OF CURRENT BUSINESS CONTENTS THE BUSINESS SITUATION 1 National Income and Product Accounts Tables 11 U.S. Department of Commerce Malcolm Baldrige / Secretary Motor Vehicles, Model Year 1981 22 Robert G. Dederick / Assistant Secretary State Personal Income, Second Quarter 1981 26 for Economic Affairs State Personal Income 27 The Realization of Plans Reported in the Bureau of Economic Analysis BEA Plant and Equipment Survey 28 George Jaszi / Director A Profile of U.S. Multinational Companies in 1977 38 Allan H. Young / Deputy Director Carol S. Carson / Editor-in-Chief, Capital Expenditures by Majority-Owned Foreign Survey of Current Business Affiliates of U.S. Companies, 1981 and 1982 58 Manuscript Editor: Dannelet A. Grosvenor Managing Editor: Patti A. Trujillo Staff Contributors to This Issue: Betty L. Barker, Leo M. Bernstein, Robert B. Bretzfelder, Robert Brown, Edwin J. Coleman, Frank deLeeuw, Douglas R. Fox, Howard L. Friedenberg, Eric R. Johnson, Daniel J. Larkins, Jeffery H. Lowe, Francis G. McFaul, Michael J. Mckelvey, Edward I. Steinberg. SURVEY OF CURRENT BUSINESS. Published monthly by the Bureau of Economic Analysis of the U.S. Department of Commerce, Editorial correspondence should be ad- dressed to the Editor-in-Chief, Survey of Current Busi- ness, Bureau of Economic Analysis, U.S. Department of Commerce, Washington, D.C. 20230. First-Class mail.—Domestic only: Annual subscription CURRENT BUSINESS STATISTICS $46.00. Single copy: $5.00. Second-class mail,—Annual subscription: $27.00 domes- tic; $33.75 foreign. Single copy: $3.75 domestic; $4.70 General SI foreign. Foreign air mail rates available upon request. Industry S22 Mail subscription orders and address changes to the Superintendent of Documents, U.S. Government Printing Office, Washington, DC. 20402. Make checks payable to Footnotes S37 Superintendent of Documents. Second-class postage paid at Washington, D.C. and at Subject Index (Inside Back Cover) additional mailing offices. The Secretary of Commerce has determined that the publication of this periodical is necessary in the transaction of the public business required by law of this Department. Use of funds for printing this periodical has been approved by the Director of the Office of Management and Budget through September 1,1983. U.S. DEPARTMENT OF COMMERCE DISTRICT OFFICES AL, Birmingham 35205 GA, Savannah 31412 MN, Minneapolis 55401 NY, New York 10278 TN, Memphis 38103 908 S. 20th St. 254.1331 125-29 Bull St. 944-4202 110 S. 4th St. 725-2133 26 Federal Plaza 264-0634 147 Jefferson Ave. 521-3213 AK, Anchorage 99513 HI, Honolulu 96850 MS, Jackson 39201 NC, Greensboro 27402 TX, Dallas 75242 701 C St. 271-5041 300 Ala Moatia Blvd. 546-8694 200 E. Pastagoula 960-4388 203 Federal Bldg. 378-5345 1100 Commerce St. 767-0542 AZ, Phoenix 85073 II. Chicago 60603 MO, Saint Louis 63105 OH,Cincinatti 45202 TX, Houston 77002 201 N. Central Aw. 261*3285 55 E. Monroe St. 353-4450 120 S. Central Ave. 425-3302 550 Main St. 684-2944 515 Rusk St. 226-4231 AR, Little Rock 72201 IN, Indianapolis 46204 320 W. Capitol Ave. 378-5794 46 E. Ohio St. 269-6214 MO, Kansas City 64106 OH, Cleveland 44114 UT, Salt Lake City 84101 60? E. 12th St. 374-3142 666 Euclid Ave. 522-4750 350 S. Main St. 524-5116 €A, Los Angeles 90049 IA, Des Moines 50309 1! 777 San Vicente Blvd. 824-7591 210 Walnut St. 284-4222 ME, Omaha 68102 OB, Portland 97204 VA, Richmond 23240 CA, Sau Francisco 94102 KY, Louisville 40202 300 S. 19th St. 221-3664 1220 S. W. 3rd Ave. 221-3001 400 N. 8th St. 771-2246 450 Golden Gate Ave. 556-5860 IKS. P.O. & Courthouse BIdg. 582-5066 NV, Reno 89503 PA, Philadelphia 19106 WA, Seattle 98109 CO. Denver 80202 LA, New Orleans 70130 777 W. 2nd St. 784-5203 600 Arch St. 597-2866 Rm 706, Lake Union Bldg. 44:1-5616 721 - 19th St. 837-3246 432 International Trade Mart 962-3560 NJ. Newark 07102 PA, Pittsburgh 15222 WV, Charleston 25301 €T, Hartford 06103 MD, Baltimore 21202 4th Floor, Gateway Bldg. 645-6214 1000 Liberty Ave. 644-2850 5000 Quarrier St. 343-6181 450 Main St. 244-3530 415 U.S. Customhouse 962-3560 FL, Miami 33130 MA, Boston 02116 NM, Albuquerque 87102 PR, San Juan 00918 WI. Milwaukee 53202 25 W. Flagler St. 350-5267 441 Stuart St. 223-2312 505 MarqueUe Ave., N.W. 766-2386 Rm. 659, Federal Bldg. 753-4555 517 E . Wisconsin Ave. 191-34' 3 GA, Atlanta 30309 Ml, Detroit 48226 NY, Buffalo 14202 SC, Columbia 29201 WY, Cheyenne 82001 1365 Peaihtree St., N.E. 881-7000 231 W. Lavfayette 226-3650 111 W.Huron St. 846-4191 1835 Assembly St. 765-5345 2120 Capitol Ave. 778-2220 the BUSINESS SITUATION CHART 1 JL HE economy weakened further in final sales that were down, $11 billion, Real Product: the third quarter. Eeal GNP declined and it was CBI that was up, $13 billion. Change From Preceding Quarter Billion (1972) $ 1/2 percent at an annual rate, after a For nonvehicle components, final sales 40 11/^-percent decline in the second quar- declined in both quarters—the same GROSS NATIONAL PRODUCT ter.1 Estimates of components making amount, $7% billion, and with the same 30 up the four-fifths of GNP for which pattern. Increases in nonvehicle per- 20" monthly source data are available indi- sonal consumption expenditures and cate that real GNP has trended down nonresidential structures were more 10 since January-February. than offset by declines in each of the 0 Although the second- and third-quar- other nonvehicle components, i.e., pro- ter declines in real GNP were small, ducers' durable equipment, residential -10 there were both large increases and investment, net exports, and govern- -20 large declines in the components (chart ment purchases. In the third quarter, 1). This feature is brought into sharper the decline in nonvehicle final sales was -30 focus by a separation of real GNP, final offset in its impact on the change in -40 sales, and inventory change (CBI) into GNP by an increase in nonvehicle CBI; CHANGE IN BUSINESS INVENTORIES their motor vehicle and non vehicle com- in the second quarter, the change in 10 ponents (table 1). For motor vehicles, CBI was negligible. 0 A large changes in final siales and large These kinds of changes suggest that changes in CBI tended to offset each several strong causal factors—some -10 30 other in their impact on the change in countering each other, some reinforc- PERSONAL CONSUMPTION EXPENDITURES GNP. In the third quarter, final sales ing—have been at work. The impact of 20 were up $6 billion and CBI was down $8 persistently high interest rates—wheth- 2 billion. In the second quarter, it was er a result of monetary policy or a reflec- 10 tion of inflation—can be seen in several 0 •lll-.ll-lll.l 1. The third-quarter GNP estimates are based GNP components: residential invest- on the following major source data: For personal -10 consumption expenditures (PCE), retail sales, and ment, motor vehicles (although strongly unit auto and truck sales through September; for nonresidential fixed investment, the same informa- affected by other factors as well), con- -20 tion for autos and trucks as for PCE, manufac- sumer spending on items such as furni- turers' shipments of machinery and equipment for -30 _L July and August, July and August construction ture and household equipment, and FIXED INVESTMENT put in place, and investment plans for the quar- State and local government construc- 10 ter ; for residential investment, July and August tion. Price changes, including auto re- construction put in place, and housing starts for 0 1 »—P»>T * July and August; for change in business inven- bates, help explain some components of M tories, July and August book values for manufac- -10 turing and trade, and unit auto inventories through consumer spending. Also, the apprecia- RESIDENTIAL September ; for net exports of goods and services, tion of the dollar against foreign cur- -20 J I • I July and August merchandise trade, and frag- I mentary information on investment income for the rencies had a strong impact on net ex- NET EXPORTS quarter; for government purchases of goods and ports. There is no evidence, however, 10 services, Federal unified budget outlays for July and August, State and local construction put in that the new Federal fiscal policy has 0 place for July and August, and State and local em- affected GNP in a major way. Although ployment through September; and for GNP prices, -10 T"» the Consumer Price Index for July and August, some categories of expenditure—most the Producer Price Index through September, and 10 unit value indexes for exports and imports for importantly, grants-in-aid to State and GOVERNMENT PURCHASES July and August. Some of these source data are local governments—have turned down, 0 pJL- subject to revision. most of the changes in expenditures are FEDERAL 2. Quarterly estimates of the national income -10 _L I and product accounts are expressed at seasonally yet to be felt. The tax cuts enacted as 1978 1979 1980 1981 adjusted annual rates, and quarterly changes in part of the Economic Recovery Tax Act Based on Seasonally Adjusted Rates them are differences between these rates. U.S. Department of Commerce, Bureau of Economic Analysis 81-10-1 1 SURVEY OF CURRENT BUSINESS October 1981 of 1981 are unlikely to have as yet af- Table 1.—Real GNP and Motor Vehicle Output: Change From Preceding Quarter fected the spending and saving of in- [Billions of 1972 dollars, based on seasonally adjusted annual rates] vestors or consumers.