SEPTEMBER 1938 SURVEY OF CURRENT BUSINESS UNITED STATES DEPARTMENT OF COMMERCE BUREAU OF FOREIGN AND DOMESTIC COMMERCE WASHINGTON VOLUME 18 NUMBER 9 The l'Survey of Current Business" henceforth will be pub- lished by the Division of Business Review, a newly created administrative unit of the Bureau of Foreign and Domestic Commerce. Communications intended for the ^Survey" should in the future be addressed to this Division. The Division of Business Review was established through the consolidation of certain sections of the Bureau whose functions and duties were closely related. This action does not involve any change in the major functions of the Bureau or the addition of any new personnel. It was designed to strengthen and to improve the services to business being rendered by the existing facilities. The Bureau's periodical "Domestic Commerce" will in the future also be issued by this Division. This publication furnishes a flow of current information designed to keep businessmen and those servicing business informed of plans for and the results of current research by Government and private agencies, and of significant developments relating to the production and distribution of goods. An announce- ment of this periodical is carried on the outside back cover of this issue. Through the medium of a business information service, the Division will be in a position to provide promptly, in response to requests, a body of carefully selected data on general and specific business problems. Volume 18 Number 9 UNITED STATES DEPARTMENT OF COMMERCE DANIEL C. ROPER, Secretary BUREAU OF FOREIGN AND DOMESTIC COMMERCE ALEXANDER V. DYE, Director SURVEY OF CURRENT BUSINESS SEPTEMBER 1938 A publication of the DIVISION OF BUSINESS REVIEW M. JOSEPH MEEHAN, Chief TABLE OF CONTENTS CHARTS AND SUMMARIES STATISTICAL DATA Page New or revised series: Page Business indicators 2 Table 67. Manufactured gas: Customers, sales and revenue, 1929-32 16 Table 68. Natural gas: Customers, sales and revenue, 1929-32 17 Business situation summarized 3 Table 69. Wholesale price of calves, 1913-38 18 Commodity prices 7 Table 70. Wholesale price of gum rosin, grade H, Savannah, 1919-38 18 Table 71. Wholesale price of gum spirits of turpentine, Savannah, Domestic trade 8 1926-38 18 Table 72. Corporation earnings, Standard Statistics Co., Inc., Employment 9 1924-38 19 Table 73. Average closing price of 65 industrial, railroad, and utility Finance 10 stocks, 1929-38 19 Foreign trade 11 Table 74. Newsprint paper: Consumption by publishers, and stocks at publishers and in transit, to publishers 1923-37 20 Construction and real estate 12 Table 75. Gas and fuel oils: Consumption by electric power plants. 1920-37 20 SPECIALIARTICLE j Weekly business statistics through August 27, 1938 21 Monthly business statistics 22 Progress of current trade-reporting program 13 General index Inside back cover Subscription price of the monthly and weekly issues of the SURVEY OF CURRENT BUSINESS is ?2.00 a year. Single-copy price: Monthly, 15 cents; weekly, 5 cents. Foreign subscriptions, 33.50. Price of the 1936 Supplement is 35 cent*. Make remittances only to Superintendent of Documents, Washington, D. C* 91360—38 1 1 SURVEY OF CURRENT BUSINESS September 1938 Business Indicators INDUSTRIAL PRODUCTION MONTHLY INCOME PAYMENTS ** 140 INDEX NUMBERS, (1925- 25= 100) 120 INDEX NUf 1BERS (|929 = 1 oo) 130 110 s^ 120 ~s 100 110 k\ 90 \ J ^\ 100 s ^v 80 90 \ y 70 _> r^ 80 \X 60 v^ 70 50 60 40 50 30 •> 0" 1929 1930 1-93! 1932 1933 1934 1935 1936 1937 1938 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 FACTORY EMPLOYMENT AND PAYROLLS RETAIL SALES ** NDEX NUMBERS, (I9Z}- Z^= lOOj RURAL SALES-GENERAL MERCHANDISE (I929--JI =100) FACTORY EMPLOYMENT (ADJUSTED) FACTORY PAYROLLS DEPARTMENT STORE SALES I (^UNADJUSTED) (l9£}- 25 = 100) 50 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 CONSTRUCTION CONTRACTS AWARDED* %* WHOLESALE PRICES 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1929 1930 193! 1932 1933 !934 i935 1935 1937 1938 * ADJUSTED FOR SEASONAL VARIATION ° THREE-MONTH MOVING AVERAGE + VOLUME BASIS * DOLLAR BASIS p D September 1938 SURVEY OF CURRENT BUSINESS Business Situation Summarized USINESS activity expanded further during August. industries. The marked recovery in the textile in- B The rate of increase in important lines of industry dustry in recent months is indicated in figure 1. and trade has slackened in recent weeks, but the major During August, the seasonally corrected index of indexes averaged higher in August than in July. The industrial output continued to advance. Steel output volume of business activity remains considerably below averaged above 40 percent of capacity, compared with the level of a year ago, although the margin of decline a rate of 35 percent in July, and 85 percent in August has been reduced during the past 2 months. last year. Demand for steel products broadened dur- Output of manufacturing industries increased in ing the month, with larger orders from some of the major August, and this rise has been reflected in the move- consuming industries whose demands had been light in ment of railway traffic. Retail trade reports indicate the preceding month. The automobile industry has that sales of general merchandise did not experience the usual contraction in July; in August they improved, but INDEX NUMBERS, (1929- the gain was less than that usually recorded. Passenger- car sales during July and August declined less than usual for this period of the year. This relative improvement, with production at a seasonal low, reduced the stocks of cars in the hands of manufacturers and distributors. Consumer purchasing has reflected the altered busi- ness outlook arid the upward movement in the season- ally corrected index of national income payments. The inclusive character of this index makes it a reliable guide to the trend of consumer income; therefore, the advance of 1 percent in July, which interrupted a down- ward movement which had extended over a period of 10 Figure 1.—Indexes of Textile Mill Activity, 1934-38. months, though modest, is significant. The advance NOTE.—Indexes of wool and cotton consumption and silk deliveries are the season- resulted mainly from the less-than-seasonal recession in ally adjusted Federal Reserve System indexes recomputed on a 1929-31 base. The index of rayon deliveries is from Rayon Organon and is not corrected for seasonal varia- pay-roll distributions. The adjusted index of labor in- tion; it also has been recomputed on a 1929-31 base. come rose from 79.5 in June to 80.5 in July (1929= 100), with all of the major industrial groups sharing in the required relatively small quantities of steel as produc- advance. Total labor payments for July were 11 per- tion in mid-August dropped to the low point of the year. cent less than a year ago, the declines varying from 2 Preparations are being made for starting the assembly percent in the service industries, including Govern- of 1939 cars with extensive retooling programs under ment, to as high as 26 percent in the commodity-produc- way, and support to the current rise in demands for ing groups. steel may be expected to be forthcoming shortly from Receipts from marketings of farm products in July this industry. increased more than seasonally over June, according to Purchases of railway equipment, which have been at the Bureau of Agricultural Economics, the change re- an extremely low level throughout 1938 by reason of the sulting in large part from the increased income from difficult financial position of the carriers, have improved grain marketings; the seasonally adjusted index of in- slightly since June but are still small. Machine tool come from livestock rose slightly. That Bureau's re- orders from domestic sources, which are sensitive to cently issued estimate of the cash income from farm changes in business volumes, have advanced at a moder- products marketed in 1938, and from Government pay- ate rate. Lumber orders, reflecting the continued ments, is 7.5 billion dollars, compared with 8.6 billion improvement in residential building and in other major dollars in 1937 and 7.9 billion dollars in 1936. consuming industries, rose steadily during July. Purchases of cotton textiles have not been so large as Industrial Output Higher those of a month ago, as weakness in the price of the Industrial output, seasonally corrected, was about 8 raw fiber has retarded sales. Mill activity has been percent higher in July than in June. Production of maintained, however, on the basis of the volume of both durable and nondurable manufactures advanced business previously booked. The unprecedented vol- contraseasonally, with particularly large gains being re- ume of factory deliveries of rayon in July reflected the corded for the textile, leather manufactures, and steel improved sales of finished goods and the prospects of industries. Increases also occurred in the cement, higher yarn prices. Yarn shipments are reported to meat-packing, paper, rubber-products, and minerals have held up well during the first half of August. SURVEY OF CURRENT BUSINESS September 1938 July traffic of the railroads, seasonally corrected, was end of 1929, despite the smaller volume of business and larger than in June as the expansion of industrial out- the lower price level in the later period. The total cur- put coincided with the movement of the large grain rent assets of these concerns as reported had declined by harvest. The improvement in loadings in August was about 9 percent in this interval, the heavier inventories not uniform, but the roads serving the major industrial being more than offset by the decline in the amount of areas reported that the upward movement of traffic has receivables and of cash and its equivalent held.