transmitted to the congress - presidency.ucsb.edu · of prospective home buyers under federal...

Economic Report

or tne PresidentIII

TRANSMITTED TO THE CONGRESS

! 1

Economic Reportof the President

TRANSMITTED TO THE CONGRESS

JANUARY 20, 1958

UNITED STATES GOVERtiNliNT PRINTING OFFICEWASHINGTON : 1958

Additional copies of this report are for sale by the Superintendent of Documents,U. S. Government Printing Office, Washington 25, D. C.

Price of single copy, 65 cents

LETTER OF TRANSMITTAL

THE WHITE HOUSE,

January 20, 1958.To the Congress of the United States:

I present herewith my Economic Report, as required by Section 3 (a)of the Employment Act of 1946. In preparing this Report, I have receivedthe assistance and advice of the Council of Economic Advisers. I havealso had the advice of the heads of the executive departments and inde-pendent agencies of the Government.

I set forth below, in condensed form, what I consider to be the majorconclusions and recommendations of the Report.

The Economy in 1957

The past year was a prosperous one, despite a decline in the closingmonths. Over 65 million people were employed, 300,000 more than in1956. The Nation's output of goods and services totaled $434 billion, andpersonal income was $343 billion. Both were 5 percent larger than in thepreceding year. A considerable part of these increases, however, reflectedhigher prices.

In the final quarter of the year, gross national product was about 1 J/i per-cent below the peak reached in the third quarter. Personal income aftertaxes declined one-half of 1 percent, and personal consumption expendi-tures somewhat less. In December, however, unemployment amounted to5.2 percent of the civilian labor force, compared with 4.3 percent inSeptember.

This change in economic conditions called for adjustments in economicpolicies. During much of the year, the task of restraining inflationary pres-sures was paramount, and policies were directed to this end. In the closingmonths of the year, and currently, the task has been to facilitate readjust-ments in the economy essential to the resumption of sustainable economicgrowth, but to do so without reviving inflationary pressures.

The Current Economic Situation and Outlook

As we look ahead in 1958, there are grounds for expecting that the declinein business activity need not be prolonged and that economic growth can beresumed without extended interruption. The policies of Government willbe directed toward helping to assure this result.

in

The demand for goods and services for final use has been well maintained.A considerable adjustment in inventories has already taken place, and presentholdings are generally not heavy. Personal income has fallen very little,and purchases by consumers are continuing at a high level. The confidenceof business concerns in the economic future is evidenced by their long-rangeplans for the expansion and improvement of production facilities and thehigh rate at which they are carrying out these plans. The increasing amountof resources committed to research and development is further evidence ofthis confidence and assures the continued working of forces that make forexpansion.

Financial conditions are increasingly favorable to resumption of economicgrowth. Credit is more readily available and its cost is lower. These con-ditions, together with the recent reduction in the cash investment requiredof prospective home buyers under Federal mortgage insurance programs,tend to promote increased home building. More ample and lower-costcredit also favors a continuation of the large and growing volume of capitalexpenditures by State and local governments, and should help moderate thedecline in investment outlays by business concerns.

At the turn of the year, the economy was beginning to feel the effects ofan acceleration of the placement of defense contract awards, prompted bythe need to move forward quickly with programs essential to the strength-ening of the Nation's defenses.

The Longer Perspective

At a time like the present, when the economy is adjusting to the largeadditions to productive capacity made in the past few years, it is well to viewour economic prospects in a longer perspective and to consider some of thesources of our strength.

There are good reasons for confidence that a vigorous expansion of oureconomy can be sustained over the years. Our domestic market for goodsand services has about doubled every quarter of a century, and we shoulddo at least as well in the next 25 years. The needs and wants of our growingpopulation will continue to enlarge markets for output. To keep pace withexpanding requirements, State and local outlays must continue rising atsome such rate as the recent $3 billion a year. Research and technologicaldevelopments are opening up vast new fields for profitable investment.World-wide economic development can enlarge foreign markets for ourproducts. The annual personal savings of Americans, which are close to$20 billion, and the strength of our financial institutions, will help attainthe economic capacity necessary to meet these growing requirements.

The latest challenge of international communism will require a furtherincrease in the economic claims of national security, which are already heavy.If we follow suitable private and public policies, this challenge can be met

IV

without distorting our economy, or destroying the freedoms that we cherish.Whatever our national security requires, our economy can provide and wecan afford to pay.

The Challenge to Economic Policies

A realistic appraisal of our economic prospects, though it warrants con-fidence, also requires that we acknowledge an unfavorable feature of recenteconomic developments. In 1957, our gross national product rose 5 percent,but four-fifths of this increase was accounted for by rising prices.

There are critical questions here for business and labor, as well as forGovernment. Business managements must recognize that price increasesthat are unwarranted by costs, or that attempt to recapture invesment outlaystoo quickly, not only lower the buying power of the dollar, but also may beself-defeating by causing a restriction of markets, lower output, and a nar-rowing of the return on capital investment. The leadership of labor mustrecognize that wage increases that go beyond over-all productivity gains areinconsistent with stable prices, and that the resumption of economic growthcan be slowed by wage increases that involve either higher prices or a furthernarrowing of the margin between prices and costs. Government, for its part,must use its powers to help keep our economy stable and to encourage soundeconomic growth with reasonably stable prices.

The resumption and maintenance of economic growth promise greatereconomic capability for meeting the Nation's needs. If this opportunityis to be fully realized, however, growth must take the form of increases inreal output, accompanied by a stable price level. This can be achieved ifweight is given to long-run as well as short-run considerations in policiesand practices that affect our economic welfare. It can be guaranteed bya public opinion that is alert to the consequences of wrong policies andinsists on policies which will yield economic growth without inflation.

Measures to Help Attain Economic Goals

A legislative program is presented in this Report to help solve urgentproblems that confront the Nation today, foster a resumption of growth,and build stronger foundations for economic advances in the years ahead.Fiscal policies are recommended to meet, within the framework of a budgetin which expected revenues are adequate to cover projected expenditures,the Nation's needs for strengthened defenses, for the improvement of ourposition in science and education, and for other essential activities. Legis-lation is proposed to increase the effectiveness of the Federal Government'scredit programs and its programs for the insurance and guaranty of privatecredits; to widen and strengthen our economic ties with other nations; tofoster adjustments intended to bring agricultural production into line with

commercial demands and reduce the fiscal burden of price-support pro-grams; to give individuals greater protection against economic hardships,promote integrity in labor-management relationships, and improve indus-trial relations; to enhance the competitive character of our private enter-prise system; and to strengthen the economic position of small businesses.

Favorable consideration of this program will materially enlarge theNation's capacity to meet present challenges and to achieve sustainableeconomic growth and improvement in the years ahead.

DWIGHT D. EISENHOWER.

VI

CONTENTS

PageCHAPTER 1. Economic Goals and Policies in a Free Society 1

Economic Growth 1Economic Stability 3Price Stability 4Free Competitive Enterprise 5Economic Change and Shifts in the Emphasis of Policy 5Economic Policies in 1957 6

CHAPTER 2. The American Economy in 1957 10Shifts in the Major Components of Demand 12Employment and Incomes 17Prices, Costs, Profits, and Productivity 22Financial Developments 27Agriculture 34The Extent of the Over-All Decline 38

CHAPTER 3. Foreign Developments and the American Economy... 40Changes in Production 40The Course of World Trade 42Internationa] Financial Developments 46Future Problems and Policies 48

CHAPTER 4. Economic Opportunities and Challenges Ahead 49Appraisal of the Current Economic Situation 49The Longer Perspective 50The Challenge to Economic Policies 53

CHAPTER 5. A Legislative Program to Help Achieve NationalEconomic Goals 55

Government Finances 55Federal Credit Programs 57Science and Education 60Small Business and the Competitive System 63Personal Welfare 64Agriculture 67Foreign Economic Policy 70Federal Economic Statistics 73

APPENDIXES Page

A. Summary of Recommendations in the Economic Report of thePresident 75

B. Report to the President on the Activities of the Council ofEconomic Advisers During 1957 81

C. Program for Improving Federal Statistics in Fiscal Year 1959. . 89D. The Consumer Price Index 97E. Productivity Statistics 105F. Statistical Tables Relating to Income, Employment, and

Production I l l

LIST OF TABLES AND CHARTS

{Chapters 2 and 3 and Appendix E)Tables

1. Changes in Employment, Income, and Production, 1955-57... . 102. Changes in Gross National Product and Its Major Components,

1955-57 163. Changes in Nonagricultural Employment Since December 1956.. 204. Distribution of Employees Receiving Wage Increases Under

Major Labor Agreements, 1956-57 215. Security Offerings, 1954-57 276. Changes in Commercial Bank Holdings of Loans and Invest-

ments, 1954-57 287. World Industrial Production, 1955-57 418. Changes in World Trade, 1955-57 429. U. S. Merchandise Exports and Imports, 1953-57 44E—1. Indexes of Output per Man-Hour for the Private Economy,

1948-57 108

Charts

1. Output of the Economy 112. Shifts in Major Components of Demand 133. Personal Income and Consumption - 174. Employment and Income 185. Wholesale Price Changes 236. Consumer Prices 257. The Pattern of Credit Expansion 298. Liquidity of Commercial Banks and Nonfinancial Corporations. 309. Member Bank Reserves 31

10. Interest Rates and Bond Yields 3311. Indicators of Agricultural Conditions 3512. Federal Agricultural Programs 3613. World and U. S. Foreign Trade 4314. U. S. Balance of Payments 45

VIII

Chapter 1

Economic Goals and Policies in a Free Society

DEVELOPMENTS IN 1957 illustrate how rapidly changes can occurin the problem of maintaining growth with reasonable stability of

prices in a dynamic, free enterprise economy. Production, employment, andincome were high, but tended to decline somewhat toward the year's end.During much of the year, a rise in the consumer price index accompanied aslowing down in the rate of growth of national output. Small increases inthe price index continued even after industrial production and employmenthad turned downward and inflationary pressures had been substantiallydiminished. In recent months, fresh challenges have arisen: to strengthenour defenses; to improve our position in science and education; and to uniteour efforts more effectively with those of other countries for the achievementof security, freedom, and improvements in material welfare.

These changes, compressed into a short time span, underscore the needfor a balanced conception of national economic goals, if private and publicpolicies and programs are to serve all our people and advance the long-runas well as the immediate interests of the Nation. We cannot say that wehave only one goal, unless it is to advance the general welfare. Sustainableand balanced growth in our economy is needed to assure our defenses, tosatisfy our growing wants, and to enable us to assist healthy expansionand improvement in other economies of the free world. Also, we seek tohold economic fluctuations within narrow limits, to maintain a reasonablystable price level, and to avoid deflationary as well as inflationary develop-ments. And we insist on striving for these goals within a framework offree competitive institutions.

To achieve a proper balance among these sometimes conflicting objectivesis a difficult task. Success requires an understanding by all of us of ournational economic objectives and of private and public responsibilities forhelping achieve them. Accordingly, this chapter is devoted to a statementof these objectives and a brief review of the steps taken during the year toattain them.

ECONOMIC GROWTH

Confidence that economic growth and improvement within a frameworkof free institutions are feasible national goals is evidenced by the stresswhich the Employment Act of 1946 places on "maximum production,

employment, and purchasing power." The record of the 12 years that haveelapsed since the Employment Act was passed has abundantly justified thisconfidence and clearly demonstrated the strength of the forces that makefor growth in a free economy. A rising national output has enabled us tomake up arrears that accumulated during the War. Most of the heavyrequirements arising from the increase in our population and the persistentlyexpanding needs and wants of our people are being met. We are alsofulfilling greatly enlarged world responsibilities.

The aggregate of goods and services produced today is nearly one and ahalf times what it was when the Employment Act was passed. This is anaverage rate of economic growth of 3l/2 percent a year. There are 10 mil-lion more civilian jobs now than there were in 1946. More than $350billion of private funds have been devoted since then to the expansion andmodernization of productive facilities. In addition, huge investments havebeen made in housing, schools, hospitals, roads, and other private and publicimprovements.

The use of these vast resources to increase our productive capacity andour fixed public and private assets has been accompanied by a sustainedadvance in current consumption. The output of consumer goods andservices is 40 percent higher today than it was in 1946. The increaseover the period has averaged about 3 percent a year.

In short, our economy has exhibited a remarkable capacity for sustainedand balanced growth. The American people and the free enterprisesystem have responded well to the challenges of our increasingrequirements.

These challenges continue. In some important respects they have be-come greater. Despite our utmost efforts, international tensions persist.This hard fact emphasizes the need for a sound and growing economyto assure our defenses. The national security burden carried by oureconomy is a heavy one, claiming about 10 percent of our nationaloutput. We do not abandon hope for arrangements under which less ofour own and of the rest of the world's resources can, with safety, be devotedto military preparedness. But pending measurable progress in these efforts,Americans will not shrink from the task of defending our freedoms, what-ever the necessary cost.

A sound and growing economy is needed also to meet the requirementsof our expanding population. There are 32 million more Americans nowthan at the end of World War II, and the number is increasing at the rateof about 3 million a year. Heavy economic requirements are implied by thisincrease. A huge expansion of educational personnel and physical facili-ties will be required to train increasing numbers of students for the higherlevel of technology on which our security and welfare depend. Ourlarger population will also require increased facilities for the productionand distribution of goods and services, and for health and recreation.Production must expand as fast as population merely to maintain our

present consumption standards. Even higher rates will be necessaryas these standards rise.

Apart from our civilian and cjefense requirements, economic growth isneeded to help meet our expanded international responsibilities. Theseinclude the provision of public and private capital to assist economic de-velopment abroad, as well as military and economic aid to countries asso-ciated with us in the common defense effort.

Although the rate of economic growth that is best suited to the Nation'scapacity and requirements cannot be stated precisely, the low currentrate would clearly be unsatisfactory as a continuing condition. Wemust always be alert to question the adequacy of the rate of economicgrowth and to consider whether further encouragement and incentives areneeded, and if so how best to provide them. Yet we must be continuously onguard against resort to measures that might provide a spurt in activity atthe cost of impairing the long-run health of the economy.

ECONOMIC STABILITY

When the Employment Act was being considered in the Congress, fearswere expressed that the transition from war to peace would entail seriouseconomic dislocation and abnormally high unemployment. Actually,the transition was made with relatively little contraction in pro-duction, employment, or income, despite the large reductions in nationalsecurity expenditures. The supporters of the legislation were also mindfulof the waste of resources which economic fluctuations had occasioned in thepast. The Council of Economic Advisers was accordingly directed by theEmployment Act to develop and recommend to the President national eco-nomic policies "to avoid economic fluctuations or to diminish the effectsthereof."

Economic stability as an aim of national policy clearly means more thanfostering the maintenance of production, employment, and income at con-stant levels. Extended lapses from normal rates of growth must be resistedand their effects diminished where possible. And every effort should bemade to moderate surges that go beyond rates of growth that can be sus-tained over longer periods. Such surges often involve increases in limitedsectors of the economy that cannot be sustained and that may lead to seriousimbalances. The proper objective of national economic policy, to theachievement of which private as well as public actions must contribute, isto strive to limit fluctuations in the rate of over-all economic growth to arelatively narrow range around a rising trend.

Because our economy responds to forces and conditions that are continu-ally changing in intensity and character, economic growth will inevitablyproceed at a somewhat uneven pace. The high rate of economic growththat occurs when ground lost during a recession is being recovered cannotcontinue indefinitely. When economic resources are close to being fullyused, even though there may be slack in some sectors of the economy, expan-

sion normally proceeds at a slower pace. Efforts to accelerate growthunder these conditions may succeed only in generating inflationary pressures.

When readjustments are being made, with some sectors of the economyremaining unchanged or contracting while others are expanding, over-alleconomic activity may show no growth for a time, or may even recedeslightly. The establishment of a new balance which such a readjustmententails is often an essential phase in the operation of a dynamic enterprisesystem. It is the means by which the economy corrects previous excessesand prepares for resumption of over-all growth. Through its economicpolicies and programs, Government can help achieve this improved balanceand speed the resumption of sound economic growth.

PRICE STABILITY

A clear responsibility rests on Government to pursue policies that willhelp prevent inflation. Although the harmful consequences of inflationspread widely through the economy, they fall with unequal severity on dif-ferent individuals and on different economic sectors. Some persons mayobtain an increase in money income that is greater than the increase in livingcosts, while others may fail to do so. Some industries may be in a betterposition than others to adjust prices promptly to rising costs. As a result,the relative economic positions of individuals and of different industries maybe altered, sometimes in ways that harm the national welfare by lessening in-centives to enter certain essential vocations and by impeding the flow ofresources into important sectors of industry. Similarly, although the in-vestment income of some individuals may rise during an inflationary period,that of others, and frequently the great majority of those who have onlymodest savings, does not increase at all. Consequently, persons in the lattergroup suffer a decline in the value of the income received and a diminishedpurchasing power of their savings when repaid. The effect is to reducethe incentive to save, which tends to dry up one of the major sourcesof capital upon which maximum employment and economic growth depend.Furthermore, price inflation directs activities into speculative channels anddistorts private and public obligations and contracts that are expressed infixed dollar amounts. Finally, changes in the value of money disrupt inter-national trade and financial relations. In these and other ways, inflationweakens our capacity to achieve and sustain balanced economic growth.

The task of restraining price inflation is a continuing one for a free societyexperiencing high production, employment, and incomes over long periods.In such a society, pressure on prices may arise from a number of sources.One is the rapid increase and concentration of demands on scarce skills andresources and on output which is limited by capacity. Another is the ex-uberance, even imprudence, of some individuals and businesses during goodtimes in making commitments that assume continual inflation in prices.Still another is the exercise of economic power by individuals and groups

favored by temporary conditions or by their place in the Nation's productivesystem.

We must learn to conduct our economic affairs in ways that will harnessthe expansionary forces of our free economy for the increase of our nationalstrength and well-being, and must prevent these forces from finding expres-sion in a depreciation in the value of our money. This task entails heavyresponsibilities for private individuals and groups, and for Government, topursue policies that will assure that economic expansion provides an increasein real output and does not consist merely of larger money values reflectinghigher prices. A strong and growing economy is needed for our nationalsecurity, for meeting the needs of our expanding population, and for im-proving our level of living. Reasonable stability of prices is needed also, forreasons of equity and as a condition for sustaining economic growth. Failureto achieve these goals would court the danger of controls incompatible withour way of life which would eventually impede advances in our economicwelfare.

FREE COMPETITIVE ENTERPRISE

The productiveness of the American economy derives from its reliance onprivate enterprise and on the incentives and opportunities which such asystem supplies for the development and use of individual talents and ener-gies. Initiative and efficiency are stimulated and rewarded through themarket place; pressures are exerted to remedy inefficiencies; and economicresources tend to be used in accordance with the preferences of consumers.This way of organizing production and consumption both encourages vigor-ous economic growth and reinforces our freedoms in the political and socialspheres. Thus, the strengthening of free competitive enterprise not only isa means for promoting economic growth but also is, in itself, a major ob-jective of policy.

This view was held by the authors of the Employment Act, who madeit explicit that Government, in seeking to achieve maximum production,employment, and purchasing power, should do so "in a manner calculatedto foster and promote free competitive enterprise." Accordingly, in ourefforts to achieve economic growth and at the same time to avoid price in-flation, we place reliance on measures that involve a minimum of directintervention in the affairs of individuals and private groups. The corollaryof this reliance is that the policies and practices of individuals and privategroups must contribute to, not hinder, the achievement of economic growthwith reasonably stable prices. With such assistance toward making thejoint effort a success, pressures for direct Government controls are averted.

ECONOMIC CHANGE AND SHIFTS IN THE EMPHASIS OF POLICY

No one goal alone provides a complete guide to public policy in economicmatters. In an economy where changes are as rapid and far-reaching asthose which occur in ours, the accent of policy shifts according to the logic

of events. At times the emphasis may be mainly on the containment andreduction of inflationary pressures, which has been the case during much ofthe period since 1955. At other times, as at present, the accent may properlybe placed on encouraging orderly readjustment within the economy andfacilitating the resumption of economic growth. At all times, policy mustbe capable of responding to unusual demands, such as those that have beenfelt recently as a result of international developments.

ECONOMIC POLICIES IN 1957

In 1957, policy had to cope with important changes in the economy.The paramount task during much of the year was to restrain inflationarytendencies. However, as the year developed, these tendencies diminishedin strength. Current demand failed to keep pace with growing industrialcapacity in a number of lines. Shortages of goods became fewer and werelargely eliminated after the middle of the year. Prices of basic commoditiesbegan to decline in the early months, and the rise in prices of finished indus-trial commodities was moderated. The index of consumer prices, however,which had started to rise in April 1956, continued upward with only briefpauses. In the late summer, production, employment, and sales leveled offor declined in a number of lines; and as the year closed, indicators of over-alleconomic activity moved down in response to the using up of inventoriesand to somewhat lower domestic and foreign sales.

This shifting of economic forces called for adjustments in public policies.For the first three quarters of the year, Federal Reserve operations weredesigned to limit the expansion of bank credit and to hold down increasesin the money supply. A partly seasonal reduction of $1.6 billion in FederalReserve holdings of Government securities kept the reserve position of mem-ber banks under continuous pressure. The pressure on reserves inducedmember banks, despite an increased discount rate, to borrow more heavilyfrom the Federal Reserve System. From April through mid-October,member bank borrowings fluctuated around $ 1 billion, and net free reserves(the difference between excess reserves and member bank borrowings)remained negative, at close to $500 million.

These restrictive measures had a marked effect on the money supply and,jointly with the heavy demand for capital and credit, on interest rates.Demand deposits, the most important component of the money supply,were virtually the same at the end of 1957 as two years earlier. Duringthe same period, the dollar volume of total output increased 7 percent.With demands for capital and credit continuing substantial, and the supplyof funds under increasing pressure, interest rates rose sharply in the firsthalf of 1957. In August and September, the costs of financing for corpo-rations and State and local governments were well above anything experi-enced for many years. By mid-October, the yield on long-term Govern-ment securities had reached 3.78 percent, and the cost to the FederalGovernment of its shortest term borrowing had risen to 3.66 percent, thehighest in 24 years.

Federal fiscal policies were also directed to restraining inflationary tenden-cies. Beginning early in the year, all Federal expenditure programs wereclosely reviewed to effect economies wherever such action was consistentwith essential program objectives. No general reduction of taxes was under-taken, and reductions in specific taxes—certain excise taxes and the tax rateon corporate income—that were scheduled to occur on April 1, 1957 werepostponed. The Federal budget was balanced during the calendar year1957, and $1.7 billion of debt was retired.

Treasury financing operations were designed to help sustain economicgrowth and at the same time to produce a better debt structure. Morethan $10 billion of the Treasury's new marketable offerings had a maturityin excess of 1 year; Treasury notes varying in maturity from 3 to5 years were offered on six different occasions; and more than $500 mil-lion of long-term bonds were issued in October and again in December. Theeffective rates of interest to maturity on Series E and H Savings Bonds wereraised to 3% percent, as of February 1, 1957, to encourage saving in theseforms; sales of Series J and K Savings Bonds were discontinued on April30, 1957, in view of the high rate of redemption of these fixed-interestsecurities.

A number of steps were taken to moderate the impact on specific sectorsof the economy of the general measures to restrain inflationary tendencies.On March 29, 1957, in two moves designed to assist prospective home buy-ers, the Federal Housing Administration (FHA) reduced its minimum down-payment requirements to the limit then permitted by law, and the FederalHome Loan Bank System undertook to encourage greater mobility of mort-gage funds among different areas of the country by authorizing insured mem-ber institutions to buy and sell participating interests of up to 50 percent inhome mortgage loans. In May, the Veterans Administration (VA) beganthe immediate processing of direct loan applications for veterans living inlocalities where private lenders had restricted their participation in the VAHome Loan Guaranty Program. On August 6, FHA reduced downpay-ment requirements by the full amount authorized by the Housing Act of1957 and, in order to attract additional funds into home financing, raisedthe maximum interest rate to 5^4 percent.

Other actions were taken by FHA to simplify and expedite the processingof home purchase applications in remote areas, and the insurance premiumon repair and modernization loans was reduced. For the year as a whole,about $1 billion of home mortgages were purchased by the Federal Na-tional Mortgage Association in its secondary market operations, in order torelieve particularly acute shortages of available funds.

Although business needs for credit were generally met well by banks andother private financial institutions, financing assistance from the Small Busi-ness Administration proved useful in helping to satisfy the special needs ofmany small concerns. During 1957, this agency approved $162 million ofloans, 33 percent above its 1956 volume.

The credit policy of the Federal Reserve authorities continued unchangeduntil mid-October. By that time, mainly because of a fall in the demandfor loans, member bank borrowings at the Federal Reserve Banks beganto decline, and the net deficiency of reserves gradually fell. All but one of theFederal Reserve Banks reduced their discount rates from 3 ^ percentto 3 percent between November 15 and November 29, initiating a declinein interest rates and bond yields. A further absorption of the net reservedeficiency occurred in December. In the last week of the year, excessreserves were greater than member bank borrowings by $74 million. Interestrates and bond yields had returned to approximately the levels reached inlate 1956 and early 1957.

Increasing the availability and lowering the cost of credit are measuresthat help moderate a decline in business investment. They also permitcapital outlays by State and local governments that might not otherwise befeasible. Largely through their impact on the yields available on corporatesecurities and Government obligations, they widen the spread between thereturn on home mortgages and on competing uses of funds. They tendthereby to make financing more readily available for home construction andpurchase and to promote a higher level of building activity. Their effective-ness in this connection was strengthened in January 1958 by actions takenby Federal housing and home financing agencies. The Federal HousingAdministration announced the rescinding of a rule, adopted in April 1955as an anti-inflationary measure, that prohibited the inclusion of closingcosts in the maximum insurable amount of home mortgage loans. FHA alsoannounced certain changes in the permissible discounts on insured mort-gage loans, calculated to make funds more readily available in areas of thecountry still experiencing a relative scarcity and to bring the yield on insuredmortgage investments more nearly into alignment with market rates in areashaving more adequate supplies. At the same time, the prices at which theFederal National Mortgage Association buys mortgages were adjusted, alsoto increase the availability of funds for home construction and purchase.

In 1957, steps were taken to expedite activity in certain Federal construc-tion programs involving no direct capital charge on the budget, and toaccomplish a needed expansion of the military housing program. Thesemoves were made with full realization of the fact that resources of laborand materials in some parts of the economy continued relatively short,particularly in construction, and that a sharp increase in demand mightresult in further increases in costs and prices. For this reason, they weretaken cautiously, to avoid reviving inflationary pressures in the face ofenlarged national security requirements. At the turn of the year, theeconomy was beginning to feel the effects of an acceleration of the place-ment of defense contract awards, prompted by the need to move forwardquickly with programs essential to the strengthening of the Nation's defenses.

Events in 1957 show how important it is for private and public policiesand practices to complement each other as we seek to achieve economic

8

growth with reasonable stability of prices. Decisions which give rise towage increases generally in excess of improvements in productivity, or toprice increases that typically go beyond increases in costs, make this taskmore difficult. If fiscal and credit policies are sufficiently stern to keep theprice level from rising, there are risks of economic dislocation, an unneces-sarily slow rate of economic growth, and extreme and inequitable pressureson some who are not themselves contributors to the inflation of costs andprices. On the other hand, if economically unwarranted increases in wagerates or prices are validated by credit and fiscal policies, a persistent declinein the value of the dollar results.

Neither of these is an acceptable alternative, and neither is consistentwith sustainable expansion of the economy. The conclusion is inescapablethat, if we are to have orderly and adequately rapid growth in the economy,our wage-making and price-making arrangements must produce resultsconsistent with a reasonably stable price level. They must do so within afree competitive economy. Freedom, including econornjc freedom, requiresself-discipline. If important groups ignore this truth, the alternatives areeither an economy damaged by inflation or controls that are incompatiblewith our free competitive institutions.

Chapter 2

The American Economy in 1957

T H E YEAR 1957 was a prosperous one, despite the decline in the•*" final quarter. Economic expansion continued, though at a lower rate.

Production, employment, and income again attained record levels. Forthe year as a whole, gross national product amounted to $434 billion andpersonal income to $343 billion, both some 5 percent above 1956. Civilianemployment increased by 300,000, and the annual average of unemploymentshowed little change from 1956 (Table 1).

TABLE 1.—Changes in employment, income, and production, 1955-57

Item

EMPLOYMENT »

Civilian labor force 3__

Employment __ _ -NonagriculturalAgricultural

TTnP.mploymfint

Employees in nonagricultural establishments *M anuf actur ingNonmanufacturing

INCOME

Personal income disbursements 5

Disposable personal income 6

Corporate profits and depreciationCorporate profits:

Before taxesAfter taxes _ _.

PRODUCTION

Gross national product (1957 prices)

Industrial production

1955 1956 19571

Millions of persons

65.8

62.956.26.7

2.9

50.116.633.5

67.5

64.758.16.6

2.8

51.916.935.0

67.9

65.058.86.2

2.9

52.616.835.8

Billions of dollars

311.1270.257.9

42.521.0

417.4

332.6287.260.0

43.021.0

430.3

349.7300.060.7

42.020.6

433.9

1947-49=100

139 143 143

Percentage change

1955 to1956

2.6

2.83.4

- 2 . 2

- 2 . 8

3.62.14.4

6.96.33.6

1.2.0

3.1

2.9

1956 to19571

0.6

.51.1

- 5 . 3

4.0

1.3- . 62.2

5.14.51.2

- 2 . 3- 1 . 9

.8

. 0

1 Preliminary.2 Percentage changes based on unrounded data.3 Bureau of the Census data (new definitions). See Table F-17.4 Bureau of Labor Statistics data. See Table F-22 for definition.8 Total personal income plus personal contributions for social insurance.• Total personal income less personal taxes.Sources: Department of Commerce, Department of Labor, Board of Governors of the Federal Reserve

System, and Council of Economic Advisers.

IO

The decline which became apparent in the last quarter of the year inour broadest measures of economic activity followed an unusuallylong period of expansion. Beginning in 1954, business activity was carriedupward by large increases in demand, first in one part of the economyand then in another. The expansion was launched by rapidly increasing out-lays for residential construction, and late in 1954 there was an upsurge ofdemand for new automobiles. As the force of these demands began to wanein mid-1955, an enormous increase in business expenditures for new plantand equipment emerged, reinforced by a heavy accumulation of inventories.In late 1956 and early 1957, as plant and equipment expenditures began tolevel off, national security expenditures increased, and exports rose sharply,sustaining the advance. But demands were being somewhat moderated bya reduction in the rate of increase of inventories, and the over-all rateof expansion was clearly slowing down. The rise of expenditures and in-comes in the latter part of 1956 and most of 1957 was largely matchedby an increase in prices. The physical output of goods and services roseonly slightly, and throughout 1957 industrial output remained below thepeak registered in December 1956 (Chart 1).

CHART 1

Output of the Economy

Total output of goods and services decreased in late 1957.

Industrial production began to decline earlier and fell rather

sharply in the closing months of the year.

BILLIONS OF DOLLARS * INDEX, 1947-49 » 100

4 5 0

425

400

375

SEASONALLY ADJUSTED

GROSS NATIONAL PRODUCTIN 1957 PRICES

(LEFT SCAL

X . GROSS NATIONAL PROOUCT^ IN CURRENT PRICES

(LEFT SCALE)

INDUSTRIAL PRODUCTION(RIGHT SCALE)

150

140

130

1955 1956* ANNUAL RATES.

SOURCES: DEPARTMENT OF COMMERCE, BOARD OF GOVERNORS OF THEFEDERAL RESERVE SYSTEM, AND COUNCIL OF ECONOMIC ADVISERS.

1957

11

By mid-summer the balance of economic forces had shifted, thoughexpenditures of State and local governments continued to increase andoutlays on residential construction began to move upward. Business ex-penditures on plant and equipment declined slightly in the final quarterof the year. The sharp advance in national security outlays ended in thesecond quarter, and exports decreased. A curtailment of orders for newequipment and generally cautious business policies had reduced the accumu-lation of inventories to an annual rate of $1 billion in the first three quartersof the year; in the final quarter inventories were being reduced, on balance,at an annual rate of $3 billion, or possibly more, as the further decline insales and the decrease in backlogs of unfilled orders led to curtailed produc-tion schedules. With employment and incomes reduced slightly, sales atretail leveled off and then declined. Reflecting these movements, grossnational product was at a rate of $433 billion in the fourth quarter of theyear, about 1 l/i percent below the $439 billion reached in the third quarter.

SHIFTS IN THE MAJOR COMPONENTS OF DEMAND

The pattern of economic developments during the year was shapedlargely by the shifts in three major components of demand—business outlayson plant and equipment, exports, and government expenditures. Im-portant changes occurred also in construction expenditures and the man-agement of business inventories (Chart 2). These shifts in demand,through their impact on production and employment, and thus on incomes,in turn affected the expenditures of consumers, the ultimate demand in oureconomy.

Business Outlays on Plant and Equipment

The increase in business outlays on plant and equipment from the firstquarter of 1955 to the third quarter of 1957 was of boom proportions,amounting to almost 50 percent. The gains in some industries were par-ticularly large. Railroads more than doubled their capital outlays. Ex-penditures by manufacturers of durable goods increased by nearly 75percent. New business was placed with producers of capital goods at sucha pace that, even with production at capacity limits, backlogs of unfilledorders became extremely large. The pressure of demand in this sectorof the economy was further increased as manufacturers of investment goodsand their suppliers expanded their working inventories.

But in the second half of 1956 unfilled orders of producers of investmentgoods rose more slowly, and by the end of the year the major expansive in-fluence of investment spending had subsided. New orders received and thevolume of unfilled orders began to fall. Expenditures on capital goods bymost industries continued to rise through the first three quarters of 1957,but they declined moderately toward the year's end. For the year as a

12

CHART 2

Shifts in Major Components of Demand

Business fixed investment leveled off in 1957, and the rate of

inventory accumulation declined. Federal outlays, after rising for

a year, were reduced in the second half of 1957.

BILLIONS OF DOLLARS

6 0

50

4 0

30

20

10

-10

SEASONALLY ADJUSTED ANNUAL RATES

. FEDERAL OUTLAYS FORS GOODS AND SERVICES

..'"" ^ B U S I N E S S FIXED INVESTMENT-^

STATE AND LOCAL EXPENDITURESFOR GOODS AND SERVICES

RESIDENTIAL CONSTRUCTION

1954 1955 1956 1957- 1 / PRODUCERS* DURABLE EQUIPMENT AND NONRESIDENTIAL CONSTRUCTION.

SOURCES: DEPARTMENT OF COMMERCE AND COUNCIL OF ECONOMIC ADVISERS.

whole, business expenditures for new plant and equipment were more thanin any previous year and 6 percent more than in 1956. When adjustmentis made for higher prices, however, it appears that there was no increaseafter the turn of the year in the rate of installation of plant and equipment.

Exports

Exports were a second major force in the expansion of the Americaneconomy to mid-1957, and also a contributor to the downward movementin the latter part of the year. Exports of goods and services increased swiftlyfrom early 1956 to the first quarter of 1957, partly because of special cir-cumstances, including the extra demand for United States petroleum gen-erated by the temporary disruption of normal shipments via the Suez Canal.Later in the year, however, these special forces subsided. The demand forexports was also reduced by a slowing down in the rate of economic expansionabroad and by foreign exchange difficulties in a number of countries. Asa result exports declined in the autumn. Imports, on the other hand, showedlittle change from the high level reached in 1956. Exports remainedhigher than imports, but by a reduced margin. By the end of the year,net foreign investment, which reflects mainly this relation, was $1J/2—2 bil-lion lower, at an annual rate, than at the beginning of the year.

Government Expenditures

A third major force affecting economic developments was a change inpurchases of goods and services by Federal, State, and local governments.The total of these outlays rose $7*4 billion between mid-1956 and mid-1957,with 60 percent of the increase representing higher Federal spending fornational security purposes. This increase in Federal expenditures wasaccompanied by a large rise in employment and inventories in the industriesimmediately affected, notably aircraft. After the middle of the year, how-ever, military procurement outlays and awards of new contracts were re-duced, and total Federal purchases declined moderately. A rise of about$3 billion in the total of social security outlays, other transfer payments, andinterest on the public debt further increased tptal Government cash outlaysto the public in 1957 and supplemented consumer incomes.

State and local governments continued to increase their outlays on con-struction and on goods and services, adding $3 billion in 1957 to theirover-all rate of expenditures. Such outlays on construction, including workdone with Federal assistance, were 9 percent more than in 1956. Therewere substantial increases in the construction of schools, highways, hospitals,and sewerage and water systems. These outlays were continuing upwardat the end of the year.

Construction Expenditures

The long upward movement in total construction expenditures continuedin 1957. Although there was some decline in outlays on residences in thefirst half of the year, continuing a movement which had started early in1955, this trend was later reversed. Fewer dwelling units were started in

1957 than in 1956, but in the second half of the year home building wasgoing forward at a rate only slightly below that of 1956. A considerablepart of the upturn in residential building activity was in the constructionof apartment dwellings, a sector of the industry that had been relativelyinactive for a few years.

The year witnessed a sharp increase in private institutional building,for which outlays rose 14 percent. Hospital construction rose more than50 percent, and there were substantial increases in the construction of re-ligious, social, and recreational buildings.

Again, the rising trend of dollar outlays can be misleading. Actually,construction costs rose during the year somewhat more than expenditures,so that the physical volume of construction was a little less than in 1956.Prices of building materials were virtually unchanged, on the average,as reductions in prices of materials used principally in home buildingwere roughly offset by increases in prices of other materials. For the industryas a whole, higher wage rates accounted for most of the rise in constructioncosts.

Inventories

In contrast to 1956, when business inventories were increased by $4.6billion, no further accumulation took place in 1957 (Table 2), and inventoryholdings were sharply reduced in the final quarter of the year.

Retailers and wholesalers—with the exception of automobile dealersand wholesalers of certain durable goods—lowered their inventories in1957. Reductions were particularly large in the first few months ofthe year, and for a while caused sharply decreased rates of productionin a number of consumer goods industries. By the year end, stocks in manylines were still low relative to current retail sales.

Manufacturers' inventories, large parts of which are closely relatedto current and prospective levels of output, continued to rise in thefirst nine months of 1957, though at a much slower rate. Changeswere particularly large in the machinery-producing and defenseindustries, where inventories had expanded in response to rising levelsof production and, to some extent, in anticipation of further advances.The rate of accumulation in the machinery-producing industries, how-ever, was reduced in late 1956, and especially in early 1957, as productiondeclined. After the middle of the year, decreases in defense orders producedeven larger adjustments in the holdings of the aircraft industry. Decliningnew orders and falling backlogs of unfilled orders caused, first, a furtherdecline in the rate of accumulation, and later, in the final months of the year,an actual decrease in the inventory holdings of these industries. Many pro-ducers of consumer goods also reduced their inventory investment in theearly part of 1957 and, after some increase in the summer, again in the latemonths of the year.

TABLE 2.—Changes in gross national product and its major components, 1955—57

[Billions of dollars]

Item

Gross national product or expenditure

Change in business inventories

Final purchases

Personal consumption expenditures

Durable goodsNondurable goods

Services

Gross private fixed investment

Residential construction (nonfarm)Other construction

Producers' durable equipment

Net foreign investment

Exports of goods and services.Less: Imports of goods and services

Unilateral transfers

Government purchases of goods and services.

Federal (excluding Government sales)..National security

State and local

1957 i

433.9

.0433.9

280.4

35.1140.0105.4

63.6

14.219.030.4

3.3

26.320.62.4

86.6

50.545.736.0

Change

1955 to 1956

Currentprices

23.0

.422.6

12.8

-1 .77.37.1

5.0

- 1 . 31.94.4

1.8

3.51.9

- . 2

3.1

.41.12.7

1957prices

12.9

.412.5

9.1

- 1 . 95.95.0

2.3

-1 .81.13.0

1.9

2.91.5

- . 5

- 2 . 1-1 .0

1.5

1956 to 1957 i

Currentprices

19.2

-4 .623.8

13.2

1.26.75.5

2.2

- 1 . 11.02.3

1.9

2.8.8.1

6.4

3.33.33.0

1957prices

3.6

-4.98.54.8

.02.52.4

- . 5

-1 .4.2.7

1.4

2.0.6.0

2.7

1.31.51.2

1 Preliminary estimates by Council of Economic Advisers.NOTE.—Detail will not necessarily add to totals because of rounding.Source: Department of Commerce (except as noted).

As manufacturers of finished goods lowered their output and adjustedtheir stocks of purchased materials, sales and new orders of the primarymetals industries fell. Production of these metals declined; producers'inventories nevertheless rose sharply during most of 1957. In the finalmonths of the year, however, further decreases in output halted this accu-mulation. Rising inventories in a number of other industries also led tocutbacks in production during the final quarter of the year, notably amongproducers of petroleum products, chemicals, and apparel. Output inmanufacturing industries as a whole declined sufficiently below the level ofshipments to result in an over-all reduction of inventories. Total inventoryinvestment, which had absorbed $4.6 billion of output in 1956, dropped toan annual rate of $1 billion in the first three quarters of 1957; and in thefinal quarter of the year inventories were being reduced at an annual rate of$3 billion or possibly more.

Consumer Expenditures

Increased incomes from production, augmented by substantial increasesin pension, social security, and similar payments, provided a basis for higherlevels of consumer expenditures during most of 1957. Consumer demandwas supported also by a further moderate increase in consumer credit,

16

though there was no significant increase in spending on durable goods. In-creases in spending were confined mainly to nondurable goods and services.

By the end of the summer, the expansion of consumer demand ceased.Personal income began to decline in September, and retail sales recededfrom the high levels of the summer. Purchases of services continued to rise,but total consumer spending declined one-half of 1 percent from the third tothe final quarter of the year. For the year as a whole, consumer expendituresincreased 5 percent, about the same as in 1956. However, the higher expend-itures in 1957 reflected in large part increases in prices, and only a small in-crease in the volume of goods and services acquired (Chart 3).

CHART 3

Personal Income and ConsumptionDisposable personal income rose during most of 1957, but its

buying power increased little because of price advances.

BILLIONS OF DOLLARS

325

3 0 0

275

2 5 0

225


DISPOSABLE PERSONAL INCOMEJ

I I I 1 I I I T1954 1955 1956 1957

PERSONAL INCOME LESS TAXES.

SOURCES: DEPARTMENT OF COMMERCE, DEPARTMENT OF LABOR, ANDCOUNCIL OF ECONOMIC ADVISERS.

EMPLOYMENT AND INCOMES

Employment and Earnings

After nearly three years of sizable gains, nonagricultural employmentreached a peak in the summer of 1957 (Chart 4) . A slowing down in therate of growth had become apparent after mid-1956, and hours of work inmanufacturing had turned downward somewhat earlier. In 1957, declinesbegan to appear in employment in manufacturing industries, the mostpronounced decreases occurring in durable goods, especially machinery,primary metals, and transportation equipment. The declines continued

CHART 4

Employment and Income

Total nonagricultural employment, after rising until September 1957,

declined in the closing months of the year.

MILLIONS OF PERSONS54

5 2

5 0

16

12

SEASONALLY ADJUSTED DATA

NONAGRICULTURALEMPLOYMENT

(BLS)

MANUFACTURINGPRODUCTIONWORKERS

' . ..f— ' V

I I I I I 1 1 I I I I 1 I I I I I 1 I I I I I 1 I I I I I 1 I I I I I i i i i i I i i I I I i

Basic wage rates rose moderately throughout the year

DOLLARS

FOR MANUFACTURINGPRODUCTION WORKERS

2.20

2.00

1.80

1.60

AVERAGE HOURLY EARNINGSGROSS «

• \

EXCLUDINGOVERTIME

I I i i i i I i i i i i I i i i i i 1 i i i i i I i i i i i 1 i i i i

1954 1955 1956 1957

SOURCE: DEPARTMENT OF LABOR.

18

CHART 4—Continued

Employment and Income

. . . but hours of work were reduced and weekly earnings remained

roughly constant.

DOLLARS HOURS

1 0 0

9 0

80

70

FOR MANUFACTURINGPRODUCTION WORKERS

AVERAGE WEEKLY EARNINGS(LEFT SCALE)

AVERAGE WEEKLY HOURS-!/(RIGHT SCALE)

Personal income reached a new high in the summer, and then

declined slightly, reflecting changes in labor income.BILLIONS OF DOLLARS400

350

300

250

200

150 -


PERSONAL INCOME

WAGE AND SALARYDISBURSEMENTS *

19547SEASONALLY ADJUSTED

1955 1956 1957

SOURCES: DEPARTMENT OF LABOR, DEPARTMENT OF COMMERCE, ANDNATIONAL BUREAU OF ECONOMIC RESEARCH.

throughout the year, accelerating in the autumn. Until September, gains innonmanufacturing employment, especially in trade and services, more thanoffset the reductions in manufacturing (Table 3). But after the summerpeak, lowered employment in construction, trade, and transportation, com-bined with sharper declines in manufacturing, reduced nonfarm employmentby December to a level below that of December 1956.

TABLE 3.—Changes in nonagricultural employment since December 1956[Thousands of persons, seasonally adjusted data]

Industry

Employees in nonagricultural establishments.

Manufacturing

Durable goods industriesNondurable goods industries.

Nonmanufacturing.

MiningContract constructionTransportationPublic utilitiesWholesale and retail tradeFinance, insurance, and real estate-Service and miscellaneousGovernment

FederalState and local-

December1957

51,895

16, 281

9,3906.891

35,614

8162,9062,6651,41111, 4712,3656,5457,435

2,1745,261

Change

December1956 toAugust

1957

303

-270

-191- 7 9

573

20- 4 2- 722

26134

118167

17150

August1957 to

December1957 1

-949

-555

-454-101

-394

- 3 7-126- 9 7- 1 1

-1981168

- 4

- 6 056

December1956 to

December1957 1

-646

-825

-645-180

179

-17-168-104

116345186163

-43206

1 Based on preliminary figures for December.Source: Department of Labor.

The decline in employment during 1957 was accompanied by a slowergrowth of the civilian labor force. From 1954 to 1956, as job opportunitieshad increased rapidly, large numbers of people had entered the labor marketand the civilian labor force had expanded by 3 million. The growth wasdue mainly to substantial increases in the number of teen-age persons andwomen over 35 desiring employment. By late 1956, however, and through-out 1957, the labor force was increasing more slowly; between the finalquarters of 1956 and 1957, the increase amounted to about half a million.

Because the slower growth of employment was generally accompaniedby smaller additions to the labor force, rates of unemployment remainedroughly unchanged until October, at the low level prevailing since 1955. ByDecember, however, the unemployment rate had risen, on a seasonallyadjusted basis, to 5.2 percent, from 4.3 percent in September. For 1957 asa whole, unemployment averaged 4.3 percent of the labor force, about thesame as in 1956.

Lower employment in manufacturing in 1957 was accompanied by reduc-tions in hours of work, less overtime, and a distinct slowing down in gainsin average hourly and weekly earnings. In December, the average work-

20

week was 39.3 hours and average overtime was 2.0 hours, compared with41.0 hours and 3.1 hours, respectively, in December 1956. For 1957 as awhole, average hourly earnings rose 5 percent, and weekly earnings only 3percent, above 1956. The rise above 1956 in weekly earnings was aboutequal to the rise in consumer prices. The same general experience withrespect to hours of work and earnings was characteristic of industries otherthan manufacturing.

Collective Bargaining

Wage contract negotiations were relatively few in 1957, because of thelarge number of long-term contracts in existence that had been negotiatedin earlier years. Labor disputes were infrequent, and idleness resultingfrom work stoppages was less than in any year since World War IT. Wageincreases were provided for in almost all the major contracts open for nego-tiation, except those in the men's apparel and northern textile industries.

The number of workers who received wage rate increases under majorcollective bargaining contracts in 1957 was about the same as in the pre-vious year, but the increases tended to be somewhat larger than in 1956.Of the approximately 7.5 million workers who received increases undersuch major agreements, about 5 million obtained the adjustments as aresult of settlements concluded prior to 1957 which specified "deferred"wage adjustments to go into effect in 1957 and, typically, also provided forcost-of-living escalator adjustments. About 2.5 million workers obtainedwage increases under major contracts negotiated during the year.

TABLE 4.—Distribution of employees receiving wage increases under major laboragreements, 1956-57

Wage increase (cents per hour)

All wage increases 2

Under 5 cents _ _ _ _ _ _5-8.9 cents9-12.9 cents _. . . . _ . _ _ _ . . _ _ .__13-16.9 cents.17 cents and overNot specified. _ - - _ _ _

Percent of total workersreceiving wage

increases

1956

100

11962873

1957

100

?20363463

1 Preliminary.2 Includes cost-of-living, deferred, and newly negotiated wage increases received under collective bargain-

ing situations affecting 1,000 or more employees and coming to the attention of the Department of Labor.Excludes construction, services, finance, and government.

NOTE.—Detail will not necessarily add to totals because of rounding.

Source: Department of Labor.

In contrast to about 15 percent in 1956, about 40 percent of the employeeswhose rates of pay were raised under the terms of major labor agreementsreceived increases averaging 13 cents or more per hour (Table 4). Threeof every four agreements negotiated in 1957 specified improvements in thenonwage benefits of employees, notably in health and welfare plans,improved vacation and holiday schedules, and more liberal pensions. Cost-

21

of-living escalator clauses were more widely adopted. By the end of the year,about 4 million workers were covered by such clauses, compared with 3.5million in late 1956.

Personal Income

For the year as a whole, total personal income reached $343 billion, a newhigh level. But the change in production and employment during the yearwas evident in the flow of income payments. Personal income paymentswere at their highest rate in August; by the end of the year, they were1 percent below this level. Continued increases in employment of non-production workers in manufacturing and gains elsewhere in the economy,combined with rising average hourly earnings, kept total wage and salarypayments advancing through the first eight months of the year. As re-ductions in employment and in hours of work became more pronouncedin manufacturing, and began to occur also in nonmanufacturing industries,total wage and salary payments declined from an annual rate of $242 billionin August to $239 billion in December.

The decline in total personal income after August was moderated by anincrease in transfer payments, about half in unemployment insurance bene-fits. The extent of this stabilizing influence may be seen in the fact thatbetween September and December, when wage and salary disbursementsand other labor income declined by $2.9 billion, on an annual rate basis,transfer payments rose by $1.5 billion, also on an annual rate basis. Theeffect was to offset more than half of the impact on total personal income oflower wage and salary payments.

PRICES, COSTS, PROFITS, AND PRODUCTIVITY

The upward movement of consumer prices continued in 1957, thoughthe circumstances which produced the increases were in many cases notclosely related to current demand. The record was different in otherareas of the economy, where prices are more responsive to changes inmarket conditions. The rapid advance of industrial prices at wholesalewas halted, and prices of crude materials, which are especially sensitive,declined.

Wholesale Prices

Wholesale prices, particularly the prices of industrial commodities,advanced much less in 1957 than in 1956 (Chart 5). From December1956 to December 1957, prices of crude industrial materials, whichpreviously had risen sharply, fell 10 percent. The prices of almost allmajor crude materials declined; certain nonferrous metals—copper, lead,and zinc—were especially affected, as mounting stocks forced a series ofprice reductions. On the average, prices of construction materialschanged little over the year, and prices of semifabricated materials andcomponents for manufacturing rose only slightly, despite advances in

22

CHART 5

Price ChangesWholesale prices rose much less during 1957 than in 1956.

- 2 0PERCENTAGE CHANGE

-10 0 t l O + 20

ALL COMMODITIES

FARM PRODUCTS

PROCESSED FOOD

INDUSTRIAL PRODUCTS(OTHER THAN FARM AND FOODS)

Among industrial products, prices of finished and inter-

mediate goods increased more slowly, and those of

crude materials declined.

1 ' INDUSTRIAL PRODUCTS-

inPRODUCER FINISHED GOODS [v-vv

CONSUMER FINISHED GOODS [ffffj

INTERMEDIATE MATERIALS, F ^SUPPLIES, AND COMPONENTS fcy.y

CRUDE WTMATERIALS ^ ^ ^ ^ ^ ^ f r ^ J

1 1 1 1 1

special groups '

1

1 1 1

I

1

-^ CHANGES AT ANNUAL RATES.SOURCE: DEPARTMENT OF LABOR.

steel prices. Prices of producer finished goods continued to rise, but muchless rapidly than during the previous 18 months. Prices of consumer finishedgoods also increased very gradually, except those for new automobiles, onwhich the increases were significant though smaller than in 1956. Reflectingchanges in these various categories, the average of all industrial prices roseonly 1 percent during the year, and the increase after February was negli-gible. Wholesale prices of farm products and of foods also advanced, but,like prices of industrial goods, by a smaller amount than during 1956.

The small advance in industrial prices reflected the slower rise in demand,growing industrial capacity, and a somewhat smaller increase than in 1956in manufacturing labor costs per unit of output. Production-worker man-hours of employment in manufacturing declined relative to output duringmost of 1957, and the rate of rise in average hourly earnings slowed con-siderably; as a result, production-worker wage costs per unit of outputadvanced only slightly, and significantly less than in 1956. On the otherhand, the employment of nonproduction workers, and salary payments tothem, rose rapidly throughout the first eight months of 1957. The resultwas that total labor costs per unit, including both production and non-production workers, continued to advance in 1957, although the rise wasless than in the preceding year.

Consumer Prices

The increase in the consumer price index, which had started in April1956, about ten months after the first sharp rise in wholesale industrialprices, continued with virtually no interruption through 1957. By Novem-ber, the index was 6 percent above the level of early 1956. About 70 percentof the rise was due to food and service prices, about 13 percent to durablegoods, and 17 percent to nondurable commodities (Chart 6).

Among foods, the increases in prices of meat were the most important.As supplies of meat products fell below the large amounts available earlier,meat prices began to recover, and by the end of 1957 they were 12 percentabove the low point of two years earlier. Other food prices rose mainlybecause of higher costs of processing and distribution, and because theproducts were in some cases more highly processed or of a better quality.

Prices of consumer durable goods l̂ ave risen about 6 percent since March1956, but on the average they are still below 1952 prices. Increases inprices of automobiles are mainly responsible for the recent changes. Pricesof furniture and many other consumer durable goods rose moderately overthe past 18 months, reflecting increased manufacturers' prices. Prices ofappliances, on the other hand, fell slightly. Among nondurable goods otherthan food, the major contributors to the over-all price advance were gaso-line, fuel, and drugs; prices of apparel rose only moderately.

Prices of services are subject to a wide variety of influences. Someservices—such as those of the light, power, and communications industries-are produced on a highly industrialized basis; others are largely personal.Prices of most services in the first group have increased only moderately

24

CHART 6

Consumer Prices

After declining for several years, prices of commodities began

to rise in 1956. Prices of services continued their postwar

uptrend.

INDEX, 1947-49 = 100

140

130

120

110

100

NONDURABLE COMMODITIESEXCLUDING FOOD

COMMODITIES

, 1 ,1952 1953 1954 1955 1956 1957

SOURCE: DEPARTMENT OF LABOR.

over the past few years. On the other hand, the cost of personal services,in many of which the possibilities of gains in productivity are small, haveincreased by almost the full amount of the rise in earnings of service workersand self-employed professional people. Increases in the prices of these serv-ices in the past two years have been generally larger than in the precedingtwo years, when consumer prices were broadly stable. Rents have continuedto rise of late, at a slightly faster rate than in 1954 and 1955.

The advance in consumer prices during 1957 was only in part an indica-tion of current inflationary demand in retail markets. Adjustments ofprices to cost increases that had occurred earlier, and special condi-tions affecting particular commodities and services, also played importantroles. The decline in meat supplies is an example of such changes. In-creases in prices of petroleum products reflected, at least in part, the di-version of oil supplies to Europe during the interruption of shipments viathe Suez Canal. Service prices that are subject to the approval of publiccommissions normally adjust only slowly to changes in cost and marketconditions. Rent increases, particularly those following the release of con-

trols, often reflect cost and demand conditions originating in earlier periods.And month-to-month changes in the consumer price index, especially asaffected by changes in the prices of food, apparel, and automobiles, mayreflect essentially seasonal variations. This factor was important in anumber of month-to-month changes in the index during 1957. In viewof the widespread interest in the movement of consumer prices, the natureand construction of the consumer price index are described in Appendix Dof this Report.

Corporate Profits

Changes in industrial prices, costs, and production are the major factorsdetermining the movement of corporate profits and their share in totalincome. During the expansion of activity that began in 1954, profitsfollowed a course different from that of other forms of income. With bothsales and margins increasing, profits rose rapidly throughout 1955. How-ever, the increase was not extended into 1956; on the contrary, duringthat year and in the first half of 1957, corporate profits fluctuated arounda level somewhat below that reached in the second half of 1955. This failureof profits to advance during 1956 and early 1957, while other incomes wererising, reflected a number of factors, including the incurrence of additionalcosts of many kinds and an increased allocation of gross earnings to depre-ciation accounts. The number of employees was rising, wage rates wereincreasing, and overhead expenditures were higher, in part as a result ofthe rapid increase in investment outlays. Although increases in prices cov-ered most of the increases in unit costs of production, profit margins wereslightly reduced. Output increased only moderately, and total profits failedto rise.

Profits of manufacturing corporations fell early in 1957, reflecting de-clines in production and sales in a number of important industries and atendency for industrial prices to level off while some elements of cost con-tinued to rise. The decline in profits was accelerated later in the year, asproduction and sales fell further. In most nonmanufacturing sectors of theeconomy, where activity continued to rise, profits in general were wellmaintained during the first part of 1957. Present indications are that theprofits of these sectors also declined in the latter part of the year. Theaggregate volume of corporate profits, in which the profits of manufacturingcorporations are more important than all other types combined, fell slightlyin the first half of 1957; and by the end of the year, they had declinedsignificantly below the levels around which they had been moving earlier.

Productivity

Private nonagricultural output rose only slightly from 1956 to 1957,and man-hours of employment were virtually unchanged. The indicatedgain in productivity accordingly was still small, though much larger than thegain from 1955 to 1956. In both instances, the increase was smaller than thelong-term average annual increase of about 2 percent recorded for the past

26

few decades and the still higher average increase recorded for the wholeperiod following World War II. The small extent of these gains, in com-parison with increases in wage rates, maintained the upward pressure on unitcosts and, therefore, on prices.

The small improvement in productivity indicated for 1956 and 1957provides no basis for expecting the future long-term rate to fall below theaverage annual gain realized in recent decades. For one thing, produc-tivity statistics generally show irregular year-to-year changes. Moreover,uncertainties about the concept, difficulties of measurement, and short-comings of available information require a cautious interpretation of theyearly changes shown by available data (see Appendix E).

But more positive reasons may be cited for confidence that the long-termrate of gain in productivity will be higher than the rates for 1956 and 1957. Amajor reason for confidence is the huge investment made during recent yearsin new plant and equipment. Circumstances favorable to the full realizationof the productivity potential of these facilities, namely, large gains in outputin the industries concerned, have not yet been experienced. And largeincreases in certain types of expenditures also raise the productivity poten-tial, even though they may depress the current level of productivity. Al-though the starting-up of new productive facilities, the expansion of researchand development projects, and the training of personnel in new techniquestend to raise employment immediately, their beneficial effect on the outputof goods and services is deferred.

FINANCIAL DEVELOPMENTS

The major demands for credit in 1957 were reflected in the long-termcapital markets. State and local governments drew on these markets for$6.9 billion of funds, $ 1.4 billion more than in 1956 (Table 5). School con-struction expenditures accounted for more than 35 percent of the fundsborrowed. Added to these demands of State and local governments were

TABLE 5.—Security offerings, 1954-57

[Millions of dollars]

Security

State and municipal securities (principal amounts).

Corporate securities (gross proceeds)

ManufacturingMining .Electric, gas, and waterRailroadOther transportationCommunicationFinancial and real estate (excluding investment companies).Commercial and other

1954

6,969

9,516

2,268539

3,713479299720

1,076422

1955

5,977

10,240

2,994415

2,464548345

1,1321,899443

1956

5,446

10,939

3,647456

2,529382342

1,4191,856307

1957J

6,879

12,997

4,275329

3,942344416

1,4721,843

377

1 Preliminary.


Source: Securities and Exchange Commission.

very heavy security flotations by corporations, amounting to $13.0 billion,$2.1 billion more than in 1956 (Chart 7). The issues of utility companieswere especially important, reflecting the continued large programs of expan-sion and improvement in this industry. But manufacturing concerns werealso heavy borrowers, despite the slowing down in their expansion programsafter the strong upsurge of the past several years.

This heavy reliance of corporations on the securities markets reflected inpart the culmination of a reduction in liquid assets which had been in prog-ress since the end of 1955 and which had brought corporate liquidity to anew low for the postwar period (Chart 8). It also reflected a decline in thevolume of additional funds available to business concerns from the commer-cial banking system. Bank loans to businesses increased only $1.6 billion in1957, compared with an increase of $5.5 billion in 1956 (Table 6), thoughthis difference doubtless reflected in part a decline in the demand for short-term credit arising from a substantially slower rate of accumulation ofbusiness inventories.

TABLE 6.—Changes in commercial bank holdings of loans and investments, 1954—57


Loans or investmentNet change during—

1954 1955 1956 1957 1

Loans (excluding interbank) and investments.

Loans (excluding interbank)

BusinessReal estate...Consumer....SecurityAgricultural.Allother

Investments.

U. S. Government securities.Other securities

10.2

2.9

- . 31.7

(2).9.2.6

7.2

5.61.6

4.6

11.6

6.42.42.3

-7.0

-7.4.4

4.2

7.6

5.51.71.3

- . 8- . 3

.5

-3.5

-3.0- . 4

4.3

3.6

1.6.7

1.3

- . 5.3

.8

- . 61.3

1 Preliminary estimates by Council of Economic Advisers.2 Less than 50 million dollars.NOTE.—See Table F-41 for data including interbank loans.Detail will not necessarily add to totals because of rounding.

Source: Board of Governors of the Federal Reserve System (except as noted).

At the same time, credit demands from other sectors of the economywere somewhat more moderate than in earlier years. Total mortgagedebt rose by only $11 billion in 1957, compared with $15 billion in 1956and $16 billion in 1955. This slower rate of growth was due in part tothe fact that funds for investment in federally insured and guaranteedhome mortgages were less readily available, since interest rates on thesemortgages were less attractive to lenders than the yields available onother types of investments. The total amount of consumer credit out-

28

CHART 7

The Pattern of Credit ExpansionState and local governments marketed a near-record volume of

securities in 1957, and corporate issues were at a new high . . .

BILLIONS OF DOLLARS0 5

1955

1956

1957

10 15 20

CORPORATE SECURITYISSUES: NEW MONEY-2/

. . . but growth in other forms of credit was greatly reduced.

+ 10 +15 +20BILLIONS OF DOLLARS0 +5

1955

1956

1957

1955

1956

1957

INCREASE INMORTGAGE DEBT3/

( I - to 4-Family Homes)

INCREASE INCONSUMER CREDIT-^/

INCREASE IN BUSINESS LOANSBY COMMERCIAL BANKS-2/

I

y PRINCIPAL AMOUNTS.1/ NET PROCEEDS.3/CHANGES IN AMOUNTS OUTSTANDING.

SOURCES: THE BOND BUYER. SECURITIES AND EXCHANGE COMMISSION, BOARD OFGOVERNORS OF THE FEDERAL RESERVE SYSTEM, AND COUNCIL OF ECONOMIC ADVISERS.

standing increased by only $2.7 billion in 1957, compared with $3.4 bil-lion in 1956 and $6.4 billion in 1955. The amount of instalment creditextended was actually above that in 1956; but since repayments were high,the increase in total instalment credit outstanding was held down.

Significant changes also took place in the supply of funds during 1957.First, in most of the year the capacity of the commercial bankingsystem to expand its loans and investments was more limited than in1956. The volume of member bank reserves was held roughly un-changed by the monetary authorities, and the already sharp reductionsin bank holdings of United States Government securities limited anyfurther shifts out of these securities in order to expand loans (Chart 9).Commercial banks sold $600 million of Government securities in 1957,compared with $3 billion in 1956 and $7.4 billion in 1955.

With the level of bank reserves unchanged, and a sharp increase in timedeposits, there was no expansion in the money supply during 1957. Indeed,demand deposits and currency actually declined by $1.5 billion, whereas thevolume of money expenditures increased. The decline in the cash liquidityof businesses and individuals which is represented by this changed relation

CHART 8

Liquidity of Commercial Banks and NonfinancialCorporations

Bank liquidity continued low in 1957. The liquidity of business

concerns was further reduced.

PERCENT

60

55

50

45

40

0

ENO OF QUARTER

COMMERCIAL BANKS-!/

NONFINANCIALCORPORATIONS-?/

I I 1 I I I

* * • • • , • • • '

I I I i1955 1956 1957

U RATIO OF HOLDINGS OF U.S.GOVERNMENT SECURITIES (BOOK VALUE) TO DEMAND DEPOSITS.U RATIO OF CASH ASSETS AND HOLDINGS OF U.S. GOVERNMENT SECURITIES (PAR VALUE)

TO CURRENT LIABILITIES.

SOURCES: BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, SECURITIES ANDEXCHANGE COMMISSION, AND COUNCIL OF ECONOMIC ADVISERS.

CHART 9

Member Bank Reserves

Member bank reserves changed little in 1957.

BILLIONS OF DOLLARS1

28

U.S. GOVERNMENT SECURITIES HELD

BY FEDERAL RESERVE BANKS

22

20

18

MEMBER BANK RESERVES

: i i i i fFree reserves were negative for most of the year but the

deficiency was reduced in the closing months.

BILLIONS OF DOLLARS1 (Enlarged scale)

1.5

1.0

.5

%. S FEDER,

MEMBER BANKS

^ BORROWINGS FROM••. / ^ FEDERAL RESERVE BANKS

FREE RESERVES(EXCESS RESERVESLESS BORROWINGS)

-.5

~ I . O I i i i i i I i i i i 1 1 i i i i i 1 i i i i i l i i i i i 1 i i i i i I i i i i i 1 i i i i i I i i i i i 1 i i i i

1953 1954 1955 1956 1957

+ AVERAGES OF DAILY FIGURES.

* CHANGE IN RESERVE REQUIREMENTS.

SOURCE: BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM.

31

between money supply and expenditures was one of the most significantfinancial developments of the year.

Second, there was a decline in the amount of new funds availablefrom insurance companies, savings and loan associations, and mutualsavings banks, resulting from the lower liquidity of these institutions andthe smaller flow of new savings through them. Their purchases of Stateand local securities and corporate issues were somewhat greater than in 1956,but this was made possible only by a large reduction in their purchases ofmortgages.

Third, despite a slightly smaller volume of total personal saving, directpurchases by individuals of corporate, State and local, and other market-able securities were almost $3 billion larger in 1957 than in 1956. Thiswas due partly to the attractiveness of yields on these securities for in-dividuals. An important source of funds for these greatly enlarged pur-chases, though not a net addition to new savings, was a reduction of almost$2 billion in individuals' holdings of United States Savings Bonds, primarilyby investors sensitive to the higher yields generally available in the market.

Fourth, the Federal budget during the calendar year 1957 contributedless than during 1956 to making additional funds available to the securitiesmarkets through financial institutions and individuals. In 1956, a reduc-tion of $6.4 billion in the publicly held United States debt was an importantfactor in the ability of financial institutions and individuals to add to theirloan and security portfolios. They did so by reducing their holdings of UnitedStates Government securities. In 1957, only $2.9 billion of the publicly held

debt was retired; thus the ability of this group of investors—especiallyfinancial institutions—to provide funds by further reducing their holdingsof Government securities was decreased.

Reflecting the more limited supply of new funds relative to the demandsfor them in 1957,, interest rates rose during much of the year (Chart 10).The rise was especially rapid in June and August, when money marketpressures became unusually heavy. In August, the rate on Treasury billswas close to 3J/2 percent, major banks raised their prime rate from 4 percentto 4^4 percent, and the Federal Reserve Banks raised the discount rate from3 percent to 3*/2 percent.

After the Federal Reserve Banks announced lower discount rates inNovember, interest rates and bond yields declined significantly, in manycases one-half of 1 percent or more. This reflected a reduction in demand forloans that had already been apparent and some easing of pressure on bankreserves. By the end of the year, credit in both the long-term and short-

term sectors of the markets had eased appreciably, though the impact oncertain sectors of the market, notably the mortgage market, was slowin developing.

The rise in stock prices to July brought the average yield on common stocksto 4 percent, about the same as the yields then available on high-grade bonds.

CHART 10

Interest Rates and Bond Yields

Short-term interest rates rose through most of 1957 but declined

after mid-November.PERCENT PER ANNUM

INTEREST RATES

SHORT-TERM BUSINESSLOANS BY BANKS .

TREASURY BILLS(NEW ISSUES)

0 M I 1 I I 1 I I I I I 1 I 1 I I I I I I I I I I I I I 1 I I I I I I I

* FEDERAL RESERVE BANKDISCOUNT RATE

Long-term rates rose sharply in the spring and summer and declined

at the year end.

PERCENT PER ANNUM6

BOND YIELDS

CORPORATE Aaa

U.S. GOVERNMENT(10 YEARS AND OVER) 1

1 HIGH-GRADE MUNICIPAL

0 I I I I I i I I I I I I I i I I i I I I I i i I I I I I I I I i I I I I1955 1956 1957

SOURCES: BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, MOODY'S INVESTORSSERVICE, TREASURY DEPARTMENT, AND STANDARD a POOR'S CORPORATION.

33

With the large decline in stock prices after July, yields on common* stocks wereabove 4 / 2 percent at the close of the year, considerably above the much loweryields then available on high-grade bonds.

AGRICULTURE

There have been a number of favorable developments in agriculture inthe past two years, though net income from farming has not changed sig-nificantly (Chart 11). Despite an over-all decline in crop prices, the live-stock market strengthened sufficiently to raise average prices received byfarmers. Heavy export shipments have made a considerable reduction insurplus stocks. A long drought in the Southwest has ended. Land valuesand the equities of farm proprietors have climbed to new record levels.Realized gross farm income increased both in 1956 and in 1957, but risingproduction expenses offset most of the gains. Conditions in the rest of theeconomy have provided generally favorable opportunities for off-farmearnings, and per capita income of the farm population from all sources hasbeen increasing. The revolution in farm technology is a continuing sourceof agricultural strength, though it complicates current problems of agri-cultural adjustment and public policy.

Livestock Sector

Prices of farm products, as well as cash receipts from farm marketings,have benefited from recent livestock developments. A peak in the hog cycle,coinciding with heavy supplies of fed steers, had seriously depressed live-stock markets late in 1955. With high slaughter rates continuing into theearly months of 1956, and with forced marketing of cattle from droughtareas that fall, both production and per capita consumption of red meatreached record levels. During 1956, however, the number of cattle onfarms decreased for the first time since 1948, and a 2 percent decline in the1957 calf crop further suggests that cattle numbers have entered a down-ward cyclical phase. Pig crops in the spring and fall of 1956 and in thespring of 1957 were reduced below the levels of the preceding year, thoughby successively narrower margins. Prices of meat animals were conse-quently about one-third higher by late 1957 than they had been two yearsearlier. Since prices of milk and dairy products were firm, cash receiptsfrom marketings of livestock and livestock products were about 6 percenthigher in 1957 than in 1956.

Exports and Stocks

The value of agricultural exports in fiscal 1957 reached $4.7 billion,an increase of 17 percent over the previous record attained in 1952; and thevolume of exports exceeded by 30 percent the record reached in 1919.Shipments financed through special Government programs (Chart 12) —mainly sales for foreign currencies under Public Law 480, barter transactions,and outright commodity donations—comprised fully 40 percent of the total.Of the remainder, a substantial portion moved under export subsidies in

34

CHART 11

Indicators of Agricultural Conditions

Net farm income has reflected little of the improvement in gross

farm income since 1955.


3 0

10

REALIZED GROSSFARM INCOME-*/

.TOTAL NET FARM INCOMEy

.7^REALIZEO NET

FARM INCOME-!/

NET INCOME FROMNONFARM SOURCES-b/

Farm product prices and the parity index increased in 1957.

INDEX, 1910-14 = 100

300

275

250

225

7PRICES RECEIVED

(ALL FARM PRODUCTS)

PRICES PAID, INTERESTiTAXES, AND WAGE RATES

(PARITY INDEX)

The value of proprietors' equities is higher than ever.


140

100

0

FARM PROPRIETORS'EQUIT IES(JANUARY I )

1950 51 52 53 5 4 55 56 57& INCOME OF FARM OPERATORS, INCLUDING GOVERNMENT PAYMENTS.2j INCOME OF ALL FARM PEOPLE.SOURCE: DEPARTMENT OF AGRICULTURE.

35

CHART 12

Federal Agricultural Programs

CCC price-support investment has been reduced by enlarged com-

modity disposals, particularly under special export programs.

BILLIONS OF DOLLARS

8 -

6 -

FISCAL YEARS

CCC PRICE-SUPPORTINVESTMENT-1'

TOTAL EXPORTS FORFOREIGN CURRENCIES

Net budget expenditures for agricultural programs remain high,

and heavy losses are being realized on commodity operations.

BILLIONS OF DOLLARS

4

2

0

NET BUDGETEXPENDITURES^

\

-

^

REALIZED COST OF MSTABILIZATION PROGRAMS y/*

DIRECT GOVERNMENT . .*^ PAYMENTS!/ »••*

X1 1

1953 1954 1955 1956 19571/ LOANS AND INVENTORIES, JUNE 30 .2/EXPENDITURES FOR AGRICULTURE AND AGRICULTURAL RESOURCES.& PAYMENTS TO FARM OPERATORS AND LANDLORDS, CALENDAR YEARSSOURCES: DEPARTMENT OF AGRICULTURE AND BUREAU OF THE BUDGET.

various forms. On dollar sales of wheat, the subsidy element averagedabout 80 cents per bushel. Under the export program for raw cotton, ini-tiated early in 1956 and continued in the current season, sales have been atcompetitive world prices, some 20 percent below the domestic price. Com-modities valued in excess of $600 million (CCG cost) were released to bartercontractors during the fiscal year 1957, but activity declined sharply afternew regulations were issued in May to help prevent displacement of normaldollar sales. Since August 1957, exports have been running below thevery high monthly levels of the preceding year.

Under present circumstances, variations in the rate of export shipmentsexert their major influence on the level of commodity stocks, not on currentcrop prices or farm income. Carry-overs of cotton, wheat, and rice werereduced, and investment by the Commodity Credit Corporation (CCC) inprice-support loans and inventories on November 30, 1957 was $1.0 billionlower than a year earlier. However, a substantial rise in stocks of feedgrains continues, and the grain surplus is world-wide. Despite a recordvolume of international trade in wheat during 1956-57, stocks of majorcoarse and bread grains in the four principal exporting countries as of July 1reached a new high in 1957 for the fifth consecutive year. Tobacco stocksalso increased in 1956-57, in part because newer high-yielding varietiesfound poor favor in domestic and export markets alike. All stocks of CCC-owned wool have now been sold.

Crop Production and Prices

Crop adjustments in 1957 were expected to reinforce the favorable exportexperience and further reduce burdensome surpluses. Over 25 million acreswere placed in the Soil Bank; acreage allotments were at the minimumlevels permitted by law; and total harvested acreage of wheat, cotton,and corn was about 25 percent lower than four years earlier. Soil-Bankwithdrawals contributed to significant reductions in the output of wheat,cotton, rice, and tobacco. Excessive rainfall at harvest time adversely af-fected the quality of several crops and reduced cotton production sharplybelow early-season estimates. The all-crop production index neverthelessequaled the record-matching 106 (1947-49=100) of 1956, as drought wasbroken on the Great Plains, more acreage was diverted to soybeans andminor feed grains, and the upward trend in yields per acre continued. Totalfeed-grain output set a new record.

Farm prices have reflected these developments. Since September 1957,the index of crop prices has been lower than on corresponding dates in1956. Because of improved prices for livestock and livestock products, how-ever, the general index of prices received by farmers in 1957 averaged some3 percent higher than in the two preceding years. Record supplies of feedconcentrates and cheap feed relative to livestock prices are now encouragingexpansion of hog production and heavy feeding of beef cattle.

37

Financial Position of Farmers

Realized gross farm income was 1 percent higher in 1957 than in 1956.However, higher cash receipts from livestock and an increase of nearly halfa billion dollars in Soil-Bank payments were not sufficient to counteract re-ductions in crop marketings and increases in production expenses. Unusualweather conditions in the autumn lowered cash receipts from cotton, de-layed marketings of hogs to allow feeding of wet corn, and thus adverselyaffected farm income in the fourth quarter. Net realized farm income,while higher than in 1955, declined from $12.1 billion in 1956 to an esti-mated $12.0 billion in 1957. After adjustment for net change in inven-tories, net farm income was the same as in 1956.

Most of the increase in total expenses was due to higher overhead costs—depreciation charges that reflect heavy capital investment in earlier years, taxpayments, and interest. More expensive feeder livestock, motor vehicles,and farm machinery contributed to a 4 percent rise in the index of pricespaid for all items (including interest, taxes, and wage rates) and held thestatutory parity ratio at its 1956 level.

The over-all financial position of agriculture continues to show strength.The value of farm land per acre on November 1, 1957, was 7 percent higherthan a year earlier and one-fourth higher than in 1951. This was themain factor lifting the value of proprietors' equities to an estimated $168.4billion as of January 1, 1958, about 7 percent above the previous peak. Afurther rise in real estate debt also occurred, but the ratio of total liabilitiesto proprietors' equities declined. Relatively few farms are being offeredfor sale, and foreclosures in 1957 were below the relatively low rate in 1956.Efforts to enlarge existing holdings in the interest of improved efficiency,demands for rural home sites, and other nonfarm uses for farm land insome regions all lend strength to farm land values. To some extent, thesehigher land prices also reflect the capitalized value of Government pro-grams to sustain farm income and prices.

T H E EXTENT OF THE OVER-ALL DECLINE

The decline in over-all economic activity that had taken place by the endof 1957 was moderate. The Nation's output of goods and services in thefourth quarter was less than. 1 J/i percent below the total reached in the thirdquarter. Nonagricultural employment in December, adjusted for seasonalchanges in the number of jobs, was about 2 percent below the summer peak,and personal income had declined by less than 1 percent.

Final purchases of goods and services were, in the aggregate, virtuallyunchanged—only $1 billion less than in the third quarter—but inventories,which had been accumulating at the rate of $2 billion annually in the thirdquarter of the year, were being used up in the fourth quarter at the rate of$3 billion or more. Adjustments in inventory holdings, therefore, accountedfor most of the declines in production, employment, and income which de-veloped toward the year's end.

38

Because of the high level of private investment expenditures and of Gov-ernment purchases, and the strength of consumer demand, labor incomedeclined by only 1 percent between the third and the fourth quarters of theyear. And since other forms of income, notably payments to individualsunder various income-maintenance programs, increased in the fourth quar-ter, total personal income fell even less than 1 percent. Personal incomeafter taxes fell by $2 billion in the fourth quarter, and personal consumptionexpenditures by $ 1 billion.

Thus, the over-all decline has been moderate, despite rather sharp re-ductions in inventories and in industrial production. Purchases of goodsand services for final use have been well sustained; incomes have held upwell; and the continuing high level of retail purchases attests to the confi-dence of consumers in their economic position.

39

Chapter 3

Foreign Developments and the American Economy

THE INTERACTION between economic developments in other coun-tries and in the United States was again evident in 1957. In the early

part of the year, foreign demand exerted a strongly expansive effect on theAmerican economy. United States exports, which had already been risingrapidly with the growth in economic activity abroad, increased with unusualforce as a result of demands arising from the closure of the Suez Canaland other temporary circumstances. These special demands subsided atthe same time that the pace of economic expansion abroad slowed down,and United States exports declined from the record level of the first halfof the year. United States imports varied only slightly, in total amount,from the 1956 level, though the demand for raw material imports declinedin the latter part of the year, as a result of reduced industrial activity.

When economic activity contracted in 1953-54, United States demandfor imports fell for a time. However, the outflow of dollars through capitalinvestment and in other ways increased; this strengthened the foreignexchange positions of other countries and helped promote economic expan-sion. The continued rise in industrial production in Western Europe sup-ported world trade and commodity prices and contributed to an upturn ineconomic activity in the United States.

In the months ahead, developments in the United States economy andin its external trade and financial relations will influence, and be influencedby, economic developments in other countries. It is important that policiespursued here and abroad promote economic growth and counteract strainsthat would lead to raising and hardening trade barriers among nations.

CHANGES IN PRODUCTION

Industrial production abroad (excluding output of countries in the Sovietbloc) averaged about 4 percent higher in 1957 than in 1956, and close todouble the prewar output (Table 7). In most countries, the lead in theexceptionally rapid expansion since 1953 was taken by the metal andmetal-fabricating industries, to meet strong home-investment and exportdemands. In the more developed countries, the demand for consumerdurable goods also proved to be heavy, as incomes and levels of living rose;during 1956, textile manufactures, which had previously lagged, joinedin the rise.

4°

TABLE 7.—World industrial production, 1955-57[Index, 1953=100]

Country 1955 1956

1957

First Secondquarter quarter quarter

Third Fourthquarter

Not seasonally adjusted

World:»Including United StatesExcluding United States

OEEC countries

AustriaBelgiumDenmarkFranceGermany, Federal Republic.GreeceIrelandItalyNetherlandsNorway _.SwedenUnited Kingdom

CanadaUnited States. „ .

IndiaJapanYugoslaviaArgentinaChileBrazilMexico

110118

119

133116112117129130108118118117111114

107104

116117132118102112119

U25

125

138122111

«129139134104128124122114113

114107

126142145117104112130

119129

120133

3 115* 127

Seasonally adjusted

130

144127118142147142102135130123118113

117109

131

146125116143148145104137127128120116

115107

131

147* 117113144146149100138126128119116

114107

3 131

()7 151U46

()7 1247 128)7 115

7 112104

Not seasonally adjusted

13315015011195

(4)

149164165120

(4)

(<)

(4)164170

7 131(4)

w

()7 159

i Excluding USSR and other members of the Soviet bloc.* Quarterly figures for 1956 are: for the world including United States, 114, 116, 112, 119; for the world

excluding United States, 122, 128, 122, 130.3 Preliminary estimates by Council of Economic Advisers.« Not available.«Reflects July strike.6 Average of quarterly figures for 1956 would be 134.7 Partial data for quarter.Sources: United Nations and Organization for European Economic Cooperation (except as noted).

These gains in industrial production were achieved in Western Europegenerally by May 1957, and there appears to have been no further over-allincrease since then. Production in the Federal Republic of Germany, aftera pace-setting rise up to mid-1956 and a further vigorous increase in thefirst quarter of 1957, fell in the summer but turned upward again inthe autumn. The revival in the United Kingdom's industrial outputstarting in the spring did not go much beyond the level reached at the endof 1955. In France, however, the industrial upsurge that began in 1954continued during 1957; but it was accompanied by inflationary pressuresand produced an imbalance in trade and a depletion of foreign exchangereserves.

Industrial output in Canada leveled off in the early months of 1957 andthen receded. Japanese production, after a long and rapid increase, de-

41

clined after July. Industrial activity in India and Yugoslavia con-tinued to expand rapidly, but this was not typical of less developed countriesas a whole. In Latin America, the total volume of mining output expandedappreciably, but manufacturing appears to have been only moderatelyhigher than in 1956\

Although the growth of demand slackened in some countries, a slowerrate of increase in output was inevitable because, in a number of cases,industrial production had begun to crowd the physical limits set by existingplant capacity or by the supply of labor. Moreover, in response to the riseof prices and wages, the monetary authorities in most of the developedeconomies restricted credit, thereby restraining investment outlays. Inseveral countries, loss of foreign exchange reserves as the result of tradedeficits or speculative capital movements compelled policies of restraint.

T H E COURSE OF WORLD TRADE

Total world exports (excluding those of the Soviet bloc) reached anannual rate close to $100 billion during the first half of 1957. In physicalterms, exports were 8 percent above those in the first half of 1956 and nearly40 percent above the same period of 1953 (Chart 13). In recent monthsthere has been little further expansion. Trade among the industrial coun-tries accounted for most of the increase to mid-1957. In relative terms,however, some of the sharpest increases were in imports of certain of theless developed countries (Table 8). Most of this rise was in their trade withthe United States and other industrially developed countries.

TABLE 8.—Changes in world trade, 1955—57

Area

World i

Northern North America2

Latin AmericaWestern Europe (OEEC countries).

To or from other WesternEuropean countries

To or from other areas

Overseas territories of continentalWestern Europe _ _

Outer sterling areaMiddle East 3Far East 3Other countries 3

Exports

July1956-June1957

(billionsof

dollars)

94.9

24.18.6

38.3

19.718 6

2.812.02.24.72.2

Percentageincrease

First half1955 to

first half1956

12.2

16.810.612.2

11.313.0

6.85.9

24.514.22.2

First half1956 to

first half1957

10.9

18.72.1

11.8

12.910.7

.74.53.4

12.48.4

Imports

July1956-June1957

(billionsof

dollars)

103.1

20.78.3

45.5

20.225.3

3.712.82.26.93.0

Percentageincrease

First half1955 to

first half1956

11.0

17.92.7

10.5

11.69.7

2.57.1

11.917.89.3

First half1956 to

first half1957

11.9

3.514.414.0

11.915.7

18.07.31.8

34.012.1

» Excludes USSR and other members of the Soviet bloc.2 Exports exclude military aid shipments by United States and Canada.3 Excludes countries belonging to the sterling area.

Sources: Department of Commerce, based on data from United Nations and Organization for EuropeanEconomic Cooperation.

CHART 13

World and U. S. Foreign Trade

BILLI120

100

8 0

6 0

o

J. S. exports rose much faster than imports or total world trade

rom early 1956 to early 1957, but declined later in the year.

ONS OF DOLLARS, 1953 PRICES


WORLD TRADE(MEASURED BY J

^_ MERCHANDISE EXPORTS) ^^ *

^

N

1 1 1 1 1 i 1 1 1 1 1

-

i i i 1 i i i r

BILLIONS OF DOLLARS, 1953 PRICES (ENLARGED SCALE)

2 0

1 8

16

1 4

1 2

1 0

<


-

U.S. MERCHANDISE /EXPORTS X

r rMERCHANDISE

IMPORTS

-

-

<

1 1 1 1 1 1 1 I 1 i 1 1 1 1 I 1 1 1 1 1

1953 1954 1955 1956 1957

MOTE: DATA EXCLUDE U.S. MILITARY SHIPMENTS UNDER AID PROGRAMS ANDEXPORTS OF USSR AND OTHER MEMBERS OF THE SOVIET BLOC.

SOURCES: COUNCIL OF ECONOMIC ADVISERS AND DEPARTMENT OF COMMERCE.

43

Purchases of American goods and services by foreign countries rose withexceptional vigor during the first quarter of 1957 to an annual rate of about$27 billion, 25 percent higher than a year earlier (Chart 14). They main-tained this rate during the second quarter and most of the third, but declinedin the autumn.

Exports of three commodities—petroleum (and products), raw cotton, andwheat—together increased by $850 million and accounted for nearly one-halfof the increase in total United States merchandise exports between the firsthalf of 1956 and the first half of 1957. The large rise in petroleum ship-ments resulted from the temporary disruption of traffic through the SuezCanal. Cotton shipments, which had been abnormally low in 1955-56prior to the reduction in the United States export price to world marketlevels, rose to exceptionally high amounts as foreign stocks were rebuilt.Exports of wheat were unusually large, primarily because of the poor Euro-pean harvest in 1956 and large special-program shipments to Asian countries.

In addition to these special circumstances, United States exports bene-fited from reductions achieved in trade barriers abroad and, until mid-1957,from the general buoyancy of foreign demand. Sales of both industrialmaterials and capital equipment rose as industrial activity expanded abroad(Table 9). Exports of many products, such as steel, scrap, and machinery,

TABLE 9.—U. S. merchandise exports and imports, 1953—57[Millions of dollars]

Commodity group

1953-55 1956

Quarterly average

1957

Firstquarter

Secondquarter

Thirdquarter

Domestic exports !

Producers' supplies and materials:Cotton, tobacco, and other agricultural mate-

rialsNonagricultural materials

Capital equipment

Consumer goods:FoodOther consumer goods

Miscellaneous.

G eneral imports.. _

Producers' supplies and materials:Petroleum and productsOther materials used in production of non-

durable goods 2

Materials used in production of durablegoods

Materials used in agriculture

Capital equipment3

Consumer goods:Food, beverages, and drugsOther consumer goods

Miscellaneous.

3,248

3051,055

1,036

464346

43

2,706

219

514

75694

58

797228

40

4,286

3661,474

1,326

685380

56

3.151

320

570

91884

92

793318

55

5,043

5311,847

1,432

762396

75

3,237

360

580

83494

105

879332

53

5,089

4331,8471,643

709397

60

3,205

382

560

884101

108

737359

74

4,437

3781,625

1,430

595348

61

3,197

406

518

87385

92

747414

1 Excludes military aid, and motion picture films exported on a royalty basis.2 Includes newsprint and paper base stocks and tobacco.8 Includes agricultural machinery.

NOTE .—Detail will not necessarily add to totals because of rounding.Source: Department of Commerce.

44

CHART 14

U. S. Balance of Payments

The excess of U. S. receipts from other countries over payments to

them led to reductions in foreign gold and dollar holdings in 1957.

BILLIONS OF DOLLARS

8

6

4 ,

-

TOTAL PAYMENTS

\ .

_

SEASONALLY ADJUSTED _

J0T*

\TOTAL RECEIPTS

_

I I I 1 1 1 I 1 I 1 -S

6

4

1

0

RECEIPTS

-

-

>

\EXPORTS

AND S!

OTHER RECEIPTS-*/

-I >\

—

OF GOODS -IRVICES

<

\m^"mV^ 1

PAYMENTS

IMPORTS OF GOODSAND SERVICES

4 -

I -

GOVERNMENT GRANTS ANDPRIVATE REMITTANCES^/

U.S. PRIVATECAPITAL3^

/

o L—cdI955 I956 I957

-*/ FOREIGN LONG-TERM CAPITAL PLUS ERRORS AND OMISSIONS.•2/ INCLUDES RELATED GOVERNMENT CAPITAL EXPORTS.& INCLUDES EXPORT-IMPORT BANK LOANS.

NOTE: DATA EXCLUDE MILITARY GRANT-AID.

SOURCE: DEPARTMENT OF COMMERCE.

45

were facilitated by the possibility of obtaining delivery more rapidly fromthe United States than from other sources, though this entailed some addi-tional upward pressure on United States prices of such goods. Exports ofconsumer finished goods, on the other hand, rose more slowly.

As the year progressed, foreign demand for United States output de-clined from the very high rate of the early months. Late in the year, the vol-ume of exports had fallen to a level slightly below that of 12 months earlierand was at an annual rate markedly lower than in the first six monthsof 1957.

The expansion of imports into this country, though much smaller thanthe rise in exports, was fairly general and substantial from 1954 to 1956.Further growth of imports has been limited, with increases occurringchiefly in petroleum and products and consumer manufactures includingautomobiles (Table 9). Imports of industrial materials, other than petro-leum, which had constituted nearly half of total imports in 1953-56,reflected the decline in domestic manufacturing production and showedsome effect of reductions in prices.

INTERNATIONAL FINANCIAL DEVELOPMENTS

Disparities between movements in exports and in imports gave riseto some exceptionally large trade deficits and consequent difficulties ininternational payments. In India, heavy private and public demandsgenerated by the program for economic development caused the tradedeficit to increase by an annual rate of more than $600 million fromthe first half of 1955 to the first half of 1957. Smaller increases occurredin some other less developed countries. Trade deficits also rose in someof the industrially more advanced countries over the same two-year period—by an annual rate of $1,550 million in France, almost $1,400 million inJapan, and $640 million in the Netherlands. These changes had theircounterpart in increased trade surpluses of a few other countries. That ofthe United States rose by an annual rate of $4,500 million and that ofWestern Germany by a rate of $600 million.

The deficits and surpluses arising in international trade in the recentpast were to a large extent offset by capital movements. Much of thelarge increase in the excess of our exports over imports of goods andservices in the last few years was made possible by a rapid growth in theoutflow of United States private capital. Although private Americaninvestment abroad fell sharply in the third quarter of 1957, it was stillrelatively high. United States Government grants and credits remainedclose to previous levels and continue to contribute significantly to our ex-port surplus (Chart 14).

In a number of countries, however, trade balances were not coveredby capital movements; and in several cases capital outflows, particularly ofa speculative nature, increased rather than alleviated these strains. TheUnited Kingdom achieved a surplus on current account but experienced

a still larger outflow of capital. Much of this outflow was due to speculativeoperations, concentrated first during the period of the Suez crisis and againduring the summer of 1957.

The net result of these movements on trade and capital account was asharp fall in the gold and foreign exchange reserves of a number of coun-tries, notably France, the United Kingdom, India, Japan, the Netherlands,and Belgium. In addition, heavy demands were made upon the resourcesof the International Monetary Fund, and further credits were obtainedthrough the European Payments Union. Part of these gold and exchangeresources were used in settlements with the United States. The net declinein the gold and dollar balances of foreign countries and of internationalinstitutions attributable to transactions with this country amounted to $900million during the year ended September 30, 1957. A substantial inflowof foreign private capital played a role in these movements; some of theseassets are potential sources of additions to foreign currency reserves.

Certain foreign countries, however, added significantly to their gold andforeign exchange holdings during that period. The increase amounted to$1,650 million in Western Germany. Other major increases were $800million in Venezuela and $300 million in Canada, influenced in both casesby large capital inflows, chiefly from the United States. Australia's goldand foreign exchange holdings, mainly in sterling, rose by about $500 million.

In several countries, notably the United Kingdom, the Netherlands, andJapan, exchange positions took a turn for the better before the end of 1957.Credit policy, operating externally on speculation and internally on invest-ments and inventories, was the major corrective measure. France, how-ever, responded to continued losses of exchange reserves by devaluing thefranc and tightening trade controls. Within the French economy, thepressure of demand remained strong and consumer prices rose further,whereas in most European countries retail prices increased much less thanin other recent years.

Western Germany's strong external position and some easing of domesticdemand permitted a reduction in its central bank discount rate while othercountries were raising theirs. Western Germany was also able to providesome direct relief to the international payments situation by prepaymentson long-term debts and by new loans.

Demand in the nonindustrial countries has continued strong, as shownby the further rise in the imports of this group of countries in the thirdquarter of 1957. Thus, United States exports of machinery to LatinAmerica in that period expanded further, although machinery exports toCanada and Western Europe declined. In a number of the less developedcountries, the increases in imports reflected, in part, inflationary internalconditions and resulted in continued difficulties in international payments.

The foreign exchange earnings of a number of countries heavily de-pendent on the export of primary products have been reduced as the resultof declines in prices of certain commodities—including minerals and metals

47

and some foodstuffs and fibres—as enlarged capacity and output encounteredsome slackening in export demand. The effective buying power of theprimary producing countries has been further impaired by the rise in pricespaid for imports of manufactured goods.

FUTURE PROBLEMS AND POLICIES

Although world production and trade are, for the time being, not risingat the rapid rate of recent years, the possibilities for further advance remaingreat. Potential demands abroad for consumer goods, for public facilities,and for other types of investments continue to be large. Most govern-ments today recognize a responsibility for pursuing policies to promote highlevels of economic activity. The industrially less developed countries areeager to push ahead with their economic development. Vigorous growthabroad will help fulfill universal aspirations for economic betterment andcan result in a rising level of demand for United States goods and services.

The actual course of foreign economic developments will be influenced insignificant measure by developments in our own economy and in our foreignand domestic policies. Whether potential external demands for our goodsand services materialize will depend primarily upon foreign opportunitiesto earn dollars through exports to the United States or to obtain loans andinvestments. These opportunities have expanded swiftly ever since the endof the war, with only minor interruptions, and have played an essential rolein world economic growth. If the outflow of dollar payments should cease togrow or should contract, the continuation of economic expansion abroadwould become more difficult to achieve and measures aimed at restrictingpurchases from the United States might result, because of lack of dollars topay for them. A continued rise in the outflow of dollar payments, on theother hand, would make for a mutually reinforcing economic expansion hereand abroad.

The economic policies of the United States, both domestic and foreign,have an important bearing on these prospects. In the field of domesticeconomic policy, growth and stability are important objectives not onlyfor this country's welfare but also for their effects on foreign countriesthrough our imports and in other ways. In the field of foreign economicpolicy, our aims are expressed in programs of economic and technical assist-ance for promoting economic development abroad and in efforts to extendthe liberalization of trade.

In all of this, we stand to benefit not only by the rise in foreign demandfor our exports but also by the increase in foreign capacity to meet our importneeds. The contribution made by imports to our welfare includes thesatisfaction of certain essential requirements and a widening of the varietyof goods available to our consumers and producers. These results are tothe good of the Nation. It would be a grave loss to impede our access toneeded imports or to isolate ourselves from the specializations and skills ofother countries.

Chapter 4

Economic Opportunities and Challenges Ahead

A S WE ATTEMPT to evaluate the current economic situation and the•̂ ^ outlook for the year ahead, we must be alert to the limitations of ourinformation concerning many factors that will influence the outcome and,above all, to the uncertainties that attend any effort to chart beforehandthe course that our free economy will take. However, it seems likely that,in the current year, changes in spending by business concerns on new facili-ties and equipment and by Government on defense procurement will signifi-cantly influence the magnitude and duration of the movement of inventoriesand, in conjunction with inventory changes, the course of over-all economicactivity. Accordingly, attention may usefully be directed first to these im-portant components of the demand for goods and services.

APPRAISAL OF THE CURRENT ECONOMIC SITUATION

Although an extension into 1958 of the decline in business expenditureson plant and equipment is suggested by data on new orders and contracts,and by information on businessmen's investment intentions, the magnitudeof the decline and its duration are uncertain. Decisions regarding these ex-penditures are influenced by a variety of conditions that affect particularindustries and firms and are subject to rapid change. The outcome will beespecially affected by sales experience and expectations. A decline in invest-ment spending seldom lasts only a few months; however, in some industriesreductions began as early as 1956, and in many others they have been inprogress during much of 1957. Also, certain conditions that tend to limitthe decline may be noted. Pressures to reduce costs and to improve productscontinue and in some respects have been intensified. Research anddevelopment activities, which are cumulative in their results, continue ata high level and are certain to yield many practical suggestions for under-takings the financial feasibility of which will be enhanced by the greateravailability and lower cost of capital and credit.

For other categories of investment expenditures, many evidences ofstrength are apparent. There are signs that the rise in residential con-struction outlays will continue, possibly at a faster pace. Well-maintainedpersonal incomes, greater availability of mortgage credit, and recent movesto reduce the cash investment required for home purchase will help achievethis result. Expenditures for the construction of various types of privateinstitutional buildings have been rising for several years. Growing needs for

49

such facilities and the improvement in financing conditions reinforce theevidence provided by contract awards that outlays on this type of constructionshould continue to rise moderately.

Foreign demand, on the other hand, is likely to exert a moderately con-tractive influence on economic activity for the time being. The reasonsfor this are discussed in Chapter 3. They include the passing of the specialcircumstances which accounted for part of the sharp increase in UnitedStates exports in 1956 and early 1957, some slowing down in economicexpansion abroad, and pressure on the foreign exchange positions of certainnations abroad. While a reduction in some categories of United Statesimport demand is also evident, exports seem likely to decline relative toimports. This development, in conjunction with other international eco-nomic transactions, would involve a further, though probably modest, re-duction in net foreign investment and hence in the stimulus provided toproduction and employment from this quarter.

In view of the necessary acceleration of certain defense programs, and thesteps already taken to give effect to this change, national security expendi-tures may be expected to increase during the year ahead. Insofar as busi-ness activity is affected by the award of procurement contracts, which arebeing placed at an increased rate, it may rise earlier and more stronglythan the prospective increase in national security expenditures.

The growing need for public services, and particularly the furtherincrease of highway construction, point to a continued high rate of increasein the expenditures of State and local governments. The outlook for moreample and lower-cost financing strengthens this expectation.

The uncertainties associated with estimating the movement of each ofthese major elements of demand remain, of course, when an attempt is madeto strike a balance for them taken together. Though the decline in businessoutlays on new plant and equipment may outweigh the combined rise inother types of investment expenditures, this is likely to be offset by thenecessarily larger outlays on certain defense procurement items and by therising expenditures of State and local governments. And the rate of inven-tory reduction may not be substantially greater than it has been so far,if the balance between government expenditures and business capital out-lays is favorable and if personal incomes and consumption expendituresare well maintained, as seems likely.

These considerations suggest that the decline in business activity neednot be prolonged, and that economic growth can be resumed withoutextended interruption. The policies of Government will be directed towardhelping to assure, this result.

T H E LONGER PERSPECTIVE

At a time like the present, when the economy is adjusting to the largeincreases in productive capacity created in the past few years, it is well toseek a longer perspective on our economic prospects and to consider some

50

of the sources of strength for the years ahead. There are good grounds forconfidence not only that economic growth can be resumed without pro-longed delay, but also that a vigorous expansion of our economy can besustained over the years. Our domestic market for goods and serviceshas about doubled every quarter of a century. There is every reason tobelieve that we shall do at least as well in the next 25 years.

The vigorous postwar growth of population is a basic and powerful forcemaking for expansion in the American economy. Our numbers are in-creasing by some 3 million a year, and there is no reason to doubt a stronguptrend in the next quarter century. In our economy, an increase in popu-lation continues to mean new and enlarged markets for output. Over thelast two decades, per capita consumption has increased by more than 50percent, in spite of changes in the age composition of the population whichhave tended to lower basic needs per capita for consumer goods. Afterthis year or the next, the number in the group aged 13 to 19, whose needsand wants are much greater than those of young children, will increasesubstantially for a decade or more.

The growth and changed age distribution of our population will requiregreatly expanded private facilities for the production, transportation, anddistribution of goods and for services of many kinds, including education.The capital assets normally provided by Government must at least keeppace, and the expansion of some types of public assets will have to beat a faster rate to reduce backlogs and to supply services that will be requiredin especially increased amounts. The clearly indicated need for enlarge-ment of the capacity of our public schools, colleges, and universitiesis a case in point. Large and growing sums will be spent by State and localgovernments to provide needed educational and other facilities and services.Large public and private outlays will also be required to develop and con-serve our water, land, forest, mineral, and energy resources. Major under-takings have been launched in many cities, with Federal aid, looking to therenewal of urban areas, and many more are in the planning stages. Stateand local outlays have been rising at the rate of $3 billion a year, and some-thing like this rate of increase must continue, to keep pace with growingrequirements.

Many activities of the Federal Government exert a growth-promotinginfluence. Grants to States for extending and modernizing our roads andhighways will reach $1.8 billion in the current fiscal year and $2.4 billion inthe next fiscal period. The program for providing the navigational aidsnecessary to jet air travel and otherwise modernizing our airways will growin magnitude over the next several years. Major improvements will becalled for in the great variety of physical facilities utilized by the FederalGovernment. Like the vast improvements in public assets being under-taken by State and local governments, these Federal programs are designedto keep pace with expanding public needs and to facilitate the long-termexpansion of our private economy. These additions to the Nation's assets

will have an economic effect many times their direct cost through the newopportunities for profitable private investment which they will inevitablyopen up.

A further element of strength consists in the increase of knowledge andthe improvement of technology which are being steadily fostered by a hugeexpansion of our educational system and of research and development.Billions of dollars are being spent each year by private industry and institu-tions on scientific and technical research, and additional billions by theFederal Government. These efforts, including many federally supportedprojects related to national defense, will lead to new products for civilianuse and improved methods of production. Indeed, a large proportion ofour output in 1957 consisted of products not in use a decade or so ago. Thereis every reason to expect continuation of these trends in the years ahead.

It can be safely anticipated that the momentum of economic development,which has been a notable feature of recent years in most of the advancedcountries of the world and in several of the less advanced, will be resumedas readjustments now in progress are completed. The extent of inter-national economic cooperation among the free nations of the world exceedsanything heretofore experienced, and recent steps toward greater economicintegration in Western Europe hold out high promise, Almost everywhere,horizons have been extended and greatly enlarged economic potentials arerecognized. In this perspective, the temporary strains now being felt insome countries and the more basic problems of others can be faced withmore assurance.

Important developments in recent years have significantly improved theoutlook for greater stability in our economy. Among these are the sub-stantial progress of market and economic research by American busi-nesses, and the more orderly and longer-range planning which they nowundertake for the expansion and improvement of their productive facilities.Businesses can usefully intensify these activities. In large part because ofthem, it is less likely now than in earlier years that unsound projects will belaunched in a boom psychology, or that projects needed for the long pullwill be discontinued in a period of readjustment.

The stability of our economy is also enhanced by public and private ar-rangements, greatly extended in recent years, that help maintain incomesin an economic downturn. The Federal-State unemployment compensa-tion system is functioning with enlarged coverage and somewhat liberalizedbenefits. The broadened coverage of old age, survivors, and disability in-surance and the increasing volume of payments sustain the purchasing powerof many millions of consumers. Benefits are also paid in an increasingvolume to many millions of persons under private pension and welfare pro-grams. Under our tax system, income tax liabilities vary directly with in-dividual and corporate income, so that incomes change less after tax thanbefore tax. Such stabilizers cushion the impact of an economic decline andimprove the basis for early resumption of growth.

The strength of our financial institutions provides a basis for confidenceboth in immediate economic prospects and in the outlook for economicgrowth over the longer run. Speculative excesses have been notably rarein our recent experience. Though consumer debt is higher than ever before,it is not dangerously burdensome in a growing economy. The preva-lence of regularly scheduled debt repayment, both on long-term mortgage in-debtedness and on shorter-term obligations, reduces the risk of defaults. Afar greater proportion than ever before of the assets of financial institutionsis protected by governmental insurance or guaranty; and the guaranty ofliabilities to depositors covers virtually all of our banks.

Assured of these continuing sources of economic and financial strength andstability, business concerns and consumers can make plans which will enablethe Nation to move forward to new economic achievements.

The latest challenge of international communism will require a furtherincrease in the economic claims of national security, which are already heavy.If we follow suitable private and public policies, this challenge can be metwithout distorting our economy., or destroying the freedoms that we cherish.Whatever our national security requires, our economy can provide and wecan afford to pay.

T H E CHALLENGE TO ECONOMIC POLICIES

Although a realistic appraisal of the present economic outlook warrantsconfidence, it also requires that we recognize an unfavorable feature of therecent performance of our economy. In 1957, the money value of grossnational output rose by almost 5 percent, but in physical terms the increasewas only about 1 percent. There was a good expansion in demand but,despite the existence of unused capacity in several important lines of indus-try, it was accompanied by an increase in prices and only a small increase inoutput. At the same time, the margin between business costs and pricesnarrowed, business profits were reduced, and at the end of the year produc-tion and employment were declining.

There is no simple explanation of recent economic developments and noeasy solution to the problem of maintaining high employment, vigorouseconomic growth, and reasonably stable prices. But it is clear that the com-bination of policies and practices followed in the recent past by the variousparticipants in our economic life has given results that in certain importantrespects are unfavorable.

There are critical questions here for the leadership of business and labor,as well as for Government. Business concerns must re-examine their policiesand practices. Price increases that are unwarranted by costs or that attemptto recapture investment outlays too quickly not only lower the purchasingpower of the dollar but may be self-defeating by causing a restriction of mar-kets, lower output, under-utilization of capacity, and a narrowing of thereturn on capital investment. The leadership of labor must recognize that

53

wage increases that go beyond prospective productivity gains are incon-sistent with a stable price level. The problem of inflation can only beaggravated by wage increases that are demanded and obtained on theassumption that living costs are going to rise; and the resumption of eco-nomic growth can only be slowed by wage demands that imply either anincrease in prices or a further narrowing of the margin between prices andcosts. Government's role is to follow policies that will help keep our econ-omy stable and promote sound economic growth with reasonably stableprices.

The resumption and maintenance of economic growth which can beachieved through suitable private and public policies assure expandingeconomic strength with which to meet the Nation's needs, accomplishedthrough an enterprise system that preserves individual freedoms. How-ever, if this opportunity is to be fully realized, economic growth must takethe form of increases in real output, accompanied by a stable price level.This can be achieved if weight is given to long-run as well as short-runconsiderations in policies and practices that affect our economic welfare.It can be guaranteed by a public opinion that is alert to the consequences ofwrong policies and insists on those that will yield real economic growthwithout inflation.

54

Chapter 5

A Legislative Program To Help AchieveNational Economic Goals

THE LEGISLATIVE PROGRAM for the coming year, which is pre-sented here, is designed to help discharge the responsibilities of the

Federal Government under the Employment Act of 1946. It takes accountof present and foreseeable economic conditions and seeks to reach an ap-propriate balance among our national economic goals. The proposed meas-ures would strengthen the foundations on which sustainable economicgrowth and national security are based, help moderate fluctuations in oureconomy, aid in countering a resurgence of inflationary pressures, and assistin the sound development of the free world economy.

First, the program recognizes the economic impact of the fiscal policies ofGovernment. It takes particular note of the far-reaching effects of theactivities under which the Federal Government makes loans directly toindividuals, business concerns, local governments, and other groups, or in-sures or guarantees loans made to them by private lenders. Second, itproposes steps to improve our store of technical knowledge and productiveskills, the better to meet the problems of our time. Third, it suggests meas-ures to enhance the competitive character of our system of private enter-prise, with emphasis on strengthening the economic position of small businessconcerns. Fourth, it suggests ways of giving to individuals greater protectionagainst economic hardships, of promoting integrity in labor-managementrelationships, and of improving industrial relations. Fifth, it proposes theextension of certain agricultural laws and the revision of others, to facilitatelong-needed adjustments. Sixth, it proposes means for widening andstrengthening our economic ties with other nations. And, finally, it suggestsmeasures for improving the economic information needed by private andpublic groups to follow and analyze economic developments and to providea sounder basis for policy decisions.

GOVERNMENT FINANCES

The Federal Government's fiscal operations are of such size and char-acter that the policies followed in these matters cannot fail to exert apowerful influence on economic conditions. Fiscal policies can con-tribute significantly to the attainment of national economic objectivesor can impede their accomplishment. It is crucial, therefore, that they

55

be attuned to the times and so designed as to promote the long-run aswell as the immediate economic welfare of the Nation.

The budget provides an integrated view of the planned fiscal operationsof Government. It also provides a basis for considering the impact of fiscaloperations on the economy. In determining budget policy, four objectivesare uppermost: to make adequate provision for needed services; to providethese services efficiently; to promote suitable relationships among Federal,State, and local governments; and to make the maximum contribution toeconomic growth and stability.

Because the provision of services by Government requires that income beclaimed that would otherwise be used privately, the first of these objectivesmeans, in a broad sense, that the amount of income which is taken in taxes,the sources from which taxes are drawn, and the way tax receipts are spentshould be such as to maximize Government's contribution to nationalwelfare. Constant vigilance is needed to get the work of Government doneat the lowest cost consistent with the desired level of performance, which isthe essence of the second stated objective, but vigilance is needed also toassure that the income which Government takes in taxes makes a greatercontribution to well-being when spent publicly than it would if usedprivately. Efficiency in this broad economic and social sense requires wisejudgment in selecting the activities on which the revenues of Governmentare to be spent and in allocating the burden of taxation.

The third objective—a suitable relationship among the various levelsof Government—has been affected by the increasing scope and complex-ity of our economic life, a desire to conduct various programs on a uni-form basis, a succession of national emergencies, and the existence of ahighly productive Federal revenue system. These circumstances havetended to direct more functions to the Federal Government, with theconsequence that a continuing re-evaluation of the distribution of gov-ernmental functions and of the revenues for financing them is necessary.

During the past year, a Committee of ten Governors and seven Federal offi-cials, including three Cabinet members, has been developing recommenda-tions and plans under which certain functions now performed at the Federallevel may be undertaken by the States, with an appropriate transfer of rev-enue sources presently used by the Federal Government. The first results ofthis constructive work are described in Progress Report No. 1 of the JointFederal-State Action Committee, issued December 5, 1957. Where neces-sary, legislative proposals to carry out these recommendations will be trans-mitted to the Congress.

The continuing work of the Committee is expected to yield additionalsuggestions. Its efforts will also help establish clearer definitions of respon-sibility for emerging problems.

The balance between Federal budget expenditures and receipts in thecalendar year 1957 was broadly favorable to the attainment of the fourthgoal of fiscal policy, namely, to help create conditions conducive to economic

56

growth and stability. Although Federal expenditures were somewhathigher than in the preceding year, some surplus of receipts over outlays helpedmoderate inflationary pressures.

The need to accelerate important portions of our defense program re-quires that the Congress make certain supplemental appropriations early inthe calendar year 1958 and authorize the Executive Branch to make certaintransfers of funds under existing appropriations. The acceleration of ourdefense program, which these steps will facilitate, will result in some increaseof Federal outlays in the fiscal year 1958. And readjustments currentlytaking place in the economy suggest that receipts will be somewhat lowerthan was estimated earlier. Present indications point, therefore, to a smallexcess of outlays over receipts for the fiscal year as a whole.

Budget estimates reflect the interaction between economic developmentsand the Federal Government's receipts. With the anticipated resumptionof economic growth, receipts in the fiscal year 1959 are expected to beenough higher than in fiscal 1958 to provide a small surplus over the some-what increased level of projected expenditures. The prospective surplus isa narrow one, however, and insufficient to permit the reductions in the cor-porate income tax rate and in the excise taxes on automobiles and parts,cigarettes, distilled spirits, wines, and beer scheduled to take effect on July 1,1958. It is recommended, therefore, that these tax rates be extended bylegislative action for an additional year.

The statutory limit on the public debt returned to $275 billion at thebeginning of the fiscal year 1958. At that time, the debt subject to thisrestriction was slightly over $270 billion. The usual excess of cash paymentsover receipts in the first half of the fiscal year resulted in an increase in thepublic debt outstanding, and at the end of December the debt subject tolimit was less than one-half billion dollars under the ceiling.

It has been possible to conduct the Federal Government's fiscal operationswithin this statutory restriction only by the most careful economy and bydrawing down Treasury cash balances to uncomfortably low levels. Thisextremely narrow margin has imposed serious problems of fiscal administra-tion on the Federal Government, not the least of which is the lack of flexibil-ity needed for efficient management of the public debt. Financial demandsupon the Treasury will be severe also during the second half of the calendaryear 1958. The higher rate of expenditures dictated by our national securityrequirements, the seasonal pattern of Treasury receipts, and the need forgreater operating flexibility requires a less restrictive debt limit. Legislationproviding an appropriate temporary increase will be requested of theCongress.

FEDERAL CREDIT PROGRAMS

Increasing attention has been directed recently to the numerous programsunder which the Federal Government lends money directly to individuals,local governments, business concerns, and other groups, or underwrites,either by insurance or by guarantee, credit extended to them by private

57

lenders. These Federal programs fall into four broad categories: programsunder which direct loans and loan insurance are provided for housing; directloan and loan insurance programs for farm people; programs of financialaid for business concerns; and programs under which loans are extended toforeign firms or governments and international agencies. Some programswere designed originally to fill gaps in private credit markets; others werecreated to achieve certain social objectives; and still others were designedto meet specific defense needs or to support the foreign policy of the UnitedStates.

All of these programs involve the credit of the Federal Government inone way or another. They also tend to swell Government expenditures,though they are by no means fully reflected in Federal budget totals. In-sured and guaranteed loans do not appear in budget expenditures at all,except for the relatively minor administrative costs and the losses whichhave been associated with them; and, in most cases, direct loan programsresult in net expenditures only to the extent that disbursements under newcredits exceed repayments of loans previously made and by the amount ofthe administrative costs involved. But whether reflected in the budget ornot, Federal credit programs, both individually and in the aggregate, havea significant and widely diffused impact on the economy. They influencethe volume of credit extended, the uses for which it is available, and theinterest rate and other terms on which it can be obtained. It is important,therefore, that the programs be administered in such a way that the burdenwhich they place on the Federal budget is minimized, consistent with pro-gram objectives; that they supplement, rather than compete with, privatecredit agencies; and that they make their maximum contribution to thestability of the economy and to its capacity for sustainable growth.

Federal credit programs could fulfill their statutory objectives and pro-mote the stability and growth of the economy more effectively if the headsof the various agencies had wider discretionary authority to set the termson which funds are available to qualified borrowers under Federal insuranceor guarantee of private loans. Congress should give favorable considerationto legislation that will accomplish this result. Existing statutory limitationsare sometimes so restrictive as virtually to nullify program objectives. Aprime example is the VA Home Loan Guaranty Program. Because of thecurrently uneconomic level of its statutory maximum interest rate, this pro-gram has been drastically curtailed before its scheduled expiration date, sofar as new guaranty commitments are concerned. Home mortgage loansare not currently available from private sources at the statutory maximumof 4J/2 percent, in view of the higher yields that can be earned on other in-vestments of comparable quality. Other programs that have been seriouslyretarded in obtaining necessary financing from private investors include thearmed services housing, rental housing, and management-type cooperative

housing loans insured by the Federal Housing Administration. The Na-tional Housing Act should be amended to adjust the interest rate limitationsin Sections 207, 213 and 803, which have become impediments to the in-tended operation of these programs.

Wider discretionary authority would make it possible to administer pro-grams so as to encourage the use of private funds under loan insurance orguaranty arrangements, rather than to employ direct public funds. Thiswould substantially reduce the burden of credit programs on the Federalbudget and eliminate a type of subsidized public competition with privatefinancial facilities. Also, the use of Federal insurance or guaranty pro-grams, rather than those under which loans are extended directly, should beencouraged by the Congress through legislation making it explicit thatFederal credit is available directly only when financing cannot be securedfrom private sources at reasonable rates.

Proposals will be made for the adjustment of the statutory maximuminterest rates on certain direct loan programs. These adjustments areneeded to reduce the burden which the programs involved place on thebudget and to bring the charges available to qualified borrowers under theprograms into reasonable alignment with rates that must be paid in privatemarkets.

Much can be done to harmonize the policies of Federal credit programswith the general economic and credit policies of Government through ex-changes of views among Federal credit agencies and other divisions of theExecutive Branch. The Advisory Board on Economic Growth and Stabilityprovides the nucleus of a group to facilitate interagency consultation onprogram policies and practices.

A number of specific proposals relating to housing and home financingshould be enacted by the Congress. These proposals would increase theavailability of funds to prospective home owners and would facilitate theconstruction of dwelling units both for sale and for rent. Thus, they wouldincrease the effectiveness of Governmental programs in improving theNation's housing resources.

The requirement that charges, fees, and discounts on federally insured orguaranteed home loans must be regulated by Government has proved to bea serious impediment to the free flow of funds into mortgage loan invest-ments. This provision of the Housing Act of 1957 has served in practiceto handicap the families it was designed to protect. It should be repealed.

The Congress should also eliminate the requirement that mortgagesacquired by the Federal National Mortgage Association (FNMA) under itsspecial assistance programs be purchased at par. This requirement, coupledwith statutory maximum interest rates on insured and guaranteed loans thatare lower than market rates on comparable investments, has forced FNMAto buy mortgages at unreasonably low yields and in amounts larger thanwould otherwise be necessary, with a corresponding burden on the Federal

59

budget. The par purchase requirement tends strongly to discourage pri-vate financing at present interest rates.

In view of the increased costs of homes, a proposal will be made to in-crease to $30,000 the maximum size of loan that may be insured by the Fed-eral Housing Administration (FHA) under Sections 203 and 220 of theNational Housing Act. Favorable action on this proposal will make thealready very useful FHA program even more effective in promoting widerhome ownership and improved housing.

The increasing scale of activities of FHA in the home mortgage insuranceprograms will require a higher statutory limit on the amount of outstandinginsured loans. This action should be taken well in advance of the exhaus-tion of FHA's insuring authority in order to assure the continuity of thisimportant aid to home financing.

Finally, recommendations will be made to realign Federal, State, and localrelations in the Urban Renewal Program in the light of experience gainedduring recent years.

SCIENCE AND EDUCATION

The security and well-being of our people depend upon timely and ade-quate investment not only in physical structures, equipment, and weapons,but also in knowledge and skills. Indeed, without satisfactory provision forthe intangible capital accumulated through research and education, itwould be impossible to design, to construct, or to use effectively the imple-ments essential to our survival and progress.

Most of the scientific and educational needs of our dynamic economy aremet routinely. However, new and stern challenges to the security ofthe free world, both immediate and long-run, call for greater efforts tostrengthen the technical base of our military preparedness and to improvethe quality of our school system. If we allow a gap to develop andpersist in favor of the communist bloc, our influence in the struggle forpeace may be seriously diminished. Our economy must be able to meetthreats that are subtle and emerging, as well as those that are obvious andimminent. There is no cause for complacency in the fact that a rival power,making impressive contributions to science and technology, at the same timedenies its people the common freedoms, adequate housing, and other basicamenities of life. On the contrary, the ability of a dictatorial regime con-sistently to subordinate the freedom and welfare of its population to the pur-suit of military might and foreign economic penetration is a circumstancethat requires vigilant attention.

Impatience to meet the Soviet challenge in its new dimensions of scienceand education should not blind us to the true nature of the threat or induceus to take inappropriate countermeasures. Our aim is to assure the con-tinuing superiority of the free world's military and economic defenses, andto retain the confidence of uncommitted peoples. This aim can beachieved, not by distorting the Nation's scientific programs and educationalsystem, but by promoting their rapid growth and improvement in needed

6o

directions, without sacrificing either the balance necessary for the roundedlife in a free society or the capacity to meet new contingencies that mayarise.

Above all, it would be unwise and unrealistic to assume that the expand-ing Soviet challenge can be successfully met merely by enlarging Federalappropriations. Some additional funds are needed and are being requested.But it will be even more necessary to enlist the interest and to marshal theenergies of individuals and private groups throughout the Nation. In a freesociety, an enlightened public attitude toward science and learning is essen-tial if the quality and capacity of schools, colleges, and universities are tobe improved. Broad remedial action must be taken by citizens, communityorganizations, schools, foundations, business firms, labor groups, professionalsocieties, the press, and State and local governments.

Two Committees appointed by the President have been at work sinceApril 1956 on problems of technical manpower and higher education. Theirreports deserve the widest possible study.

One report, issued by the President's Committee on Scientists and Engi-neers in October 1957, emphasizes contributions that can be made by com-munity and other essentially non-Federal programs. It indicates how thepresent corps of scientists and engineers may be utilized more effectivelyand how young people may be encouraged to prepare for scientific andengineering careers. It notes the importance of providing adequate techni-cal and clerical assistance to professional workers, raising the quality of edu-cation in science and mathematics, and encouraging talented students tocontinue their studies. It also proposes measures for elevating the economicstatus of teachers, upgrading teacher qualifications, revising school curricula,providing better guidance and counseling services, improving college facili-ties, enlarging the contributions of junior colleges and intermediate technicalinstitutes, and stimulating public interest in education.

The other report, issued by the President's Committee on EducationBeyond the High School in July 1957, makes similar recommendations andcertain additional ones. It stresses the need for making teaching careersmore attractive, proposes assistance to capable students through scholar-ships and counseling, points to the importance of planning for the expan-sion and diversification of educational facilities at the college level, sug-gests modes of financing higher education, and sketches a role it deemsappropriate for the Federal Government in the achievement of theseobjectives.

Science and education already receive considerable support from theFederal Government. Huge sums are devoted annually to research anddevelopment undertakings in many fields, including national defense, atomicenergy, health, agriculture, and mineral resources. These funds, allocatedto basic as well as applied research, benefit thousands of business firms,private and public institutions of higher learning, and other non-Federalorganizations. As conventionally reckoned, they amounted to $3 bil-

6i

lion in the fiscal year 1957 and will exceed this total by a substantialamount in the current fiscal year. Moreover, when fuller account is takenof certain research-connected military expenditures, these sums are morethan doubled. Thus, the funds programmed by the Department of Defensefor the fiscal year 1958 for research and development, according to the usualdefinition, amounted to $1.8 billion; but this figure is raised to well over$5 billion when the definition is broadened to include supplementary items.

Federal encouragement of basic or general-purpose research is exemplifiedby the activities of the National Science Foundation, for which substantiallyenlarged appropriations are being requested for the fiscal year 1959. Thisagency makes grants to universities and other institutions for the conduct offundamental investigations in mathematical, physical, medical, biological,engineering, and other sciences. It aids the training of scientific manpowerthrough graduate fellowships and science-teacher institutes. It also financesexperimentation to improve science teaching.

The Federal Government assists science and education in many otherways. It sponsors numerous activities to help establish a civilian atomicenergy industry on a commercial basis. It trains groups to man privatedomestic projects and to aid the nuclear programs of friendly nations. TheDefense Department conducts education and training programs that raisethe technical qualifications of in-service personnel. Like research contracts,military procurement contracts make a large contribution toward raisingthe level of skills in the civilian labor force and increasing their variety.

In recent years, the Administration has sought legislation to help State andlocal agencies construct elementary and high schools. Although its pro-posals were not enacted, the effort underscored the national interest inproviding an increasing number of classrooms. First reports for the 1956-57school year indicate that the rate of construction of school buildings con-tinued at a high level, and that the classroom shortage was reduced. Itis not too early for our people to begin thinking of ways to accommodatethe large numbers of students who will be entering the colleges and uni-versities in the next few years.

Several legislative steps are needed to help improve the Nation's resourcesof knowledge and skills. The Congress is being asked to authorize fundsthat would be made available on a temporary basis to the States for theimprovement of instruction in science and mathematics, for the identifica-tion and encouragement of able high school students through testing andimproved counseling and guidance services, and for college scholarships.Other provisions of this temporary program include the strengthening ofState departments of education in the fields of science and mathematics,broader support of graduate education, improvement and expansion of theteaching of foreign languages in colleges and universities, and improvementof State statistics on education.

The Congress is requested, as in last year's Economic Report, to authorizea temporary assistance program for the expansion and modernization of

62

medical and dental teaching facilities. These would complement theresearch facilities for which legislative provision has already been made.In the health field, it is not practicable to separate training from research.

SMALL BUSINESS AND THE COMPETITIVE SYSTEM

The variety of ways in which the Federal Government assists small busi-ness concerns is described in a report, "Federal Policies and Programs thatBenefit Small Business," published on September 23, 1957. This reportwas prepared by the Cabinet Committee on Small Business, established bythe President in 1956. The Committee's task is to follow the fortunes ofsmall business concerns and to recommend legislative and administrativeactions that would aid them.

In its First Progress Report, dated August 7, 1956, the Committee maderecommendations in respect of taxation, financing, competition, procure-ment, technical assistance, and Government reports. These recommenda-tions were described in last year's Economic Report. Those that couldbe given effect by the Executive Branch within the framework of presentlaw—such as the elimination of certain administrative impediments toGovernment procurement from small business concerns—have been actedupon. Other proposals require changes in the law. Such changes wereenumerated and recommended by the President in a letter to the Chairmanof the Committee on Ways and Means of the House of Representatives, datedJuly 15, 1957. In the field of taxation, it was recommended that Congressextend accelerated depreciation formulas to purchases of used property up to$50,000 in any one year; grant closely held corporations the option to electthe tax status of partnerships; grant taxpayers the option of paying estatetaxes over periods of up to 10 years where an estate consists largely of invest-ments in closely held businesses; and allow an ordinary loss deduction, up tosome maximum amount, instead of a capital loss deduction, on originalinvestments in the stock of small companies. A broad reduction of the taxburden carried by small concerns, whether incorporated or not, cannot beachieved until budgetary conditions warrant cutting taxes generally. Al-though such a cut cannot be proposed at present, the changes in our taxlaws outlined above promise to remedy, with a minimum loss of revenue tothe Government, important specific handicaps under which small businessfirms now operate, and the Congress is requested to act favorably on them.

The difficulties which small business concerns face in obtaining adequatefinancing on satisfactory terms would be lessened by favorable Congressionalconsideration of the proposal to increase, from $300,000 to $500,000, themaximum amount of a corporate security issue that is exempt from the fullregistration requirements of the Securities and Exchange Commission. Be-cause of the Commission's power to limit or condition by appropriate rulesthe privileges of Regulation A filings, which would be extended by this pro-posal, this change could benefit small concerns without weakening theprotections for the investor which our securities laws are designed to provideand which must continue unimpaired.

63

Legislation should be enacted to remove the limitation on the life of theSmall Business Administration (SBA) and to increase suitably its authori-zation for making business loans and disaster loans. Business loans ap-proved by the SBA totaled about $160 million in the fiscal year 1957. Inaddition, SBA helps small concerns obtain procurement awards, and it offersimportant management counseling services. This work can be done mosteffectively by an agency having assured continuity of functions.

The Board of Governors of the Federal Reserve System is currently en-gaged in a study which should help assess the adequacy of existing privatefacilities for financing small business.

A further means by which Government can promote the proper interestsof small business concerns, and of the community in general, is by eliminatingbarriers to open and fair competition. This requires vigorous enforcementof the antitrust laws. Certain improvements in these laws should be made.

The recommendation has been made in previous Economic Reports thatnotice to the antitrust agencies should be required when businesses of sig-nificant size that are engaged in interstate commerce propose to merge.Such a law would facilitate antitrust enforcement by providing an automaticnotification to the responsible agencies of merger plans.

Other measures also are needed to strengthen the administration andenforcement of the antitrust laws and to foster a competitive environment:Federal regulation should be extended to bank mergers accomplishedthrough the acquisition of assets; in antitrust cases, the Attorney Generalshould be empowered to issue civil investigative demands for the productionof necessary documents without the need of grand jury proceedings; cease -and-desist orders issued by the Federal Trade Commission for violations ofthe Clayton Act should be macie final unless appealed to the courts; andthe Federal Trade Commission should be authorized, in merger cases whereit believes violation is likely, to seek a preliminary injunction.

Proposals for certain changes in our laws regarding labor-managementrelations are made in a later section of this chapter. These proposals wouldtend to eliminate practices that are inimical not only to the proper interestsof the community generally, but also to the long-run interests of employees.Favorable action on these proposals by the Congress would yield significantbenefits to small business concerns.

PERSONAL WELFARE

The primary means by which Government can help improve the welfareand security of the family and the individual is by following policies thatfoster stable economic growth. General prosperity has made it easier inrecent years for our people to acquire homes and other property, and toprotect themselves against the hazards of life through savings and insurance.

The capacity of the economy to provide opportunities for steady employ-ment at good wages is promoted by Federal programs that strengthen labor

standards and help maintain the incomes of older people, of families bereftof breadwinners, and of persons experiencing unemployment or other severepersonal misfortune. The improvement of these programs along lines setout in previous Economic Reports is desirable as a means of promotinggeneral economic stability as well as personal welfare.

The Federal-State programs of unemployment compensation provide amajor defense against- personal hardship and an important means for helpingsustain personal income, and thus consumption expenditures, during periodsof economic readjustment. As pointed out in an earlier section of thisReport, payments to individuals under unemployment insurance systems havehelped significantly to cushion the impact on total personal income of thedecline of wage and salary payments in the closing months of 1957.

The past four Economic Reports have recommended changes designedto strengthen unemployment insurance systems, and some progress has beenmade. More than 43 million people, or 83 percent of all nonagriculturalwage and salary workers, are now covered by unemployment compensation,compared with only 37 million in 1954. In many States, weekly benefitshave been increased and their duration extended; yet coverage, size of bene-fits, and duration still fall short of recommended standards. It is again sug-gested that the States increase maximum benefits so that the great majorityof the covered workers will be eligible for payments equal to at least halftheir regular earnings, and that States which have not already done solengthen the maximum term of benefits to 26 weeks for every person whoqualifies for any benefit and who remains unemployed that long.

Recommendations made in last year's Economic Report are already pend-ing before the Congress for legislation extending the coverage of unemploy-ment insurance to employees of firms employing under 4 workers and toemployees in Puerto Rico. This important means for sustaining personalincomes would be strengthened further if the States which have not yet doneso would provide coverage for approximately 5 million State and localgovernment employees who still lack protection under the system.

Unemployment insurance in the District of Columbia should measureup to the standards that are recommended for all States and have beenadopted in several. Enactment of legislation to this end is requested.

Workmen's compensation systems, which are mainly the responsibilityof the States, are a second means for safeguarding personal welfare. Oc-cupational accidents result in about 2 million injuries and deaths a year,bringing tragedy and hardship to individuals and families and needlesslyimpairing the Nation's manpower resources. Efforts to develop and en-force adequate safety standards and to encourage safe practices shouldbe intensified by State and local governments and by employers, and theStates, where necessary, should improve workmen's compensation sys-tems with respect to benefits, administration, and provision for rehabili-tation. A special responsibility of the Federal Government in this areaof personal welfare could be discharged more fully if legislation were

65

enacted enabling the Secretary of Labor to prescribe and enforce safetystandards for longshoremen. Enactment of such a law is recommended.

Temporary disabilities not related to the work of employees often re-sult in unusual expenses at the very time that income is cut off. FourStates have insurance programs to deal with this problem, and healthand welfare plans of employers have become increasingly numerous.Nevertheless, protection against this form of personal hardship is stillinadequate. It is hoped that the remaining State and Territorial juris-dictions will establish programs to provide nonoccupational temporarydisability insurance.

Another major safeguard of personal welfare is provided by the oldage, survivors, and disability insurance programs, which now cover morethan 90 percent of all employed persons in the Nation. The 1954 and 1956amendments to the Social Security Act extended coverage under theseprograms to about 840,000 additional persons, liberalized the provissionsgoverning the eligibility of older women for benefits, and provided bene-fits for totally and permanently disabled workers aged 50 or over. Thesechanges, coupled with the increase in the number of persons eligible forbenefits, account for the increase in payments to an annual rate of $7.2billion in 1957, from $5.5 billion in 1956. Benefits because of permanentdisability of persons 50 to 64 years of age are now being paid to 140,000persons at an annual rate of more than $120 million. More than 600,000women aged 62 to 64 are drawing benefits amounting to about $27 million amonth at recent rates.

Recommendations in last year's Economic Report are already pendingbefore the Congress for legislation extending the Fair Labor Standards Actto additional groups of workers needing its protection and to enact theprinciple of equal pay for equal work without discrimination on account ofsex. Favorable consideration by the Congress is requested for legislationto strengthen the Federal 8-hour laws for the benefit of workers subject toFederal wage standards on Federal and federally assisted construction andother public works.

Earlier Economic Reports recommended a Federal program to stimulatesound economic development in areas of persistent unemployment. Legis-lation previously recommended to provide an Area Assistance Administra-tion in the Department of Commerce, to extend loans, research grants, andtechnical assistance to such areas, should be enacted.

Labor-management relations and the trade unions through which work-ers bargain collectively with employers must be kept free of Governmentdomination. Nonetheless, Government has a responsibility to maintain aframework of laws to protect the basic rights of the individual, promoteintegrity in labor-management relationships, and make for better industrialrelations. In keeping with this responsibility, a program of legislation isbeing proposed to the Congress. This program will require, among otherthings, periodic public reports on private employee welfare and pension

66

funds, on financial dealings between employers and employee representa-tives and their agents, on general union finances, and on union organizationand structure. It also calls for modifications of the law governing secondaryboycotts and picketing, and provides that the States have jurisdiction inlabor-management disputes in which the National Labor Relations Boarddeclines to exercise authority.

AGRICULTURE

American agriculture is basically strong. The transformation in farm tech-nology has been raising output per man-hour more rapidly in agriculturethan in manufacturing. Family farms remain the dominant form of agri-cultural operation, and the proportion of farms that are owner-operated hasnever been higher. Although the average size of farm is rising, a key featureof modern technology is that it permits a larger enterprise to be successfullymanaged by a farm family. Electricity, the tractor, the automobile, and thetruck have helped to lighten the burden of farm work and to relieve theisolation of rural living. Recent declines in the number of farms have beenheaviest among those too small to provide an adequate level of living fromagriculture alone. Greater mobility, and the movement of industry into thecountryside, have widened the range of economic opportunities open to ruralpeople. Farm families have notably improved their levels of living duringthe last decade and a half, and this improvement continued even whenincome from farming alone was declining.

Many of the Federal programs undertaken on behalf of farm people havemade important contributions to this long-term progress. Gains in agri-cultural productivity owe much to research and extension services. TheRural Electrification Administration has played a major role in raising theproportion of farms having central station electricity service from 11 percentin 1935 to 95 percent today. A variety of credit facilities have been de-veloped for farm operators; farmers own more than half the capital of theFarm Credit System and participate extensively in its management. In 1957farm operators became eligible to receive benefits under old age, survivors,and disability insurance. The regulation of markets and dissemination ofcurrent market news serve the interests of producer and consumer alike.However, in three areas especially, farm programs are in need of recon-sideration: the disposal of accumulated surpluses, the operation of agri-cultural price supports, and direct measures of production adjustment.

The high cost of carrying commodity stocks, and the persistent tendencyfor current production to outrun commercial demands, continue to requireemphasis on programs for disposal of surplus stocks. During the past severalyears, an impressive volume of commodities has been successfully moved intoconsumption in this country and abroad. Although constructive ends havebeen incidentally served, surplus disposal on a large scale gives rise to seriousdangers. When disposal is made overseas, damage to other exportingcountries is an ever-present risk.

67

The Agricultural Trade Development and Assistance Act of 1954 hasfinanced a large volume of agricultural exports. It has also furthered ourforeign policy objectives. Title II of the Act has facilitated emergency foodassistance to foreign countries. Sales for foreign currencies under Title Iof the Act have contributed to mutual security and to economic developmentprograms in underdeveloped countries. Titles I and II should be extendedfor one year beyond the current expiration date of June 30, 1958, and thepresent limit on permissible expenses and losses of the Commodity CreditCorporation under Title I should be raised by $1.5 billion. Operations underthis temporary legislation require frequent review. Carry-overs of certaincommodities are already being reduced to levels that raise mandatory pricesupports through statutory escalator formulas even while supplies remainseriously out of balance with commercial requirements. Past and pros-pective shipments under various surplus disposal measures must not beallowed to stimulate the production of continuing surpluses.

Measures designed to direct our surpluses into domestic consumption out-side commercial channels have also been helpful. Distributions to schools,institutions, and needy persons, together with direct financial grants for theschool lunch and special milk programs, now amount to about $400 milliona year. The advantages of sustaining milk consumption among children ofschool age, especially in low-income communities, are of sufficient im-portance to warrant the extension of the special milk program beyond thepresent expiration date of June 30, 1958.

Government expenditures on agriculture and agricultural resources infiscal 1958 are estimated at about $5 billion—about one-quarter of the totalfor all purposes other than national security and interest on the publicdebt. The figure has doubled since 1954, largely because of mandatoryprice-support operations under existing legislation. Through June 30,1957, direct price support had been extended by the Commodity CreditCorporation on $3 billion worth of 1956 crops. This was 15 percent belowthe previous year's rate, but still involved one-half the rice produced, one-third of the upland cotton, and one-fourth of all wheat. In the past severalyears, and despite some reduction in support levels, new price-support ac-quisitions have been running about 20 percent as large as total farm market-ings of all price-supported commodities. Losses realized in disposing ofcommodities during the fiscal years 1955-57 totaled $4 billion, chiefly fromoperations in wheat, dairy products, cotton, and corn.

In a statement to the Chairman of the Senate Committee on Agricultureand Forestry on May 2, 1957, the Secretary of Agriculture made three keypoints: production controls have been ineffective in reducing over-all agri-cultural output; abundant agricultural products cannot successfully bepriced as if they were scarce; and present legal formulas governing pricesupports and acreage allotments are proving obsolete. In view of agricul-ture's advancing productivity and the importance of enlarging commercialmarkets, changes are required in the method of determining price supports

68

on basic crops and dairy products. The rigid escalator formulas governingprice supports at levels between 75 and 90 percent of parity, should be elimi-nated. Price supports for wheat, corn, cotton, rice, tobacco, peanuts, anddairy products should be determined administratively, within a range offrom 60 to 90 percent of parity, in accordance with guidelines alreadyestablished by law for almost all other agricultural commodities. It is alsorecommended that the National Wool Act be extended beyond March31,1959.

The achievement of statutory price objectives has been premised on appro-priate adjustments of output by growers. Yet there is little support, amongfarmers or in the Congress, for controls that would be severe enough toimplement current price objectives, except possibly for tobacco. Acreageallotments for corn have become largely inoperative and should be elimi-nated. Within the limits of general statutory principles, the Secretaryshould be given discretionary authority to increase allotments of other basiccrops now governed by legal formulas.

The Acreage Reserve Program has temporarily contributed to a reductionof output of certain crops, by voluntary means, without loss of net incometo growers but at a high cost to the Treasury. This Program should be per-mitted to expire at the end of the 1958 crop season. Longer-term contractsunder the Conservation Reserve Program promise to be more useful in pro-moting agricultural adjustments and the conservation of natural resources.If we are to avoid moving toward tighter restraints on production, it isimperative that the stimulus to current output should be less than that nowsupplied by various Government programs. At the same time that theConservation Reserve Program is strengthened, consideration should begiven to further consolidation of the Federal Government's widespread activ-ities in soil and water conservation.

The Commodity Credit Corporation Advisory Board should be enlarged;its members should require confirmation by the Senate; and its powers shouldextend to advising the Secretary of Agriculture in the exercise of the widerdiscretionary authority requested for determining both acreage allotmentsand price support levels, as well as related matters.

The Commission on Increased Industrial Use of Agricultural Products,appointed pursuant to Public Law 540 of the 84th Congress, made a numberof useful suggestions for widening the markets for existing farm productsand for developing new crops. While unrealizable hopes must be guardedagainst, more funds can usefully be diverted to research and promotion inthis area within the limits of present statutory authority and without thecreation of a new administrative agency in the Executive Branch.

The Federal Government assumes certain responsibilities in assistingfarm people who are hit hard by natural disaster and those who are handi-capped by chronically low incomes. Although drought in the Great Plainsis no longer a matter of immediate concern, important recommendationsconveyed in the Presidential Drought Message of March 5, 1957 should be

69

implemented at an early date. In particular, the distribution formulaunder Title I of the Bankhead-Jones Act should be revised so as to permitallocation of a larger amount of loan funds to areas in acute need; andStates should be required to contribute at least 25 percent of disaster-reliefcosts in certain emergency programs.

The Rural Development Program is a long-range program. It enlists pri-vate and public cooperation to raise levels of living in low-income rural areas.Among these efforts are improved vocational education, more effective em-ployment and public health services, and the encouragement of local indus-trialization as well as better farming. The soundness of this approach iswidely accepted and the results being attained warrant continued supportof this program by the Congres, but it requires no new legislation at thistime.

FOREIGN ECONOMIC POLICY

Now more than ever the United States must ensure that its foreign eco-nomic policy is soundly conceived in the interest of the Nation as a wholeand is adequate to the changing needs of the times. Gratifying gainshave already been achieved in the scope and freedom of international tradeand financial transactions. Important legislative steps remain to be takenin the field of foreign economic policy if we are to deal successfully with theproblems confronting us.

The keystone of our foreign trade policy is the Trade Agreements Act,shortly up for renewal. Under that Act, as extended from time to timeby the Congress, trade barriers against United States goods have been reducedon a wide front. The most important results are embodied in the GeneralAgreement on Tariffs and Trade, to which 37 countries accounting formore than 80 percent of world trade are now signatories. Through theGeneral Agreement we have secured conditions conducive to the increase ofour exports. We have succeeded not only in reducing tariffs against ourgoods but also, owing in large part to the multilateral obligations provided bythe General Agreement, in greatly reducing the quantitative controls abroadwhich were so prevalent before and, for a time, after the war.

While the national interest demands a growing two-way flow of trade,certain recognized safeguards have been established. These include "escapeclause" relief for industries which have experienced, or are threatenedwith, serious injury as a result of tariff concessions on imports. To assisthim in the consideration of Tariff Commission investigations in such cases,and to advise on the administration of the trade agreements program gener-ally, the President has established the Trade Policy Committee at the Cabinetlevel with the Secretary of Commerce as Chairman.

The preservation and extension of the benefits obtained from wideningthe channels of world trade will depend heavily on the direction taken byAmerican trade policy in the next year. The decisions made will have asignificant bearing on the economic fortunes and policies of our trading

70

partners, and particularly on the success of the steps being taken towardcloser integration in Western Europe through the Common Market nowstarting among six countries and through the Free Trade Area under nego-tiation for the region as a whole. It is basic to our interests and to those ofthe larger community of nations that these ne,w groups pursue policies favor-ing the expansion of international trade and that they contribute effectivelyto the economic growth and unity of the free world.

To meet these needs, three major elements are required in our tradeagreements program. First, the Trade Agreements Act should be extendedfor five years from the date of its expiration on June 30, 1958. This actionwould confirm our continued adherence to the principles which the Actembodies, and would enable the United States to carry on necessary negotia-tions in behalf of our export trade during the crucial formative period whichlies ahead in Western Europe.

Second, additional authority is needed to make tariff concessions to enableus to conduct trade negotiations successfully. Congress will be requestedto authorize the reduction of any duty existing on July 1, 1958, by 5 percentper year over a 5-year period, or by an equivalent total amount in not lessthan three stages with a maximum of 10 percent in any one year. ThePresident would also be authorized, alternatively, to reduce any rate of dutyby 3 percentage points ad valorem, without any yearly reduction exceeding1 percentage point, or to reduce any rate to 50 percent ad valorem, if theexisting duty is in excess of that amount, without any yearly reduction exceed-ing one-third of that difference. The negotiation of tariff reductions wouldremain subject to the safeguards now in the Act, and additional safeguardswould be provided to permit prompter and more effective relief to domesticindustries through escape clause proceedings.

Third, we need a formally constituted center to serve as the administrativeorgan for the General Agreement. Such a center would provide a more effec-tive means for reviewing developments affecting trade and for consideringdisputes arising out of undertakings among signatories to the General Agree-ment. The Congress is requested to help constitute this center by enactinglegislation authorizing United States membership in the Organization forTrade Cooperation.

In addition to the trade agreements program, the Congress will havebefore it certain other measures relating to our foreign trade. These includethe extension of the Export Control Act, which expires on June 30 of thisyear; bills amending certain provisions concerning customs administrationin the Tariff Act of 1930; and amendments to the Antidumping Act of 1921,designed to improve the administration of the Act, which have been ap-proved by the House of Representatives and are awaiting action by theSenate. Favorable action is needed on all of these measures.

The various measures of United States assistance to, and cooperationwith, other countries have played a significant role in strengthening national

economies abroad. Direct United States Government loans and grants andthe investment guaranty program have assisted economic recovery and devel-opment abroad since the war. United States expenditures overseas for mili-tary and other purposes have increased the foreign exchange resources ofmany countries. Technical assistance to foreign countries has been providedby the United States, both through our own bilateral programs and throughthe United Nations. Some of the largest agreements under Public Law 480have benefited industrially less-developed countries.

Much assistance has also been obtained from private sources and inter-national agencies. Private capital has been invested abroad in increasingvolume, carrying with it the benefit of American managerial and technicalexperience. Public and private funds have been channeled through theInternational Bank for Reconstruction and Development and its affiliate,the International Finance Corporation. The International Monetary Fundhas played a key role in helping countries take actions to strengthen theircurrencies and in assisting them to overcome temporary foreign exchangedifficulties.

Our Mutual Security Program is designed to strengthen the nations whoseindependence and welfare are essential to our own. This calls not only formilitary assistance but for economic support also, since some countries can-not, without such support, make the military effort needed in the commoninterest. Further, it would be illusory to aim only at strengthening militarysecurity in a narrow sense. A large part of the world's population—the mostrapidly growing part—has so far experienced little improvement in materialwelfare. Many of these peoples are now emerging into political independ-ence, and we should not lose the opportunity, through appropriate programsof assistance, to strengthen their confidence in the possibilities of economicgrowth under free institutions. Some other highly developed countries areable to participate in this endeavor. An additional reason for welcoming thenew moves toward greater economic integration in Western Europe is thatthey should increase the foreign resources available for this purpose.

For the fiscal year 1959, an additional appropriation will be required forthe Development Loan Fund which was authorized in 1957 to facilitatefinancing economic development projects in underdeveloped countries. Theamount that will be requested is needed to permit effective operation of theFund. Appropriations requested for technical assistance will include anincrease in our contribution to the United Nations program in this field.

An increase is being requested in the lending authority of the Export-Im-port Bank. The Bank's activities in financing exports are directly helpful inpromoting production and employment in the United States economy aswell as in assisting the economic development of foreign countries. TheBank has the widespread support of our banking and foreign trade com-munities, and its funds are often loaned jointly with private capital, thusreducing the demand for public funds.

FEDERAL ECONOMIC STATISTICS

A well-coordinated system of Federal statistics is essential for recordingthe Nation's economic activity, correctly appraising its economic perform-ance, and formulating appropriate public and private policies. Such astatistical system must provide timely and reasonably complete informationon economic trends and interrelations. It must have continuity and besufficiently flexible to take account of the changes that characterize adynamic economy.

Taken as a whole, Federal economic statistics are good; but in view of thepublic and private needs for more and better information, numerous defi-ciencies in them should be remedied. Accordingly, the Congress will beasked to provide funds for the fiscal year 1959, for the first step of a programintended to make our economic information more nearly adequate to ourgrowing and changing requirements. This first step is described in AppendixC to this Report. In designing it, use was made of the special studies pre-pared over a number of years by university, business, labor, Government, andother experts. The work of the Subcommittee on Economic Statistics of theJoint Economic Committee of the Congress has been especially helpful. Theadditional funds requested are small in comparison with the total cost ofpresent statistical programs. Yet with these funds a significant contribu-tion can be made toward improving existing statistics and filling gaps in ourknowledge of the workings of our economy.

73

Appendix A

SUMMARY OF RECOMMENDATIONS INTHE ECONOMIC REPORT OF

THE PRESIDENT

75

Summary of Recommendations in the EconomicReport of the President

Including Recommendations to the Congress and Suggestionsto the States and Local Governments

I. GOVERNMENT FINANCES

a) Extend the present tax rate on the income of corporations and the presentexcise rates on automobiles and parts, cigarettes, distilled spirits, wines,and beer for one year beyond July 1, 1958. [Page 57]

b) Enact legislation temporarily increasing the statutory debt limit.[Page 57]

See also Recommendation IV (a).

II. FEDERAL CREDIT PROGRAMS

a) Grant wider discretionary authority to heads of Executive agencies anddepartments to set terms on private loans insured or guaranteed by theFederal Government. [Page 58]

b) Adjust interest rate limitations on certain FHA loan insurance programs(National Housing Act, Sections 207, 213, and 803) and on the VAHome Loan Guaranty Program. [Pages 58-59]

c) Repeal the provisions of the Housing Act of 1957 requiring regulationof charges, fees, and discounts on federally insured or guaranteed homeloans and the purchase of mortgages at par by the Federal NationalMortgage Association under its special assistance programs. [Pages59-60]

d) Increase to $30,000 the maximum size of home mortgage loan that maybe insured by the Federal Housing Administration under Sections 203and 220 of the National Housing Act. [Page 60]

e) Increase the limit on outstanding insured loans of the Federal HousingAdministration. [Page 60]

III. SCIENCE AND EDUCATION

a) Provide funds on a temporary basis for grants to States to improveinstruction and to strengthen State departments of education in thefields of science and mathematics, to identify and encourage able highschool students, to provide college scholarships, and to improveState statistics on education; and funds for broader support ofgraduate education and the improvement and expansion of foreign lan-guage teaching in colleges and universities. [Page 62]

77

b) Authorize a temporary program of assistance for the expansion andmodernization of medical and dental teaching facilities. [Pages 62-63]

IV. SMALL BUSINESS AND THE COMPETITIVE SYSTEM

a) Amend the tax laws to extend accelerated depreciation formulas topurchases of used property up to $50,000 in any one year; to permitclosely held corporations the option of electing the tax status of partner-ships; to grant taxpayers the option of paying estate taxes over periodsof up to 10 years where estates largely consist of investments in closelyheld businesses; and to allow losses on original investments in the stockof small companies to be treated as ordinary loss deductions rather thancapital loss deductions. [Page 63]

b) Permit the Securities and Exchange Commission to apply its simplifiednotification procedure to security issues in amounts up to $500,000.[Page 63]

c) Remove the limitation on the life of the Small Business Administrationand suitably increase its authorization for making business and disasterloans. [Page 64]

d) Require notification to the antitrust agencies of proposed mergers bybusinesses of significant size engaged in interstate commerce. [Page 64]

e) Extend Federal regulation to bank mergers accomplished through theacquisition of assets. [Page 64]

f) Empower the Attorney General in antitrust cases to issue civil investiga-tive demands for the production of necessary documents without theneed of grand jury proceedings. [Page 64]

g) Make Federal Trade Commission cease-and-desist orders issued forviolations of the Clayton Act final, unless appealed to the courts.[Page 64]

h) Authorize the Federal Trade Commission to seek preliminary injunc-tions in merger cases where a violation may be likely. [Page 64]

V. PERSONAL WELFARE

a) Amount and duration of unemployment insurance benefits; coverageof firms with one to three persons on their payrolls; coverage of em-ployees in Puerto Rico; coverage of State and local government em-ployees. (State and Federal responsibility) [Page 65]

b) Bring the unemployment insurance provisions applicable to workers inthe District of Columbia up to the standards recommended for the States.[Page 65]

c) Intensify efforts to develop and enforce adequate occupational safetystandards and to encourage safe practices. (State and local responsi-bility) [Page 65]

d) Improve workmen's compensation laws with respect to benefits, ad-ministration, and provisions for rehabilitation. (State responsibility)[Page 65]

78

e) Authorize the Secretary of Labor to prescribe and enforce safety standardsfor longshoremen. [Pages 65-66]

f) Provide nonoccupational temporary disability insurance for employeesin States and Territorial jurisdictions where programs have not beenestablished. (State and Federal responsibility) [Page 66]

g) Minimum wage legislation covering certain additional groups of work-ers; equal pay for equal work without discrimination on account of sex.[Page 66]

h) Improve the 8-hour laws applicable to Federal and federally assistedconstruction projects. [Page 66]

i) Establish an Area Assistance Administration in the Department of Com-merce to extend loans, research grants and technical assistance in areasof persistent unemployment. [Page 66]

j) Require periodic public reports on the status of private employee wel-fare and pension funds, on financial dealings between employers andemployee representatives or their agents, on general union finances, andon union organization and structure. [Pages 66-67]

k) Modify the law governing secondary boycotts and picketing, and pro-vide that the States have jurisdiction in labor-management disputes inwhich the National Labor Relations Board declines to exercise authority.[Page 67]

VI. AGRICULTURE

a) Extend Titles I and II of the Agricultural Trade Development andAssistance Act of 1954 for one year beyond June 30, 1958, and raise thepresent limit on permissible expenses and losses of the CommodityCredit Corporation under Title I by $1.5 billion. [Page 68]

b) Continue the special milk program beyond June 30, 1958. [Page 68]c) Eliminate the escalator clauses governing price supports on basic com-

modities under the Agricultural Act of 1949. [Pages 68-69]d) Authorize price supports for wheat, corn, cotton, rice, tobacco, peanuts,

and dairy products to be determined administratively, within a rangeof from 60 to 90 percent of parity, in accordance with guidelines alreadyestablished by law for almost all other agricultural commodities.[Page 69]

e) Extend the National Wool Act beyond March 31, 1959. [Page 69]f) Eliminate acreage allotments for corn and provide discretionary au-

thority to increase allotments of other crops. [ Page 69]g) Permit the Acreage Reserve Program to expire at the end of the 1958

crop season; strengthen the Conservation Reserve Program; and considerfurther consolidation of Federal activities in soil and water conservation.[Page 69]

h) Enlarge the Commodity Credit Corporation Advisory Board and assignit the role of advising the Secretary of Agriculture in the exercise of thewider discretionary authority requested in VI (d) and VI (f). [Page69]

79

i) Revise the distribution formula under Title I of the Bankhead-JonesAct to permit the allocation of a larger amount of loan funds to areasof acute need, and require States to contribute at least 25 percent ofdisaster-relief costs in certain emergency programs. [Page 70]

VII. FOREIGN ECONOMIC POLICY

a) Extend the Trade Agreements Act for 5 years beyond June 30, 1958;permit the reduction of any duty existing on July 1, 1958 by 5 percentper year over a 5-year period, or by an equivalent total amount in notless than three stages with a maximum of 10 percent in any one year; alsopermit, alternatively, the reduction of any rate of duty by threepercentage points ad valorem without any yearly reduction exceedingone percentage point, or the reduction of any rate to 50 percentad valorem, if the existing duty is higher than that amount, withoutany yearly reduction exceeding one-third of that difference; andauthorize United States membership in the Organization for TradeCooperation. [Page 71]

b) Extend the Export Control Act beyond its expiration on June 30, 1958;amend certain customs administration provisions in the Tariff Act of1930; and approve amendments to the Antidumping Act of 1921 toimprove its administration. [Page 71]

c) Provide funds for the Development Loan Fund to finance economicdevelopment projects in underdeveloped countries, and for technicalassistance under the United Nations program. [Page 72]

d) Increase the lending authority of the Export-Import Bank. [Page 72]

VIII. FEDERAL ECONOMIC STATISTICS

a) Provide funds for the improvement of Federal economic statisticsprograms. [Page 73]

8o

Appendix B

REPORT TO THE PRESIDENT ON THEACTIVITIES OF THE COUNCIL

OF ECONOMIC ADVISERSDURING 1957

81

Letter of TransmittalDECEMBER 23, 1957.

The PRESIDENT.

SIR: The Council of Economic Advisers submits this Annual Report forcalendar year 1957 in accordance with the requirements of Congress, asset forth in Section 4 (d) of the Employment Act of 1946.

Respectfully,

RAYMOND J. SAULNIER^ Chairman.JOSEPH S. DAVIS.

PAUL W. MCCRACKEN.

Report to the President on the Activities of the Council ofEconomic Advisers During 1957

The past year has been marked by important economic developments, inboth the United States and the rest of the world. The rise in the consumerprice index, which had begun early in 1956, was perhaps the center of in-terest. But with inflationary pressures substantially reduced by the middleof the year, attention shifted to the completion of adjustments within theeconomy on the basis of which growth with reasonably stable prices mightbe extended into the future. The progress of these developments and theirimplications for Government policy have been under continuous review bythe Council.

Council Activities

The principal responsibility of the Council of Economic Advisers is toreview and analyze developments in the United States economy and else-where in the world, and to evaluate their policy implications. Reports onthese matters are made frequently to the President by the Chairman of theCouncil. The Chairman performs a similar function for the Cabinet.

A second responsibility of the Council is to review legislative proposals,and suggestions for administrative actions, for their possible effect on thestability of our economy and its capacity for balanced and sustainablegrowth. During the year, a large number of such proposals were reviewedby the Council.

Numerous other activities of the Council grow out of its membership incontinuing or ad hoc committees. Among these are the Council on ForeignEconomic Policy; the Defense Mobilization Board and the Emergency Re-sources Board; the Cabinet Committee on Small Business, of which theChairman of the Council serves as Chairman; the ad hoc committee estab-lished in September 1957 by the Secretary of the Treasury for considerationof credit and related policies; and the Committee for Rural DevelopmentProgram. Members of the staff have represented the Council on severaltechnical interagency committees, including groups concerned with produc-tivity measurements, health surveys, population and housing censuses, ruraldevelopment, and employment statistics.

The Council cooperates with the Organization for European EconomicCooperation (OEEC) in its economic surveys and with the InternationalCooperation Administration (ICA) in its training programs for foreignspecialists. During the year, the Council prepared a Survey of Economic

Developments in the United States for the annual review of the OEEC,and materials for response to the United Nations' annual questionnaire. ACouncil Member, assisted by a member of the staff, participated in theannual review of economic conditions conducted by the OEEC in Parisin September 1957. The Chairman attended a meeting of OEEC eco-nomic experts in October. Throughout the year, two staff members metfrequently with ICA study teams.

The Council conferred frequently during the year with groups outsidethe Government. These groups included experts from universities andrepresentatives of labor, agricultural, business, and financial organizations.

The Council assists the President each year in the preparation of theEconomic Report which he transmits to the Congress. The Report re-views economic developments, assesses the outlook, and makes recommen-dations to the Congress and suggestions to States, communities, and privategroups for actions and policies designed to achieve the goals set forth inthe Employment Act. The Report is widely used as an authoritativereview of developments in the United States economy; 35,000 copies ofthe January 1957 Report were published.

The Council also prepares Economic Indicators, & monthly compendiumof current economic statistics, published by the Joint Economic Committeeof the Congress. Copies of Economic Indicators are distributed to membersof the Congress and to depository libraries; in addition, 6,500 copies aresent monthly to paying subscribers.

Council Membership

The Council has three members, appointed by the President and con-firmed by the Senate. Raymond J. Saulnier has served as a member ofthe Council since April 4, 1955 and as Chairman since December 3, 1956.Joseph S. Davis has served as a member since May 2, 1955, and Paul W.McCracken since December 3, 1956.

Council Staff

The Council is assisted by a staff of 27 persons of whom 12 are senioreconomists selected for their skill and judgment in the objective analysisof economic problems. Each senior staff member is assigned an area forspecial attention and is responsible for eliciting the cooperation of Govern-ment agencies and business, labor, and other private groups in analyzingand evaluating economic developments. Most senior staff members arepermanent employees of the Council; some are on leave of absence fromuniversity posts; others serve the Council on a consulting basis. Presentmembers of the senior staff, including consultants, are Henry W. Briefs,Samuel L. Brown, Robert C. Colwell, Frances M. James, Marshall A.Kaplan, Hal B. Lary, David W. Lusher, Charles L. Schultze, Irving H.Siegel, Collis Stocking, Boris C. Swerling, and Philip E. Taylor.

86

Advisory Board on Economic Growth and Stability

Continuous assistance is received by the Council from the Advisory Boardon Economic Growth and Stability, established by the President in 1953.The Board consists of policy-making officials of departments and agenciesthat have responsibility for important economic programs. The Chairmanof the Council serves as Chairman of the Advisory Board. The presentmembers of the Board are as follows:

Department of State—Thomas C. Mann, Assistant Secretary forEconomic Affairs

Department of the Treasury—Julian B. Baird, Under SecretaryDepartment of Agriculture—True D. Morse, Under SecretaryDepartment of Commerce—Walter Williams, Under SecretaryDepartment of Labor—James T. O'Connell, Under SecretaryDepartment of Health, Education, and Welfare—John A. Perkins,

Under SecretaryBoard of Governors of the Federal Reserve System—Abbot L. Milk

Member of the BoardBureau of the Budget—Percival F. Brundage, DirectorThe White House Office—Gabriel Hauge, Special Assistant to the

PresidentCouncil of Economic Advisers—Raymond J. Saulnier, Chairman

Budget for Fiscal Years 1957 and 1958

For the fiscal year 1958, the Congress appropriated $375,000 for theCouncil's activities. Contributions to the Government Retirement Fund,not previously required of Federal agencies, accounted for the increasefrom the $365,700 appropriated for the fiscal year 1957.

Appendix C

PROGRAM FOR IMPROVING FEDERALSTATISTICS IN FISCAL YEAR 1959

Program for Improving Federal Statisticsin Fiscal Year 1959

Proposals for a significant step toward a more balanced and better inte-grated Federal statistics program are made in the budget for the fiscal year1959. These proposals take account of the findings of special studies madein the past several years by university, business, labor, and other experts, to-gether with Government technicians, and of extensive studies by the Sub-committee on Economic Statistics of the Joint Economic Committee of theCongress. Further steps should be taken in the fiscal year 1960 and there-after, to carry into effect long-range plans for improving the scope andusefulness of Federal statistics.

IMPROVING SYSTEMS OF NATIONAL ACCOUNTS

Some of the requested funds would be devoted to bolstering the best knownof the integrated national accounts—the system of statistics relating tonational income and national product. Attention would also be directedtoward improving other sets of national accounts that are valuable for thestudy of economic interrelations.

Statistics on National Income and Product

National income and product statistics are the most highly developed,widely used, and current of our economic accounts. Four projects are con-templated for the fiscal year 1959:

(1) Preparation and publication of quarterly estimates of gross nationalproduct and its major components, adjusted for price changes. The pricedata needed for this work would also be improved.

(2) Initiation of the measurement in constant dollars of net outputfor several major industry groups and for selected components of manufac-turing. This will require the improvement of industry input data and ofproduct price and quantity information.

(3) Initiation of work on an accounting of interindustry flows for 1958(see below) for the major economic sectors identified in national incomeand product accounts.

(4) Establishment of a small research staff for work on problems of con-cept and estimation which cannot be adequately pursued by statisticiansfully occupied with the preparation of current statistics, and for explorationof the interrelationships among the several types of economic accounts.

International Balance of Payments Accounts

These accounts, which assemble all transactions involving paymentsbetween the United States and foreign countries, enter national productestimates through the "net foreign investment" component. The 1959 pro-gram includes provision for beginning a comprehensive survey of UnitedStates direct private investments abroad.

Statistics on Savings

Plans for improving the data needed to estimate national savings are wellunder way, and definitive quarterly statistics on savings should become avail-able by late 1959. Methods are already being developed for dovetailingsavings and flow-of funds accounts (see below) with other types of nationalaccounts.

Flow-of-Funds Accounts

Accounts showing the flow of funds corresponding to transactions be-tween sectors of the economy are valuable for current analysis of financialflows. In addition to transactions that originate income, they include trans-actions in existing assets. Major improvements in the quality of the basicdata are needed.

Sector Balance Sheet Accounts

Balance sheets should be developed to permit the study of the allocationof resources to the various industrial sectors, and of intersector claims.The flow-of-funds accounts, which show outstanding financial assets andliabilities for each sector, provide only partial balance sheets. Although noprovision is made in the 1959 budget for the development of sector balancesheet accounts, they should eventually be included among, and integratedwith, other types of national accounts.

Interindustry Accounts

Interindustry accounts are designed to show for a given period, throughso-called input-output tables, the flow of goods and services between indus-tries and to households. When constructed in detail, they are especiallyvaluable for economic and technological analyses, market and investmentplanning by business firms, and mobilization planning by Government. The1959 budget proposes initiation of an accounting of flows between majorindustry groups in 1958.

Broad Productivity Estimates

The development of estimates of real product originating in broadindustry groups, proposed in the 1959 budget, would make it possible toderive consistent estimates of labor productivity for the economy as a wholeand for the major industrial divisions. These estimates would be made inaddition to measures for narrowly defined industries based on other avail-able production data. On the input side, the chief immediate need is forimprovement of data on employment and average hours worked in the

various divisions. Improvements in this direction too are contemplated inthe 1959 budget proposal.

IMPROVING DATA FOR ECONOMIC ANALYSIS

Economic censuses provide comprehensive benchmark data that are essen-tial for the analysis of industrial and regional developments and for theinterpretation and adjustment of current statistics derived from interimsurveys that are less complete than census reports. Several censuses cover-ing 1958 are scheduled for 1959. Many improvements are planned in thescope of census data and in the variety and quality of statistics derived fromother sources.

Census of Business

Margin and value-added data.—Data on retail margins are essential forestablishing benchmarks in the national income accounts for expenditureson personal consumption and for investment in producers' durable goods.They are also necessary for constructing interindustry accounts. Collectionand tabulation procedures for the Census of Business are expected to yieldmeasures of "value added" in distribution, which would provide a basis forbetter estimates of trade margins.

Plant and equipment expenditures data.—On the basis of data tobe provided by the 1958 Census of Business, estimates would be made ofplant and equipment expenditures by retail trade, wholesale trade, and serv-ice trade establishments.

Annual surveys.—The 1959 budget program would also provide for de-velopmental and preparatory work for later annual surveys of wholesaletrade and selected services. Procedures would be devised for the futurecompilation of detailed sales or purchase data of commodities at wholesale,comparable with sales or shipments data obtained in the Census of Manu-factures.

Census of Manufactures

Use of materials, products, and durable equipment.—Data showing theconsumption of materials by individual industries are desirable for studyingcommodity flows throughout the economy and for mobilization planning.The 1958 Census of Manufactures will provide statistics on industrialpurchases of producers' durable equipment.

Distribution of manufacturers3 sales.—Information on the distribution ofmanufacturers' shipments by class of customer, including shipments to theGovernment, would also contribute to better estimates of commodity flow.Plans for the 1958 Census of Manufactures call for the collection of salesdata by class of customer.

Census of Mineral Industries

The 1958 Census of Mineral Industries will have essentially the samescope as the 1954 Census. The inauguration of annual surveys of mineral

93

industries, analogous to those for manufactures, is planned; the first surveywould refer to 1959 operations.

Employment and Hours Statistics

Estimates of man-hour productivity would be improved by changes con-templated in reports by establishments on hours of work. The 1959 pro-gram calls for the collection of information on hours worked, as well as onhours paid for, in manufacturing industries, and for the collection of datarelating to so-called "nonproduction workers" in these industries. It alsocalls for the collection of data on hours for selected nonmanufacturingindustries not now covered.

Price Statistics

Prices paid by the Government.—A major limitation of price statisticsfrom the standpoint of national accounting is the lack of data on prices paidfor goods, especially defense items, by the Government. Systematic effortstoward the preparation of appropriate price indexes in this field will be made.

Wholesale and retail prices.—Many durable goods and various servicesare not covered by existing price indexes. Plans for 1959 include the ex-pansion of data on prices in primary markets and at retail. This expansionwould improve current business indicators and lead to better estimates ofreal output, productivity, and inventories in constant prices.

Construction Statistics

The development of a sound, comprehensive program of constructionstatistics will require several years. The budget proposed for 1959 includessurveys designed to improve estimates of construction activity, including"additions and alterations" and "repairs and maintenance."

Plant and Equipment Expenditures

Two recommendations for improvement of data on plant and equipmentexpenditures are included in the 1959 program. First, in the 1958 Censusof Business, data would be obtained from wholesale trade, retail trade, andservice trade establishments. Second, the collecting agencies for the currentPlant and Equipment Expenditures Survey would renew efforts to obtainseparate information for plant and for equipment.

Producers' Durable Equipment

Efforts would be made under the 1959 proposal to remedy the chiefdeficiencies in statistics on equipment. In the 1958 Census of Manufac-tures, as already noted, data on manufacturers' sales of producers' durableequipment will be compiled by class of customer and type of equipmentpurchased. The collection of more detailed sales data by industry, in theMonthly Industry Survey, would permit improvement of the quarterlyestimates of investment in producers' durable equipment.

94

Inventories

Separate stage-of-fabrication estimates are to be developed for all majorindustry groups in manufacturing and for significant subgroups. For se-lected subgroups, the estimates of inventories of finished goods would besubdivided into producers' equipment and consumer goods. Informationis still needed on the proportion of manufacturers' inventories that is relatedto defense production. Improvements are planned in the monthly estimatesof retail trade inventories by major "kind of business." Estimates wouldbe provided for a limited number of commodities at both retail andwholesale levels.

Manufacturers' Sales, Inventories, and New Orders

Refinement of company data supplied in the Monthly Industry Surveyand revision and enlargement of the sample would lead to better currenteconomic indicators on manufacturers' sales, inventories, and new orders.Provision is made in the 1959 budget for these improvements.

Service Trade Receipts

Statistics on monthly receipts of service trades—such as hotels, barberand beauty shops, and auto-repair shops—are not available. A project toimprove the estimates for selected service trades is included in the 1959budget proposal.

Consumer Credit

The 1959 budget proposal includes the collection of monthly informationon accounts receivable from a sample of retail trade establishments. Thisinformation would strengthen present estimates of consumer credit out-standing.

Corporate Profits and Income of Unincorporated Enterprises

Corporate profits.—The Business Indicators Series has been initiated toprovide preliminary estimates derived for selected items from income taxreturns within a year after the returns are filed. The 1959 budget proposesthat this work be continued on a regular basis. Among other improvementsthat are essential is a regular Audit Control Study, preferably made onceevery five years, to provide factors for adjusting profits in the unaudited taxreturns used in benchmark tabulations.

Current financial data on nonmanufacturing firms, by size, are not nowavailable. The 1959 budget proposal calls for extension of the presentQuarterly Financial Report program to include both small and large cor-porations in trade and mining industries.

Nonfarm unincorporated enterprises.—Selected income and balance-sheetitems for sole proprietorships and partnerships, the dominant forms of"small business," would be tabulated annually as part of the Business Indi-cators Series. Data on sole proprietorships and partnerships should also beincluded in plans for the Audit Control Study, referred to above.

95

Attention is being directed to the need for accurate measures of monthlyand quarterly changes in profits of unincorporated business. Considerationwill also be given to the feasibility of regularly constructing financial reportsfrom accessible operating information.

Survey of Farm Operators

After the Census of Agriculture for 1959 is completed, an annual samplesurvey of farm operators should be initiated to provide data on farm income,off-farm income, and farm production expenditures. The sample shouldmake possible estimates for at least three categories—large commercialfarms, small commercial farms, and all other farms.

State and Local Governments

The 1959 budget proposal includes the preparation of a quarterly reporton State and local government finances, including revenues, capital outlaysand current expenditures, indebtedness, and financial assets.

Appendix D

THE CONSUMER PRICE INDEX

97

The Consumer Price Index

Considerable public interest has been focused on the consumer price indexas an indicator of price trends in the consumer sector of the economy, andbecause of its extensive use in wage adjustments. To afford a better under-standing of the index, this Appendix briefly describes its essential features,some of the problems connected with its computation, and its limitations anduses.

CONSTRUCTING THE INDEX

The consumer price index in roughly its present form was first publishedby the United States Bureau of Labor Statistics (BLS) in 1921, and coveredthe period extending back to 1913. The last major revision was in 1953.

The present index is designed to measure changes in the prices of goodsand services commonly purchased by wage-earner and clerical-worker fam-ilies living in the 3,000 towns, cities, and suburbs of the United States thathad a population of 2,500 or more in 1950. In general, the only familiesincluded are those whose major sources of income are earnings of crafts-men, factory workers, laborers, clerks, and sales and service workers. Thisgroup of families comprises about 64 percent of the urban, and 40 percentof the total, population.

An over-all consumer price index is published and also various subgroupindexes. The most familiar groupings are those in which commodities andservices are classified by their end use, e. g., food, apparel, housing, readingand recreation, etc. More recently, the BLS has been publishing monthlywhat might be termed an "economic" classification: all commodities; allcommodities other than food; durable goods; nondurable goods; and serv-ices. It also publishes indexes for three major groups: (1) food, (2) com-modities other than food, and (3) services. As of December 1956, eachof these three categories was of roughly equal relative importance in theindex—29, 37, and 34 percent, respectively.

In essence, the consumer price index measures changes in the price ofa fixed "market basket" of goods and services chosen to represent the cus-tomary spending pattern of wage-earner and clerical-worker families. Inthe computation of the index, prices of individual items or groups of itemsare assigned specific weights, based on their relative importance in the aver-age family budget for a survey year. The price changes from the base period(1947-49) for all of the items, appropriately weighted, are then combinedinto the consumer price index—which expresses the change in the price of the

99

total market basket since the base period. There are thus two major ele-ments in constructing the index: the prices of the specific goods and servicesincluded and the weights assigned to them.

Prices

The prices used in computing the index are obtained at 46 urban sam-pling points, selected as representative of the entire urban portion of thecountry. Most of the prices are obtained at regular intervals from a sampleof stores and service establishments. In each city, a selection is made ofestablishments most frequently patronized by wage-earner and clerical-worker families, and which represent the important types of retail outlets,such as chain and independent stores, and department and specialty stores.Samples of rental units are chosen from block listings representative of thetotal rental housing market.

The price data, in general, are collected in personal visits by trained BLSfield agents. In order to eliminate as far as possible the effect of significantchanges in the quality of products, specifications are drawn up for use bythe field agents in comparing prices. These specifications provide a detaileddescription of the article, including quality factors associated with price, andphysical characteristics essential for identifying an item from store to storeand from time to time. Product descriptions and other data are checked,and, wherever possible, prices posted for goods on display are recorded. Ifdiscounts or over allowances on trade-ins are known to be common, theagents obtain from the store manager the information needed for computinga realistic net price.

Prices obtained for each city are combined by means of expenditureweights described below. Prices for all 46 cities are then combined bymeans of population weights to form the national index. Separate indexesare published monthly for the 5 largest cities, and quarterly for the 15 nextlargest of the 46 cities.

WeightsThe weights currently used were derived in the main from a comprehen-

sive family expenditure survey made in 1950-51. This survey included datafor nearly 12,000 families in 91 cities of various characteristics: size, climate,population density, income level, and, in the case of small cities, distance tomarket. Six additional cities surveyed earlier were also used.

In the 1953 revision of the index, the development of weights involvedtwo principal steps: (1) averaging the different spending patterns reportedby individual families, and (2) adjusting the survey data for price andincome changes which had occurred between 1950 and January 1953, thefirst month of the revised index.

During 1950 and 1951, while the major study of consumer expenditureswas under way, the BLS collected and studied prices for several hundredcommodities and services. The individual items were classified into "pricefamilies," i. e., groups of commodities with similar characteristics as regards

ioo

physical properties, use, and price movements. Items of major importancewere chosen from each "price family" to represent price changes for allitems in the group. In the computation of the index, a specific item or setof items was assigned the total expenditure weight of the group which itwas chosen to represent.

MAINTAINING THE INDEX

Periodically, the goods and services priced for the consumer price indexare varied to take account of changes in patterns of family spending. Butthis is done infrequently, because spending patterns change slowly. Therevision in 1953 incorporated the results of the 1950-51 expenditure survey.When a revision is made, it is done in a way that will preserve the characterof the index as a measure of price change. Prices for comparableitems are matched for each pair of successive months in the "linking-in"period. If, for example, the new index is to be introduced in January,both old and new indexes are computed for December. Percentage changesbetween November and December are based on the old index; and thosebetween December and January are based on the new index. Thus month-to-month changes in the index continue to represent price change, not thedifference between the price of one market basket and that of another.

The basic character of the index is determined by the requirement thatthe same market basket (in terms of quantity and quality of goods andservices) be priced in the periods being compared. To achieve this com-parability, the BLS has established statistical procedures for the collectionof prices according to fixed specifications. But new items come onto themarket and become popular, and others decline in favor or disappear. Inaddition, there are frequent changes in established products. Such changescumulate and eventually produce shifts in buying habits that are so farreaching as to require revision of the fixed basket of goods. However,account is taken of many minor changes in the interval between majorrevisions.

When the characteristics of an item priced for the index have changed,the specifications reported call attention to the points of noncomparabilityand provide information for eliminating the measurable price effect ofsuch changes. When these changes are definite improvements or recog-nizable additions to the old item, or the reverse, statistical adjustments canbe made to reduce the prices to a comparable basis. However, when im-provements in quality cannot be eliminated, the index reflects an upwardbias in consumer prices; and the reverse is true when quality deteriorationoccurs.

The problem of adjustment for quality changes is particularly importantin the pricing of appliances, household equipment, and automobiles, al-though variants of this problem appear in almost all components of theindex, including the pricing of foods, services, and housing. When pricesfor exactly comparable items cannot be collected, the BLS procedures just

I O I

described are applied whenever possible. Thus, when a new automobilemodel or a new appliance model contains specific features which can beisolated as improvements or additions, the price comparison is adjusted toeliminate that part of the price change which can be ascribed to the changein model. Nevertheless, there are types of changes which it is not possibleto take into account, even though there may be general agreement thatthese changes constitute improvements. For example, a change in theshape of the springs in an automobile may make for better riding, perhapsat no increase in cost; or a slight change in the composition of an automobiletire may make it safer and lengthen its life.

Other practices in pricing the fixed basket of goods may cause a downwardbias in the index. For example, when items drop out of the marketcompletely or, because of reduced sales, fail to qualify for continued inclu-sion as a "volume seller," they are replaced where possible by similar itemsof different specifications—often of a higher quality and price. The newprices are linked in without showing the price difference between the oldand the new items. For consumers who would prefer to buy the original,lower-priced item, the change in market availability represents a real priceincrease.

For short periods of 2, 3, or 4 years, the amount of bias arisingfrom quality changes that have not been eliminated is probably too smallto affect the index very much. For periods of a decade or more, however,there is undoubtedly a significant effect upon the index values for some items,although the net effect on the total index cannot be determined.

In preparing a monthly index of prices with fixed weights, the Bureauof Labor Statistics must cope with items which are available on the marketin volume only in particular seasons. Such items are represented in themarket basket in accordance with their relative importance in annual con-sumption. Consequently, in off-season months the relative importance ofsuch items is too great in the price comparisons. In the months when theseitems disappear from the market, their price movements must in effect beestimated by the price movements of other products in the same class ofcommodities. When such items reappear on the market, erratic jumps inthe index may occur as seasonal prices are reintroduced. For year-to-yearcomparisons, this measurement of price changes is correct; but it may tendto exaggerate the magnitude of some month-to-month changes.

LIMITATIONS

Since the index represents changes in the prices of a fixed set of goods andservices typically bought by a designated class of consumers, it does notmeasure changes in consumption levels or in total living costs. These areresponsive to factors other than the changes in prices of the set of goods andservices included in the index. Thus, a family's living costs will shift as thefamily grows, as its income rises or falls, as its tastes change, or for reasons

102

not related to price changes alone. The effects of such factors are ignoredby the consumer price index.

Because the index is an average, it does not necessarily apply to any onefamily or to any small group of families. A careful housewife, by judiciousshopping, may purchase many items at prices lower than the averages em-bodied in the index. A family which takes great care in budgeting its ex-penditures, a family faced with abnormal expenses for one reason or another,or a family in a position to make its purchases under particularly advanta-geous circumstances, would find that the index does not represent the move-ment of prices that it is called upon to pay. And, strictly speaking, the indexis not an appropriate measure of prices paid by very low or very high incomegroups, or by single workers, elderly couples, or other groups whose living andmanner of spending are different from those of wage-earner and clerical-worker families. On the other hand, when the index is applied to all cityfamilies or to the total urban population, the limitations are not consideredto be serious, since the wage-earner and clerical-worker group constitutesnearly two-thirds of the population.

Although separate consumer price indexes are published for individualcities, they do not measure absolute differences in price levels. The factthat the index for city A is higher than the index for city B does not neces-sarily mean that prices are higher in city A; it means only that, since the baseperiod, prices have risen more in city A. Indeed, the particular level ofthe consumer price index for the Nation as a whole, for an individual city,or for some specific group of consumer goods, represents only the magni-tude of the change in prices since the base period, and has no meaning exceptwith reference to that period.

SOME USES OF THE INDEX

Government has long recognized the importance of prices in the formula-tion of policies affecting wage rates. As early as 1780 an index, based onfour commodities, was calculated by the State of Massachusetts to providea basis for adjusting soldiers' pay. Although first published in 1921, thepresent index of consumer prices in the United States was developed by theDepartment of Labor in 1918 to serve as a guide for the adjustment of wagescales in the shipyards and other war production centers during Word War I.In World War II and during the Korean conflict, the index was the basisof a number of strategic wage decisions.

The index has been the focus of Nation-wide attention in recent years,as wage contracts have been signed calling for periodic adjustments in wagesif the consumer price index should move up or down beyond specifiedlimits—the so-called "escalator clauses." This form of wage contract spreadrapidly throughout the automobile industry, and was extended to farmequipment, aircraft, and electrical manufacturing industries, and to therailroads. Most of the agreements are for a long term—2, 3, or 5 years—without reopening clauses on wages. By 1952, more than 3,500,000 workers

103

were employed under contracts containing escalator clauses. After somedecline in the use of escalator clauses, they have recently become morewidespread. It is estimated that at least 4,000,000 workers are now em-ployed under labor-management contracts by which wages are adjustedaccording to changes in the consumer price index. As a rule, these clausesprovide for wage adjustments of about two cents per hour for each changeof one index point. At 40 hours a week for 50 weeks in the year, an increaseof one point in the index raises the annual wage bill for these workers byabout $160 million.

The index has an indirect impact on wage rates even where formal esca-lator agreements are not in effect. Pay adjustments made under escalatorcontracts influence wage payments elsewhere, and the index is often explicitlyconsidered by management and labor in formulating wage policies.

104

Appendix E

PRODUCTIVITY STATISTICS

105

Productivity Statistics

The terms "productivity" and "labor productivity" are commonly usedto designate measures of output per unit of labor input. Productivityindex numbers showing changes in output per employee or per man-hourare used in the discussion and study of various economic topics—e. g., wage-cost-price relationships, the rise of living standards, technological progress,and the outlook for production and employment.

PRODUCTIVITY ESTIMATES FOR THE PRIVATE ECONOMY, 1947-56

Table E-l shows two sets of productivity index numbers (1947=100)computed by the Bureau of Labor Statistics from available Governmentdata. These productivity measures, relating to the private economy (i. e.̂excluding Government) and its main components, are based on a com-mon set of output estimates and two different sets of man-hour estimatescovering both employers and employees. In one index, the man-hoursrefer to hours for which pay is received (plus the hours of unpaid familyworkers). In the other, the man-hours refer to hours worked. In otherwords, the first man-hour concept includes, and the second excludes, paidholidays, vacations, and sick leave. The output estimates, which are subjectto further revision for much of the period, refer to portions of the grossnational product adjusted to 1947 prices.

For the decade 1947—56, both productivity measures for the privateeconomy as a whole show average annual rates of increase that exceed thelong-term trend rates. According to one mode of computation usedthroughout this Appendix, the average annual increase in output per man-hour paid was 3.4 percent during the postwar decade, and the average foroutput per man-hour worked was 3.9 percent. These rates are much largerthan the long-term rates of 2 percent or slightly more per year shown byvarious studies for periods covering several decades. Smaller excesses overlong-term rates are indicated if the postwar interval is lengthened to 1945-56or shortened to 1950-56.

Productivity advanced more rapidly in agriculture than in the rest of theprivate economy during 1947—56. The two average annual rates for agri-culture, derived from an output series fitting into the national productaccounts, were about 6 percent. For nonagricultural industries, on theother hand, output per man-hour paid increased at 2.8 percent per year(3.2 percent in the manufacturing sector and 2.6 percent in nonmanufactur-

107

TABLE E-l.—Indexes of output per man-hour for the private economy, 1948-57[1947=100]

Year

19481949

19501951195219531954

195519561957 5

Based on man-hours paid 1

Total

104.9107.0

115.6118.1121.7126.2129.0

133.5134.6137.0

Agri-culture 3

123.4114.7

131.8129.8138.7153.6167.1

169.7175.8183.8

Nonagricultural industries

Total

102.5106.0

112.7114.9117.5120.4122.4

126.8127.1128.6

Manu-factur-ing*

102.5104.7

113.1114.6116.4120.3123.7

130.9131.4132.4

Non-manufac-

turing

102.8107.2

112.8115.1118.1120 2121.9

124.7125.1127.1

Based on man-hours worked 2

Total

104.2105.4

114.5118.8123.2127.8131.5

136.3137.9140.9

Agri-culture 3

123.7113.8

131.4129.0138.0152.7166.3

168.9175.0183.4

Nonagri-cultural

in-dustries

101.7104.2

111.5115.7119.2122.2125.1

129.8130.6132.6

1 "Man-hours paid" were derived from Bureau of Labor Statistics figures for the nonagricultural com-ponent and Bureau of the Census information for the agricultural component. They include the hours ofunpaid family workers in addition to wage and salaried workers and the self-employed. They cover paidholidays, vacations, and sick leave.

2 "Man-hours worked" were derived from data of the Bureau of the Census, Department of Commerce.Like "man-hours paid," they include the hours of all persons, whether employees or employers. Theyincorporate adjustments designed to eliminate holidays, vacations, and sick leave.

3 Differs in concept from Department of Agriculture's productivity series based on requirements of equiv-alent adult man-hours.

* Derived from a Bureau of Labor Statistics index of net output for 1947-53 extended with the aid of Officeof Business Economics data.

5 Preliminary, subject to revision.

NOTE.—The indexes in this table were computed by Department of Labor, Bureau of Labor Statistics,from estimates of real product and man-hours. The real product estimates, referring to 1947 prices, arebased primarily on national product statistics of the Department of Commerce, Office of Business Eco-nomics.

Source: Department of Labor (see note above).

ing). In the case of output per man-hour worked, the average nonagri-cultural productivity rise was 3.3 percent per year.

Both sets of productivity measures show uneven percentage changes fromyear to year. Although agriculture recorded an exceptionally high rate ofgain for the decade as a whole, it experienced setbacks between 1948 and1949 and between 1950 and 1951. Unusually small rises occurred in the pri-vate economy as a whole and in the nonagricultural sector between 1955 and1956. For the private economy, output per man-hour paid advanced 8percent between 1949 and 1950 as output increased sharply, and produc-tivity in terms of man-hours worked advanced nearly 9 percent. Between1955 and 1956, on the other hand, the two productivity indicators for theprivate sector rose only about 1 percent, and the two measures for thenonagricultural industries changed even less. For the same year, eachagricultural measure showed a gain of 3.6 percent.

PRODUCTIVITY CHANGES IN 1957

Preliminary estimates indicate a generally better productivity performancein 1957 than in 1956. According to either man-hour concept, the produc-tivity advance for the private economy apparently matched the long-termtrend rate of about 2 percent. The two measures for agriculture approached

108

5 percent. Some improvement over the preceding year is suggested for thenonagricultural sector and its manufacturing and nonmanufacturing divi-sions, but the gains were still comparatively small. Thus, the nonagricul-tural productivity increases for 1957 over 1956 were 1.2 percent for man-hours paid and 1.6 percent for man-hours worked. The advances for themanufacturing and nonmanufacturing divisions, both referring to man-hourspaid, were 0.8 percent and 1.6 percent, respectively.

PROBLEMS OF MEASUREMENT AND MEANING

The application and interpretation of available productivity index num-bers must take account of many theoretical and practical difficulties ofmeasurement. In principle, various acceptable productivity indicators canbe constructed, each of which would be especially appropriate to a particularcontext or use. But limitations of data and other factors commonly makeit impracticable to construct measures consistent with the desired concepts.The details of actual measurement affect the meaning and applicability ofthe results. Two or more productivity index numbers computed for agiven industry occasionally differ significantly—in direction as well as inmagnitude. Furthermore, tolerable agreement during a period of obser-vation gives no assurance of similarity thereafter.

The problems of concept, technique, and data that are important forapplication and interpretation pertain not only to the productivity ratioproper but also to the production numerator and the labor denominator.Production measures often employ gross output concepts rather than pre-ferred net concepts; incorporated weights may refer to a year other thanthe one desired; basic product data are commonly reported in crude unitsor broad classes, vary greatly in quality between census and other years,and lack continuity because of technological and other changes. For manyindustries (e. g., finance) and activities (e. g., research) that do not haveuniform or directly measurable products, indirect and rough techniques ofestimation have to be used (e. g., the adjustment of dollar values for pricechanges by means of price measures that may not be altogether pertinent),and these techniques yield results that are conceptually obscure. In laborinput measures, employees and hours of different skill are typically treatedas equivalent; statistics for hours remunerated often have to be used inlieu of hours actually worked; and the scope of the data frequently failsto coincide exactly with the scope of the production measure. Finally, pro-ductivity index numbers for specific industries may be combined in variousways, with results that sometimes differ significantly from ratios of compositeproduction and labor input measures computed for the same group ofindustries.

Certain common misunderstandings of productivity measures should alsobe noted. Short-term changes provide no clear guide to the long-term pro-ductivity trend or to an alteration of this trend. Furthermore, short-termchanges are influenced by, but do not closely reflect, the course of tech-

109

nological progress. The confinement of the denominator to labor inputdoes not imply that labor is the sole contributor to the value of product orthe sole input to be economized in the process of production.

Continual efforts are being made to improve productivity indicators andto extend measurement to additional sectors and industries. These effortsare reflected in the 1959 budget proposals described in Appendix C and inthe establishment in January 1957 of an Interagency Committee on Pro-ductivity Estimates under the auspices of the Bureau of the Budget. ThisCommittee has been making a systematic review of productivity concepts,methods, and data needs and of opportunities to fill the major statisticalgaps.

n o

Appendix F

STATISTICAL TABLES RELATING TO INCOME,EMPLOYMENT, AND PRODUCTION

I I I

CONTENTSNational income or expenditure: Page

F-l. Gross national product or expenditure, 1929-57 117, F-2. Gross national product or expenditure, in 1957 prices, 1929-57 118

F—3. Gross private and government product, in current and 1957 prices,1929-57 120

F-4, Gross national product or expenditure, in 1947 prices, 1929-57 121F-5. Implicit price deflators for gross national product, 1929-57 122F-6. The Nation's income, expenditure, and saving, 1955-57 123F-7. Personal consumption expenditures, 1929-57 124F~8. Gross private domestic investment, 1929-57 125F-9. National income by distributive shares, 1929-57 126F-10. Relation of gross national product and national income, 1929-57. . . . 127F- l l . Relation of national income and personal income, 1929-57 128F-12. Sources of personal income, 1929-57 129F-l3. Disposition of personal income, 1929-57 130F-l 4. Total and per capita disposable personal income and personal con-

sumption expenditures, in current and 1957 prices, 1929-57 131F-l5. Financial saving by individuals, 1939-57 132F-l6. Sources and uses of gross saving, 1929-57 133

Employment and wages:F-l 7. Noninstitutional population and the labor force, 1929-57 134F-18. Employment and unemployment, by age and sex, 1942-57 136F-l9. Employed persons not at work, by reason for not working, and special

groups of unemployed persons, 1946-57 137F-20. Unemployed persons, by duration of unemployment, 1946-57 138F-21. Unemployment insurance programs, selected data, 1939 and 1946-57. 139F-22. Number of wage and salary workers in nonagricultural establishments,

1929-57 140F-23. Average weekly hours of work in selected industries, 1929-57 142F-24. Average gross hourly earnings in selected industries, 1929-57 143F-25. Average gross weekly earnings in selected industries, 1929-57 144F-26. Average weekly hours and hourly earnings, gross and excluding over-

time, in manufacturing industries, 1939-57 145F-27. Average weekly, earnings, gross and net spendable, in manufacturing

industries, in current and 1957 prices, 1939-57 146F-28. Labor turnover rates in manufacturing industries, 1930-57 147

Production and business activity:F-29. Industrial production indexes, 1929-57 148F--30. Business expenditures for new plant and equipment, 1939 and 1945-58. 150F-31. New construction activity, 1929-57 151F-32. New public construction activity, 1929-57 152F-33. Housing starts and applications for financing, 1929-57 153F-34. Sales and inventories in manufacturing and trade, 1939-57 . 154F-35. Manufacturers' sales, inventories, and orders, 1939-57 155

J I3

Prices: PageF-36. Wholesale price indexes, 1929-57 156F-37. Wholesale price indexes, by economic sector, 1947-57 158F-38. Consumer price indexes, 1929-57 160F-39. Consumer price indexes, by selected major groups, 1935-57 161

Money supply, credit, and finance:F-40. Deposits and currency, 1929-57 162F-41. Loans and investments of all commercial banks, 1929-57 163F-42. Federal Reserve Bank credit and member bank reserves, 1929-57. . . . 164F-43. Bond yields and interest rates, 1929-57 165F-44. Short- and intermediate-term consumer credit outstanding, 1929-57. . 167F-45. Instalment credit extended and repaid, 1946-57 168F-46. Mortgage debt outstanding, by type of property and of financing,

1939-57 169F-47. Net public and private debt, 1929-57 170

Government finance:F-48. U. S. Government debt, by kind of obligation, 1929-57 171F-49. Estimated ownership of Federal obligation, 1939-57 172F-50. Federal budget receipts and expenditures and the public debt,

1929-59 173F-51. Federal budget receipts by source and expenditures by function, fiscal

years 1946-59 174F-52. Government cash receipts from and payments to the public, 1946-59. . 175F-53. Government receipts and expenditures as shown in the national income

accounts, 1954-57 176F-54. Reconciliation of Federal Government receipts and expenditures as

shown in the national income accounts with receipts and expendi-tures as reported in the consolidated cash statement and the con-ventional budget, fiscal years 1955-57 177

F-55. State and local government revenues and expenditures, selected fiscalyears, 1927-56 178

Corporate profits and finance:F-56. Profits before and after taxes, all private corporations, 1929-57 179F—57. Relation of profits before and after taxes to stockholders' equity and

to sales, private manufacturing corporations, by asset size class,1947-50 average and 1956-57 180

F—58. Relation of profits after taxes to stockholders' equity and to sales,private manufacturing corporations, by industry group, 1947-50average and 1956-57 181

F-59. Sources and uses of corporate funds, 1946-57 183F-60. Current assets and liabilities of U. S. corporations, 1953-57 184F-61. State and municipal and corporate securities offered, 1934-57 185F-62. Common stock prices and stock market credit, 1939-57 186F-63. Business population and business failures, 1929-57 187

Agriculture:F-64. Income of the farm population, 1929-57 188F-65. Farm population, employment, and productivity, 1929-57 189F-66. Farm production indexes, 1929-57 190F-67. Indexes of prices received and prices paid by farmers, and parity

ratio, 1929-57 191F-68. Comparative balance sheet of agriculture, 1940-58 192F—69. Level-of-living indicators for farm-operator families, selected years,

1920-56 192F-70. Selected indicators of farming conditions, 1929-57 193

International transactions: PageF-71. United States balance of payments, 1953-57 194F-72. United States balance of payments with individual areas, 1953-57. . . . 195F-73. United States merchandise exports and imports for consumption, by

leading commodities, 1936-38 average and 1953-57 . . 197"F—74. U. S. Government grants and credits, excluding military supplies and

services, by areas, total postwar period and fiscal years 1953-57. . . . 198F-75. U. S. Government grants of military supplies and services, by areas,

total postwar period and fiscal years 1953-57 199F—76. Estimated gold reserves and dollar holdings of foreign countries, 1937

and 1949-57 199

NATIONAL INCOME OR EXPENDITURE

TABLE F—1.—Gross national product or expenditure, 1929—57


Period

^otalsrossna-

tionalprod-uct

1929.

19301931193219331934

19351936193719381939

19401941194219431944

19451946 .194719481949

19501951195219531954

195519561957«...

1955: First quarter..Second quarter.Third quarter..Fourth quarter.

1956: First quarter..Second quarter.Third quarter..Fourth quarter.

1957: First quarter...Second quarter.Third quarter..Fourth quarter

Per-sonalcon-

sump-tionex-

pendi-tures 1

104.4

91.176.358.556.065.0

72.582.90.885.291.1

100.6125.8159.192.5211.4

213.209.232.257.257.

285.328.345.363.361.

391.414.433.

79.0

71.061.349.346.51.9

56.362.667.364.667.6

71.81.89.7

100.109.8

121.146. e165.177.180.

194.208.218.230.236.

254.267.280.

Gross private domesticinvestment2

16.

10.35.5

.91.42.9

8.411.

13.218.19.95.67.

10.427.29.741.232.5

51.256.49.850. £48.

60.65. S63.

New construc-tion

10.214.017. S17.

22.23.23.25.27.

32.33.33.

3.6

2.11.6.6

12.11.11.11.813.5

16.15.14.

10.12.412.13.14.

16.18.19.

5.8

4.52.81.61.62.3

3.14.25.13.64.2

5.56.94.34.05.

7.710.16.719.

- 1 . 3- 2 . 6

Netfor-eignin-

vest-ment

.91.02.2

2.24.51.8

-l'.C

0.8

- . 1- . 1

.11.1

- 2 .

Government purchases ofgoods and services

9.29.28.18.09.8

10.011.811.12.813.3

14.124.859.788.696.5

82.930.928.636.643.6

42.62. £77.84.4

77.

Federal

1.3

1.41.51.52.03.0

2.94.84.65.35.2

6.216.952.081.289.0

20.915.821.025.4

22.

59. £48. S

46.847.250.

()1.3

2.213.849.680.488.6

75.921.213.316.019.3

18.537.348.851.543.1

41.42.445.

()(*)

)

3.9

4.03.22.1.51.6

1.02.53.85.66.6

3.94.25.88.46.2

5.95.25.2

Seasonally adjusted annual rates

379.0387.7397.0402.8

405.2410.8416.7426.0

429.1434.3439.0433.0

247.4252.1258.3259.9

262.8265.0268.6272.3

276.7278.9283.6282.5

55.659.761.465.4

64.465.365.568.5

62.765.065.561.0

31.632.732.933.2

32.933.633.233.4

32.832.733.034.0

16.316.816.716.4

15.715.515.115.1

14.413.714.014.5

15.315.916.216.8

17.318.118.118.4

18.519.019.019.5

21.322.425.225.9

26.327.229.029.9

30.730.530.530.0

2.74.63.36.3

5.24.63.35.1

- . 81.72.0

- 3 . 0

- . 4- . 7

.1- . 7

- . 21.22.02.4

4.13.53.22.5

76.576.677.278.2

78.279.380.682.8

85.686.986.787.0

46.946.546.747.1

46.246.447.349.0

50.351.150.650.0

41.841.341.340.7

41.141.642.744.2

45.546.345.845.2

5.55.65.86.8

5.55.24.95.1

5.25.25.25.2

.4

.4

.4

.4

.4

.4

.4

.4

.4

.4

.4

.4

7.2

7.87.76.66.06.8

7.17.07.27.58.2

7.97.87.77.47.5

8.110.012.815.618.2

19.921.823.224.927.7

30.333.036.0

29.530.130.531.1

32.032.933.333.9

35.335.836.137.0

1 See table F-7 for major components.1 See Table F-8 for more detail and explanation of components.3 For 1947-57, national security expenditures include the items classified as such in the Budget of the

United States Government for tjie Fiscal Year ending June 30,1954. They are not comparable with the majornational security category in the Budget for the fiscal year ending June 30, 1959, which corresponds moreclosely to national defense expenditures for goods and services. National defense expenditures since 1947are as follows: 1947,12.3 billion dollars; 1948,11.6 billion; 1949,13.6 billion; 1950,14.3 billion; 1951, 33.9 billion;1952, 43.4 billion; 1953, 49.3 billion; 1954, 41.2 billion; 1955, 39.1 billion; 1956, 40.4 billion; and 1957, 43.7 billion.

4 Not available separately.8 Less than 50 million dollars.9 Preliminary; fourth quarter by Council of Economic Advisers.

NOTE.—Detai l will not necessarily add to totals because of rounding.

Source: Department of Commerce (except as noted).

117

TABLE F—2.—Gross national product or expenditure, in 1957 prices, 1929—57*

[Billions of dollars, 1957 prices]

Period

1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954

195519561957 8

Totalgross

nationalproduct

193.8

175.7162.7138.0134.9148.9

164.0186.3197.0188.5203.5

221.6256.8291.4323.9348.0

340.1301.1300.5314.0313. 3

341.6367.6381.1397.0389.7

417.4430.3433.9

Personal consumptionexpenditures

Total

133.0

125.3121.6110.5107.7113.5

120.6133.0137.7135.7143.5

151.0161.1158.3162.5168.1

179.5200.3203.5207.5212.9

225.6227.2234.4244. 3248.8

266.5275.6280.4

Dura-ble

goods

15.0

12.110.47.97.78.7

10.813.314.011.513.6

15.617.911.610.09.1

10.319.823.724.525.8

31.327.927.530.731.0

37.035.135.1

Non-durable

goods

68.3

64.964.759.557.861.7

65.172.675.076.380.5

84.289.791.794.999.0

106.5112.1109.4109.6111.3

114.2116.3120.3123.9125.0

131.6137.5140.0

Services

49.7

48.346.643.142.343.2

44.747.148.847.949.4

51.353.555.057.660.0

62.768.370.573.575.8

80.283.086.589.792.9

98.0103.0105.4

Gross private domestic investment

Total

38.9

26.616.74.54.78.8

17.723.530.017.223.9

32.040.620.711.813.8

18.845.944.753.741.9

63.364.956.856.654.1

66.368.963.6

New construction

Total

23.1

17.112.06.65.15.7

7.410.412.511.113.3

14.916.88.64.85.3

7.217.820.122.922.5

28.227.126.928.330.5

35.134.433.2

Resi-dential(non-farm)

9.3

5.54.52.31.72.0

3.34.95.35.57.3

7.88.43.91.81.5

1.96.58.5

10.410.2

15.012.212.012.714.5

17.415.614.2

Other

13.8

11.77.44.43.43.6

4.15.57.25.66.0

7.18.44.73.03.7

5.311.311.512.612.3

13.314.914.915.616.0

17.718.819.0

Produc-ers'

durableequip-ment

12.6

10.06.74.04.25.7

7.610.411.98.29.6

12.414.58.47.7

10.2

14.218.124.626.123.2

26.927.227.028.025.9

26.729.730.4

Changein busi-

nessinven-tories

3.2

- . 6- 2 . 0- 6 . 2- 4 . 6- 2 . 6

2.62.75.7

- 2 . 11.0

4.89.33.7

- . 7- 1 . 7

- 2 . 710.0

.14.8

- 3 . 8

8.110.63.0.4

- 2 . 3

4.54.9

(6)

See footnotes at end of table.

u8

TABLE F-2.—Gross national product or expenditure, in 1957 prices, 1929-57l


-Continued

Period

1929

19301931193219331934

19351936193719381939

1940 _194119421943 _ -- . .1944

1945.19461947 . -19481949

19501951 .195219531954

195519561957 6 . .

Netforeigninvest-ment

1.1

.8

.2

- . 4

-L.2L.4LOL.6

?

1.9.4

- 2 . 1- 5 . 8- 5 . 7

- 4 . 54.99.51.5

- 2 . 31.5.6

- 1 . 7.1

1.93.3

Government purchases of goods and services

Total

20.8

23.124.223.122.926.6

26.931.330.233.934.9

36.754.7

114.5155.4171.8

146.350.042.751.258.5

55.074.189.397.886.7

84.683.986.6

Federal

Total

3.4

3.94.24.46.28.4

8.112.611.814.413.5

16.435.697.1

139.6156.3

130.532.122.429.133.6

28.246.961.769.155.5

51.349.250.5

Nat iona lsecuri ty 2

(4)

(})

(4)3.3

5.929.092.5

138.1155.7

132.532.519.022.125.4

23.642.655.559.848.8

45.244.245.7

Other 3

(4)

10.2

10.56.75.02.52.7

1.83.85.37.78.7

5.04.76.69.87.1

6.55.45.2

Stateandlocal

17.4

19.220.018.716.718.2

18.818.718.519.621.4

20.319.117.415.815.5

15.817.920.322.124.9

26.727.227.628.731.2

33.334.836.0

1 These estimates represent an approximate conversion of the Department of Commerce series in 1947prices. (See Table F-4.) This was done by major components, using the implicit price indexes convertedto a 1957 base. Although it would have been preferable to redeflate the series by minor components, thiswould not substantially change the results except possibly for the period of World War II, and for theseries on change in business inventories.

2 Net of Government sales, which are not shown separately in this table. See Table F-l for Govern-ment sales in current prices.

3 See Table F-l , footnote 3.4 Not available separately.« Less than 50 million dollars.6 Preliminary.


Source: Council of Economic Advisers.

TABLE F—3.—Gross private and government product, in current and 7957 prices, 1929—57


Year

1929

193019311932 - . . .19331934

1935 . _ .193619371938 .1939

194019411942 .19431944

19451946194719481949 - . .

19501951195219531954

195519561957 «

Current prices

Totalgrossna-

tionalprod-uct

104.4

91.176.358.556.065.0

72.582.790.885.291.1

100.6125.8159.1192.5211,4

213.6209.2232.2257.3257.3

285.1328.2345.4363.2361.2

391.7414.7433.9

Gross private productl

Total

100.1

86.671.654.051.359.4

66.675.583.977.683.5

92.8116.4144.0167.0179.2

178.4188.5215.6240.0238.0

264.3301.0314.5331.5328.9

357.8378.6395.5

Farm2

9.8

7.76.24.44.64.3

6.96.38.16.76.5

6.89.4

13.415.315.7

16.218.820.623.720.1

21.124.622.721.020.5

19.919.619.2

Non-farm

90.3

78.865.449.646.755.1

59.669.275.870.977.0

86.0107.0130.6151.7163.5

162.2169.7195.0216.2217.8

243.1276.4291.8310.5308.4

337.9359.0376.3

Grossgov-ern-

mentprod-uc t 3

4.3

4.54.74.44.75.6

5.97.36.97.67.6

7.89.4

15.125.632.2

35.220.716.717.419.3

20.827.231.031.732.2

33.936.138.3

1957 prices *

Totalgrossna-

tionalprod-uct

193.8

175.7162.7138.0134.9148.9

164.0186.3197.0188.5203.5

221.6256.8291.4323.9348.0

340.1301.1300.5314.0313.3

341.6367.6381.1397.0389.7

417.4430.3433.9

Gross private product *

Total

181.9

163.3150.0125.6121.3132.9

146.9166.2178.2168.0182.9

200.3230.7253.5265.2280.8

274.5266.6274.0287.4285.4

312.8331.8342.7358.8352.2

380.0392.5395.5

Farm 2

15.4

14.316.615.615.212.7

15.513.016.916.716.6

16.117.419.017.518.0

16.917.616.318.918.0

18.717.517.718.419.4

20.219.919.2

Non-farm

166.5

149.0133.5110.0106.1120.3

131.4153.1161.3151.3166.4

184.1213.2234.5247.7262.8

257.7249.0257.7268.6267.5

294.1314.3325.0340.4332.8

359. 8372.6376.3

Grossgov-ern-

mentprod-uct 3

11.9

12.512.712.413.616.0

17.120.218.820.520.6

21.426.237.858.767.2

65.534.526.526.627.8

28.835.838.438.237.5

37.437.938.3

1 Gross national product less compensation of general government employees, i. e., gross product accruingfrom domestic business, households, and institutions, and from the rest of the world.

2 See Survey of Current Business, August 1954 and June 1957, for description of series and estimates incurrent and constant prices and implicit deflators for 1910-56.

3 Includes compensation of general government employees and excludes compensation of employees ingovernment enterprises. Government enterprises are those agencies of government whose operating costsare at least to a substantial extent covered by the sale of goods and services, in contrast to the general activi-ties of government which are financed mainly by tax revenues and debt creation. Government enter-prises, in other words, conduct operations essentially commercial in character, even though they performthem under governmental auspices. The Post Office and public power systems are typical examples ofgovernment enterprises. On the other hand, State universities and public parks, where the fees and ad-missions cover only a nominal part of operating costs, are part of general government activities.

* See Table F-2, footnote 1.8 Preliminary.


Sources: Department of Commerce and Council of Economic Advisers.

I 2 O

TABLE F—4.—Gross national product or expenditure, in 1947 prices, 1929-57 1


Period

1929

19301931193219331934

19351936193719381939

19401941194219431944 .

19451946194719481949

19501951195219531954

195519561957 *

Totalgrossna-tionalprod-uct

149.3

135.2126.6107.6103.7113.4

127.8142.5153.5145.9157.5

171.6198.2223.6248.9268.2

263.1233.8232.2243.9241.5

264.7282.9293.7305.3301.3

322.8332.0334.7

Personal consumption

Total

107.3

100.998.088.986.691.5

97.3107.6111.5109.8116.3

122.5130.9128.1131.4135.9

145.2162. 4165.0168.0172.3

182.8183.6189.3197.4200.9

215.4222.5226.3

expenditures

Du-rablegoods

13.0

10.59.16.96.77.6

9.411.612.210.011.8

13.515.610.18.77.9

8.917.220.621.322.4

27.224.223.926.726.9

32.230.530.5

Non-du-

rablegoods

58.1

55.255.050.749.252.5

55.461.863 864.968.5

71.676.478.080.884.3

90.695.493.193.394.7

97.299.0

102.4105.4106.3

111.9117.0119.0

Serv-ices

36.2

35.233.931.430.831.4

32.534.335 534.936.0

37.438.940.142.043.7

45.649.851.353.555.2

58.460.463.065.367.6

71.375.076.7

Gross private domestic

Total

26.8

17.912.03.32.14.3

13.615.222 512.116.8

22.828.914.77.49.2

13.032.429.738.828.1

45.345.239.338.537.9

46.647.643.6

investment

Newcon-

struc-tion

16.1

11.88.34.63.53.9

5.27.38 77.89.4

10.611.86.03.43.6

5.012.314.016.115.8

20.019.018.819.821.4

24.724.123.2

Pro-duc-ers'du-

rableequip-ment

8.5

6.84.62.72.93.9

5.27.18.15.66.5

8.49.85.75.26.9

9.712.316.717.715.7

18.318.418.319.017.6

18.120.120.7

Changein

busi-ness

inven-tories

2.1

- . 7- . 9

- 4 . 1—4.2- 3 . 5

3.2.9

5 7- 1 . 2

.8

3.97.33.0

— 1.2- 1 . 3

—1.67.8

- 1 . 05.1

- 3 . 5

7.07.82.2

- . 3- 1 . 0

3.83.4

- . 3

Netfor-eignin-

vest-ment

1.6

1.2.6.3. 1.5

- 5- . 7— 21.91.6

2.21 1

- 1 . 1—4.1- 4 . 0

—2.95.08.92.1

.8

- 1 . 12.31.7

- . 31.2

1.33.04.2

Governmentpurchases of goods

and services

Total

13.6

15.115.915.114 917.2

17.420.319.722.122.8

24.137 381.8

114.2127.1

107.834.028.634.940.3

37.751.863.469.661.2

59.458.960.7

Fed-e r a l

2.3

2.72.93.04 35.7

5 48.37.89.69.0

11.025 170.8

104 3117.4

97.922.715.820.824.3

20.534.245.651.141.0

37.836.337.4

Stateandlocal

11.2

12.513.012.110.611.6

11.912.011.812.513.8

13.012 211.09 99.7

9 911.212.814.016.0

17.317.517.818.520.2

21.622.523.3

Grosspri-vate

prod-uct 3

142.3

127. 8119.1100.395.6

103.9

117.6130.3142 1133! 6145.0

158.6181.7198.7209.0222.0

218.0211 2215.6227.3224.0

246.6259.9268.9280.7277.3

299.0308.0310.5

1 See National Income, 1954. Edition, A Supplement to the Survey of Current Business, for explanation ofconversion of estimates in current prices to those in 1947 prices. See Table F-5 for implicit deflators.

2 Net of Government sales.3 Gross national product less compensation of general government employees.* Preliminary estimates by Council of Economic Advisers.

NOTE.—Detail will not necessary add to totals because of rounding.


121

TABLE F—5.—Implicit price deflators for gross national product, 1929—57

[Index numbers, 1947=100]

Year

1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949 - .

19501951195219531954

195519561957 «

Grossna-

tionalprod-uct i

Total

70.0

67.460.354.354.057.3

56.758.159.258.457.9

58.663.571.277.378.8

81.289.5

100.0105.5106.6

107.7116.0117.6119.0119.9

121.3124.9129.6

Personal consumptionexpenditures

Dur-able

goods

73.6

70.362.655.453.656.7

57.858.260.358.958.1

58.762.670.076.580.8

83.890.3

100.0105.7104.8

106.2113.5115.3116.8117.7

118.1120.1123.9

Non-dur-able

goods

70.7

67.960.653.052.055.4

54.554.556.957.056.5

57.461.969.276.285.6

90.692.2

100.0104.3105.1

105.1112.0111.3111.7109.0

110.7111.3114.9

64.8

61.652.644.945.350.8

52.953.255.152.351.3

52.056.665.873.477.6

80.888.6

100.0105.9102.3

103.3112.2113.4112.9113.4

112.5113.9117.6

Serv-ices

Total

88.6

84.879.373.067.266.9

67.268.470.871.671.6

72.074.578.582.786.3

88.592.9

100.0105.9108.9

111.4116.1120.0125.0128.1

130.1133.2137.4

Gross private domesticinvestment1

New construction

53.9

52.247.740.840.643.4

44.245.050.450.750.6

51.756.061.669.274.7

76.883.3

100.0111.4110.7

113.9122.8125.9130.1129.7

132.2138.0142.9

Resi-den-tialnon-farm

Other

52.6

51.346.737.737.541.7

41.143.247.649.249.9

51.556.359.965.271.6

77.083.4

100.0112.0109.2

113.8121.6124.9127.4125.9

129.0133.1135.1

54.9

52.648.442.542.444.4

47.046.852.852.351.5

51.955.663.171.976.1

76.883.3

100.0110.9112.0

113.9123.9126.9132.4133.4

135.6142.4149.4

Pro-duc-ers'dur-able

equip-ment

68.5

65.862.358.855.759.3

59.159.063.365.464.0

66.070.676.477.278.3

79.387.4

100.0108.1113.3

115.7125.7126.4127.8128.1

130.9139.6147.3

Total

Government pur-chases of goodsand services

62.4

60.757.953.454.056.7

57.558.359.657.958.3

58.566.373.077.676.0

76.991.0

100.0104.9108.2

111.3121.3122.3121.2125.2

129.7136.3142.5

Fed-eral

56.0

52.853.248.947.352.9

53.858.358.055.157.3

55.967.373.477.975.8

76.492.2

100.0100.8104.6

108.0119.9119.0116.3119.2

123.6129.9135.1

Stateandlocal

63.8

62.458.954.556.758.6

59.258.460.660.159.0

60.764.370.074.877.8

81.888.8

100.0110.8113.6

115.3124.3130.6134.6137.3

140.3146.6154.4

Grossgov-ern-

mentprod-uct2

Grosspri-vate

prod-uct 3

61.5

61.362.060.558.358.7

58.359.761.061.861.2

59.957.260.964.169.7

77.991.9

100.0104.5111.0

115.0118.3|124. 7!128. 9134.1

142.3150.2158.1

70.4

67.760.253.953.657.2

56.657.959.058.157.6

58.564.172.579.980.7

81.889.2

100.0105.6106.2

107.2115.8117.0118.1118.6

119.7122.9127.4

1 Separate deflators are not available for total gross private domestic investment, change in businessinventories, and net foreign investment. For explanation of conversion of estimates in current prices tothose in 1947 prices, see National Income, 1954. Edition, A Supplement to the Survey of Current Business.

2 For definition, see footnote 3, Table F-3.3 Gross national product less compensation of general government employees.4 Preliminary estimates by Council of Economic Advisers.


1 2 2

T A B L E F—6.—The Nation's income, expenditure, and saving, 1955—57


Economic group

Consumers:Disposable personal incomePersonal consumption expendi-

turesPersonal net saving. _

Business:Gross retained earningsGross private domestic invest-

mentExcess of investment (—)

International:Net foreign investment

Excess of receipts or invest-ment (—)

Government (Federal, State, andlocal):

Tax and nontax receipts or ac-cruals

Less: Transfers, interest, andsubsidies (net)

Net receipts

Total government expenditures _Less: Transfers, interest, and

subsidies (net)

Purchases of goods and serv-ices

Surplus or deficit (—)on income and prod-uct account

Statistical discrepancy

GROSS NATIONAL PRODUCT

1955

Re-ceipts

270.2

39.8

101.1

21.5

79 6

2.1

391.7

Ex-pend-itures

254.4

60.6

— .4

98.6

21.5

77 1

391.7

Excessof re-ceiptsor ex-pend-itures

<-)

15.8

—20 8

.4

2.6

2.1

1956

Re-ceipts

287.2

40 9

109.0

24.0

85.0

1.6

414.7

Ex-pend-itures

267.2

65.9

1.4

104.2

24.0

80 2

414.7

Excessof re-ceiptsor ex-pend-itures

(-)

20.0

—25 6

— 1 4

4 8

1 6

1957 1

Re-ceipts

300.0

44 0

115 7

27.5

88 2

1 7

433.9

Ex-pend-itures

280.4

63.6

3.3

114.1

27.5

86.6

433.9

Excessof re-ceiptsor ex-pend-itures(-)

19.6

-19.6

- 3 . 3

1.7

1.7

i Preliminary; fourth quarter by Council of Economic Advisers.


Source: Based on the national income and product statistics of the Department of Commerce (exceptas noted).

123

TABLE F-7.—Personal consumption expenditures, 1929-57


Period

1929-

1930-1931-1932-1933-1934-

1935-1936-1937-1938-1939..

1940-1941-1942-1943-1944-

1945-1946-1947-1948-1949-

1950-1951-1952-1953-1954..

1955..1956-1957 «.

1955: First quarter...Second quarter.Third quarter __Fourth quarter.

1956: First quarter._.Second quarter.Third quarter..Fourth quarter

1957: First quarter...Second quarter.Third quarter..Fourth quarter

Totalper-sonalcon-

sump-tionex-

pend-itures

79.0

71.061.349.346.451.9

56.362.667.364.67.6

71.981.89.7

100.5109.

121.7146.165.0177.6180.6

194.0208.3218.3230.5236.6

254.4267.2280.4

Durable goods

To-tal

9.2

7.25.53.3.54.2

5.16.36.95.76.7

7.89.77.06.6.8

8.115.920.622.223.

29.829.4

33.35.1

28. 6 12. 4 12. 910. 9 12. 7

26. 6 10. 413.12. 6 12. 9

35. 6 17. 2 14. 214.8

L79 14.

1.03.96.37.3 11.59. 5 10. 9

4.8.7

11.0

12.5

Nondurable goods

To-tal

37. 7 19. 5

3428.922.822.3

0 18J14.711.410.9

26. 7 12. 2

29.32.835.34.035.1

3 13.

37.243.251.59.65.

73.84.93.198. 7 49.

3. 3 100. 4111.1116.1119.120.

1.615.2

L 415.15.7

2 16.

7.48.8

11.03 27. 8 13. 4

14.

16.719.4

1.73 23.

4 30.6

2 34., 5 40.

1.4

45.1.4

9 48.8

16.518.218.819.618.5

51.0 18.558.3119.861. 4 20.1

6 64

4. 2 126. 0 66. 9 20. 64. 5 133. 3 714.7

.3 21.8140. 0 75.4 22. 3

19.7

7.0

6.35.74.85.37.2

7.99.19.89.5

10.1

10.12.314.5

2.32.62.11. 3 16. 71.4 18.7

1. 8 20.81.8

3. 6 25.14. 3 25.4. 7 24.

. 95. 5 27. 4

0 28.66. 6 29. 66. 9 29. 7

7. 5 31. 08. 0 32. 28. 6 33. 7

Services

32.1

29.26.22.920.721.0

8 11.9 10.

21.23.525.125.025.8

26.929.31.534.737.7

40.446.51.56.60.1

65.70.75.81.786.6

11.4

0 10.9.3

i . O10.11.311.9

12.4i. 2 13.

5.417.519.4

0 21.1 23.

27.629.5

92. 8 31.199.

105. 4 34. 5

4.0

3.93.53.02.83.0

3.23.43.73.3.

4.04.34.85.25.9

6.46.77.48.08.5

9.410.311.112.012.6

14.18 15.5

16.3

2. 6 14.0

2. 2 12. 71.9 11.2

9.38.5

1.61.5

9.410.311. 110.711.0

11.412.313.114.716.3

5.5

17.51.8

23.0.2

1 20.

5. 9 25.5. 8 26. 4

5. 8 28. 56. 4 30. 06. 8 32. 17. 3 34. 87. 3 37. 2

7. 5 40.17. 7 43. 87.9 46. 6


247.4252.1258.3259.9

262.8265.0268.272.3

276.278.9283.282.5

34.'35.337. 2 18. 535.4

34.6

16. 8 13. 91

14.516. 5 14. 4

15.433. 3 13. 8 15. 033. 0 13. 7 14. 734. 8 15. 3 14. 9

35. 9 16. 3 14. 935. 0 15. 5 14. 935. 0 15. 334. 5 15. 6 14.1

14.

14. 9

19. 96. 3 20. 6

. 4 68. 0 20. 83

122. 4 64. 8124.127.129. 2 68. 6 21. 3

8 66.

4. 5 130. 9 69. 9 21. 04. 5 132. 7 70. 8 21.4. 6 134. 4 71. 9 22. 34. 6 135. 3 72. 7 22. 2

4. 7 137. 3 74. 0 21.75. 5 22. 0

4. 8 142. 5 76. 6 23.14. 8 141. 0 76.1 22.1

3 30.5 30.

7 31.

8. 7 34.1

90.92.93. 7 31. 3 14. 395. 3 31 7

2 30.0 30.

15.215.5

33. 2 15. 7

7. 9 32.18. 0 32. 28. 0 32. 28. 3 32.1

8. 5 32. 9 103. 4 33. 9 16. 08. 7 32. 9 104. 9 34. 3 16. 28. 7 34. 0 106.1 34.7

107. 0 35.0

i. 5 13. 5I. 9 13. 8

97. 2 32.199. 0 32. 6

101.1102. 2 33. 5 15. 8

16.6

. 4 38.

. 4 39.

. 5 40.

. 6 41.

7. 7 42. 27.7.7. 8 45.1

'. 7 43.

7. 8 45. 77. 9 46. 57. 9 47.18.0 47. 4

1 Quarterly data are estimates by Council of Economic Advisers.2 Includes standard clothing issued to military personnel.3 Includes imputed rental value of owner-occupied dwellings.* Preliminary; fourth quarter by Council of Economic Advisers.



124

TABLE F-8.—Gross private domestic investment, 1929-57


Periodprivate

do-mesticinvest-ment

1929.

1930..1931.1932.1933..1934.

19351936193719381939.

19401941.194219431944.

1945.1946-1947,19481949-

1950.1951-1952.1953.1954.

1955.1956.1957*

1955:First quarterSecond quarter.Third quarter..Fourth quarter.

1956:First quarterSecond quarter.Third quarter..Fourth quarter.

1957:First quarterSecond quarter.Third quarter. .Fourth quarter 8.

Total

16.2

10.35.5.9

1.42.9

6.38.4

11.76.79.3

13.218.19.95.67.1

10.427.129.741.232.5

51.256.949.850.348.4

60.665.963.6

Nonfarm producers'plant and equipment

Total Equip-ment 2

55.659.761.465.4

64.465.365.568.5

62.765.065.561.0

9 3

7.24.42.42.22.9

3.75.06.54.75.3

5.34.66.2

9.214.820.723.521.7

25.529.129.631.930.5

33.339.542.0

5.2

4.02.61.41.52.1

2.73.64.53.13.7

4.96.13.73.54.7

6.910.015.016.815.3

18.520.420.521.620.0

21.225.727.6

Con-struc-tions

4.1

3.31.81.0

1.01.42.11.51.6

2.02.51.61.11.5

2.34.85.76.76.4

7.08.89.1

10.310.5

12.113.814.4

Farm equipmentand construction

Total Equip-ment

0.9

.7

.4

.2

.2

.3

.5

.7

.8

.7

.7

1.0

1.01.63.03.94.0

4.24.74.54.44.1

4.14.04.4

0.6

.5

.3

.1

.1

.3

.4

.5

.6

.5

.5

.6

.8

.7

.6

.7

.7

.71.62.32.5

2.62.82.62.72.5

2.52.42.9

Con-struc-tion

Resi-dential

con-struc-tion(non-farm)

0.3

. 2

. 1(7)

(01

. 1

.2

.2

.2

.2

.2

.3

.3

.3

.3

.3

.91.41.51.5

1.61.81.91.71.6

1.61.61.6

Otherpri-vatecon-

struc-tions

3.6

2.11.6.6.5

1.01.61.92.02.7

3.03.51.7

1.14.06.38.68.3

12.611.011.111.913.5

16.615.314.2

Total

0.7

.7

.5

.2

.1

.1

.1

.2

.2

.3

.71.01.3

1.51.71.61.82.1

2.32.63.0

Net change inbusiness inventories

1.7

- . 4- 1 . 3- 2 . 6- 1 . 6- 1 . 1

.91.02.2

- . 9.4

2.24.51.8

- . 8- 1 . 0

- 1 . 16.1

- 1 . 04.2

- 2 . 7

7.410.43.0

.3- 1 . 9

4.24.6(0

Non-farm 6

1.8

- . 1- 1 . 6- 2 . 6-1 .4

.2

.42.11.7

- 1 . 0.3

1.94.0

.7- . 6- . 6

- . 66.41.33.0

- 1 . 9

6.49.02.1.9

- 2 . 4

4.05.0.3

Farm


-0.2

- . 3.3

(7)- . 3

- 1 . 3

.5- 1 . 1

.5

.1

.1

.3

.51.2

- . 2- . 4

- . 5- . 2

- 2 . 31.1

- . 6.5

.3- . 5- . 3

30.231.934.736.4

37.639.040.341.2

42.042.042; 142.0

18.920.022.523.5

24.225.026.427.2

27.927.627.727.2

11.411.912.312.9

13.414.013.914.0

14.114.414.414.8

4.04.14.34.0

3.63.84.24.3

4.34.64.44.4

2.42.52.72.4

2.12.22.62.7

2.83.02.82.8

1.61.61.61.6

1.61.61.61.6

1.51.61.61.6

16.316.816.716.4

15.715.515.115.1

14.413.714.014.5

2.32.42.32.3

2.32.52.62.8

2.93.03.03.1

2.74.63. 36.3

5.24.63.35.1

- . 81.72.0

- 3 . 0

2.24.23.16.3

5.45.03.95.7

- . 32.22.3

- 3 .0

- . 5- . 5- . 3CO

1 Items for nonfarm producers' plant and equipment are not comparable with those shown in Table F-28principally because the latter exclude equipment and construction outlays charged to current expense andalso investment by nonprofit organizations and professional persons.

2 Total producers' durable equipment less farm machinery and equipment, and farmers' purchases oftractors and business motor vehicles.

3 Industrial buildings, public utilities, gas- and oil-well drilling, warehouses, office and loft buildings,stores, restuarants, and garages.

* Farm construction (residential and nonresidential) plus farm machinery and equipment, and farmers'purchases of tractors and business motor vehicles. (See footnote 2.)

s Includes religious, educational, social and recreational, hospital and institutional, miscellaneous non-residential, and all other private construction.

6 After inventory valuation adjustment.7 Less than 50 million dollars.s Preliminary; fourth quarter by Council of Economic Advisers.



125

TABLE F-9.—National income by distributive shares, 1929-57


Period

Totalna-

tionalin-

come1

Com-pen-

sationof em-ploy-ees 2

Business and pro-fessional incomeand inventory-

valuationadjustment »

Total

8.8

7.45.63.43.24.6

5.46.57.16.87.3

8.410.913.916.818.0

19.021.319.921.621.4

22 924.825.725.925.9

27.328.028.7

In-come

ofunin-corpo-ratedenter-prises

8.6

6.75.03.13.74.6

5.46.67.16.67.5

8.511.514.317.018.1

19.123.021.422.121.0

24.025.125.526.125.9

27.628.628.9

In-ven-toryvalu-ationad-

just-ment

In-come

offarmpro-prie-tors3

6.0

4.13.21.92.42.4

5.04.05.64.34.3

4.66.5

10.011.411.5

11.813.914.516.712.7

13.316.015.113.312.7

11.911.611.6

Rent-al in-come

ofper-sons

5.4

4.83.82.72.01.7

1.71.82.12.62.7

2.93.54.55.15.4

5.66.26.57.27.9

8.59.19.9

10.210.6

10.210.310.4

Corporate profitsand inventory

valuationadjustment

Total

10.1

6.61.6

-2 .0-2 .0

1.1

2.95.06.24.35.7

9.114.519.723.823.0

18.417.323.630.628.1

35.139.936.936.033.1

40.740.440.6

Cor-porateprofitsbeforetaxes<

9.6

3.3- . 8

-3 .0. 2

1.7

3.15.76.23.36.4

9.317.020.924.623.3

19.022.629.532.826.2

40.041.235.937.033.5

42.543.042.0

In-ven-toryvalu-ationad-just-ment

Netin-

terest

1929

1930 _ -19311932 .-_19331934

193519361937 ,19381939

1940.1941194219431944

194519461947 .._19481949

1950 _1951195219531954

195519561957 6

1955: First quarter....Second quarter..Third quarter...Fourth quarter..

1956: First quarterSecond quarter.Third quarter. _.Fourth quarter.

1957: First quarter....Second quarter..Third quarter...Fourth quarter 6.

87.8

75.759.742.540.249.0

57.164.973.667.672.8

81.6104.7137. 7170.3182.6

181.2179.6197.2221.6216.2

240.0277.0290.2302.1299.0

324.1343.6358.5

51.1

46.839.731.129.534.3

37.342.947.945.048.1

52.164.885.3

109.6121.3

123.2117.7128.8140.9140.9

LS4.3180.4195.1208.1206.8

223.1241.4254.3

0.1

.8

.6

.3- . 5- . 1

().2

- . 2

- . 6- . 4- . 2- . 1

- . 1- 1 . 7- 1 . 5- . 4

.5

- 1 . 1- . 3

.2- . 2- . 1

- . 3

0.5

3.32.41.0

-2 .1

- . 2

()1.0

- . 7

- . 2-2 .5-1.2- . 8- . 3

-5 .3-5.9-2.2

1.9

-4 .9-1 .3

1.0-1.0- . 3

-1.7-2.6-1.4

6.4

6.05.85.45.04.9

4.84.74.74.64.6

4.64.54.33.73.3

3.23.13.84.55.2

5.96.87.48.79.8

10.911.912.9


311.4321.5328.3334.9

335.8340.6344.5353.3

355.1358.1362. 2

(7)

214.0221.3226.1230.8

234.5240.0242.7247.9

251.1254.0257.0255.0

26.727.327.627.8

27.728.028.228.3

28.428.729.128.5

26.827.627.928.1

28.328.728.528.8

28.929.029.228.8

- . 1- . 3

o

- ! 4

- . 6- . 7- . 4- . 6

- . 5- . 3- . 1- . 3

11.712.111.911.7

11.411.511.512.0

11.511.711.811.5

10.410.210.110.1

10.210.310.410.4

10.410.410.410.4

38.239.941.643.2

40.539.139.842.4

41.240.740.9(7)

39.440.743.646.1

43.342.440.845.6

43.942.041.8(7)

-1 .2- . 9

-2 .0-2 .9

- 2 . 8-3 .2-1 .0-3 .2

-2 .7- 1 . 3

- . 9(7)

10.510.711.011.3

11.511.712.012.3

12.512.713.013.3

1 National income is the total net income earned in production. It differs from gross national productmainly in that it excludes depreciation charges and other allowances for business and institutional con-sumption of durable capital goods, and indirect business taxes. See Table F-10.

2 Wages and salaries and supplements to wages and salaries (employer contributions for social insurance;employer contributions to private pension, health, and welfare funds; compensation for injuries; directors'fees; pay of the military reserve: and a few other minor items).

3 Excludes income resulting from net reductions of farm inventories and gives credit in computingincome to net additions to farm inventories during the period.

4 See Table F-56 for corporate tax liability (Federal and State income and excess profits taxes) andcorporate profits after taxes.

« Less than 50 million dollars.6 Preliminary; fourth quarter by Council of Economic Advisers.7 Not available.NOTE.—Detail wUl not necessarily add to totals because of rounding.Source: Department of Commerce (except as noted).

126

T A B L E F-10.—Relation of gross national product and national income, 1029—57


Period

Grossna-

tionalprod-

uct Total

Less: Capital con-sumption allowances

Depre-ciation

chargesOther

Equals:Netna-

tionalprod-uct

Plus:Sub-sidiesless

iurrentsurplusof gov-ern-mententer-prises

Less:

Indirect business

Total

7.0

7.26.96.87.17.8

8.28.79.29.29.4

10.011.311.812.714.1

15.517.318.720.421.6

23.725.628.130.230.1

32.935.036.9

tax

Fed-eral

1.2

1.0.9.9

1.62.2

2.22.32.42.22.3

2.63.64.04.96.2

7.17.97.98.18.2

9.09.5

10.511.210.1

11.011.612.3

Stateandlocal

5.8

6.16.05.85.45.6

6.06.46.86.97.0

7.47.77.77.88.0

8.49.5

10.812.313.5

14.716.117.619.020.1

21.823.424.6

Busi-ness

trans-fer

pay-ments

0.6

.5

.6

.7

.7

.6

.6

.6

.6

.4

.5

.4

.5

.5

.5

.5

. 5

.6

.7

.7

.8

. 81.01.21.41.3

1.31.31.3

Sta-tisti-caldis-crep-ancy

0.3

- 1 . 0. 8.8.9.7

- . 21.1

- . 2.5

1.2

. 8

.4- . 8

- 1 . 72.8

4.5.9

1.4- 2 . 1

.1

.21.32.02.61.7

2.11.61.7

Equals:Na-

tionalncome

1929..

1930..1931..1932..1933-1934..

1935..1936..1937-1938..

19401941194219431944

19451946194719481949

19501951195219531954

195519561957 »

1955:First quarterSecond quarter-Third quar te r . -Four th quarter .

1956:First quar ter . . . .Second quar te r .Third quarter - .Four th quar ter .

1957:First quar te r . _.Second quarter _Third quar te r .Four th quarter 3

104.4

91.176.358.56.065.0

72.582.90.885.291.1

100.6125.8159.1192.5211.

213.6209.2232.2257.3257.3

285.1328.2345.4363.2361.2

391.7414.433. S

8.6

8.58.27.67.27.1

7.27.57.77.87.8

8.19.0

10.210.912.0

12.511.714.116.518.4

20.523.523.926.528.9

31.634.337.1

7.7

7.77.67.06.7

6.76.76.96.97.1

7.38.19.29.9

10.8

11.210.012.214.316.4

18.020.321.023.325.6

28.130.633.3

0.9

.8

.6

.6

.5

.5

.6

.7

.81.01.01.01.2

1.31.72.02.2.1

2.53.12.93.3.3

3.73.8

95.8

82.668.150.948.857.9

65.375.283.077.483.3

92.5116.8149.0181.6199.4

201.0197.6218.1240.8238.9

264.6304.8321.6336.332.2

360.1380.4396.8

- 0 . 1

1.11.6


379.0387.7397.0402.8

405.2410.8416.7426.0

429.1434.3439.0433.0

30.631.432.032.6

33.333.934.635.3

36.136.637.438.2

(4)(4)(4)(4)

(4)(4)(4)(4)

(4)(4)(4)(4)

(4)(4)(4)(4)

(4)(4)(4)(4)

(4)(4)(4)(4)

348.4356.3365.0370.2

371.9376.9382.1390.7

393.0397.7401.6394.8

. 1

.70

. 1

.81.01.11.6

1.41.61.71.7

31.532.833.234.0

34.134.735.136.1

36.436.637.137.4

10.611.311.011.3

11.111.311.512.3

12.212.112.312.3

20.921.522.222.7

23.023.423.623.8

24.224.524.825.1

1.31.31.31.3

1.31.31.31.3

1.31.31.3, 3

4.41.42.3

. 1

1.51.32.31.6

- 1.63.32.7«

87.8

75.759.742.540.249.0

57.164.973.667.672.8

81.6104.7137.7170.3182.6

181.2179.6197.2221.6216.2

240.0277.0290.2302.1299.0

324.1343.6358.5

311.4321.5328.3334.9

335.8340.6344. 5353.3

355.1358.1362.2

1 Accidental damage to fixed capital and capital outlays charged to current account.2 Less than 50 million dollars.3 Preliminary; fourth quarter by Council of Economic Advisers.* Not available.NOTE.—Detail will not necessarily add to totals because of rounding.Source: Department of Commerce (except as noted).

127

T A B L E F—11.—Relation of national income and personal income^ 1929—57


Period Nationalincome

Less:

Corpo-rate

profitsand in-

ven-toryvalu-ation

adjust-ment

Contri-butions

forsocialinsur-ance

Excessof

wageac-

crualsoverdis-

burse-ments

Gov-ern-

menttrans-

ferpay-

ments

Plus:

Netinter-

estpaidby

gov-ern-

ment

Divi-dends

Busi-ness

trans-fer

pay-ments

Equals:

Per-sonal

L929

1930 . .193119321933 . .1934

19351936193719381939

19401941 -194219431944

1945 - -194619471948-1949

19501951195219531954

1955.-- . - - . .19561957 1

87.8

75.759.742.540.249.0

57.164.973.667.672.8

81.6104.7137.7170 3182.6

181.2179.6197.2221.6216.2

240.0277.0290.2302.1299.0

324.1343.6358.5

1955: First quarterSecond quarter._Third quarter...Fourth quarter..

1956: First quarterSecond quarter..Third quarter...Fourth quarter..

1957: First quarterSecond quarter..Third quarter-..Fourth quarter i.

311.4321. 5328.3334.9

335.8340.6344.5353.3

355.1358.1362.2

10.1

6.61.6

-2 .0-2 .0

1.1

2.95.06.24.35.7

9.114.519.723.823.0

18.417.323.630.628.1

35.139.936.936.033.1

40.740.440.6

0.2

.3

.3

.3

.3

.3

.3

.61.82.02.1

2.32.83.54.55.2

6.16.05.75.25.7

6.98.28.68.79.7

11.012.414.4

0.2- . 2

0.9

1.02.11.41.51.6

1.82.91.9 j2.4 !2.5

2.7 12.62.62.53.1

5.610.911.1

1.0

1.01.1.1.2.2

.1

.1

.2

.2.. 2

.3

.3

.52.12.8

3.74.54.4

- . 1

10.511.6

14.311.612.012.915.0

16.117.219.9

4.4 j4.6

4.74.84.95.05.2

5.25.76.0

5.8

5.54.12.62.12.6

2.94.54.73.23.8

4.04.54.34.54.7

4.75.86.57.27.5

9.29.19.09.39.9

11.011.912.3


38.239.941.643.2

40.539. 139.842.4

41.240.740.9(2)

10.610.811.311.4

12.012.212.512.8

14.214.314.614.5

. 1

.5- . 6

0.6

.5

1.1.1.1.

1.1.1.

45

45555

56778

80243

333

15.716.116. 116.2

16.617.117.417.7

18.420.020.021.3

5.25.15.25.3

5.55.75.85.9

6.06.06.06.1

10.210.410.812.0

11.712.012.111.5

12.412.512.611.7

1.31.31.31.3

1.31.31.31.3

1.31.31.31.3

85.8

76.965.750.147.253.6

60.268.573.968.672.9

78.796.3

123.5151. 4165.7

171.2178.0190.5208.7206.8

227.0255.3271.8286.0287.4

305.9326.9342.9

294.8303.3309.4315.2

318.5325.3328.7334.5

337.7342.8346.5344.5

1 Preliminary; fourth quarter by Council of Economic Advisers.2 Not available.



128

TABLE F-12.—Sources of personal income, 1929—57


PeriodTotal

personalincome

1929..

1930..1931 . .1932..1933. .1934..

1935..1936..1937..1938..1939..

1940..1941..1942..1943..1944..

1945..1946..1947..1948..1949..

1950..1951..1952..1953..1954..

1955..1956..1957 «

1955: First quarterSecond quarter-Third quarter..Fourth quarter.

1956: First quarter-Second quarter-Third quarter.-Fourth quarter.

1957: First quarter..Second quarter.Third quarter..Fourth quarter

85.8

76.965.750.147.253.6

60.268.573.968.672.9

78.796.3

123.5151.4165.7

171.2178.0190.5208.7206.8

227.0255.3271.8286.0287.4

305.9326.9342.9

Laborincomewage andsalary

disburse-ments

and otherlabor

income)1

F a r m

51.0

46.739.630.929.434.1

37.242.546.743.646.6

50.562.883.0

106.7118.5

119.4113.8125.2137.9137.4

150. 3175.6190.3203.4201.7

217.3234.8246.6

Proprietors'income 2

Busi-ness andprofes-sional

6.0

4.13.21.92.42.4

5.04.05.64.34.3

4.66.5

10.011.411.5

11.813.914.516.712.7

13.316.015.113.312.7

11.911.611.6

8.8

7.45.63.43.24.6

5.46.57.16.87.3

8.410.913.916.818.0

19.021.319.921.621.4

22.924.825.725.925.9

27.328.028.7

Rentalincome

ofpersons

Divi-dends

5.4

4.83.82.72.01.7

1.71.82.12.62.7

2.93.54.55.15.4

5.66.26.57.27.9

8.59.19.9

10.210.6

10.210.310.4

5.8

5.54.12.62.12.6

2.94.54.73.23.8

4.04.54.34.54.7

4.75.86.57.27.5

9.29.19.09.3

11.011.912.3

Per-sonal

interestincome

6.96.96.66.26.1

5.95.85.95.85.8

5.85.85.85.86.2

6.97.68.29.0

10.611.612.313.715.0

16.117.618.8

Trans-fer pay-ments

Less:Per-sonal

contri-butions

forsocialinsur-ance

1.5

1.52.72.22.12.2

2.43.52.42.83.0

3.13.13.13.03.6

6.211.411.811.312.4

15.112.613.214.316.2

17.418.521.2


294.8303.3309.4315.2

318.5325. 3328.7334.5

337.7342.8346.5344.5

.1

.2

.2

.2

.2

.2

.2

.6

.6

.6

.7

.81.21.82.2

2.32.02.12.22.2

2.93.43.83 94^6

5.25.7

Non-agricul-tural

personalncome3

208.3215. 2220.7224.7

228.2233.6235. 9241.0

243.6246.4249.2247.3

11.712.111.911.7

11.411.511.512.0

11.511.711.811.5

26.727.327.627.8

27.728.028.228.3

28.428.729.128.5

10.410.210.110.1

10.210.310.410.4

10.410.410.410.4

10.210.410.812.0

11.712.012.111.5

12.412.512.611.7

15.615.816.216.7

17.017.417.818.2

18.518.719! 019.3

17.017.417.417.5

17.918.418.718.9

19.721.321.322.6

5.05.15.35.3

5.65.75.75.9

6.76.86.96.8

77.7

70.860.946.943.649.8

53.963.267.062.867.1

72.688.0

111.5137.6151.6

156.8161.1172.8188.5190.8

210.5235. 7253.1269.2271.3

290.6311.7327.6

279.7287.7294.0300.0

303.4310.2313.6318.9

322.6327.4331.0329.4

1 The total of wage and salary disbursements and other labor income differs from condensation of em-ployees in Table F-9 in that it excludes employer contributions for social insurance and excludes the excessof wage accruals over wage disbursements.

2 Excludes income resulting from net reductions of inventories and gives credit in computing incometo net additions to inventories during the period.3 Nonagricultural income is personal income exclusive of net income of unincorporated farm enterprises,farm wages, agricultural net interest, and net dividends paid by agricultural corporations.4 Preliminary; fourth quarter by Council of Economic Advisers.

NOTE.—Detail will not necessarily add to totals because of rounding.Source: Department of Commerce (except as noted).

129

TABLE F-13.—Disposition of personal income, 1929-57

Period Personalincome

Less:Personaltaxes »

Equals:Dispos-

ablepersonalincome

Less:Personal

con-sumptionexpendi-

tures

Equals:Personalsaving

Saving aspercentof dis-

posablepersonalincome

(percent)2

Billions of dollars

1929.-

1930-.1931..1932..1933-.1934..

1935..1936..1937..1938-.1939..

1940..1941..1942..1943..1944-.

1945..1946-.1947-,1948-.1949..

1950..1951..1952..1953..1954-

1955-.1956-.1957 3.

1955; First quarterSecond quarter..Third quarter. . .Fourth quarter..

1956: First quarterSecond quarter..Third quarter. . .Fourth quarter..

1957: First quarterSecond quarter..Third quarter. _.Fourth quarter 3.

85.8

76.965.750.147.253.6

60.268.573.968.672.9

78.796.3

123.5151.4165.7

171.2178.0190.5208.7206.8

227.0255.3271.8286.0287.4

305.9326.9342.9

2.6

2.51.91.51.51.6

1.92.32.92.92.4

2.63.36.0

17.818.9

20.918.821.521.118.7

20.929.334.435.833.0

35.839.743.0

83.1

74.463.848.745.752.0

58.366.271.065.770.4

76.193.0

117.5133.5146.8

150.4159.2169.0187.6188.2

206.1226.1237.4250.2254.5

270.2287.2300.0

79.0

71.061.349.346.451.9

56.362.667.364.667.6

71.981.989.7

100.5109.8

121.7146.6165.0177.6180.6

194.0208.3218.3230.5236.6

254.4267.2280.4


294.8303.3309.4315.2

318.5325.3328.7334.5

337.7342.8346.5344.5

34.735.536.236.6

38.939.539.840.5

42.242.943.643.5

260.1267.8273.2278.6

279.6285.8288.8294.0

295.5299.9302.9301.0

247.4252.1258.3259.9

262.8265.0268.6272.3

276.7278.9283.6282.5

4.2

3.42.5

- . 6- . 6

.1

2.03.63.71.12.9

4.211.127.833.036.9

28.712.64.0

10.07.6

12.117.719.019.717.9

15.820.019.6

12.715.714.918.7

16.820.820.321.7

18.921.019.318.5

5.0

4.63.9

- 1 . 3-1 .4

.2

3.55.45.31.64.1

5.511.923.624.725.2

19.17.92.45.34.0

5.97.88.07.97.0

5.87.06.5

4.95.95.56.7

6.07.37.07.46.47.06.46.1

1 Includes also such items as fines, penalties, and donations.2 Annual percentages are based on data in millions of dollars, and may therefore differ slightly from per-

centages computed on the basis of figures shown in this table.3 Preliminary; fourth quarter by Council of Economic Advisers.



I3O

TABLE F-14.—Total and per capita disposable personal income and personal consumptionexpenditures, in current and 1957 prices, 1929-57

Period

Total disposablepersonal income

(billions ofdollars)

Currentprices

1957prices ]

Per capita dis-posable personalincome (dollars)

Currentprices

1957prices'

Total personalconsumptionexpenditures(billions ofdollars)

Currentprices

1957prices ]

Per capita per-sonal consump-tion expendi-tures (dollars)

Currentprices

1957prices ]

Popu-lation(thou-sands) 2

1929..

1930-1931..1932..1933..1934..

1935-1936..1937..1938-1939..

1940..1941..1942..1943-1944..

1945-1946..1947..1948-1949..

1950-1951-1952..1953-1954-

1955-1956-1957«.


1956: First quarterSecond quarter..Third quarter._.Fourth quarter..

1957: First quarterSecond quarter..Third quarter. _.Fourth quarter 3

83.1

74.463.848.745.752.0

58.366.271.065.770.4

76.193.0

117.5133.5146.8

150.4159.2169.0187.6188.2

206.1226.1237.4250.2254.5

270.2287.2300.0

136.0

125.0117.899.999.2

109.0

119.3134.1138.7130.9142.3

152.5177.4202.3216.4234.1

234.6229.0212.3218.9221.9

240.5244.4250.9262.6265.9

283.2296.7300.0

682

604514389364411

458517551.505538

576697871977

1,060

1,0751,1261,1731,2791,261

1,3591,4651,5121,5681,567

1,6351,7081,752

1,116

1,015948799790862

9371,0471,0761,0061,087

1,1541,3301,4991,5831,691

1,6771,6201,4741,4921,487

1,5861,5841,5981,6451,637

1,7141,7641,752

79.0

71.061.349.346.451.9

56.362.667.364.667.6

71.981.989.7

100.5109.8

121.7146.6165.0177.6180.6

194.0208.3218.3230.5236.6

254.4267.2280.4

129.2

119.3113.2101.2100.6108.8

115.1126.8131.4128.8136.5

144.0156.2154.5163.0175.2

189.9211.0207.3207.2213.0

226.4225.2230.8241.9247.2

266.7276.0280.4


576494

410

442488522497516

544614665735794

8701,0371,1451,2111,211

,279,350,390,444,456

,539

260.1267.8273. 2278.6

279.6285.8288.8294.0

295.5299.9302.9301.0

273.2281.3285.8290.8

292.8297.1296.2299.4

299.1300.5300.5297.4

1]1]

:

,583,624,649,674

,673L,7031,713L,735

1,7371,7551,7651,746

1,6631,7061,7251,747

1,7521,7701, 7571,767

1,7581,7591,7511,725

247.4252.1258.3259.9

262.8265.0268.6272.3

276.7278.9283.6282.5

259.9264.8270.2271.3

275.2275.5275.5277.3

280.1279.5281.3279.2

1,5061,5281,5591,561

1,5721, 5791,5931,607

1,6261,6321,6521,638

1,061

911811800860

904988

1,020990

1,042

1,090,172,145,191,266

,357,492,438,413,428

,492,459,469,5151,521

1,6131,6421,638

1,5821,6051,6311,629

1,6461,6411,6341,636

1,6461,6351,6391,619

121,875

123,188124,149124,949125,690126,485

127,362128,181128,961129,969131,028

132,122133,402134,860136,739138, 397

139,928141,389144,126146,631149,188

151,683154,360157,028159,636162,417

165, 270168,174171, 229

164,288164,934165, 662166,452

167,150167,824168, 594169,416

170,158170,859171,650172, 440

i Dollar estimates in current prices divided by the consumer price index on a 1957 base. Personal con-sumption expenditures in this table therefore differ from the data in Table F-2.8 Population of the continental United States including armed forces overseas. Annual data are forJuly 1; quarterly data are for middle of period.

3 Preliminary; fourth quarter by Council of Economic Advisers.NOTE.—Annual figures for total income and expenditures in 1957 prices and for per capita income and

expenditures in current prices are computed from data in millions of dollars.Sources: Department of Commerce, Department of Labor, and Council of Economic Advisers.

TABLE F-15.—Financial saving by individuals, 1939-57


Period Total

Cur-rencyand

bankde-

posits 2

Sav-ingsandloanasso-cia-

tions

Securities

TotalsU. S.sav-ings

bonds

Othergov-ern-

ment4

Cor-

andother

Private in-surance and

pensionreserves

[nsur-ance

Pen-sion

Gov-ern-

mentinsur-anceandpen-sionre-

serves

Less: Increasein debt

Mort-gage

debt5

Con-sumerdebt «

Old series J

1939

19401941194219431944

19451946194719481949

19501951

1951 i195219531954

19551956

1955: First quarter._.Second quarter.Third quarter..Fourth quarter

1956: First quarter...Second quarter.Third quarter..Fourth quarter.

1957: First quarter...Second quarter.Third quarter..

4.25

4.2410.5229.3038.7141.41

37.3913.746.672.992.86

1.8010.88

3.00

2.884.80

10.9516.1817.55

19.0610.562.01

-1.84-1.46

3.625.95

0.04

.20

.36

.26

.55

.81

1.061.181.201.211.51

1.512.10

-0.53

- .172.83

10.2513.8314.96

9.36.89

3.513.223.03

2.042.05

0.66

.862.757.98

11.1411.80

6.85.90

1.782.131.53

.55- . 47

-0.83

- . 8 1.44

2.172.883.89

3.43- . 6 5

.89- . 4 3

.52

.12- . 07

-0.36

- . 22- . 36

.09- .20- . 7 3

- .92.65.84

1.52.98

1.362.59

1.72

1.852.142.492.853.21

3.463.423.643.753.71

3.924.06

(7)

(7)(7)(7)(7)(7)

(7)(7)(7)(7)(7)

(7)(7)

1.30

1.301.862.553.924.96

5.143.553.493.572.34

1.094.24

0.50

.84

.82

.09- . 3 8- .06

.203.604.464.613.87

7.166.58

.97

.66-2.89-1.01

.14

.482.282.732.312.40

3.22

New series !

10.9012.9510.679.02

7.4014.41

2.00- .663.422.63

5.042.043.663.67

5.933.244.74

6.057.154.975.44

4.444.71

- . 5 5- . 2 53.222.02

- . 08.24

1.612.94

.21

.531.95

2.073.053.644.45

4.765.08

1.121.42

.671.56

1.121.61.68

1.67

1.011.64.51

.712.713.02

- .69

5.666.72

1.671.141.791.06

3.32.96

1.72.72

3.341.652.43

- . 4 7.09.20.60

.27- . 10

.20

.02- . 0 1

.06

.16- . 08- . 08- .10

- . 58- . 46- .49

- .34.83

1.74-1.20

3.243.80

1.10.84

1.19.11

2.54.49.69.08

2.17.55

1.77

1.531.791.09

- . 08

2.153.02

.37

.28

.61

.89

.62

.551.11.74

1.751.571.15

3.113.783.924.21

4.204.28

1.07.85

1.151.13

.97

.951.181.19

.95

.851.23

2.302.732.843.11

3.353.61

.84

.84

.84

.84

.90

.90

.90

.90

.98

.98

.98

4.244.403.242.63

3.093.68

.451.00.98.67

.821.62.98.25

.501.23.59

6.606.527.309.17

12.0110.59

2.723.333.482.48

2.522.792.792.50

1.972.142.20

4.363.65.96

6.093.08

- . 122.321.742.15

- . 5 11.46.63

1.49

- . 9 21.50.74

1 Individuals' saving, in addition to personal holdings, covers saving of unincorporated business, trustand pension funds, and nonprofit institutions in the forms specified. Prior to 1951, separate data on corpo-rate pension fund investments are not available and are reflected in the various components of indi-viduals' saving.

2 Includes currency, demand deposits, and time and savings deposits.3 Does not include net purchases by brokers and dealers or by other individuals financed by bank loans.4 Includes armed forces leave bonds and other U. S. Government bonds (except savings bonds) andall securities issued by State and local governments.5 Mortgage debt to institutions on 1- to 4-family nonfarm dwellings.6 Largely attributable to purchases of automobiles and other durable consumer goods, although includ-ing some debt arising from purchases of other consumption goods. The other segments of individuals'debt have been allocated to the assets to which they pertain, viz., saving in insurance and securities.

7 Not available separately. See footnote 1.NOTE.—In addition to the concept of saving shown above, there are other concepts of individuals' saving,

with varying degrees of coverage, currently in use. The series with the most complete coverage, the per-sonal saving estimates of the Department of Commerce, is derived as the difference between personal incomeand expenditures. Conceptually, Commerce saving includes the following items not included in Securitiesand Exchange Commission saving: Housing net of depreciation, and farm and unincorporated businessinvestment in inventories and plant and equipment, net of depreciation and net of increases in mortgageand other debt to corporations and financial institutions. Government insurance is excluded from theCommerce saving series. For a reconciliation of the two series, see Survey of Current Business, July 1957.

Revisions for 1955-57 in the consumer credit statistics of the Board of Governors of the Federal ReserveSystem have not yet been incorporated into these estimates.

Detail will not necessarily add to totals because of rounding.Source: Securities and Exchange Commission.

132

TABLE F—16.—Sources and uses of gross saving, 1929—57


Period

1929._

1930..1931..1932..1933..1934..

1935..1936..1937..1938..1939..

1940..1941..1942..1943..1944..

1945..1946..1947..1948..1949..

1950..1951..1952..1953..1954-.

1955..1956..1957 2.

1955:First quarterSecond quarter. _Third quarterFourth quarter-.

1956:First quarter.Second quarter. .Third quarter - _Fourth quarter-

1957:First quarterSecond quarter..Third quarter . . .Fourth quarter 2.

Gross private saving and government surplus ordeficit on income and product transactions

Total

16.7

11.94.9.3.6

2.6

6.47.2

12.17.39.0

13,918.810.55.12.3

4.530.837.345.233.0

48.855.847.745.746.3

58.165.765.3

Private saving

Total

15.7

12.27.72.01.95.0

8.410.111.58.9

11.2

14.622.641.949.354.2

44.326.624.037.436.2

40.749.651.052.552.7

55.560.963.6

Per-sonalsaving

4.2

3.42.5

2.03.63.71.12.9

4.211.127.833.036.9

28.712.64.0

10.07.6

12.117.719.019.717.9

15.820.019.6

Grossbusi-ness

saving

11.5

5.22.72.64.9

6. 36.57.87.8

10.411.514.116.317.2

15.614.020.027.428.7

28.631.932.032.834.8

40.944.0

Governmentsurplus ordeficit (-)

Total

1.0

- . 3- 2 . 8- 1 . 7- 1 . 4- 2 . 4

- 2 . 0- 3 . 0

.6- 1 . 6- 2 . 1

- . 7- 3 . 8-31.4-44.2-51.9

-39.74.2

13.37.9

- 3 . 2

8.16.2

- 3 . 3- 6 . 8- 6 . 4

2.64.81.7

Fed-eral

1.2

.3- 2 . 1- 1 . 5- 1 . 3- 2 . 9

-2.6-3.5- . 2

-2.0-2.2

- 1 . 4- 5 . 1

-33.2-46.7-54.6

-42.32.2

12.28.0

- 2 . 4

9.26.5

- 3 . 4- 7 . 1- 5 . 4

3.66.24.0

Stateandlocal

- 0 . 1

- . 5- . 7- . 2(9

.5

.5

.7

.4

.1

.71.31.82.52.7

2.62.01.0

- . 1

- 1 . 1- . 40)

.2- 1 . 0-1 .0- 1 . 4- 2 . 2

Gross investment

Total

17.0

11.05.71.11.53.3

6.28.3

11.87.8

10.2

14.719.29.73.45.0

9.031.738.643.133.1

49.057.149.648.348.0

60.267.366.9

Grossprivatedomes-tic in-vest-ment

Net for-eign in-

vest-ment

16.2

10.35.5.9

1.42.9

6.38.4

11.76.79.3

13.218.19.95.67.1

10.427.129.741.232.5

51.256.949.850.348.4

60.665.963.6

.7

.2

.2

.2

.4

i

!i1.1

1.51.1

- . 2- 2 . 2- 2 . 1

- 1 . 44.68.92.0.5

- 2 . 2.2

- . 2- 2 . 0

- . 4

- . 41.43.3


50.857.759.364.6

62.865.365.269.2

65.265.065.9(3)

51.556.455.059.1

56.860.261.764.6

61.464.363.7(3)

12.715.714.918.7

16.820.820.321.7

18.921.019.318.5

38.840.740.140.4

40.039.441.442.9

42.543.344.4(3)

- . 71.34.35.5

6.05.13.54.6

3.8.7

2.2(3)

.92.84.65.9

7.36.74.56.0

6.13.14.2(3)

- 1 . 6- 1 . 5

- . 4A

- 1 . 3- 1 . 7- 1 . 1-1 .4

- 2 . 3-2 .4- 1 . 9

(3)

55.259.061.564.7

64.266.567.570.9

66.868.568.763.5

55.659.761.465.4

64.465.365.568.5

62.765.065.561.0

- . 4- . 7

.1- . 7

- . 21.22.02.4

4.13.53.22.5

Statis-ticaldis-

crep-ancy

0.3

-1.0

.7

- . 21.1

- . 2.5

1.2

.4- . 8

-1.72.8

4.5.9

1.4- 2 . 1

.1

.21.32.02.61.7

2.11.61.7

4.41.42.3.1

1.51.32.31.6

1.63.32.7

1 Less than 50 million dollars.2 Preliminary; fourth quarter by Council of Economic Advisers.3 Not available.



133

EMPLOYMENT AND WAGESTABLE F-17.—Noninstitutional population and the labor force, 1929-1957

Period

Nonin-stitu-tionalpopu-lation l

Totallaborforce

(includ-ing

armedforces)

Armedforces J

Civilian labor force

Total

Employment2

TotalAgri-cul-

tural

Non-agri-cul-tural

Unem-ploy-

ment2

Totallabor

force aspercentof non-institu-tionalpopu-lation

Unemploy-ment as

percent ofcivilian

labor force

Unad-justed

Season-ally ad-justed

Thousands of persons 14 years of age and over Percent

Old definitions 21929..

1930..1931.1932..1933..1934..

1935-1936-.1937-.1938-

1940-.1941..1942-.1943-1944-.

1945-1946-.1947..1948-1949-

1950-1951-1952-1953-1954-.

1955..1956..1957..

New definitions 2

194719481949

1950-1951-1952..1953..1954..

1955-1956-1957-

Old definitions 2

1956: JanuaryFebruary._-MarchAprilMayJune

JulyAugustSeptember..OctoberNovember-.December...

8

00

100,380101, 520102, 610103, 660104,630

105, 520106, 520107, 608108, 632109, 773

110,929112,075113,270115,094116,220

117,388118, 734120,445

107, 608108, 63r109, 773

110, 929112, 075113, 270115, 094116, 220

117,388118, 734120,445

118,080118,180118, 293118,367118, 53:118,632

118, 762118,891119,047119,198119,344119, 481

49, 440

50,08050,68051, 26051,84052,490

53,14053,74054,32054,95055,600

56,18057, 53060,38064,56066,040

65,29060,97061,75862,89863,721

64,74965,98366, 56067,36267,818

68,89670,38770, 761

61, 758

3, 721

64,74965,98366,56067,36267,818

68,89670,38770, 744

68,39668,80669,43470, 71172,274

72,32571, 78770,89670,90570,56069,855

260

260260250250260

270300320340370

5401,6203,9709,02011,410

11, 4303,450I,!"1, 4561,616

1,6503,0983,5943,5473,350

3,0482,8572,797

1,5901,4561,616

1,6503,0983,5943,5473,350

3,0482,8572,797

2,9162,9062,8932,8792,8652,844

2,8362,8402,8272,8232,8282,826

49,180

49,82050,42051,00051,59052,230

52,87053,44054,00054, 61055, 230

55,64055, 91056, 41055,54054,630

53,86057, o2060,16861,44262,105

63,09962,88462,96663,81564,468

65,84767, 53067,964

60,16861, 44262,105

63,09962,88462,96663,81564,468

65, 84867,53067, 946

65, 77565,49065,91366,55567,84669, 430

69, 48968,94768,06968,08267, 73267,029

47,630

45,48042,40038,94038,76040,890

42,26044,41046,30044,22045,750

47, 52050, 350.53, 75054, 47053,960

52,82055,25058,02769,37858,710

59, 95761,00561.29362,21361,238

63,19364,97965,272

57, 81259,11758,423

59, 74860,78461,03561,94560,890

62,94464,70865, Oil

62,89162,57663,07863,99065,23866, 503

66, 65566,75266,07166,17465,26964, 550

10,450

10,34010,29010,17010,0909,900

10,11010,0009,8209,6909,610

9,5409,1009,2509,0808,950

8,5808,3208,2667,9738,026

7,5077,0546, 8056,5626,604

6,7306,5856,229

8,2567,9608,017

7,4977,0486,7926,5556,495

6,7186,5726,222

5,6355,4695,6786,3877,1467,876

7,7007,2657,3887,1736,1925,110

37,180

35,14032,11028, 77028,67030,990

32,15034, 41036, 48034,53036,140

37, 98041,25044,50045,39045,010

44,24046,93049, 76161,40550,684

52,45053,95154,48855, 65154,734

56,46458,39459,043

49, 55751,15650,406

52, 25153, 73654, 24355,39054, 395

56, 22558,13558, 789

57,25667,10757,40057,60358,09258,627

58,95559,48768,68359,00059,07659,440

1, 550

4,3408,02012,06012,83011,340

10,6109,0307,70010,3909,480

8,1205,5602,6601,070670

1,0402,2702,1422,0643,395

3,1421,8791, 6731,6023,230

2,6542,5512,693

2,3562,3253,682

3,3512,0991,9321,8703,578

2,9042,8222,936

2,8852,9142,8342,5642,6082,927

2,8332,1951,9981,9092,4632,479

()C3)(3)

56.056.758.862.363.1

61.967.257.457.968.0

58.458.958.858.558.4

58.759.358.7

57.457.958.0

58.458.958.858.558.4

58.759.358.7

58.257.968.258.759.760.9

60.960.459.659.559.158.5

3.2

8.715.923.624.921.7

20.116.914.319.017.2

14.69.94.71.91.2

1.93.93.63.45.5

5.03.02.72.55.0

4.03.84.0

3.85.9

5.33.33.12.95.6

4.44.24.3

4.44.44.33.93.84.2

4.13.22.92.83.63.7

S.7S.7S.8S.7

4-0S.6S.4S.54-0S.8


134

TABLE F-17.—Noninstitutional population and the labor force, 1929-57—Continued

Period

Old definitions t1957: January

February._.MarchAprilMayJune..

JulyAugustSeptember.OctoberNovember.December..

New definitions 21956: January

FebruaryMarchAprilMayJune


1957: JanuaryFebruary ..MarchAprilMayJune

JulyAugustSeptember.October . . .November.December.

Slonin-stitu-tionalpopu-ation l

Totallaborforce

(includ-ing

armedforces)

Armedforces *

Civilian labor force

Total

Employment2

TotalAgri-cul-

tural

Non-agri-cul-tural

Unem-ploy-

ment2

Thousands of persons 14 years of age and over

119,614119, 745119,899120,057120,199120,383

120, 579120, 713120,842120,983121,109121, 221

118,080118,180118, 293118,367118, 537118,632

118, 762118,891119,047119,198119,344119, 481

119,614119,745119,899120,057120,199120,383

120, 579120, 713120,842120,983121,109121,221

68,64769,13069, 56569, 77370. 77772, 742

73, 05671,83871,05671,30370,79670, 480

68,69168,39768,80669, 43470, 71172,274

72,32571, 78770,89670,90570, 56069, 855

68,63869,12869, 56269, 77170, 71472, 661

73,05171,83371,04571,29970, 79070,458

2,8172,8172,8162,8202,8212,819

2,8232,8392,8192,7862,7292,688

2,9162,9062,8932,8792,8652,844

2,8362,8402,8272,8232,8282,826

2,8172,8172,8162,8202,8212,819

2,8232.8392,8192,7862,7292,688

65,83066, 31366, 74966,95367. 95669,923

70,23368,99968,23768,51768,06767,792

65, 77565,49165, 91366, 55567,84669, 430

69,48968,94768,06968,08267, 73267,029

65,82166,31166, 74666,95167,89369, 842

70,22868,99468,22668,51368,06167, 770

62,89063,43464,04964, 47265, 46766,892

67, 54666, 61965, 92166,24065,07864,652

62,68462,35462, 78763,79964,95066,027

66,35466, 42065, 77465, 95565,08464,306

62, 57863,19063.86564. 26165,17866,504

67,22166, 38565, 67466,00564,87364,396

4,9435,1995,4425,7586,6637,547

7,8046,8276,5196,8385,8175,391

5,6255,4635,6626,3867,1207,859

7,6747,2377,3767,1686,1905,105

4,9355,1955,4345,7556,6597,534

7,7726,823G, 5186,8375,8175,385

57,94758, 23558,60758, 71458. 80459,345

59, 74259, 79259, 40259, 40259, 26259,262

57,05956,89157,12457, 41057,83058,166

58, 68059,18458,39558, 78558, 89359,199

57, 64357,99658, 43158,50658, 51958,970

59, 44959, 56259,15659,16859,05759,012

2,9402,8812,7002,4812.4893,030

2,6872,3802,31"2,27'2,9893,140

3,0923,1363,1252,7552,8963,403

3,1342,5272,2952,1272,6482,723

3,2443,12'2,8822,6902,7153,337

3,0072,6092,5522,5083,1853,37'

Totallabor

force aspercentof non-institu-tionalpopu-lation

Unemploy-ment as

percent ofcivilian

labor force

Unad-justed

Season-ally ad-justed

Percent

57.457.758.058.158.960.4

60.659.558.858.9f8.558.1

58.157.958.258.759.760.9

60.960.459.659. 559.158.5

67.457.758.058.158.960.4

60.659.558.858.958.558.1

4.54.34.03.3.4.

773

3.83.3.3.4.4.

4.4.4.4.44

433

44346

787139

574

3.13.94.1

444444

4

973008

33̂ 83345

770

3.8S.6S.6S.6S.94.2

S.8S.94.04.24-84.8

4.04.04.24.04.54.6

4-44.1S.9S.94.S4.2

4.24.0S.9S.94.24.5

4.24.24.S4.65.15.2

1 Data for 1910-52 revised to include about 150,000 members of the armed forces who were outside thecontinental United States in 1940 and who were, therefore, not enumerated in the 1940 Census and wereexcluded from the 1940-52 estimates.

2 See Note.3 Not available.

NOTE.—Civilian labor force data beginning with May 1956 are based on a 330-area sample. For January1954-April 1956 thev are based on a 230-area sample; for 1946-53 on a 68-area sample; for 1940-45 on a smallersample; and for 1929-39 on sources other than direct enumeration.

Effective January 1957, persons on layoff with definite instructions to return to work within 30 daysof layoff and persons waiting to start new wage and salary jobs within the following 30 days are classifiedas unemployed. Such persons had previously been classified as employed (with a job but not at work).The combined total of the groups changing classification has averaged about 200,000 to 300,000 a month inrecent years. The small number of persons in school during the survey week and waiting to start newjobs are classified as not in the labor force instead of employed as formerly. Persons waiting to open newbusinesi-es or start new farms within 30 days will continue to be classified as employed. (New definitionsseries for periods prior to January 1957 are Census Bureau estimates under the old definitions adjusted byCouncil of Economic Advisers to the new definitions.)

Beginning July 1955, labor force data are for the calendar week containing the 12th of the month; previ-ously, for week containing the 8th.

Annual population data are as of July 1; monthly data are as of the 1st of the month.For the years 1940-52, estimating procedures made use of 1940 Census data; for subsequent years, 1950

Census data were used. For the effects of this change on the historical comparability of the data, seeAnnual Report on the Labor Force, 1954, Series P-50, No. 59, April 1955, p. 12.

Detail will not necessarily add to totals because of rounding.

Sources: Department of Commerce, Department of Labor (labor force, 1929-39), and Council ofEconomic Advisers.

135

TABLE F—18.—Employment and unemployment, by age and sex, 1942—57

[Thousands of persons 14 years of age and over]

Period

Totalcivil-ian

laborforce

Old definitions *

194219431944

19451946 _'___194719481949

19501951195219531954

1955

1956

New definitions i

1957

Old definitions i1956: January. . .

February .March .. .AprilMayJune

JulyAugustSeptemberOctoberNovemberDecember.

New definitions 1

1957: JanuaryFebruaryMarchAprilMayJune

JulyAugustSeptemberOctoberNovemberDecember. .

Totalem-

ployed

56,41055, 54054, 630

53,86057,52060,16861, 44262,105

63,09962,88462,96663,81564,468

65,84767, 530

67, 946

65, 77565, 49065, 91366, 55567, 84669, 430

69, 48968, 94768, 06968, 082

r,73267, 029

65, 82166,31166, 74666, 95167, 89369, 842

70, 22868, 99468, 2261,513

68. 06167, 770

Employed

53,75054,47053, 960

52, 82055, 25058, 02759, 37858, 710

59, 95761, 00561,29362, 21361, 238

63,19364,979

65, 011

62, 89162, 57663, 07863,99065, 23866, 503

66, 65566, 75266, 07166,17465, 26964,550

62, 57863,19063, 86564, 26165,17866, 504

67, 22166, 38565, 67466, 00564,87364,396

14-19years

5,770 20,790 9,40014,1606,35017,55011,05015,1606, 050 16, 380 11, 280 15, 480

5,480 15,4,4, 717 23;4, 841 23,4,, 512 23,

564 23, 833 10, 376 15, 666614 23, 594 10, 833 16,144530 23, 372 10,917 16, 345514 23, 715 10, 953 16, 725285 23,178 10, 730 16, 649

4,446 23,76811,00016,8784, 764 24, 05111, 271

20-44 years

Male

\, 830 11,140 15, 520170

C409i, 842 10,098 15, 6771,483 10,087 15, 491

4, 720 23,993 11, 247 17, 246

4, 020 23, 685 10, 962 16,3,870 23,'3, 917 23, 759 10, 926 17,4,205 23,'4,565 23,99311,47217,5, 813 24, 288 11, 341

329 24, 319 11,101

4,4,672 24,23811.4,4,418 23,941 11,

332 24, 490 11, 201953 24,45011,067

,199678 24,101338 23,832 11,385 23,513 11,465

Fe-male

17, 398127 24, 424 11,143 17, 485826 24,25711,60317,528

17, 554408 24,14811,539 17,429

17,183

,857,539,301

3, 871 23, 598 10, 797 16, 8463, 970 23,4, 087 23, 807 114,204 23,911 114,4755,607 24,34611

583 11, 066 16, 955, 07',091

11, 27,191

17, 38517, 304

680 24,199 11,41617,43011, 766 17, 431

550 17, 27417,125

45 yearsand over

Male

17,294

i, 920964 16, 848

.033050 17, 258

',42117, 484

17,10917.212

',40717, 480

'617,

Fe-male

Totalunem-ployed

3,6304,3604,770

4,8504,3804,6004,9245,138

5,5175,8196,1306,3066,395

7,1017,598

7,804

7,3057,2467.44'7,5687,7887,578

7,510

7, 8557,8547,7447,708

7,4687,6127,7867,8437,9367,820

7,8147,6137,9458,0307,8787,908

Unemployed

2,6601,070

670

1,0402,2702,1422,0643, 39f

3,1421,8791,6731,6023,230

2,6542,551

2,936

2,8852,9142,8342,5642,6082,927

2,8332,19)1,9981,9092,4632,479

3,2443,1212,8822,6902,7153,337

3,0072,6092,5522,5083,1883,374

14-19years

510290200

190290425415595

543356362312515

471510

574

442508433413548

1,005

759445356331482396

493465497461566

1,105

84'55343640154'512

20-44 years

Male

670180140

3301,200

920757

1,329

1,119515495512

1,158

854784

935

967947977836769788

807678595551

1,0781,086947915790874

828779802809

1,0231,294

Fe-male

520260170

270280303353559

552419344300617

502491

566

581462495459490469

560461450438539482

652566506517556606

582554555523638541

45 yearsand over

Male

770240110

200410396414719

697402345363

606530

606

713783675565536421

425382371380518584

731724671606563528

479505528667768

Fe-male

19010050

509099

127194

232190127116256

222239

255

184215255289265241

283229228208260203

289280262192242225

251244251248313258

1 See Note, Table F-17 for explanation of differences between the old and new definitions.

NOTE.—Data are not available prior to 1942 for all the age/sex groups above.See Note, Table F-17 for information on area sample used and reporting periods.Detail will not necessarily add to totals because of rounding.

Source: Department of Commerce.

I36

T A B L E F—19.—Employed persons not at work, by reason for not working, and special groups of

unemployed persons, 7946-57 l

[Thousands of persons 14 years of age and over]

Period

1946,.1947..1948..1949-.

1950-.1951-.1952-.1953-1954.

1955.1956.1957.

1956: JanuaryFebruary...MarchApril. _MayJune

JulyAugustSeptember..OctoberNovember._December _.

1957: JanuaryFebruary...MarchAprilMayJune

JulyAugustSeptember..OctoberNovember..December..

Employed persons not at work,by reason for not working

1,9942,0111,9051,8222,0563,358

7,0146,0482,7772,5712,4922,161

Badweather

Indus-trial

dispute

959779

8557

1647353

617645

705779226830

406454130596

1226404046

1138141341627

Vacation

662834

1,0441,044

1,1371,0731,1301,1711,361

1,2681,3461,447

304381289399535

1,933

5,3273,9771,357789537327

313342342429707

1,959

5,5774,5221,430

794524421

Illness

819847844719

718782775827776

835901962

1,0321,032992913859

851885859870854835

876999975896810

793885857

1,3421,339

Allother

reasons2

)273308291

349436418362425

416456425

505413423451300493

566588427401472433

442418382317344489

514535402348438467

Special groups of un-employed persons 3

Tempo-rary

layoff 4

97123141185

92117142167221

133124150

1451341539711080

14512313911097160

202149102143142137

129148181121160

New wageand salary

job»

5892

121101

116103117101127

117147110

6288

13894

178396

156209158108

10393

147251

13610599548496

1 Data prior to 1957 are Census Bureau estimates adjusted by Council of Economic Advisers to the newdefinitions of employment and unemployment.

2 Includes persons waiting to open new businesses or start new farms within 30 days.3 Under the old definitions of employment and unemployment, these groups were included in the

"employed but not at work" category.4 Persons on layoff with definite instructions to return to work within 30 days of the layoff.5 Persons scheduled to start new wage and salary jobs within 30 days. Under the old definitions, the

"new job or business" group included these persons as well as persons waiting to open new businesses orstart new farms within 30 days (see "all other" category in this table) and persons in school during thesurvey week and waiting to start new jobs (these are now classified as "not in the labor force").

s Not available.

NOTE.—See Note, Table F-17 for information on area sample used and reporting periods.Detail will not necessarily add to totals because of rounding.


137

T A B L E F—20.—Unemployed persons, by duration of unemployment, 1946—57

Period

Old definit ions:1

1946194719481949

19501951195219531954

19551956

N e w definitions: i

1957

Old definitions:»

1955: First quarter _Second quarterThird quarterFourth quarter

1956: First quarterSecond quarterThird quarterFourth quarter

New definitions:1

1957: First quarter.Second quarterThird quarterFourth quarter

Total un-employed

Duration of Vinemployment

4 weeksand under

5-14weeks

15-26weeks

Over 26weeks

Thousands of persons 14 years of age and over

2,2702,1422,0643,395

3,1421,8791,6731,6023,230

2,6542,551

2,936

3,3022,7102,2862,319

2,8782,7002,3422,284

3,0822,9142,7233,023

1,0411,0871,517

1,3071,003

925910

1,303

1,1381,214

1,484

1,1441,1291,1161,161

1,2121,3071,1381,199

1,3821,5591,4691,529

704669

1,195

1,055574517482

1,115

815804

891

1,188702668700

1,041810730638

1,108738781935

234193427

425166148132495

367301

321

518490239218

347374256227

371359245309

141164116256

3571378479

317

336232

239

452389262239

278209218221

223258228248

Averagedurationof unem-ployment(weeks)

(3)9.88.6

10.0

12.19.78.38.1

11.7

13.211.3

10.4

14.114.712.111.3

12.210.810.910.9

10.610.79.8

10.3

1 See Note, Table F-17 for explanation of differences between the old and new definitions.2 For duration of less than 6 months, data are available only for under 3 months (1,568,000) and 3 to I

months (564,000).» Not available.NOTE.—See Note, Table F-17 for information on area sample used and reporting periods.Detail will not necessarily add to totals because of rounding.


138

TABLE F-21.—Unemployment insurance programs, selected data, 1939 and 1946—57

Period

1939..

1946..1947..1948.1949.

1950 _1951.1952.1953.1954.

1955.1956.1957 1

1956: January. _February.MarchAprilMayJune

JulyAugustSeptember.OctoberNovember-December..

1957: January. .February.MarchAprilMayJune

JulyAugustSeptember...OctoberNovember. __December 10.

State, iveteran,

andFederal

employeepro-

grams 2

Initial claims 1

Statepro-

grams 3

Insured unem-ployment *

All pro-grams 5

Statepro-

grams 3

Exhaus-tions,Statepro-

grams 3

Weekly average (thousands)

188

341280282375

239211215222310

236234274

315257219239220212

260188195185226298

347256219254221226

280196250263325451

188

189187210323

236208215218303

228229269

307250213234216205

254182190181221293

340251214250218220

276191246259320445

2,8031,8041,4652,474

1,599996

1,0641,0582,039

1,3881,3121,550

1,6061,6511,5781,4391,3161,234

1,3161,1581,060939

1,0901,379

1,8501,8461,7001,5651,4241,319

1,3681,2281,2401,3141,6232,206

1,086

1,2941,008999

1,973

1,497965

1,019988

1,857

1,2691,2251,455

1,4911,5351,4721,359 .1, 2551,178

1,2091,059988878

1,0131,285

1,7371,7301,5921,4751,3501,251

1,2851,1511,1671,2371,5132,071

38242037

3616181534

252023

202124242020

201918161617

232427262323

212120212022

Stateinsuredunem-ploy-ment

as per-cent ofcoveredemploy-

ment(per-

cent) 3 <

5. 1

4.33.13.06.2

4.62.82.92.85.2

3.43.13.5

4.04.14.03.63.33.1

3.12.72.62.32.63.3

4.44.34.03.63.33.0

3.12.82.83.03.65.0

Benefits paidunder Stateprograms 3

Totalmillionsof dollars) s

429.3

1,094.9775.1789.9

1,736.0

1, 373.1840.4998.2962.2

2,026. 9

1, 379. 21,409.31,733.9

135.7143.9152.0133.9125.8116.1

111.7112.294.991.591.7

104.2

177.6164.9168.8154.3145.7123.5

130.1121.3113.3131.8136.6175.0

Averageweeklycheck

[dollars)'

10.66

18.5017.8319.0320.48

20.7621.0922.7923.5824.93

25.0827.0628.02

26.6126.9527.1327.0326.7026.79

26.9127.0527.7727.5727.2627.43

27.7327.8527.7227.7227.4727 Ai

27.5927.8728.6429.2029.4429.60

1 Most of these are instances of new unemployment.2 Data on veterans relate to those under the following programs: Servicemen's Readjustment Act, which

became effective in October 1944 and expired for most veterans in July 1949, and Veterans ReadjustmentAssistance Act of 1952, effective October 15, 1952.

3 Beginning 1955, data include State programs and the program for Federal employees; all prior years arefor State programs only. Beginning 1956, data also include workers added by the extension of coverage tosmaller firms.

4 Represents the number of unemployed workers covered by unemployment insurance programs whohave completed at least one week of unemployment. Excludes territories.

5 State, veteran, Railroad Retirement, and Federal employee programs.8 State unemployment insurance programs during the period shown excluded from coverage agricultural

workers, domestic servants, workers in nonprofit organizations, unpaid family workers, the self-employed,and (in most States) workers in very small firms.

7 Represents the number of individuals who received payment for the final week of compensable unem-ployment in a benefit year. Workers who have exhausted benefit rights do not necessarily remain unem-ployed; some find employment, and others withdraw from the labor force.

8 Monthly totals are gross amounts; annual figures are adjusted for voided benefit checks.9 For total unemployment only.

10 Preliminary.


139

TABLE F-22.—Number of wage and salary workers in nonagr{cultural establishments, 1929-57 *

[Thousands of employees]

Period

1929

1930193119321933.1934

193519361937.19381939

19401941194219431944

19451946194719481949

19501951195219531954

195519561957 4

1955: JanuaryFebruary. -MarchAprilMayJune

JulyAugustSeptember-OctoberNovember.December.

1956- January . . . .February. .MarchAprilMayJune

JulyAugustSeptember.OctoberNovember.December.

Total

andsalarywork-

ers

31, 041

29,14326, 38323, 37723, 46625, 699

26, 79228, 80230, 71828, 90230,311

32, 05836, 22039, 77942,10641, 534

40, 03741, 28743, 46244, 44843, 315

44, 73847, 34748, 30349, 68148, 431

50, 05651, 87852, 550

Manufacturing

Total

10, 534

9,4018,0216,7977,2588,346

8,9079, 653

10, 6069,253

10, 078

10, 78012, 97415, 05117, 38117,111

15,30214, 46115, 29015, 32114,178

14. 96716,10416, 33417, 23815, 995

16. 56316,90516, 800

Du-rablegoods

(3)

(3)

(3)

(3)

( 3 )

(3)

(3)

(3)

(3)

4,683

5,3376,9458,804

11, 07710, 858

9,0797,7398, 3728, 3127,473

8,0859,0809,340

10,1059,122

9,5499,8259,807

Non-dura-ble

goods

(3)

( 3 )(3)

(3)

( 3 )

(3)

(3)

( 3 )(3)

5,394

5,4436,0286,2476,3046,253

6,2226,7226,9187,0106, 705

6,8827,0246,9947,1336,873

7,0147,0806,993

Min-ing

1,078

1,000864722735874

888937

1,006882845

916947983917883

826852943982918

889916885852111

111816840

Con-tractcon-

struc-tion

1,497

1,3721,214

970809862

9121,1451,1121,0551,150

1,2941,7902, 1701,5671,094

1,1321,6611,9822,1692,165

2,3332,6032,6342,6222,593

2,7592,9933,025

Trans-porta-tionand

publicutili-ties

3,907

3,6753,2432,8042,6592,736

2,7712.9563,1142,8402,912

3,0133,2483,4333,6193,798

3,8724,0234,1224,1413,949

3,9774,1664,1854,2214,009

4,0624,1574.156

Trade2

6,401

6,0645,5314,9074,9995,552

5,6926,0766, 5436,4536,612

6,9407,4167,3337,1897,260

7,5228,6029,1969,5199,513

9,64510, 01210, 28110, 52710, 520

10, 84611,29211,554

Fi-nance

1,431

1,3981,3331.2701,2251,247

1,2621,3131,3551,3471,399

1,4361,4801,469I, 4351,409

1,4281,6191.6721,7411,765

1,8241,8921,9672,0382,122

2,2192,3062,342

Serv-ice 2

3,127

3,0842,9132,6822,6142,784

2,8833,0603,2333,1963,321

3,4773,7053,8573,9193,934

4,0114,4744,7834,9254,972

5,0775,2645,4115,5385,664

5, 9166,2316,454

Gov-ern-

ment(Fed-eral,

State,and

local)

3,066

3,1493,2643.2253,1673,298

3,4773,6623,7493,8763,995

4,2024,6605,4836,0806,043

5,9445,5955,4745,6505, 856

6, 0266,3896,6096,6456,751

6,9147,1787,379

Seasonally adjusted

48, 82748, 90949, 23249, 46149, 82450,181

50, 29550, 42150, 62450,78850, 96551,163

51, 28551, 36851, 27451, 62451, 79952,026

51, 45652. 18052,14852, 36752, 44152, 541

16, 02916,11716, 24116,41116, 53016, 658

16,65516,68716, 68316, 82216, 95416, 993

16, 95116, 89816, 81216, 93116, 91916, 895

16, 46816, 90116, 87417,04517,07217,106

9,1349,2149,2989,4259,5239,621

9,6349.6389,6469,7429,8419,882

9,8639,8029,7369,8359,8049,791

9,4229,8219,8169,959

10,01910, 035

6,8956,9036,9436,9867,0077,037

7,0217,0497,0377,0807,1137,111

7,0887,0967.0767,0967,1157,104

7,0467,0807,0587,0867,0537,071

752750758767778783

783778791791792794

7927P4801816814829

769831838836833833

2,6242,6182,7032,7592,8132,823

2,8292,8132,8102,7772,7602,750

2,7682,8022,8342,9022,9853,113

3,0433,0833,0803,0803,0673,074

3, 9923,9843,9843,9484,0084,076

4,0904,1114,1184,1234,1464,145

4,1544, 1414, 1314,1374,1524,174

4,1304,1594,1604,1784,1734,169

10, 63110, 64510, 70110, 68210,74810, 818

10, 88710, 93110, 97211,00111,04511,122

11,19711,23111,16311,26011,25311,307

11,30311,36411,31911,37211,38811,408

2,1662,1762,1852,1872,1972,212

2,2232,2382,2542,2592,2562,263

2,2712,2842,2882,2892,2992,305

2,3032,3262,3252,3272,3262,320

5, 7885,8025,8265,8515,8575,889

5,9065,9176,0136,0116,0526,081

6,1076,1456,1426,1766,1896,227

6,2656,2626,2916,2806,3276,359

6,8456,8176,8346,8566,8936,922

6,9226,9466,9837,0046,9607,015

7,0457.0737, 1037,1137.1887,176

7,1757,2547,2617,2497,2557,272


14O

T A B L E F-22.—Number of wage and salary workers in nonagi (cultural establishments, 1929-57 1—Continued

[Thousands of employees]

Period

Totalwageand

salarywork-

ers

Manufacturing

TotalDu-rablegoods

Non-dura-ble

goods

Min-ing

Con-tractcon-

struc-tion

Trans-porta-tionand

publicutili-ties

Trade 2 Fi-nance

Serv-ice 2

Gov-ern-

ment(Fed-eral,State,and

local)

Seasonally adjusted


JulyAugustSeptember..OctoberNovember4-December 4_

52, 49352, 57752, 54752, 59352, 69852, 773

52, 81552, 84452, 66252, 46952, 23751, 895

17,05316, 99516, 96216, 96516, 94616, 924

16,88016,83616, 68116,60416, 47416, 281

10,0069,9809,9459,9289,9159,907

9,8699,8449,7009,6499,5489,390

7,0477,0157,0177,0377,0317,017

7,0116,9926,9816,9556,9266,891

832833831841843854

861853849837825816

2,9633,0203,0623,0593,0973,108

3,0613,0323,0283,0132,9562,906

4,1884,1684,1684,1604,1594,164

4,1684,1844,1754,1484,1124,076

11,46511, 51911,49011,50111, 54211, 579

11, 63611, 66911,62011, 59011, 57111, 471

2,3162,3242,3222,3202,3292,336

2,3432,3542,3612,3682,3682,365

6,3666,4016,3816,4006,4246,454

6,4926,4776,5086,4826,5156,545

7,3107,3177,3317,3477,3587,354

7,3747,4397,4407,4277,4167.435

1 Includes all full- and part-time wage and salary workers in nonagricultural establishments who workedduring, or received pay for, any part of the pay period ending nearest the 15th of the month. Excludesproprietors, self-employed persons, domestic servants, and unpaid family workers. Not comparable withestimates of nonagricultural employment of the civilian labor force (Table F-17) which include proprietors,self-employed persons, domestic servants, and unpaid family workers, which count persons as employedwhen they are not at work because of industrial disputes, bad weather, etc., and which are based on a samplesurvey of households, whereas the estimates in this table are based on reports from employing establish-ments.

2 Beginning with 1939, data are not strictly comparable with data shown for earlier years because of theshift of the automotive repair service industry from the trade to the service division.

3 Not available.4 Preliminary.



TABLE F-23.—Average weekly hours of work in selected industries, 1929-57

Period

19291930 - .19311932193319341935193619371938193919401941194219431944194519461947...194819491950195119521953 .-1954

19551956 __._1957 6

1956: JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptember...OctoberNovember.. .December. _.

1957: JanuaryFebruaryMarchAprilMayJune . - . -July. . . .AugustSeptember...OctoberNovember 6 .December 6..

Manufacturing

Total

44.2

42.140.538.338.134.636.639.238.635.637.738.140.642.944.945.2

43.440.440.440.139.2

40.540.740.740.539.740.740.439.840.740.540.440.340.040.240.140.340.740.740.541.0

40.240.240.139.839.740.039.740. 039.939.539.339.3

Du-rablegoods

()32.634.833.9

37.341.040.035.038.039.342.145.146.646.6

44.140.240.640.539.541.241.641.541.340.241.441.140.341.241.040.941.140.840.840.740.841.341.441.241.940.940.940.840.540.340.5

40.040.340.239.839.739.6

Non-du-

rablegoods

Bitumi-nouscoal

mining

()41.940.035.136.137.737.436.137.4

37.038.940.342.543.1

42.340.540.139.638.839.739.539.639.539.0

39.839.539.139.939.839.539.239.039.239.439.639.839.739.639.7

39.139.339.138.938.939.2

39.439.539.639.038.738.9

38.4

33.528.327.229.527.026.428.827.923.527.128.131.132.936.643.4

42.341.640.738.032.6

35.035.234.134.432.6

37.637.836.7

38.638.538.237.838.038.136.137.037.937.836.238.737.538.437.437.035.837.6

36.336.536.936.434.1

Build-ingcon-

struc-tion

()28.9

30.132.833.432.132.6

33.134.836.438.439.6

39.038.137.6

<37.336.7

36.337.238.137.036.2

36.236.436.135.135.534.736.036.537.237.037.237.437.435.836.334.136.336.036.236.436.9

36.837.236.836.634.3

Class Irail-

roads iTele-

phone 2

()43.7

44.345.847.048.748.9

48.546.046.446.243.740.841.040.640.640.8

41.941.741.941.342.441.841.042.341.640.642.540.742.642.141.042.542.240.942.042.441.0

42.542.341.142.2

Whole-sale

trade

()38.838.939.1

39.540.140.541.942.3

5 41.739.437.439.238.5

38.939.138.538.738.9

39.639.539.139.439.139.139.139.039.339.939.439.939.841.039.3

38.739.038.738.739.039.2

39.538.938.839 240.1

41.342.642.8

4 42.241.741.241.041.342.242.942.741.541.040.940.7

40.740.740.640.540.4

40.640.440.2

40.640.340.240.240.340.3

40.540.440.640.540.540.740.240.240.140.040.140.2

40.440.440.440.240.0

Retailtrade

(excepteatingand

drink-ing

places)

()42.7

42.542.141.140.340.4

40.340.740.340.340.4

40.540.239.939.239.1

39.038.638.138.638.538.438.538.338.739.139.138.538.338.038.6

38.238.238.038.038.038.2

38.638.738.137.637.5

Laun-dries

()39.441.042.742.641.641.8

41.842.142.242.942.9

42.842.942.641.941.5

41.241.141.140.540.1

40.340.339.840.340.140.140.540.940.9

40.439.940.240.239.940.139.839.839.940.040.340.4

39.839.439.639.439.0

)

1 Averages are based upon monthly data (exclusive of switching and terminal companies) summarizedin the M-300 report by the ICC and relate to all employees who received pay during the month, exceptexecutives, officials, and staff assistants (ICC Group I). Beginning September 1949, data reflect a reduc-tion in the basic workweek from 48 to 40 hours.

2 Prior to April 1945, data relate to all employees except executives; from April 1945 to May 1949, mainlyto employees subject to the Fair Labor Standards Act; and beginning June 1949, to nonsupervisory em-ployees only.

3 Not available.< Data beginning with January of year noted are not comparable with those for earlier periods,s Nine-month average, April through December, because of new series started in April 1945.6 Preliminary.

NOTE.—Data are for production workers in manufacturing and mining, construction workers in buildingconstruction, and for nonsupervisory employees in other industries (except as noted). Data are for pay-roll periods ending nearest the 15th of the month.

The annual figures for 1957 are simple arithmetic averages of the monthly figures shown and are notstrictly comparable with the averages for earlier years, which have been weighted by data on employment.


142

TABLE F-24.—Average gross hourly earnings in selected industries, 1929-57

Period

1929.

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954

195519561957 i

1956: January._.FebruaryMarchAprilMayJune

JulyAugustSeptemberOctoberNovemberDecember


JulyAugustSeptemberOctoberNovember 7__.December 7

Manufacturing

Total

$0. 566

.552

.515

.446

.442

.532

.550

.556

.624

.627

.633

.661

.729

.853

.9611.019

1.0231.0861.2371.3501.401

1. 4651.591.671.771.81

1.881.982.07

1.931.931.951.961.961.97

1.961.982.012.022.032.05

2.052.052.052.052.062.07

2.072.072.082.092.112.11

Dura-ble

goods

()$0.497

.472

.556

.577

.586

.674

.724

.808

.9471.0591.117

1.1111.1561.2921.4101.469

1.5371.671.771.871.92

2.012.102.20

2.062.052.062.082.082.09

2.072.102.142.152.162.18

2.182.172.182.182.182.19

2.202.212.222.232.242.24

Non-dura-

blegoods

Bitu-minous

coalmining

()$0,420

.427

.515

.530

.529

.577

.584

.582

.723

.803

.861

.9041.0151.1711.2781.325

.378

.48

.54

.61

.71

.80

.75

.75

.78

.79

.80

.81

.82

.81

.82

.83

.84

.88

.90

.90

.92

.92

$0,681

.647

.520

.501

.673

.745

.794

.856

.878

.059

.139

.186

.240.401.636.898.941

2.0102.212.292.482.48

2.562.813.02

2.702.682.682.792.792.83

2.832.772.802.922.952.98

2.952.932.933.023.013.05

3.093.043.063.043.05

Build-ingcon-

struc-tion

()$0. 795

.815

.824

.903

.908

.932

.9581.0101.1481.2521.319

1.3791.4781.6811.8481.935

2.0312.192.312.482.60

2.662.802.96

2.742.752.752.752.762.78

2.792.812.842.862.872.89

2.922.912.912.922.942.94

2.962.973.023.023.04

JlassIrail-

roadsTele-

phone2

()$0. 730

.733

.743

.837

.852

.948

.9551.0871.1861.3011.427

1.5721.731.831.881.93

1.962.122.24

2.102.122.102.112.092.11

2.112.092.142.102.192.21

2.192.242.202.212.232.27

2.252.262.282.25

()$0. 774

.816

.822

.827

.820

.843

.870

.911

6.9621.1241.1971.2481.345

1.3981.491.591.681.76

1.821.861.94

1.861.841.841.851.851.86

1.861.851.861.861.881.92

1.911.921.921.931.941.95

1.941.941.951.971.97

Whole-sale

trade

Retailtrade

(excepteating

anddrinkingplaces)

$0.648.667.698

5.700.715

.739

.793

.860

.933

.985

1.0291. 1501.2681.3591.414

1.4831.581.671.771.83

1.902.012.10

1.951.961.992.012.012.02

2.032.022.042.032.052.06

2.062.062.072.072.092.11

2.122. 112.132.132.13

()$0. 542

.553

.580

.626

.679

.731

.783

.8931.0091.0881.137

1.1761.261.321.401.45

1.501.571.65

1.541.541.541.561.561.58

1.591.581.591.591.591.55

1.611.611.621.621.641.66

1.671.671.681.671.66

Laun-dries

()$0.378

.376

.378

.395

.414

.422

.429

.444

.482

.538

.605

.648

.704

.767

.817

.843

.861

.92

.94

.981.00

1.011.051.09

1.031.021.041.041.041.05

1.051.051.061.061.061.07

1.071.071.071.081.091.09

1.091.101.111.111.11

Agri-cul-

ture 3

$0,241

.226

.172

.129

.115

.129

.142

.152

.172

.166

.166

.206

.268

.353

.423

.472

.515

.547

.580

.559

.561

.625

.661

.672

.661

.675

.705

.740

"."615

.696

.736

.785

.643

.717

'."757

1 Averages are based upon monthly data (exclusive of switching and terminal companies) summarized inthe M-300 report by the ICC and relate to all employees who received pay during the month, except execu-tives, officials, and staff assistants (ICC group I). Beginning September 1949, data reflect a wage rateincrease and reduction in the basic workweek from 48 to 40 hours.

2 Prior to April 1945, data relate to all employees except executives; from April 1945 to May 1949, mainly toemployees subject to the Fair Labor Standards Act; and beginning June 1949, to nonsupervisory employeesonly.

3 Weighted average of all farm wage rates on a per-hour basis.• Not available.8 Data beginning with January of year noted are not comparable with those for earlier periods.6 Nine-month average, April through December, because of new series started in April 1945.7 Preliminary.

NOTE.—Data are for production workers in manufacturing and mining, construction workers in buildingconstruction, and for nonsupervisory employees in other industries (except as noted). Data are for payrollperiods ending nearest the 15th of the month.

The annual figures for 1957 are simple arithmetic averages of the monthly figures shown and are notstrictly comparable with the averages for earlier years, which have been weighted by data on man-hours.

Sources: Department of Labor and Department of Agriculture.

143

TABLE F-25.—Average gross weekly earnings in selected industries, 1929—57

Period

Manufacturing

TotalDura-

blegoods

Non-durablegoods

Bitumi-nouscoal

mining

Build-ing con-struc-tion

Class Irail-

roads lTele-

phoneWhole-

saletrade

Retailtrade

(excepteating

anddrink-

ingplaces)

Laun-dries

1929--

1930..1931-.1932-.1933-.1934..

1935..1936_.1937-_1938..1939_.

1940-.1941-.1942_.1943..1944_.

1945..1946-.1947..1948-.1949-.

1950-.1951-.1952-.1953-.1954-.

1955...1956—1957 •_.


JulyAugustSeptember...OctoberNovember...December. __

1957: JanuaryFebruaryMarchAprilMayJuneJulyAugustSeptember...OctoberNovember 6.December 6 .

$25.03

23.2520.8717.0516.7318.40

20.1321.7824.0522.3023.86

25.2029.5836.6543.1446.08

44.3943.8249.9754.1454.92

59.3364.7167.9771.6971.86

76.5279.9982.46

78. 5578.1778.7878.9978.4079.19

78.6079.7981.8182.2182.2284.05

82.4182.4182.2181.5981.7882.80

82.1882.8082.9982.5682.9282.92

$27. 22

24.7721.2816.2116.4318.87

21.5224.0426.9124.0126.50

28.4434.0442.7349.3052.07

49.0546.4952.4657.1158.03

63.3269.4773.4677.2377.18

83.2186.3188.70

84.8784.0584.2585.4984.8685.27

84.2585.6888.3889.0188.9991.34

89.1688.7588.9488.2987.8588.70

88.0089.0689.2488.7588.9388.70

$22. 93

21.8420.5017.5716.8918.05

19.1119.9421.5321.0521.78

22.2724.9229.1334.1237.12

38.2941.1446.9650.6151.41

54.7158.4660.9863.6064.74

68.0671.1073.83

69.8369.6570.3170.1770.2070.95

71.7171.6872.4472.6572.8673.84

72.7373.1073.1272.7473.1374.09

74.4774.2675.2474.1074.3074.69

$25. 72

22.2117.6913.9114.4718.10

19.5822.7123.8420.8023.88

24.7130.8635.0241.6251.27

52.2558.0366.5972.1263.28

70.3577.7978.0985.3180.85

96.26106. 22110. 69

104. 22103.18102. 38105. 46106.02107. 82

102.16102. 49106.12110.38106. 79115. 33

110.63112.51109. 58111.74107. 76114.68

112.17110.96112.91110. 66104.01

()$22. 97

24.5127.0130.1429.1930.39

31.7035.1441.8048.1352.18

53.7356.2463.30

4 68. 8570.95

73.7381.4788.0191.7694.12

96.29101.92106. 96

96.1797.6395.4399.00100.74103. 42

103. 23104. 53106.22106.96102. 75104. 91

99.57105.63104. 76105. 70107. 02108. 49

108.93110.48111.14110.53104. 27

()$31. 90

32.4734.0339.3441.4946.36

46.3250.0055.0360.1162.36

64.1470.9374.3076.3378.74

82.1288.4093.79

86.7389.8987.7886.5188.4187.78

85. 6788.8387.1089.4692.2090.61

93.0894.5389.9892.8294.5593.07

95.6395.6093.7194.95

()$30. 0331.7432.14

32.6732.8834.1436.4538.54

5 40.1244.2944.7748.9251.78

54.3858.2661.2265.0268.46

72.0773. 4775.81

73.2871.9471.9472.3472.1573.10

74.2172.8974.2174.0377.0875.46

73.9274.8874.3074.6975.6676.44

76.6375.4775.6677.2279.00

()$27. 7226.1126.37

26.7628.4129.87

4 29. 5429.82

30.4532.5135.5239.3742.26

43.9447.7351.9955.5857.55

60.3664.3167.8071.6973.93

77.1481.2084.35

79.1778.9980.0080.8081.0081.41

82.2281.6182.8282.2283.0383.84

82.8182.8183.0182.8083.8184.82

85.6585.2486.0585.6385.20

()$23.14

23.5024.4225.7327.3629.53

31.5536.3540.6643.8545.93

47.6350.6552.6754.8856.70

58.5060.6062.73

59.4459.2959.1460.0659.7561.15

62.1761.7861.2260.9060.4259.83

61.5061.5061.5661.5662.3263.41

64.4664.6364.0162.7962.25

)

()$14. 89

15.4216.1416.8317.2217.64

17.9318.6920.3423.0825.95

27.7330.2032.7134.2334.98

35.4737.8138.6339.6940.10

40.7042.3243.34

41.5140.9041.7042.1242.5442.95

42.4241.9042.6142.6142.2942.9142.5942.5942.6943.2043.9344.0443.3843.3443.9643.7343.29

1 Averages are based upon monthly data (exclusive of switching and terminal companies) summarized inthe M-300 report by the ICC and relate to all employees who received pay during the month, except execu-tives, officials, and staff assistants (ICC group I). Beginning September 1949, data reflect a wage rateincrease and reduction in the basic workweek from 48 to 40 hours.

2 Prior to April 1945, data relate to all employees except executive; from April 1945 to May 1949, mainly toemployees subject to the Fair Labor Standards Act; and beginning June 1949, to nonsupervisory employeesonly.

3 Not available.4 Data beginning with January of year noted are not comparable with those for earlier periods.* Nine-month average, April through December, because of new series started in April 1945.6 Preliminary.

NOTE.—Data are for production workers in manufacturing and mining, construction workers in buildingconstruction, and for nonsupervisory employees in other industries (except as noted). Data are for payrollperiods ending nearest the 15th of the month.

The annual figures for 1957 are simple arithmetic averages of the monthly figures shown and are not strictlycomparable with the averages for earlier years, which have been weighted by data on man-hours.


144

T A B L E F-26.—Average weekly hours and hourly earnings, gross and excluding overtime, inmanufacturing industries, 1939-57

Period

All manufacturingindustries

Averageweeklyhours

Gross

37.7

38.140.642.944.945.2

43.440.440.440.139.2

40.540.740.740.539.7

40.740.439.8

40.740.540.440.340.040.2

40.140.340.740.740.541.0

40.240.240.139.839.740.0

39.740.039.939.539.339.3

Ex-clud-ing

ovei-time

0)

0)0)0)(00)0)0)0)(00)0)0)0)0)(0(037.637.4

37.737.737.737.637.437.5

37.537.637.637.637.537.9

37.637.737.637.537.537.6

37.337.637.437.237.037.3

Averagehourly

earnings

Gross

$0,633

.661

.729

.853

.9611. 019

1.0231.0861.2371.3501.401

1.4651.591.671.771.81

1.881.982.07

1.931.931.951.961.961.97

1.961.982.012.022.032.05

2.052.052.052.052.062.07

2.072.072.082.092.112.11

Ex-clud-ing

over-time

0)

(0$0. 702

.805

.894

.947

2.9631.051

<

.198L.3101.367

L. 415L. 531.611.711.76

1.821.912.01

I. 871.86L.88L.901.90L. 91

1.901.91L93L.94L. 961.98

L.98L. 991.992.002.002.01

2.012.012.022.032.05

Durable goods manufac-turing industries

Averageweeklyhours

Gross

38.0

39.342.145.146.646.6

44.140.240.640.539.5

41.241.641.541.340.2

41.441.140.3

41.241.040.941.140.840.8

40.740.841.341.441.241.9

40.940.940.840.540.340.5

40.040.340.239.839.739.6

Ex-clud-ing

over-time

0)

0)0)0)(0(0(')0)0)(00)0)0)0)0)0)0)38.137.9

38.138.038.038.238.037.9

37.937.938.038.137.938.4

38.038.238.238.138.038.1

37.737.937.737.537.437.7

Averagehourly

earnings

Gross

$0. 698

.724

.808

.9471.0591.117

1.1111.1561.2921.4101.469

1.5371.671.771.871.92

2.012.102.20

2.062.052.062.082.082.09

2.072.102.142.152.162.18

2.182.172.182.182.182.19

2.202.212.222.232.242.24

Ex-clud-ing

over-time

0)

0)$0. 770

.881

.9761.029

21.0421.1221.2501.3661.434

1. 4801.601.701.801.86

1.932.032.13

1.981.981.992.002.012.02

2.012.032.062.062.082.09

2.102.102.112.112.122.13

2.142.142.162.162.18

(*)

Nondurable goods man-ufacturing industries

Averageweeklyhours

Gross

37.4

37.038.940.342.543.1

42.340.540.139.638.8

39.739.539.639.539.0

39.839.539.1

39.939.839.539.239.039.2

39.439.639.839.739.639.7

39.139.339.138.938.939.2

39.439.539.639.038.738.9

Ex-clud-ing

over-time

0)

0)0)0)(0(00)(00)(00)0)0)0)0)0)

0)37.036.8

37.237.337.036.836.736.8

36.937.137.037.036.937.1

36.837.036.836.736.736.8

36.937.037.036.636.436.7

Averagehourly

earnings

Gross

$0.582

.602

.640

.723

.803

.861

.9041.0151.1711.2781.325

1.3781.481.541.611.66

1.711.801.89

1.751.751.781.791.801.81

1.821.811.821.831.841.86

1.861.861.871.871.881.89

1.891.881.901.901.921.92

Ex-clud-ing

over-time

0)

0)$0.625

.698

.763

.814

2.858.981

1.1331.2411.292

1.3371.431.491.561.61

1.661.751.83

1.701.701.731.741.751.75

1.761.751.761.771.781.80

1.811.811.811.821.831.83

1.841.831.841.851.86(4)

1939

19401941194219431944

19451946194719481949

19501951195219531954

1955195619573

1956: JanuaryFebruary. .MarchAprilMayJune


1957: JanuaryFebruary. . .MarchAprilMayJune

JulyAugustSeptember .OctoberNovember 3.December 3 .

1 Not available.2 Eleven-month average; August 1945 excluded because of VJ Day holiday period.3 Preliminary.4 Not available.

NOTE.—Data relate to production workers and are for payroll periods ending nearest the 15th of themonth.

The annual figures for 1957 are simple arithmetic averages of the monthly figures shown and are notstrictly comparable with the averages for earlier years, which have been weighted by data on employ-ment (in the case of hours) and man-hours (in the case of earnings).


145

TABLE F—27.—Average weekly earnings, gross and net spendable•, m manufacturing industries, incurrent and 1957 prices, 1939-57

Period

1939 _ - .

1940194119421943 . . . .1944

19451946194719481949

19501951 _195219531954 .

195519561957 3

1956: January -_FebruaryMarchAprilMay - -June . _ .

July .AugustSeptemberOctoberNovemberDecember

1957* JanuaryFebruaryMarch _ _ _AprilMayJune

JulyAugustSeptember _OctoberNovember 3_-December 3

Average gross weeklyearnings

Currentprices

$23.86

25.2029.5836.6543.1446.08

44.3943.8249.9754.1454.92

59.3364.7167.9771.6971.86

76.5279.9982.46

78.5578.1778.7878.9978.4079.19

78.6079.7981.8182.2182.2284.05

82.4182.4182.2181.5981.7882.80

82.1882.8082.9982.5682.9282.92

1957prices 2

$48.20

50.5056.4563.0869.9273.49

69.2563.0562.7863.1764.76

69.2369.9671.8575.2375.09

80.2182.6382.46

82.2581.8582.4182.5481.5081.81

80.6282.0083.8283.8083.7385.50

83.6683.3382.9682.0882.0382.63

81.6182.1482.2581.8281.86

(*)

Average net spendable weekly earnings i

Worker with nodependents

Currentprices

$23.58

24.6928.0531.7736.0138.29

36.9737.7242.7647.4348.09

51.0954.0455.6658.5459.55

63.1565.8667.63

64.7464.4464.9265.0864.6265.24

64.7865.7167.3067.6267.6369.10

67.5867.5867.4266.9367.0867.90

67.4067.9068.0567.7067.9967.99

1957prices 2

$47.64

49.4853.5354.6858.3661.07

57.6854.2753.7255.3456.71

59.6158.4258.8461.4362.23

66.1968.0467.63

67.7967.4867.9168.0067.1767.40

66.4467.5368.9568.9368.8770.30

68.6168.3368.0367.3367.2867.76

66.9367.3667.4467.1067.12

(4)

Worker with threedependents

Currentprices

$23.62

24.9529.2836.2841.3944.06

42.7443.2048.2453.1753.83

57.2161.2863.6266.5866.78

70.4573.2275.03

72.0771.7772.2572.4271.9572.58

72.1173.0674.7075.0375.0476.54

74.9974.9974.8274.3174.4775.31

74.8075.3175.4675.1175.4075.40

1957prices 2

$47.72

50 0055.8862.4467.0870.27

66.6862 1660.6062.0463.48

66 7666.2567.2569.8669.78

73.8575.6475.03

75.4775 1575.5875 6774.7974.98

73.9675.0976.5476.4876.4277.86

76.1375.8275.5074.7674.6975.16

74.2874.7174.7974.4474.43

(*)

1 Average gross weekly earnings less social security and income taxes.2 Estimates in current prices divided by the consumer price index on a 1957 base.3 Preliminary.4Not available.

NOTE.—Data relate to production workers and are for payroll periods ending nearest the 15th of themonth.

The annual figures for 1957 are simple arithmetic averages of the monthly figures shown and are not strictlycomparable with the averages for earlier years, which have been weighted by data on man-hours.


146

TABLE F-28.—Labor turnover rates in manufacturing industries, 1930-57

[Rates per 100 employees]

Period

1930..1931..1932..1933..1934..

1935-.1936..1937..1938..1939..

1940..1941-.1942-.1943..1944..

1945..1946.1947..1948.1949.

1950..1951.1952.1953.1954.

1955...1956.-.1957 2.

1956: January...February-MarchAprilMayJune

JulyAugustSeptember..OctoberNovember.December..

1957: January...February.MarchAprilMayJune

JulyAugustSeptember. . .OctoberNovember 3..

Separation rates

Total

5.04.04.43.84.1

3.63.44.44.13.1

3.43.96.57.36.8

8.36.14.84.64.3

3.54.44.14.33.5

3.33.53.5

3.63.63.53.43.73.4

3.23.94.43.53.32.8

3.33.03.33.33.43.0

3.14.04.44.03.9

Quit i

1.6. 9.7. 9.9

.91.11.3

.6

. 8

.92.03.85.25.1

5.14.33.42.81.5

1.92.42.32.31.1

1.61.61.4

1.41.31.41.51.61.6

1.52.22.61.71.31.0

1.31.21.31.31.41.3

1.41.92.21.3

. 9

Layoff

3.02.93.52.73.0

2.52.13.03.42.2

2.21.31.1

.6

. 6

2.31.21.01.32.4

1.11.21.11.31.9

1.21.51.6

1.71.81.61.41.61.3

1.21.21.41.31.51.4

1.51.41.41.51.51.1

1.31.61.82.32.6

Discharge,military,and mis-

cellaneous l

0.4. 2. 2. 2. 2

. 2

. 2

. 2

. 1

. 1

. 3

.71.71.51.1

.9

.6

. 5

. 5

. 3

. 5

. 8

.6

.7

.4

. 5

. 5

. 4

. 5

. 5

. 5

. 5

. 5

. 5

.4

. 5

. 5

. 5

. 5

.4

. 5

.4

.4

.4

.6

.4

.4

.6

.4

. 4

. 4

Accessionrates

3.13.13.35.44.7

4.24.43.63.84.1

4.45.47.67.56.1

6.36.75.14.43.5

4.44.44.43.93.0

3.73.43.0

3.33.13.13.33.44.2

3.33.84.14.23.02.3

3.22.82.82.83.03.9

3.23.23.32.92.1

1 Prior to 1940, military and miscellaneous separations are included with quits.2 Based on data through November.3 Preliminary.



147

PRODUCTION AND BUSINESS ACTIVITYTABLE F-29.—Industrial production indexes, 1929—57

[1947-49=100]

Period

Industrial production

Total

Manufactures

Total

Durable

Total

Pri-marymet-als

Fabri-catedmetalprod-ucts

Non-elec-tricalma-

chin-ery

Elec-tricalma-

chin-ery

Trans-porta-tion

equip-ment

Instru-mentsand re-1latedprod-ucts

Clay,glass,andlum-ber

prod-ucts

Fur-niture

andmiscel-lane-ous

man-ufac-tures

1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954

195519561957

1956: January. .February.MarchAprilMayJune


1957: January....February-MarchAprilMayJune

JulyAugustSeptemberOctoberNovemberDecember i

59

4940313740

4756614858

6787

106127125

10790

10010497

112120124134125

139143H3

143143141143141141

136143144146146147

146146145143143144

144145144141139136

110133130

1109010010397

113121125136127

140144144

4531192430

3849553549

6391126162159

1238610110495

116128136153137

155159159

10310790

115126116132108

140138132

10310493

115122121136123

134135138

10410690

105126136143125

135153150

101101

131138167194177

194207203

96102102

120135154

203199211

10010595

114128142155140

149166172

Seasonally adjusted

10010595

115121118125123

138140133

145144143144143142

138144146147147149

147148147145145146

146147146142140138

160158157159157157

148158162163165167

164164162160159162

161162159154153148

148146145146141136

69125148147146145

143143137134132132

132136131128121111

136134132136130132

130134139140139141

137138137140136139

141140140136139136

148149150150151151

154157158156155157

154155155151152151

152152151146142138

201194193208208208

210211210211214216

208204204196199209

214213207194199194

200199196193187188

189191193203216223

222225222217213215

210209205200201195

160161160162164163

167171171172172173

173174173172171171

173175174170171167

141138135139141141

143145139138138136

133133132133136140

134139135131128125

10010495

117116118131121

132135131

136135133135135135

136136136136134134

131129130132132133

134135136131128126

See footnotes at end of table.I48

TABLE F-29.—Industrial production indexes, 1929-57—Continued

[1947-49=100]

Period

1929

19301931—193219331934-

19351936—_ .19371938 .1939 .

1940. -194119421943—1944

194519461947 ..19481949

19501951 — -19521953.1954

195519561957 J



1957: JanuaryFebruaryMarchAprilMavJune .- .

JulyAugustSeptemberOctoberNovemberDecember l

Industrial production •

Manufactures

Nondurable

Total

56

5148424849

5561645766

69849310399

96959910299

111114114118116

126129130

Tex-tilesandap-parel

9910397

110106105107100

109108104

Rub-berand

leatherprod-ucts

10610193

110105107113104

122117119

Paperandprint-ing

96103101

114118118125125

137145148

Chem-icalandpetro-leumprod-ucts

97103100

118132133142142

159167172

Foods,bever-ages,

and to-bacco

101100100

103105106107106

109112112

Min-erals

68

5951424851

5563716268

7681848793

929110010694

105115114116111

122129128

Output of consumer durables

Total

98102101

133114105127116

147131130

Autos

8593122

159127103146131

190138146

Majorlouse-holdgoods

9910596

143118115132122

144144133

Othercon-sumerdura-bles

10910586

95969510295

106111111

Seasonally adjusted

130130128130129128

128130130131129130

131131131129130130

130131132130128127

111112107107107106

106107108111105106

104105105104105106

1041051071039997

127126119120114110

112117116117114118

122124123118115116

117123119117117114

142142142145145145

146147145148147147

148147147147148148

146149149149148148

167167167168167166

164167168167168170

174172171172174170

173174174173171171

112112111112111110

111113113113113113

111113113110111112

114113113111111111

129129129129128129

123130131131130130

131133133130130127

127129129128123121

144137133132125123

127127123123132141

137138134124124129

129133129121133127

168155145140118120

122124106117152168

169167159141139144

134145129118154140

149146144145141138

148141148142136143

130134132124126133

142138140134134

113111108111110110

111114113110109113

114114111109108108

111114116112111110

1 Preliminary. 2 Not available.

NOTE.—Detail not available prior to 1947.

Source: Board of Governors of the Federal Reserve System.

149

TABLE F-30.—Business expenditures for new plant and equipment, 1939 and 1945-58


Period

1939

1945194619471948 -- - -1949 .

1950 - - . . -1951195219531954

1955 3

195631957 3 4

1955: First quarterSecond quarterThird quarterFourth quarter.

1956: First quarterSecond quarterThird quarterFourth quarter

1957: First quarterSecond quarter.Third quarterFourth quarter 4

1958: First quarter *

Total i

5.51

8.6914.8520.6122.0619.28

20.6025.6426.4928.3226.83

28.7035.0837.03

Manufacturing

Total

1.94

3.986.798.709.137.15

7.4910.8511.6311.9111.04

11.4414.9516.05

Dura-ble

goods

0.76

1.593.113.413.482.59

3.145.175.615.655.09

5.447.628.05

Non-durablegoods

1.19

2.393.685.305.654.56

4.365.686.026.265.95

6.007.338.00

Mining

0.33

.38

.43

.69

.88

.79

.71

.93

.98

.99

.98

.961.241.25

Transportation

Rail-road

0.28

.55

.58

.891.321.35

1.111.471.401.31.85

.921.231.39

Other

0.36

.57

.921.301.28.89

1.211.491.501.561.51

1.601.711.80

Publicutili-ties

0.52

.50

.791.542.543.12

3.313.663.894.554.22

4.314.906.28

Com-mer-cialand

other 2

2.08

2.705.337.496.905.98

6.787.247.098.008.23

9.4711.0510,26


25.6527.1929.6531.45

32.8234.4935.8736.46

36.8937.0337.7537.47

35.52

10.1710.8411.9712.48

13.4514.6515.7815.81

16.1216.2516.3716.16

14.96

4.785.065.776.00

6.577.388.208.21

8.098.318.237.93

7.27

5.395.786.206.48

6.887.277.587.60

8.037.948.148.23

7.69

0.80.94.99

1.08

1.131.281.261.28

1.351.281.241.20

1.16

0.74.80.96

1.17

1.251.221.201.23

1.421.351.541.22

1.16

1.461.621.601.70

1.651.631.791.76

1.521.821.812.03

1.82

4.014.094.434.48

4.564.615.085.27

5.725.936.646.62

6.48

8.468.909.70

10.54

10.7811.1010.7611.11

10.7610.4010.1510.24

9.94

1 Excludes agriculture.2 Commercial and other includes trade, service, finance, communications, and construction.3 Annual total is the sum of unadjusted quarterly expenditures; it does not necessarily coincide

with the average of seasonally adjusted figures, which include adjustments, when necessary, for systematictendencies in anticipatory data.

* Estimates for fourth quarter 1957 and first quarter 1958 based on anticipated capital expenditures re-ported by business in late October and November 1957.

NOTE.—These figures do not agree precisely with the plant and equipment expenditures included in thegross national product estimates of the Department of Commerce. The main difference lies in the inclusionin the gross national product of investment by farmers, professionals, and institutions, and of certain out-lays charged to current account.

This series is not available for years prior to 1939 and for 1940 to 1944.Detail will not necessarily add to totals because of rounding.Sources: Securities and Exchange Commission and Department of Commerce.

I5O

TABLE F-31.—New construction activity, 1929-57

[Value put in place, millions of dollars]

Period

1929..

1930..1931-1932-1933..1934..

1935-1936-1937-1938-1939-

1940-1941-1942..1943-1944-

1945..1946-1947-1948..1949-

1950..1951-1952..1953..1954..

1955..1956-1957*

1956: JanuaryFebruary. . .MarchAprilMayJune

JulyAugustSeptember.OctoberNovember..December-

1957: JanuaryFebruary. _MarchAprilMayJune

JulyAugustSeptember.OctoberNovember.December 4

Totalnewcon-

struc-tion

10, 793

8,7416,4273, 5382,8793,720

4,2326,4976,9996,9808,198

8,68211,95714, 0758,3015, 259

5,80912, 73717, 91523,22224,163

29,95532, 73934, 75037,11839,601

44, 58146,06047, 255

Private construction

Total i

Resi-dential

building(non-farm)

44, 55645,08445,12045,66046,18846, 548

46, 47646,33246,28446,68046, 72846, 848

47,06446,33246,94446, 87246,86046,800

45, 99647, 30447, 74848, 76848, 51648, 612

8,307

5, 8833,7681,6761,2311,509

1,9992,9813,9033,5604,389

5,0546,2063,4151,9792,186

3,41110, 37514, 48118, 39517, 759

22, 95423,32023,84925, 72427, 679

32,62033, 24233, 313

3, 625

2,0751,565630470625

1,0101,5651,8751,9902,680

2,9853,5101,715885815

1,2764,7527,53510.1229,642

14,10012,52912, 84213, 77715, 379

18, 70517,63216, 571

Nonresidential building and other construction

Total Com-mercial 2

4,682

3.8082,2031,046761884

1,4162,0281,5701,709

2,0692,6961,7001,0941,371

2,1355,6236,9468,2738,117

8,85410, 79111,00711,94712,300

13, 91515, 61016, 742

1,135

454223130173

211290387285292

3484091553356

2031,132856,2531,027

,371,137,7912,212

3,2183,6313,570

Indus-trial

949

53222174176191

158266492232254

442801346156208

6421,6891,7021,397

972

1,0622,1172,3202,2292,030

2,3993,0843,162

Publicutility

1,578

1,527946467261

363518705605683

771872786570725

8271,3742,3383,0433,323

3,3303,7294,0034,4164,284

4,5435,1135,830

Other 3

1,020

856582282194194

257342444448480

508614413335382

4631,4282,0502,5802,795

3,1743,5743,5473,5113,774

3,7553,7824,180


Publiccon-

struc-tion

32,32832,84433,00033,14433,42033, 504

33, 45633,36033, 21633, 33633,86433, 588

32,83232, 88033,02433, 04833, 01232,904

32,86833,44433, 48033, 99634,11634, 248

17,76017,86817,88017, 78417, 62817,700

17,56817, 59217, 50817, 41217, 61617,520

16,93216, 69216,59616,33215,85215,888

16,18816, 52416,65616,96817,20817, 328

14,56814, 97615,12015,36015, 79215, 804

15,88815, 76815, 70815, 92416, 24816, 068

15,90016,18816, 42816, 71617.16017,016

16, 68016,92016,82417,02816,90816,920

3,5523,6243,7083,7323 7443,780

3, 6963,5043,4563,5523,6483,660

3,5043,3963,5043,5403,6483,636

3.5163,5643,5763,6963,6723,636

2,6282,7002,7722,9403,1203,216

3,2763,3123,3123,2763,2283,228

3,1683,2403,2883,3243,3363,276

3,1803,1923,0843,0122,9522,916

4,7525,0284,9564,9925,2445,076

5,1485,1245,0765,1845,4245,220

5,2205,4725,5085,6645,9645,868

5,9045,9165,9406,1206,0366,096

3,6363,6243,6843,6963,6843,732

3,7683,8283,8643,9123,9483,960

4,0084,0804,1284,1884,2124,236

4,0804,2484,2244,2004,2484,272

2,486

2,8582, 6591,8621,6482,211

2,2333, 5163,0963,4203,809

3,6285, 75110,6606,3223,073

2,3982,3623,4344,8276,404

7,0019,41910,90111,39411,922

11, 96112, 81813, 942

12,22812,24012,12012, 51612,76813,044

13,02012, 97213,06813, 34412,86413,260

14,23213,45213, 92013,82413,84813,896

13,12813,86014, 26814, 77214,40014,364

1 Excludes construction expenditures for crude petroleum and natural gas drilling, and therefore does notagree with the new construction expenditures included in the gross national product (Table F- l ) .

2 Office buildings, warehouses, stores, restaurants, and garages.3 Includes farm, institutional, and all other.4 Preliminary.

Sources: Department of Commerce and Department of Labor.

TABLE F-32.—New public construction activity, 1929-57

[Value put in place, millions of dollars]

Year

1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954

195519561957 3

Total new public construction i

Allpublicsources

2,486

2,8582,6591,8621,6482,211

2,2333,5163,0963,4203,809

3,6285,751

10,6606,3223,073

2,3982,3623,4344,8276,404

7,0019,41910,90111,39411,922

11,96112, 81813, 942

Federal

Direct

155

209271333516

814797776717759

1,1823,7519,3135,6092,505

1,737870840

1,1771,488

1,6252,9824,1864,1513,445

2,8002,7742,958

Federalaid

80

104235111286721

5671,5661.1171,3201,377

946697475268126

244409417461

465479619700709

758861

1,349

Stateandlocal

2,251

2,5452,1531,418846864

8521,1531,2031,3831,673

1,5001,303872445442

5621,2482,1853,2334,455

4,9115,9586,0966,5437,768

8,4039,1839,635

Major types of new public construction

High-way

1,266

1,5161,355

958847

1,000

845,362,226,421,381

,302,066734446362

398895

1,4511,7742,131

2,2722,5182,8203,1603,870

4,0504,4704,840

Educa-tional

389

36428513052148

153366253311468

1561581286341

59101287618

1,1331,5131,6191,7142,134

2,4422,5492,832

Hos-pitaland

institu-tional

101

118110834951

38747397

127

5442354458

858585

223477

496528473365360

322298333

Sewerand

waterand

miscel-laneouspublicservice

404

500479291160228

246509445492507

469393254156125

152278492699803

819959958

1,0501,171

1,3181,6591,740

Con-serva-tionandde-

velop-ment

137156150359518

700658605551570

528500357285163

130260424670852

942912900892773

701826975

Mili-taryfacili-ties

19

2940343647

37293762

125

3851,6205,0162,550

837

188204158137

177887

1,3881,3071,030

1,3131,3951,275

Allother

publica

192

194234216145219

214518457486631

7341,9724,1362,7781,487

884555491685

1,070

1,1622,1022,7432,9062,584

1,8151,6211,947

1 For expenditures classified by ownership, combine "Federal aid" and "State and local" columns toobtain State and local ownership. "Direct" column stands as it is for Federal ownership.

2 Includes nonresidential building other than educational and hospital and institutional (industrial,commercial, public administration, social and recreational, and miscellaneous), public residential buildings,and publicly owned parks and playgrounds, memorials, etc.

3 Preliminary.

Sources: Department of Commerce and Department of Labor.

TABLE F-33.—Housing starts and applications for financing, 1929-57

[Thousands of units]

Period

New nonfarm housing starts

TotalPub-licly

fi-nanced

Privately financed

Total

Government programs

Total i F H A i VA

Private,season-ally ad-justedannualrates

Proposed homeconstruction

FHAapplica-tions 2

VA ap-praisal

requests

1929 3. 509.0 509.0

19301931193219331934

330.0254.0134.093.0

126.0

221.0319.0336.0406.0515.0

602.6706.1356. 0191.0141.8

209.3670.5849.0931.6

1, 025.1

1, 396.01, 091. 31,127. 01,103. 81,220. 4

1, 328.91,118.11,039.2

75.178.498.6

111.4113.7107. 4

101.1103.993.993.677.463.6

63.065.887.093.7

103.0

99.9100.091.9

7 95.07 78.0

62.0

330.0254.0134.093.0

126.0

215.7304.2332.4399.3458.4

529. 6619.5301.2183.7138.7

208.1662.5845.6913. 5

1935..1936..1937..1938..1939..

1940..1941..1942..1943..1944..

1945..-1946.—1947..-1948.—1949.—

1950..1951..1952..1953..1954..

1955..1956..1957 7


JulyAugustSeptember..OctoberNovember..December..

1957: January __February.MarchAprilMayJune

JulyAugustSeptember. _OctoberNovember..December 7_

5.314.83.66.7

56.6

73.086.654.87.33.1

1.28.03.4

18.136.3

43.871.258.535.518.7

19.424.249.5

1.41.44.71.52.92.8

2.1.7

3.22.4.4.7

2.92.77.72.36.15.4

6.03.21.7

7 8.07 2.3

1.2

1, 352. 21, 020.11,068. 51,068. 31, 201. 7

1,309. 51, 093. 9

989.7

73.777.093.9

109.9110.8104.6

99.0103.290.791.277.062.9

60.163.179.391.496.994.5

93.996.890.2

7 87.07 75.7

60.8

14.049.460.0

118.7158.1

180.1220.4165.7146.293.3

686.7412.2421.2408.6583.3

669.6460. 0296.7

36.030.437.546.246.344.8

42.843.139.139.429.924.6

19.719.222.725.627.028.3

28.029.328.228.421.418.9

14.049.460.0

118.7158.1

180.1220.4165.7146.293.3

41.269.0

229.0294.1363.8

486.7263.5279.9252.0276.3

276.7189.3168.4

13.013.116.919.819.718.4

17.618.615.115.512.19.6

7.79.3

11.312.114.915.3

15.717.716.418.715.014.2

()0)()

6 200. 0148.7141.3156.6307.0

392.9270.7128.3

23.017.420.626.426.626.4

25.224.424.024.017.815.0

12.09.9

11.413.512.013.0

12.311.611.89.76.44.7

1,1951,1271,09 k1,1571,1461,091

1,0701,1361,0081,0521,0271,020

935933962994995

1,0151,0561,012

7 1,00011,010

970

* 20. 647.849.8

131.1179.8

231.2288.5238.5144.462.9

56.6121.7286.4293.2327.0

397.7192.8267.9253.7338.6

306.2197.7198.8

15.618.524.922.322.116.8

16.916.213. 413.310.07.7

10. 512.116.216.816.916.6

18.422.320.420.214.713.6

()164.4226.3251.4535.4

620.8401.5159.3

29.337.137.545.844.435.6

34.636.530.029.721.919.0

18.920.219.519.416.613.7

14.014.58.96.43.73.5

1 Excludes armed forces housing in 1956 (2,567 units) and 1957 (13,731 units).2 Units in mortgage applications for new-home construction.» The number of starts for the years 1920-28, respectively, was as follows: 247,000; 449,000; 716,000; 871,000;

893,000; 937,000; 849,000; 810,000 and 753,000.* FHA program approved in June 1934; all 1934 activity included in 1935.8 Not available.6 Partly estimated.7 Preliminary.

Sources: Department of Labor, Federal Housing Administration (FHA), and Veterans Administra-tion (VA).

153

TABLE F-34.—Sales and inventories in manufacturing and trade, 1939-57

[Amounts in billions of dollars]

Period

Sales 2

1939....

1940...1941....1942....1943....1944....

1945....1946....1947....

1948—1949—1950—

1951...1952...1953...1954...

1955—1956—1957 * •

1956: JanuaryFebruary. _.MarchAprilM a y . . . . —June

JulyAugustSeptember.OctoberNovember..December...

1957: JanuaryFebruary. _.MarchAprilMayJune

JulyAugustSeptember.OctoberNovember6

December6.

Total manufactur-ing and trade l

10.8

12.115.818.621.923.8

23.927.233.2

36.134.539.7

44.745.948.447.4

52.354.856.3

Inven-tories 3

20.1

22.228.831.131.331.1

30.942.950.5

55.451.862.8

73.875.478.675.5

81.789.190.9

Ratio

1.77

.72

.58

.66

.40

.33

.30

.33

.43

.48

.56

.39

,58.61.61.62

.49

.56

.61

Sales 2

Manufacturing

Inven-tories 3

5.1

5.98.2

10.412.813.8

12.912.615.9

17.616.419.3

22.322.824.523.5

26.327.728.4

11.5

12.817.019.320.119.5

18.424.528.9

31.728.934.3

42.843.845.443.0

46.452.353.8

Ratio •

2.11

2.061.781.771.511.45

1.481.661.71

1.721.861.57

1.771.901.841.86

1.681.791.89

Wholesale trade l

Sales 2

2.2

2.43.03.43.84.2

4.56.07.3

7.57.28.4

9.7

10.611.311.3

Inven-tories 3

3.1

3.24.03.83.73.9

4.66.67.6

7.97.69.1

9.710.010.510.4

11.413.012.8

Ratio *

1.34

1.301.201.19.97.94

.91

.901.01

1.011.06.96

1.051.011.061.07

1.021.081.14

Retail trade 1

Inven-tories 3

3.5

3.94.64.85.35.9

6.58.5

10.0

10.910.912.0

13.013.514.114.1

15.315.816.7

5.5

6.17.88.07.67.6

7.911.914.1

15.815.319.3

21.221.622.722.1

23.923.924.3

Ratio *

Seasonally adjusted

54.354.053.353.954.754.5

53.955.054.255.956.357.0

57.957.456.256.456.856.4

57.457.056.355.754.9

82.583.583.784.585.385.6

86.286.686.987.888.589.1

89.389.689.990.190.690.7

91.091.391.391.190.9

] .511.541.571.561.551.57

L. 59.57.60

L. 56L. 57L. 56

L. 54L. 56L. 60L.591.59L. 61

L. 58L601.62L.64L.66

27.627.726.827.527.627.4

26.827.627.128.728.528.8

30.029.528.428.728.628.1

29.028.628.228.127.4

46.847.648.048.649.349.6

50.050.450.851.852.252.3

52.452.953.353.753.953.9

54.154.254.254.153.8

1.691.701.781.761.781.81

1.861.821.86

. 1.791.831.81

1.751.781.871.871.881.91

1.861.891.921.931.97

11.211.110.811.011.411.3

11.211.311.111.411.611.8

11.611.511.411.311.511.4

11.411.411.211.010.9

11.611.711.912.012.112.2

12.312.512.612.712.813.0

12.912.812.812.812.712.7

12.712.812.812.812.8

1.031.051.091.091.061.08

1.091.101.121.111.101.09

1.111.111.121.131.111.11

1.121.121.151.171.17

15.515.215.615.415.715.9

15.916.115.915.916.216.3

16.316.416.316.416.616.8

17.017.016.916.716.616.7

24.124.223.823.923.923.8

23.823.723.423.323.523.9

24.023.923.723.723.924.1

24.124.324.424.224.3

1.53

1.491.481.761.421.31

1.211.131.27

1.401.421.40

1.651.551.591.59

1.501.501.44

1.551.591.541.551.521.51

1.501.481.491.471.441.45

1.471.461.461.441.431.43

1.421.421.44L451.47

1 The series beginning in 1948 are not comparable with the previous years because of changes in definitionfor the wholesale series. Beginning in 1951, the estimates of retail sales and inventories are based on anew method of estimation adopted by the Bureau of the Census.

2 Monthly average shown for year and total for month.3 Seasonally adjusted, end of period.4 Inventory/sales ratio. For annual periods weighted average inventories to average monthly sales;

for monthly data, ratio of average end of current and previous month's inventories to sales for month.fi Where December data not available, data for year calculated on basis of no change from November.6 Preliminary.

NOTE.—For a description of the series and their comparability, see Survey of Current. Business, Septemberand November 1952, January 1954, and June 1957 for retail, and August 1957 for manufacturing and whole-sale.

The inventory figures in this table do not agree with the estimates of change in business inventories in-cluded in the gross national product since these figures cover only manufacturing and trade rather than allbusiness, and show inventories in terms of current book value without adjustment for revaluation.


154

TABLE F-35.—Manufacturers* sales, inventories, and orders, 1939—57


Period Dura-ble-

goodsindus-tries

Non-durable-

goodsindus-tries

Pur-chasedmate- jrials

Inventories2

Durable-goodsindustries

Goods-in-

process

Fin-ishedgoods

Nondurable-goodsindustries

Pur-chasedmate-rials

Goods-in-

process

Fin-ishedgoods

Total

New orders *

Dura-ble-

goodsindus-tries

Non-durable

goodsindus-tries

Un-filledorders(un-

adjust-ed) 3

1940—1941....1942....1943—.1944....

1945...1946...1947—1948—1949—

1950—1951—1952...1953...1954...

1955...1956...1957 * *.

1956:JanuaryFebruary . . .MarchAprilMayJune

JulyAugustSeptember..OctoberNovember.December. .

1957:JanuaryFebruary . .MarchAprilMayJune

JulyAugustSeptember.OctoberNovember5

1.9

2.53.85.26.97.3

6.35.06.77.67.1

8.810.410.912.411.2

13.113.814.2

3.2

3.44.45.36.06.4

6.67.69.2

10.09.3

10.511.911.912.112.3

13.313.914.3

1.8

2.13.13.73.93.3

3.24.55.15.64.6

6.17.47.37.46.5

7.48.78.5

1.5

2.03.24.65.25.0

3.54.65.25.44.7

6.08.6

10.210.79.8

11.112.813.1

2.1

2.22.32.22.12.1

2.12.94.04.74.7

4.76.86.98.17.7

8.29.2

2.4

2.64.04.34.54.7

4.96.57.27.36.5

8.49.18.68.17.9

8.18.59.0

0.8

1.21.21.41.4

1.51.82.22.22.1

2.52.72.72.72.6

2.83.03.0

2.9

3.03.23.33.03.0

3.24.25.26.56.3

6.68.28.18.48.4

8.810.110.4

5.4

6.89.8

13.312.711.9

10.513.715.617.415.9

21.024.523.623.122.5

27.228.327.3

2.2

3.45.38.06.85.5

3.95.96.47.56.6

10.312.711.711.010.2

13.914.413.1

Seasonally adjusted

13.813.813.313.713.613.6

13.013.713.414.414.314.5

14.914.814.214.314.314.2

14.614.314.113.913.5

13.813.913.613.814.013.8

13.813.913.714.314.214.3

15.014.714.214.414.313.9

14.514.314.114.113.9

7.57.77.98.08.18.1

8.28.28.28.58.68.7

8.68.78.78.68.58.4

8.48.48.58.68.5

11.211.411.611.812.112.0

12.112.212.312.612.912.8

12.812.913.013.413.413.3

13.513.613.413.213.1

8.28.48.48.48.58.7

8.78.88.99.19.19.2

9.29.39.49.49.69.7

9.89.89.89.99.8

8.28.28.28.28.38.3

8.38.48.48.68.68.5

8.68.78.78.78.99.0

9.09.08.98.99.0

2.82.82.82.82.82.9

2.92.92.93.02.93.0

3.03.03.03.02.93.0

2.93.02.93.03.0

8.99.19.29.49.49.6

9.89.9

10.010.010.110.1

10.210.310.410.610.510.5

10.510.510.510.410.4

28.128.127.428.328.627.7

27.731.126.828.830.029.0

28.928.628.127.928.427.1

27.327.326.626.226.2

14.414.413.814.514.714.1

14.117.313.014.315.814.5

14.214.113.913.214.113.2

13.013.212.512.212.3

3.2

3.44.55.35.96.4

6.67.89.39.99.3

10.711.811.912.112.3

13.313.914.2

13.713.713.613.814.013.6

13.613.713.714.514.214.5

14.814.514.214.714.313.8

14.314.214.014.113.9

7.0

18.437.972.971.549.0

20.933.830.326.920.8

41.167.676.359.546.9

56.964.251.8

58.358.759.059.659.760.6

62.464.163.662.863.464.2

64.063.763.261.961.160.3

59.357.856.053.251.8

1 Monthly average shown for year and total for month.2 Book value, seasonally adjusted, end of period.3 End of period.* Based on data through November.5 Preliminary.

NOTE.—See Table F-34 for total sales and inventories of manufacturers.


155

PRICESTABLE F-36.— Wholesale price indexes, 1929-57

[1947-49=100] i

Period

1929

19301931 . .193219331934 .

19351936193719381939 . .

19401941194219431944 . _ _ - . _

1945 .1946194719481949

195019511952 -19531954

195519561957*

1956: J a n u a r yFebruary _.MarchAprilMayJuneJulyAugust __ -SeptemberOctober -NovemberDecember

1957: JanuaryFebruary. .March. __AprilMayJune

JulyAugustSeptember _OctoberNovemberDecember 4

Allcom-modi-

ties

61.9

56.147.442.142.848.7

52.052.556.151.150.1

51.156.864.267.067.6

68.878.796.4

104.499.2

103.1114.8111.6110.1110.3

110.7114.3117.6

111.9112.4112.8113 6114.4114.2

114.0114.7115.5115.6115.9116.3

116.9117.0116.9117 2117.1117.4

118.2118.4118.0117 8118.1118.4

Farmprod-ucts

58.6

49.336.226.928 736.5

44 045.248.338 336.5

37.846.059 268.568.9

71.683.2

100.0107.392 8

97.5113.4107.097 095.6

89.688.490.9

84.186.086.688 090.991.2

90.089.190.188.487.988.9

89.388.888.890 689 590.9

92.893.091.091 591.992.6

Proc-essedfoods

58.5

53.344.836.536.342.6

52.150.152.445.643.3

43.650.559.161.660.4

60.877.698.2

106.195.7

99.8111.4108.8104.6105.3

101.7101.7105.6

98.399.099.2

100.4102.4102.3

102.2102.6104.0103.6103.6103.1

104.3103.9103.7104.3104.9106.1

107.2106.8106.5105.5106.5107.4

All commodities other than farm productsand foods

Total

65.5

60.953.650.250.956.0

55.756.961.058.458.1

59.463.768.369.370.4

71.378.395.3

103.4101.3

105.0115.9113.2114.0114.5

117.0122.2125.6

120.4120.6121.0121.6121.7121.5

121.4122.5123.1123.6124.2124.7

125.2125.5125.4125.4125.2125.2

125.7126.0126.0125.8125.9126.0

Textileprod-uctsand

apparel

w(3)(3)(3)

(3)

(3)

100.1104.495.5

99.2110.699.897.395.2

95.395.395.4

95.796.095.995.194.994.9

94.994.894.895.395.495.6

95.895.795.495.395.495.5

95.495.495.495.195.094.9

Chemi-calsand

alliedprod-ucts

?(3)51.253.7

56.056.459.055.955.8

56.661.669.369.570.2

70.676.3

101.4103.894.8

96.3110.0104.5105.7107.0

106.6107.2109.5

106.3106.4106.5106.9106.9107.1

107.3107.3107.1107.7108.2108.3

108.7108.8108.8109.1109.1109.3

109.5109.8110.2110.4110.3110.5

Rubberand

rubberprod-ucts

83.5

73.062.053.856.865.8

66.471.784.482.786.3

80.286.5

100.6103.3102.0

98.999.499.0

102.198.9

120.5148.0134.0125.0126.9

143.8145.8145.2

148.4147.1146.2145.0143.5142.8

143.3146.9145.7145.8146.9147.9

145.0143.9144.3144.5144.7145.1

144.9146.9146.5146.2144.7145.7

Lumberand

woodprod-ucts

31.9

29.423.820.324.228.5

27.428.733.730.831.6

35.241.845.448.051.9

52.560.393.7

107.299.2

113.9123.9120.3120.2118.0

123.6125.4119.0

126.3126.7128.0128.5128.0127.3

126.6125.2123.6122.0121.5121.0

121.3120.7120.1120.2119.7119.7

119.3118.6117.8117.3116.9116.4


i 5 6

TABLE F-36.—Wholesale price indexes, 1929-57—Continued

[1947-49=100]i

Period

All commodities other than farm products and foods (continued)

Hides,skins,leather,

andleatherprod-ucts

Fuel,power

andlight-

ingmate-rials

Pulp,paper,

andalliedprod-ucts

Metalsand

metalprod-ucts

Machin-ery andmotiveprod-ucts

Furni-tureand

otherhouse-holddura-bles

Non-metal-

licminer-

als(struc-tural)

Tobaccomanu-factures

andbottledbever-

Miscel-laneous

products

1929

19301931193219331934

19351936193719381939

19401941.194219431944

19451946194719481949

19501951195219531954

19551956.1957*

1956: JanuaryFebruary..MarchAprilMayJune

JulyAugustSeptemberOctoberNovember-December.

1957: JanuaryFebruary.MarchAprilMayJune


59.3

54.446.839.744.047.1

48.751.956.950.552.0

54.858.964.063.963.4

64.274.6

101.0102.196.9

104.6120.397.298.594.2

93.899.399.5

96.797.197.7100.6100.0100.2

100.1100.0100.299.799.899.2

98.498.098.498.899.099.9

100.7100.5100.3100.4100.3

70.2

66.557.259.556.162.0

62.264.565.764.761.8

60.764.566.468.470.3

71.176.290.9

107.1101.9

103.0106.7106.6109.5108.1

107.9111.2117.2

111.0111.2110.9110.6110.8110.5

110.7110.9111. 1111.7111.2114.0

116.3119.6119.2119.5118.5117.2

116.4116.3116.1115.8115.7115.7

()98.6

102.998.5

100.9119.6116.5116.1116.3

119.3127.2129.5

124.8125.4126.8127.4127.3127.4

127.7127.9127.9128.1127.8128.0

128.6128.5128.7128.6128.9128.9

129.5129.9130.1130.9130.9131.0

67.0

60.354.149.950.956.2

56.257.365.663.162.6

62.864.064.964.864.8

65.973.991.3

103.9104.8

110.3122.8123.0126.9128.0

136.6148.4151.2

145.1145.1146. 5147.7146. 8145.8

144.9150.2151.9152.2152.1152. 3

152.2151.4151.0150.1150.0150.6

152.4153.2152.2150.8150.4150.3

()65.3

66.268.671.271.071.0

71.680.392.5

100.9106.6

108.6119.0121.5123.0124.6

128.4137.8146.1

133.3133.9134.7135. 7136.5136.8

136.9137.7139.7141.1143.4143.6

143.9144.5144.8145.0145.1145.2

145.8146.2146.9147.7149.2149.3

69.3

68.262.855.455.560.2

59.860.667.265.665.4

71.276.876.478.4

78.683.095.6

101.4103.1

105.3114.1112.0114.2115.4

115.9119.1122.2

118.0118.2118.1118.0118.0118.1

118.3119.1119.7121.0121.1121.2

121.9121.9121.9121.5121.6121.7

122.4122.4122.3122.6122.7123.3

72.6

72.467.663.466.971.6

71.671.773.471.169.5

69.771.374.174.575.9

79.184.293.9

101.7104.4

106.9113.6113.6118.2120.9

124.2129.6134.6

127.0127.1127.9128.6128.6128.9

130.6130.8131.1131.5131.2131.3

132.0132.7133.2134.6135.0135.1

135. 2135.3135.2135.3135.4135.7

86.6

87.184.681.472.876.0

75.975.876.576.476.4

77.378.179.183.083.4

85.889.797.2

100.5102.3

103.5109.4111.8115.7120.6

121.6122.3126.1

121.7121.7121.7121.7121.6121.6

121.7122.5122.8123.1123. 5123.6

124.0124.1124.1124.5124.5124.7

127.7127.7127.7127.7127.8128.0

()100.8103.196.1

96.6104.9108.397.8

102.5

92.091.0

89.688.788.292.196.192.9

91.391.189.989.291.291.7

93.292.492.091.489.487.3

88.890.189.487.786.887.2

1 This does not replace the former index (1926=100) as the official index prior to January 1952. Thesedata from January 1947 through December 1951 represent the revised sample and the 1947-49 weightingpattern. Prior to January 1947 they are based on the month-to-month movement of the former index.2 The data from January 1947 through January 1953 differ from the official series due to a change in themethod of eliminating excise taxes and discounts.3 Not available.

* Preliminary.Source: Department of Labor.

'57

T A B L E F—37.—Wholesale price indexes, by economic sector, 1947—57

[1947-49=100]

PeriodAll

com-modi-ties

Crude materials

Total

98.6108.093.4

101.8116.9107.499.298.3

94.595.097.2

91.593.393.495.496.695.7

95.096.496.795.094.996.6

97.496.796.797.196.598.8

99.799.697.095.395.396.3

Food-stuffsand

faoAieeu-stuffs

100.7108.890.5

97.0112.3105.794.694.7

85.784.087.7

77.880.780.883.486.486.2

85.486.887.284.483.485.0

86.385.986.588.086.989.1

90.490.387.386.186.888.5

Non-foodma-

terials,except

fuel

96.0106.897.2

111.0128.1110.9106.2104.2

110.1114.2112.5

115.8115.2115.5116.6114.3111.9

111.5113.1113.1112.6114.3115.9

115.8114.2113.4111.6112.0115.0

115.2115.0112.6109.9108.1107.7

Fuel

Intermediate materials, supplies, and components *

Total

Materials and components formanufacturing

Total

Ma-terials

forfood

manu-factur-

ing

Ma-terials

fornon-du-

rablemanu-factur-

ing

Ma-terials

fordu-

rablemanu-factur-

ing

Com-po-

nentsfor

manu-factur-

ing

Ma-terials

andcom-po-

nentsfor

con-struc-tion

194719481949

19501951195219531954

1955.—19561957*

1956:January—February..MarchAprilMayJune

JulyAugustSeptember.OctoberNovember-December. .

1957:January - . .February. .MarchAprilMayJune

JulyAugustSeptember.October—.November.December *

96.4104.499.2

103.1114.8111.6110.1110.3

110.7114.3117.6

111.9112.4112.8113.6114.4114.2

114.0114.7115.5115.6115.9116.3

116.9117.0116.9117.2117.1117.4

118.2118.4118.0117.8118.1118,4

89.4105.6105.0

104.6106.5107.2111.0106.0

105.8113.3119.5

112.4112.7113.1112.6111.9110.6

110.4110.9111.5116.0116.5120.4

120.8121.7119.9120.0119.3118.1

118.0118.0118.6119.0120.5120.7

96.2104.099.9

104.3116.9113.5114.1114.8

117.0122.1125.1

120.0120.3121.0121.7122.2121.7

121.3122.6123.0123.6123.8124.2

124.8125.1124.9125.0124.7124.5

125.2125.5125.4125.2125.3125.4

96.4104.0

104.5118.4113.4115.2115.4

118.2123.7126.9

121.3121.9122.6123.1123.4123.1

122.6124.2124.8125.6125.7125.9

126.4126.5126.3126.3126.2126.2

127.1127.4127.4127.3127.5127.6

102.8106.091.2

94.9105.7101.5101.8100.9

97.798.099.9

95.396.798.198.1

100.59a 7

97.396.797.098.399.8

100.1

101.1100.499.699.098.599.2

100.199.599.699.6

100.8101.6

99.2105.095.8

100.5116.5104.8104.0102.3

102.7104.3105.7

104.1104.3104.3104.3104.2104.0

104.1104.0104.0104.7104.8105.0

105.4105.5105.2105.4105.6105.9

105.8105.9106.0106.0105.8105.8

91.2103.0105.8

111.9124.3124.6130.1133.1

139.7148.5153.2

145.0145.7146.8147.4147.3147.1

146.1150.6151.7151.9151.1151.1

152.1152.6152.5152.5152.0151.6

153.8154.7154.3154.2154.2154.2

94.4101.9103.8

107.6122.2122.5124.7125.3

130.9142.9148.3

137.9138.4139.3141.1142.3142.3

142.0143.3145.2146.7147.9147.9

147.5147.4147.6147.9148.0147.7

148.3148.8149.4148.9149.2149.2

93.3103.2103.5

108.9119.1118.3120.2120.9

125.6132.0132.9

129.9130.3131.3132.3131.8131.5

131.4132.8133.2133.4133.1133.0

132.8132.8132.7132.8132.6132.6

133.3133.4133.1133.0133.0132.9


158

TABLE F-37.— Wholesale price indexes, by economic sector, 1947-57— Continued

[1947-49=100]

Period

Finished goods

Total

Consumer finished goods

Total Foods

Othernon-

durablegoods

Du-rablegoods

Pro-ducer

finishedgoods

Special groups of industrialproducts

Crudemate-rials 2

Inter-mediate

materials,supplies,and com-ponents 3

Con-sumer

finishedgoods ex-cluding

foods

194719481949

19501951195219531954

1955195619574

1956: JanuaryFebruary...MarchAprilMayJune

JulyAugustSeptember.OctoberNovember.December .

1957: JanuaryFebruary. .MarchAprilMayJune

JulyAugustSeptember-OctoberNovember-December 4

95.9103.5100.6

102.4112.1111.5110.4110.7

110.9114.0118.1

111.8112.0112.3112.7113.6114.0

114.0114.1115.3115.6116.2116.2

116.7117.0116.9117.4117.4117.6

118.5118.6118.8119.0119.6119.8

96.8104.199.2

100.9110.3109.0107.1107.1

106.4108.0111.1

106.4106.5106.8107.0108.0108.2

108.3108.1109.1109.1109.4109.3

109.9110.2109.9110.5110.5110.7

111.6111.6111.6111.8112.2112.5

97.0105.897.2

99.2111.3110.4104.6103.8

101.1101.0104.5

98.098.098.499.1

101.5102.2

102.1101.4103.7103.0102.7101.8

102.3101.8101.3102.7103.1104.2

106.2106.2106.0106.2106.8107.2

97.4103.599.2

100.8108.5105.9106.9107.2

107.8109.9112.4

109.5109.7109.6109.6109.6109.7

109.7109.8110.0110.3110.3111.0

111.8112.9112.7112.8112.5112.0

112.2112.2112.4112.4112.3112.4

94.8101.3104.0

105.0112.1113.0113.8114.7

115.9119.7123.3

118.3118.5119.0119.1119.1119.1

119.2119.5119.8120.7122.3122.4

122.9123.0122.9122.7122.7122.7

122.9123.1123.0123.5124.7124.8

92.8101.1106.1

108.7119.3121.3123.1124.7

128.5138.1146.6

133.3134.1134.7135.8136.6137.1

137.2138.4140.6141.9143.8144.0

144.3144.7145.1145.3145.5145.5

146.4147.2147.8148.4149.8149.9

92.9108.5

109.9120.8109.3108.5103.3

113.4120.0118.3

122.9120.4120.9121.6118.0114.6

115.2120.0120.5119.9122.0124.2

123.5121.2119.7117.1117.6121.4

121.3121.2118.3114.4112.1112.1

95.3103.7101.0

105.7118.5114.7116.2116.7

120.1126.0129.3

124.2124.9125.4125.5125.3

125.1126.6127.2127.8127.7128.2

128.7129.0129.0129.1129.0128.9

129.5129.8129.8129.8129.8129.8

96.6102.8100.6

102.1109.6108.0108.9109.4

110.2112.8115.7

112.1112.3112.4112.4112.4112.5

112.5112.7112.9113.4114.0114.4

115.2115.9115.8115.8115.5115.3

115.4115.5115.6115.7116.1116.2

1 Includes, in addition to subgroups shown, processed fuels and lubricants, containers, and supplies.2 Excludes crude foodstuffs and feedstuffs, plant and animal fibers, oilseeds, and leaf tobacco.3 Excludes intermediate materials for food manufacturing and manufactured animal feeds.* Preliminary.NOTE.—For a listing of the commodities included in each sector and their relative importance, see Monthly

Labor Review, December 1955.


159

TABLE F-38.—Consumer price indexes, 7929-57

For city wage-earner and clerical-worker families

[1947-49=100]

Period

1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954

19551956195721956: January

FebruaryMarchAprilMayJune



JulyAugustSeptemberOctoberNovember

Allitems

73.3

71.465.058.455.357.2

58.759.361.460.359.4

59.962.969.774.075.2

76.983.495.5

102.8101.8

102.8111.0113.5114.4114.8

114.5116.2120.0

114.6114.6114.7114.9115.4116.2

117.0116.8117.1117.7117.8118.0

118.2118.7118.9119. 3119.6120.2

120.8121.0121.1121.1121.6

Food

65.6

62.451.442.841.646.4

49.750.1

48. 447.1

47.852.261.368.367.4

79.095.9

104.1100.0

101.2112.6114.6112.8112.6

110.9111.7115.4

109.2108.8109.0109.6111.0113.2

114.8113.1113.1113.1112.9112. P

112.8113.6113.2113.8114.6116.2

117.4117.9117.0116.4116.0

Housing

Total Rent

0)

(00)0)0)(')

71.872.875.476.676.1

76.478.381.882.884.7

86.188.395.0

.101. 7103.3

106.1112.4114.6117.7119.1

120.0121.7125.5

120.6120.7120.7120.8120.9121.4

121.8122.2122.5122.8123.0123.5

123.8124.5124.9125.2125.3125.5

125.5125.7126.3126.6126.8

117.4

114.2108.297.183.678.4

78.280.183.886.5

8S.490.490.390.6

90.991.494.4

100.7105.0

108.8113.1117.9124.1128.5

130.3132.7135.1

131.4131.5131.6131.7132.2132.5

133.2133.2133.4133.4133.8134. 2

134.2134.2134.4134.5134.7135.0

135.2135.4135.7136.0136.3

Ap-parel

60.3

58.953.647.545.950.2

50.651.053.753.452.5

53.255.664.967.872.6

76.383.797.1

103.599.4

98.1106.9105.8104.8104.3

103.7105.5106.8

104. 1104.6104.8104.8104.8104.8

105.3105.5106.5106.8107.0107.0

106.4106.1106.8106.5106.5106.6

106.5106.6107.3107.7107.9

Trans-porta-tion

Medi-calcare

0)

0)(00)0)0)

69.670.271.371.970.2

69.872.278.578.278.2

78.182.190.6

100.9108.5

111.3118.4126.2129.7128.0

126.4128.7135.7

126.8126.9126.7126.4127.1126.8

127.7128.5128.6132.6133.2133.1

133.6134.4135.1135.5135.3135.3

135.8135.9135.9135.8140.0

0)(00)0)(0

71.471.672.372.572.6

72.773.175.178.781.2

83.187.794.9

100.9104.1

106.0111.1117.2121.3125.2

128.0132.6137.8

130.7130.9131.4131.6131.9132.0

132.7133.3134. 0134.1134.5134.7

135.3135.5136.4136.9137.3137.9

138.4138.6139.0139.7140.3

Per-sonalcare

0)

(00)0)(00)

54.655.358.559.859.6

59.561.066.973.879.0

81.587.497.6

101.3101.1

101.1110.5111.8112.8113.4

115.3120.0124.2

118.5118.9119.2119.5119.6119.9

120.1120.3120.5120.8121.4121.8

122.1122.6122.9123.3123.4124.2

124.7124.9125.1126.2126.7

Read-ing andrecrea-tion

0)

0)0)(00)0)

58.15P. 160.862.963.0

64.166.469.575.383.4

86.889.795.5

100.4104.1

103.4106.5107.0108.0107.0

106.6108.1112.0

107.3107. 5107.7108.2108.2107.6

107.7107.9108.4108.5109.0109.3

109.9110.0110.5111.8111.4111.8

112.4112.6113.3113.4114.4

Othergoodsand

services

0)

0)0)0)0)0)

67.267.068.869.470.6

72.874.276.380.282.4

85.788.696.1

100.5103.4

105.2109.7115.4118.2120.1

120.2122.0125.3

120.8120.9121.2121.4121.5121.8

122.2122.1122.7123.0123. 2123.3

123.8124.0124.2124.2124.3124.6

126.6126.7126.7126.8126.8

1 Not available.2 January-November average.Source: Department of Labor.

160

TABLE F—39.—Consumer price indexes, by selected major groups, 1935-57

[1947-49=100]

Period

1935..1936..1937..1938-.1939..

1940-1941.1942.1943_1944.

1945.1946.1947.1948-1949.

1950-1951.1952.1953.1954.

1955.1956.1957 1

1956: January. _February.MarchAprilMayJune


1957: January._February .MarchAprilMayJune

JulyAugustSeptemberOctoberNovember

Allitems

58.759.361.460.359.4

59.962.969.774.075.2

76.983.495.5

102.8101.8

102.8111.0113. 5114.4114.8

114.5116.2120.0

114.6114.6114.7114.9115.4116.2

117.0116.8117.1117.7117.8118.0

118.2118.7118.9119.3119.6120.2

120.8121.0121.1121.1121.6

Allitemslessfood

65.866.568.969.669.1

69.471.476.478.581.5

83.487.095.1

101.9103.0

104.2110.8113.5115.7116.4

116.7118.8122.6

117.4117.6117.7117.8117.9118.1

118.6119.0119.4120.2120.5120.8

121.0121.5122.0122.3122.3122.5

122.8123.0123.4123.7124.6

Allitemslessshel-ter

55.556.258.056.455.4

55.859.166.671.672.9

74.882.395.6

103.1101.3

102.0110.5112.7113.1113.0

112.4114.0117.7

112.2112.2112. 5112.7113.3114.1

114.9114.5114.8115.5115.6115.7

115.9116.4116.5116.9117.1117.8

118.5118.7118.7118.6119.2

Commodities

Allcom-modi-

ties

52.052.754.752.751.6

52.155.763.869.470.2

72.380.196.3

103.2100.6

101.2110.3111.7111.3110.2

109.0110.1113.5

108.3108.3108.5108.7109.3110.3

111.2110.6111.0111.7111.8111.8

111.9112.3112.4112.8113.0113.7

114.4114.6114.5114.3114.7

Food

49.750.152.148.447.1

47.852.261.368.367.4

68.979.095.9

104.1100.0

101.2112.6114.6112.8112.6

110.9111.7115.4

109.2108.8109.0109.6111.0113.2

114.8113.1113.1113.1112.9112.9

112.8113.6113.2113.8114.6116.2

117.4117.9117.0116.4116.0

Commodities less food

All

57.357.960.460.459.4

59.862.769.872.776.7

79.784.795.7

102.9101.5

101.3108.9109.8110.0108.6

107.5108.9112.2

107.7108.0108.1108.0108.1108.0

108.4108.7109.4110.6111.0111.1

111.2111.4111.9112.1111.8111.9

112.2112.1112.6112.8113.8

Dura-bles

53.354.157.558.557.3

56.860.768.971.277.8

83.787.594.9

101.8103.3

104.4112.4113.8112. 6108.3

105.1105.1108.7

104.2104.3104.3104.0104.2103.8

104.1104.5104.8107.4107.9108.0

108.2108.3108.6108.8108.3108.4

108.2108.4108.6108.6110.9

Non-dura-bles

57.157.659.959.658.7

59.361.868.471.374.9

77.683.395.7

103.1101.1

100.9108.5109.1110.1110.6

110.6113.0116.0

111.5111.9112.1112.2112.1112.3

112.8113.0113.9114.3114.6114.7

114.7115.0115.6115.8115.6115.8

116.3116.0116.7117.0117.4

Services

Allserv-ices

75.676.478.780.380.4

80.681.684.285.887.9

89.090.894.5

100.4105.1

108.5114.1119.3124.2127. 5

129.8132.6137.5

131.2131.3131.2131.5131.8132.3

132.9133.3133.6133.7133.9134.4

135.0135.7136.3136.7137.2137.5

137.9138.3138.8139.2139.8

Rent

78.280.183.886.5

86.988.490.490.390.6

90.991.494.4

100.7105.0

113.1117.9124.1128.5

130.3132.7135.1

131.4131.5131.6131.7132.2132.5

133.2133.2133.4133.4133.8134.2

134.2134.2134.4134.5134.7135.0

135.2135.4135.7136.0136.3

Allserv-iceslessrent

72.672.272.973.573.5

73.674.577.881.385.2

87.090.294.7

100.1105.2

108.1114.6120.1124.6127.7

130.1133.0138.4

131.6131.7131.6131.9132.2132.7

133.2133.8134.1134.2134.4134.9

135.6136.5137.1137.6138.1138.4

138.9139.3139.8140.3140.9

1 January-November average.


161

MONEY SUPPLY, CREDIT, AND FINANCETABLE F-40.—Deposits and currency, 1929-57


End of period >Total

depositsand

currency

54.753.648.445.442.648.152.757.656.859.964.771.179.1

100.5123.4151.4176.4167.5172.3172.7173.9180.6189.9200.4205.7214.8221.0226.4231.7217.2216.1217.8217.4217.4219.7217.5219.1220.1220.9222.9226.4222.4221.1221.5224.3224.2224.9225.2225.0225.4226.9227.0231.7

Total excluding U.

Total

54.653.247.944.941.546.351.356.455.858.163.370.076.391.3

112.4130.2150.8164.0170.0169.1169.8176.9186.0194.8200.9209.7216.6222.0227.3214.4211.6210.8212.4211.2213.6213.3212.8214.1216.6217.2222.0219.9218.0217.2219.6218.4219.7221.0220.0220.9223.0223.3227.3

S. Government deposits J

Demand deposits and

Total

26.424.621.920.419.823.127.031.029.631.836.242.348.662.979.690.4

102.3110.0113.6111.6111.2117.7124.5129.0130.5134.4138.2139.7138.2136.0132.8131. 5133.1131.6133.0132. 7131.9132.8135.1136.3139.7136.9134.4132.6134.7132.7133.3134.3132.9133.3134.9135.7138.2

currency

Demanddeposits

adjusted 3

22.821.017.415.715.018.522.125.524.026.029.834.939.048.960.866.975.983.387.185.585.892.398.2

101.5102.5106.6109.9111.4109.7108.9105. 6104.4106.1104.2104.7105.2104.5105.4107.4108.3111.4109.5107.0105.2107.3104.8105.6106.6105.1105. 6107.2107.2109.7

Cur-rency

outsidebanks

3.6

3.64.54.74.84.7

4.95.55.65.86.4

7.39.6

13.918.823.526.526.726.526.125.425.426.327.528.127.928.328.328.527.127.227.227.027.428.327.427.527.427.728.028.327.427.427.427.427.927.827.827.827.827.828.528.5

Timede-

posits <

28.228.726.024.521.723.224.225.426. 226.327.127.727.728.432.739.848.554.056.457.558.659.261.565.870.475.378.482.289.178.478.879.379.379.680.680.780.981.381.580.982.282,983.684.684.985.786.486.787.187.788.187.689.1

u. s.Gov-ern-

mentde-

posits *

19291930193119321933-.1934193519361937193819391940-.-19411942194319441945194619471948194919501951195219531954195519561957«1956: January

February. . .MarchAprilMayJuneJulyAugustSeptember. .OctoberNovember..December. .

1957: JanuaryFebruary. . .MarchAprilMayJuneJuly*August«September«Octobers.. .November 8.December «.

0.2.3.5.5

1.01.8.5.2.0

1.51.12.89.2

11.021.225.63.52.33.64.1

3.73.95.64.85.14.44.5I. 42.84.57.05.06.26.14.26.36.04.35.74.52.53.14.34.75.85.24.24.94.53.93.84.4

1 End-of-year, June and December 1956, and December 1957 figures are for call dates. Other data (includ-ing those for June 1957) are for the last Wednesday of the month.

2 Includes holdings of State and local governments.3 Includes demand deposits, other than interbank and U. S. Government, less cash items in process of

collection.* Includes deposits in commercial banks, mutual savings banks, and Postal Savings System, but ex-

cludes interbank deposits.6 Includes U. S. Government deposits at Federal Reserve Banks and commercial and savings banks and,

beginning with 1938, includes U. S. Treasurer's time deposits, open account.« Preliminary; December estimates by Council of Economic Advisers.NOTE.—Detail will not necessarily add to totals because of rounding.Source: Board of Governors of the Federal Reserve System (except as noted).

l 6 2

TABLE F—41.—Loans and investments of all commercial banks, 1929—57


End of period 1

Totalloansand

invest-ments

Loans

Total3 Businessloans3

Investments

TotalU. S. Gov-ernment

obligations <Other

securities

1929—Junes _.1930—Junes1931—June*1932-June*1933—June* _.1934—June*19351936193719381939194019411942194319441945194619471948194919501951195219531954195519561957 71956: January

February. . .MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..December...

1957: JanuaryFebruary..MarchAprilMayJuneJuly?August7

September IOctober 7_...November 7

December 7.

49.448.944.936.130.432.736.139.638.438.740.743.950.767.485.1

105.5124.0114.0116.3114.3120.2126.7132.6141.6145.7155.9160.9165.1169.5159.4158.4159.9160.1159.7160. 0159.6161.0162.0162.5164.0165.1162.8162. 5162.9165.1165.1165.6165.4165.9166.3167.9167.3169.5

35.734.529.221.816.315.715.216.417.216.417.218.821.719.219.121.626.131.138.142.543.052.257.764.267.670.682.690.393.982.082.584.785.386.086.987.187.588.588.889.590.388.989.390.691.091.293.392.392.893.493.093.093.9

5.76.47.39.37.97.98.09.6

14.218.218.917.121.925.927.927.226.933.238.740.332.732.934.534.834.836.135.836.437.037.237.838.737.637.839.039.038. 940.5

40.3

39.440.3

13.714.415.714.314.017.020.923.121.222.323.425.129.048.266.083.997.982.978.271.877.274.474.977.578.185.378.374.875.677.475.875.274.873.773.172.473.673.673.874.574.873.973.272.274.173.972.373.073.172.974.974.375.6

4.95.06.06.27.5

10.313.815.314.215.116.317.821.841.459.877.690.674.869.262.667.062.061.563.363.469.061.658.658.060.959.258.658.257.356.656.257.257.057.558.258.657.756.855.757.557.155.556.356.255.957.356.858.0

8.79.49.78.16.56.77.17.97.07.27.17.47.26.86.16.37.38.19.09.2

10.212.413.314.114.716.316.716.317.616.516.616.616.616.416.516.316.416.616.316.316.316.216.316.516.716.816.816.816.917.117.617.417.6

1 End-of-year, June and December 1956, and December 1957 figures are for call dates. Other data (includ -ing those for June 1957) are for the last Wednesday of the month.

2 Data are shown net, i. e., after deduction of valuation reserves. Includes commercial and industrial,agricultural, security, real estate, bank, consumer, and other loans.

3 Beginning with 1948, data are shown gross of valuation reserves, instead of net as for previous years.Prior to June 1947 and for months other than June and December, data are estimated on the basis of reporteddata for all insured commercial banks and for weekly reporting member banks.

< Figures in this table are based on book values and relate only to banks within the continental UnitedStates. Therefore, they do not agree with ngures in Table F-49, which are on the basis of par values andinclude holdings of banks in United States Territories and possessions.5 June data are used because complete end-of-year data are not available prior to 1935 for U. S. Govern-ment obligations and other securities.

6 Not available.7 Preliminary; December estimates by Council of Economic Advisers.NOTE.—Detail will not necessarily add to totals because of rounding.Source: Board of Governors of the Federal Reserve System (except as noted).

163

TABLE F-42.—Federal Reserve Bank credit and member bank reserves, 1929-57

[Averages of daily figures, millions of dollars]

Period

1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954.

1955195619572

1956: JanuaryFebruary..MarchAprilMayJune

JulyAugustSeptember-OctoberNovember-December..

1957: January. . .February. _MarchApril _MayJune

JulyAugustSeptember .OctoberNovember-December 2

Reserve Bank credit outstanding

Total

1,459

1,0871,2742,0772,4292,502

2,4752,4812,5542,6002,628

2,4872,2933,4088,182

15, 358

22, 21124, 02922, 98922, 28320,161

19, 06224,07024, 80126, 26225,602

25, 47225, 70225,373

25, 87925,18325, 51725, 41125,23725, 516

25, 59925, 35725, 73725,69826, 09727,156

25,90524,91224, 96825,41125,04125,189

25,46625,16625,48925,32625, 37326,186

U. S.Govern-ment se-curities

208

564669

1,4612,0522,432

2,4312,4312,5042,5652,584

2,4172,1873,1917,724

14, 772

21,36323, 25022, 33021, 51119, 560

18, 41022, 75623,06624, 66124, 646

23, 89123, 70923,345

23, 89723, 40123, 52223, 41023,32223,522

23, 58023.53023, 72823, 78124, 02424, 765

24,09223, 11123,06123,23923,04122, 989

23,35123,14623,32523,34823,41723, 982

Memberbank

borrow-ings

943

271323518234

29

76

1494

355

24135

366215156140115

106289780768147

607831837

807799993

1,060971769

738898792715744688

407640834

1,011909

1,005

9171,005

988811804710

Allother,mainly

float

308

252282

9814341

3744362640

67101212434451

482564503632486

5461,025

955833809

9741,1621,191

1,175983

1,002941944

1,225

1,281929

1,2171,2021,3291,703

1,4061,1611,0731,1611,0911,195

1,1981,0151,1761,1671,1521,494

Member bank reserves

Total

2,358

2,3792,3232,1142,3433,676

5,0015,9896,8307,935

10, 352

13, 24913, 40412, 64812,62613, 222

15,05515, 96916, 46118,00117, 774

16,40019,29320,35619,99619, 276

18. 84318,96519,021

19,13818, 70918, 92418.84718, 73518, 933

18, 83618, 78319, 02418, 93919,16919, 535

19,29518,81618,88419,08718,82718, 982

19,12918,83418,95619,04018,95819,420

Re-quired

2,315

2,3242,2341,858

i 1,815i 2,112

2,5323,4775,6105,4135,960

6,9238,0809,980

11.11612,176

13,93414,99315,60817,16416,952

15, 61718, 53619,64219, 31918,501

18, 25718, 40318,504

18,58618,17718, 34018,32018,26818, 359

18,23718, 22418, 44618, 41918, 57918, 883

18,77318,30218, 36618,58018,36218,485

18, 59518,30018,43418, 57318,44718,810

Excess

43

5589

256i 528

i 1, 564

2,4692,5121,2202,5224,392

6,3265,3242,6681,5101,046

1,121976853837822

783757714677775

586562517

552533585527467575

599559579520590651

523514518506465496

534534522467512610

Memberbankfree

reserves(excess re-serves lessborrow-

ings)

- 9 0 0

- 2 1 6- 2 3 4- 2 6 2

2941,535

2,4622,5061,2062,5134,388

6,3235,3192,6631,486

911

755761697697707

677468

- 6 6- 9 1628

- 2 1- 2 6 9- 3 2 0

- 2 5 5- 2 6 6- 4 0 8- 5 3 3- 5 0 4- 1 9 4

- 1 3 9- 3 3 9- 2 1 3- 1 9 5- 1 5 4

- 3 7

116- 1 2 6- 3 1 6- 5 0 5- 4 4 4- 5 0 9

- 3 8 3- 4 7 1- 4 6 6- 3 4 4- 2 9 2- 1 0 0

1 Data from March 1933 through April 1934 are for licensed banks only.3 Preliminary.



164

TABLE F-43.—Bond yields and interest rates, 1929-57

[Percent per annum]

Period3-monthTreas-

urybills i

1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954

195519561957



U. S. Governmentsecurities

()1.402.879.515.256

.137

.143

.447

.053

.023

.014

.103

.326

.373

.375

.375

.375

.5941.0401.102

1.2181.5521.7661.931.953

1.7532.6583.267

1.2571.1771. 3351.6201.4911.432

1.6221.8762.0862.2592.2252.564

9-12monthissues 2

Taxablebonds3

().75.79

.81

.82

.881.141.14

1.261.731.812.07.92

1.892.833.53

1.361.411.491.711.721.71

1.882.122.142.192.282.56

2.462.472.48

2.372.192.252.442.31

2.322.572.682.942.55

2.843.083.47

2.682.782.782.822.812.82

2.912.952.922.872.892.91

Corporatebonds

(Moody's)

4.73

4.554.585.014.494.00

3.603.243.263.193.01

2.842.772.832.732.72

2.622.532.612.822.66

2.622.862.963.202.90

3.063.363.89

2.932.993.023.013.043.05

3.063.113.133.103.103.15

Baa

Commonstock

yields,200

stocks(Moody's)

5.90

5.907.629.307.766.32

5.754.775.035.804.96

4.754.334.283.913.61

3.293.053.243.473.42

3.243.413.523.743.51

3.533.884.71

3.453.473.483.493.503.51

3.523.563.593.593.583.62

3.41

4.546.177.364.424.11

4.063.504.774.384.15

5.316.256.674.894.81

4.193.975.135.786.63

6.276.125.505.494.78

4.064.074.33

4.224.214.214.124.143.87

3.783.913.934.124.094.07

High-grade

munic-ipal

bonds(Stand-ard &

Poor's)

Averagerate onshort-termbankloans

to busi-ness-

selectedcities

4.27

4.074.014.654.714.03

3.403.073.102.912.76

2.502.102.362.061.86

1.671.642.012.402.21

1.982.002.192.722.37

2.532.933.60

2.392.422.452.432.412.48

2.622.672.632.562.552.71

()2.1

2.12.02.22.62.4

2.22.12.12.52.7

2.73.13.53.73.6

3.74.24.6

3.56

3.77

3.93

Primecom-mer-cial

paper,

months

5.85

3.592.642.731.731.02

.75

.75

.94

.81

.56

.53

.66

.69

.73

.75

.811.031.441.49

1.452.162.332.521.58

2.183.313.81

1.471.681.691.902.002.00

2.112.332.542.702.812.99

Fed-eralRe-

serveBankdis-

countrate

5.16

3.042.112.822.561.54

1.501.501.331.001.00

1.001.00

7 1.007 1.00

7 1.00

7 1.007 1.00

1.001.341.501.591.751.751.991.60

1.892.773.12

1.501.501.501.631.751.75

1.751.972.182.252.362.50


165

TABLE F-43.—Bond yields and interest rates, 1929-57—Continued

[Percent per annum]

Period

1956: January.FebruaryMarchAprilMayJune

Ju ly . - -AugustSeptemberOctoberNovemberDecember

1957: JanuaryFebruaryMarchAprilMayJune .-

July.-August.. _.SeptemberOctoberNovemberDecember

U. S. Governmentsecurities

3-monthTreas-

urybills i

2.4562.3722.3102.6132.6502.527

2.3342.6062.8502.9613.0003.230

3.2103.1653.1403.1133.0423.316

3.1653.4043.5783.5913.3373.102

9-12month Taxable

bonds3

2.502.382.432.832.832.69

2.623.013.173.073.153.33

3.173.233.353.413.373.55

3.713.934.023.943.523.09

2.882.852.933.072.972.93

3.003.173.213.203.303.40

3.343.223.263.323.403.58

3.603.633.663.733.573.30

Corporatebonds

(Moody's)

Aaa

3.113.083.103.243.283.26

3.283.433.563.593.693.75

3.773.673.663.673.743.91

3.994.104.124.104.083.81

Baa

3.603.583.603.683.733.76

3.803.934.074.174.244.37

4.494.474.434.444.524.63

4.734.824.934.995.095.03

Commonstock

yields,200

stocks(Moody's)

4.214.093.863.874.134.01

3.874.024.244.234.254.13

4.314.444.354.164.054.05

4.014.214.504.684.584.77

High-grade

munic-ipal

bonds(Stand-ard &

Poor's)

Averagerate onshort-termbankloans

to busi-n e s s -

selectedcities

2.642.582.692.882.862.75

2.782.943.073.143.383.44

3.403.263.323.333.523.75

3.753.913.903.793.763.47

3.93

4.14

4.35

4.38

4.38

4.40

4.83

4.85

Primecom-mer-cial

paper,4-6

months

3.003.003.003.143.273.38

3.273.283.503.633.633.63

3.633.633.633.633.633.79

3.883.984.004.104.073.81

Fed-eralRe-

serveBankdis-

countrate

2.502.502.502.652.752.75

2.752.813.003.003.003.00

3.003.003.003.003.003.00

3.003.153.503.503.233.00

1 Rate on new issues within period. Issues were tax exempt prior to March 1, 1941, and fully taxablethereafter. For the period 1934-37, series includes issues with maturities of more than 3 months.

2 Includes certificates of indebtedness and selected note and bond issues (fully taxable).3 First issued in 1941. Series includes: October 1941-March 1952, bonds due or callable after 15 years;

April 1952-March 1953, bonds due or callable after 12 years; April 1953 to date, bonds due or callable 10years and after.

* Treasury bills were first issued in December 1929 and were issued irregularly in 1930.* Not available before August 1942.« Not available on same basis as for 1939 and subsequent years.7 From October 30, 1942 to April 24, 1946, a preferential rate of 0.50 percent was in effect for advances

secured by Government securities maturing or callable in 1 year or less.

NOTE.—Yields and rates computed for New York City, except for short-term bank loans.

Sources: Treasury Department, Board of Governors of the Federal Reserve System, Moody's InvestorsService, and Standard & Poor's Corporation.

166

T A B L E F—44.—Short- and intermediate-term consumer credit outstanding^ 1929-57


End of period

1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949 .

19501951195219531954

195519561957 5

1956: January . , . .February__MarchAprilMayJune


1957: JanuaryFebrua ry . .MarchAprilMayJune

July -AugustSeptember.OctoberNovember.December».

Total

6,444

5,7674,7603,5673,4823,904

4,9116,1356,6896,3387,222

8,3389,1725,9834,9015,111

5,6658,384

11,57014,39817,305

21,39522,61727,40131,24332,292

38,67042,09744, 800

37,88337.46837, 75638, 21938, 92039,453

39, 51339, 92840,19940, 33240, 83142, 097

41,13840, 73840. 73541, 24741, 93742,491

42. 59243,13343, 27043. 27443, 53044,800

Instalment credit

Total

3,151

2,6872,2071,5211,5881,871

2,6943,6234,0153,6914,503

5,5146,0853,1662,1362,176

2,4624,1726,6958,996

11,590

14, 70315,29419,40323,00523,568

28,95831,82734,100

28,84928,89629,10129, 42429,77930,114

30, 36630, 74330, 84130, 98531, 24031, 827

31,56831,48831, 52431, 78632,15832,608

32,96833,30333,41533,50433, 59634,100

Auto-mobilepaper i

(4)

(4)(4)(4)(4)(4)

(4)(4)(4)(4)

1,497

2,0712,458

742355397

455981

1,9243,0184,555

6,0745,9727,7339,8359,809

13, 47214, 45915,500

13,48813, 58213, 75013, 89814,06514, 261

14, 38914, 53914, 54714, 49814, 46914,459

14, 41014, 43214, 52814,69114,88315,127

15,32915,49015.55615, 57915,54215,500

Othercon-

sumergoods

paper l

(4)

(4)(4)(4)(4)(4)

(4)(4)(4)(4)

1,620

1,8271,9291,195

819791

8161,2902,1432,9013,706

4,7994,8806,1746,7796,751

7,6348,5108,700

7,5177,4297,3767,4347,5187,554

7,5907,6977,7337,8728,0668.510

8,3058,1608,0438,0178,0818,165

8,1898,2298,2288,2368,3008,700

Repairand

modern-izationloans2

(4)

(4)(4)(4)(4)(4)

(4)(4)(4)(4)298

371376255130119

182405718853898

1,0161,0851,3851,6101,616

1,6891,8952,000

1,6621,6561,6621,680,718

1,748

L,7681,7991,8321,865L,8901,895

1,8721,8591,8561,862L,8861,905

L, 921L, 9541,9691,9881,9962,000

Per-sonalloans

(4)

(4)(4)(4)(4)(4)

(4)(4)(4)(4)

1,088

1,2451,322

974832869

1,0091,4961,9102,2242,431

2,8143,3574,1114,7815,392

6,1636,9637,900

6,1826,2296,3136,4126,4786,551

6,6196,7086.7296,7506.8156,963

6,9817,0377,0977,2167,3087,411

7,5297,6307,6627,7017,7587,900

Noninstalment credit

Total

3,293

3,0802,5532,0461,8942,033

2,2172,5122,6742,6472,719

2,8243,0872,8172,7652,935

3,2034,2124,8755,4025,715

6,6927,3237,9988,2388,724

9,71210. 27010, 700

9,0348,5728,6558,7959,1419,339

9,1479,1859,3589,3479,591

10, 270

9,5709,2509,2119,4619,7799,883

9,6249,8309,8559,7709,934

10,700

Chargeac-

counts

1,602

1,4761,2651,020

9901,102

1,1831,3001,3361,3621,414

1,4711,6451,4441,4401,517

1,6122,0762,3532,6732,795

3,2913,6054,0114,1244,308

4,5794,7354,800

4,0023,5643,5083,5743,7463,844

3,7133,7303,8223,9204,0724,735

4,1113,6903,5343,7353,8343,948

3,8103,9573,9423,9914,1354,800

Others

1,691

1,6041,2881,026

904931

1,0341,2121,3381,2851,305

1,3531,4421,3731,3251,418

1,5912,1362,5222,7292,920

3,4013,7183,9874,1144,416

5,1335,5355,900

5,0325,0085,1475,2215,3955,495

5,4345,4555,5365,4275,5195,535

5,4595,5605,6775,7265,9455,935

5,8145,8735,9135,7795,7995,900

1 Includes all consumer credit extended for the purpose of purchasing automobiles and other consumergoods and secured by the items purchased.

2 Includes only such loans held by financial institutions; those held by retail outlets are included in "otherconsumer goods paper."

3 Single-payment loans and service credit.* Not available.5 Preliminary estimates by Council of Economic Advisers.


167

TABLE F-45.—Instalment credit extended and repaid, 1946-57


Period

Total

Ex-tended

Re-paid

Automobilepaper

Ex-tended

Re-paid

Other consumergoods paper

Ex-tended

Re-paid

Repair andmodernization

loans

Ex-tended

Re-paid

Personalloans

Ex-tended

Re-paid

1946194719481949

19501951195219531954

195519561957




JulyAugustSeptemberOctoberNovemberDecember *_>_


JulyAugust ..SeptemberOctoberNovemberDecember


JulyAugustSeptemberOctoberNovemberDecember L _

8,49512,71315, 58518,108

21, 55823,57629,51431, 55831,051

39,03940,06342,300

2,8952,9373,3203,3493,4893,412

3,3543,5513,0323,4513,4493,824

3,0902,9763,3473,5943,7483,674

3,8373,7043,3883,5453,4394,000

3,3373,2863,3703,2983,168

3,2843,3953,2853,3793,5123,451

3,4753,5063,4233,4693,5333,546

3,5983,5903,5443,5413,5583,600

6,78510,19013,28415, 514

18, 44522, 98525, 40527, 95630,488

33,64937,19440,100

1,9693,6925,2176,967

8,5308,95611,76412, 98111,807

16, 74515,56316,700

1,4432,7494,1235,430

7,0119,05810,00310,87911,833

13, 08214, 57615,600

3,0774,4985,3835,865

7,1507,4859,1869,2279,117

10,63411,59011,600

2,6033,6454,6255,060

6,0577,4047,8928,6229,145

9,75110, 71411,400

423704714734

835841

1,2171,3441,261

1,3881,5681,500

200391579

717772917

1,1191,255

1,3151,3621,400

3,0263,8194,2714,542

5,0436,2947,3478,0068,866

10,27211,34212,600

Unadjusted

3,0042,8903,1153,0263,1343,077

3,1023,1742,9343,3073,1943,237

3,3493,0563,3113,3323,3763,224

3,4773,3693,2763,4563,3473,500

1,1941,2371,3771,3451,4091,391

1,3401,3941,1561,2931,2271,200

1,2581,2151,3801,4681,5131,494

1,5631,4671,3641,4041,2501,300

1,1781,1431,2091,1971,2421,195

1,2121,2441,1481,3421,2561,210

1,3071,1931,2841,3051,3211,250

1,3611,3061,2981,3811,2871,300

77676385192698191S

9231,009897

1,0771,1101,359

802763846901

1,016998

9951,022927976

1,0201,300

893851904868897882

887902861938916915

1,007908963927952914

971982928968956

1,000

93103119130151139

139148138155138115

96101111123147133

143150138141123100

120109113112113109

119117105122113110

119114114117123114

127117123122115100

832834973948948964

9521,000841926974

1,150

934897

1,0101,1021,0721,049

1,1361,065959

1,0241,0461,300

Seasonally adjusted

2,9792,9652,9563,1033,0893,071

3,1393,1113,1783,1713,1913,241

3,2953,2573,2563,2843,3143,339

3,3833,3423.4203,3583,3953,400

1,3481,3801,3261,3081,2731,217

1,2321,2641,2301,2981,3531,334

1,4221,4081,3751,3721,3641,359

1,3851,3571,3951,4391,4071.400

1,1881,1861,1571,2361,2341,188

1,2211,2001,2171,2601,2381,251

1,3141,2841,2721,2951,3061,289

1,3181,2761,3191,3171,2921,300

938925901996960888

9721,008956996

1,0471,003

931960928935993

1,004

9951,025970909961

1,000

853840845883868886

913891938909935953

943933936908920952

964977990946982

1,000

121129128134139130

130133131137133123

124129123123135128

130137127126120100

118112109116113112

120115110117109111

117121113117122120

125117124118113100

891903931932926933

950990968948979991

9981,009997

1,0391,0411,055

1,0881,0711,0521,0671,0701,100

2,5393,4053,9574,335

4,6605,7516,5937,3368,255

9,50110, 54211,600

813787889849882891

884911820905909

1,002

916841950983

1,018964927985989

1,100

820827845868874885

885905913885909926

921919935964966978

976972987977

1,0081,000

1 Preliminary; December by Council of Economic Advisers.


168

TABLE F-46.—Mortgage debt outstanding, by type of property and of financing, 1939-57


End of period

1939

19401941194219431944

1945 . . .1946194719481949

19501951 ,195219531954

195519561957 3

1955: First quarterSecond quarterThird quarterFourth quarter.-- - -

1956: First quarter _ _ . . .Second quarter. - -Third quarterFourth quarter.- . . . .

1957: First quarter 3Second quarter 3

Third quartersFourth quarter 3

Allprop-erties

35.5

36.537.636.735.334.7

35.541.848.956.262.7

72.882.391.4

101 3113.8

130.0144.7156.1

117.5122.1126.4130.0

133.6137.6141.4144.7

147.4150.3153.5156.1

Nonfarm properties

Total

28.9

30.031.230.829.929.7

30.836.943.950.957.1

66.775.684.293.6

105.5

120.9134.8145.5

109.0113.3117.4120.9

124.2128.0131.6134.8

137.3140.1143.1145.5

1- to 4-family houses

Total

16.3

17.418.418.217.817.9

18.623.028.233.337.6

45.251.758.566.175.7

88.299.0

107.6

78.682.285.688.2

90.893.796.699.0

101.0103.3105.6107.6

Government under-written

Total

1.8

2.33.03.74.14.2

4.36.19.3

12.515.0

18.922.925.428.132.1

38.943.947.0

33.535.337.038.9

40.241.342.543.9

45.145.946.547.0

FHAin-

sured

1.8

2.33.03.74.14.2

4.13.73.85.36.9

8.69.7

10.812.012.8

14.315.516.3

13.213.513.914.3

14.715.015.215.5

15.715.916.116.3

VAguar-

anteed

0.22.45.57.28.1

10.313.214.616.119.3

24.628.430.7

20.321.823.124.6

25.526.327.328.4

29.430.030.430.7

Con-ven-

tional 1

14.5

15.115.414.513.713.7

14.316.918.920.822.6

26.328.833.138.043.6

49.355.160.6

45.146.948.649.3

50.652.454.155.1

55.957.459.160.6

Multi-family

andcom-

mercialprop-

erties ! 2

12.5

12.612.912.512.111.8

12.213.815.717.619.5

21.623.925.727.529.8

32.735.837.9

30.431.131.832.7

33.434.335.135.8

36.336.837.537.9

Farmprop-erties

6.6

6.56.46.05.44.9

4.84.95.15.35.6

6.16.77.37.88.3

9.19.9

10.6

8.58.89.09.1

9.49.69.89.9

10.110.310.410.6

1 Derived figures.2 Includes negligible amount of farm loans held by savings and loan associations.3 Preliminary; fourth quarter by Council of Economic Advisers.

Source: Board of Governors of the Federal Reserve System, estimated and compiled from data suppliedby various Government and private organizations (except as noted).

169

TABLE F-47.—Net public and private debt, 1929-57 l


End ofperiod 2 Total

1929-.

1930_.1931--1932._1933.-1934..

1935-.1936-.1937-1938-.1939..

1940..1941-.1942..1943-.1944--

1945..1946-.1947..1948-.1949-.

1950..1951..1952..1953..1954..

1955..1956..1957«.

190.9

191.0181.9174.6

i.5171.4

174.7180.3182.0179.6183.2

211. 6259.0313.6370.8

406.3397.4417.4433.6448.4

490.3524.0555.2586.3606.2

655.8684.0707.5

Fed-eralGov-ern-ment

Stateandlocalgov-ern-

ment2

16.5

16.518.521.324.330.4

34.437.739.240.542.6

44.856.3

101.7154.4211.9

252.7229.7223.3216.5218.6

218.7218.5222.9228.1230.2

231.5225.4224.3

Total

13.2

14.115.516.616.715.9

16.016.216.116.016.3

16.516.315.814.914.1

13.713.614.416.218.1

20.723.325.828.633.4

38.442.746.7

Private

Total

161.2

160.4147.9136.7127.5125.1

124.2126.4126.7123.1124.3

128.6139.0141.5144.3144.8

139.9154.1179.7200.9211.7

250.9282.2306.5329.6342.6

385.9415.9436.5

Corporate

89.383.580.076.975.5

74.876.175.873.373.5

75.683.491.695.594.1

85.393.5

108.9117.8118.0

142.1162.5171.0179.5177.3

195.9208.2215.5

Long-term

Short-

47.3

51.150.349.247.944.6

43.642.543.544.844.4

43.743.642.741.0

38.341.346.152.556.5

60.166.673.378.382.6

89.397.3

106.0

Total

41.6

38.233.230.829.130.9

31.233.532.328.429.2

31.939.849.054.554.3

47.052.262.865.361.5

81.995.997.7

101.294.8

106.5110.9109.5

Individual and noncorporate

Farm 3

72.3

71.164.456.750.649.6

49.450.350.949.850.8

53.055.649.948.850.7

54.660.670.883.193.7

108.8119.7135.5150.1165.3

190.0207.7221.0

12.2

11.811.110.19.18.9

9.08.68.69.0

9.19.28.98.27.7

7.27.68.6

10.811.9

12.213.615.116.817.5

18.719.420.5

Nonfarm

Total

60.1

59.453.346.641.540.7

40.441.742.340.942.0

43.946.441.040.543.0

47.453.062.272.381.8

96.6106.1120.3133.3147.8

171.4188.3200.5

Mort-gage

31.2

32.030.929.026.325.5

24.724.424.324.525.0

26.027.226.826.226.1

27.032.538.745.150.6

59.467.475.283.894.7

108.8121.7131.0

Com-mer-cialand

finan-cial*

22.4

21.617.614.011.711.2

10.811.211.310.1

9.510.08.19.5

11.8

14.812.111.912.913.9

15.816.117.818.320.8

23.924.524.7

Con-sumer

6.4

5.84.83.63.53.9

4.96.16.76.37.2

8.39.26.04.95.1

5.78.4

11.614.417.3

21.422.627.431.232.3

38.742.144.8

1 Net public and private debt outstanding is a comprehensive aggregate of the indebtedness of borrowersafter elimination of certain types of duplicating governmental and corporate debt. For a further explana-tion of the concept, see Survey of Current Business, October 1950.

2 Data for State and local government debt are for June 30 of each year.3 Farm mortgages and farm production loans. Farmers' financial and consumer debt is included in the

nonfarm categories.* Financial debt is debt owed to banks for purchasing or carrying securities, customers' debt to brokers,

and debt owed to life insurance companies by policyholders.5 Preliminary estimates by Council of Economic Advisers.

NOTE.—Data for 1955-56 for consumer debt (and related subtotals and totals) have been adjusted bythe Council of Economic Advisers to reflect revisions for 1955-57 in the consumer credit statistics of theBoard of Governors of the Federal Reserve System. No attempt has been made to reconcile other debtitems with the adjustments in consumer debt.


Sources: Department of Agriculture, Department of Commerce, Treasury Department, Board of Gov-ernors of the Federal Reserve System, Federal Savings and Loan Insurance Corporation, and InterstateCommerce Commission (except as noted).

170

GOVERNMENT FINANCE

TABLE F—48.—U. S. Government debt, by kind of obligation, 1929—57


End of period

1929

19301931193219331934 .

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954

1955195619571956: January. . .

February.MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..December..

1957: JanuaryFebruary...MarchAprilMayJuneJulyAugustSeptember..OctoberNovember..December..

Grosspublic

debt andguar-

anteedissues J

16.3

16.017.820.824.031.5

35.139.141.944.447.6

50.964.3

112.5170.1232.1

278.7259.5257.0252.9257.2

256.7259.5267.4275.2278.8

280.8276.7

7 275.0280.1280.2276.4275.8276.8272.8272.7275.6274.3275.4277.1276.7276.3276.4275.1274.1275.3270.6272.6274.0274.5274.2274.9

7 275.0

Interest-bearing public debt

Marketable publicissues

Short-term

issues2

3.3

2.92.85.97.5

11.1

14.212.512.59.87.7

7.58.0

27.047.1

78.257.147.745.950.2

58.365.668.777.376.0

81.379.582.181.481.477.677.777.773.173.175.575.577.178.979.579.680.079.179.179.574.977.979.481.080.881.982.1

Treasurybonds

11.3

11.313.513.414.715.4

14.319.520.524.026.9

28.033.449.367.991.6

120.4119.3117.9111.4104.8

94.076.979.877.281.8

81.980.882.181.981.981.981.881.881.881.881.8

80.880.880.880.880.8

80.881.481.482.1

Nonmarketable public issues

UnitedStates

savingsbonds

0.2.5

1.01.42.2

3.26.1

15.027.440.4

48.249.852.155.156.7

58.057.657.957.757.7

57.956.352.557.657.757.757.757.757.557.457.357.357.156.956.356.055.855.655.455.254.654.354.053.853.553.252.5

Treasurytax andsavingsnotes

2.56.48.6

8.25.75.44.67.6

8.67.55.86.04.5

Invest-ment

bonds 3

1.01.01.0

1.013.013.412.912.7

12.311.610.312.212.212.212.112.012.012.011.911.911.811.711.611.611.511.411.311.211.111.010.910.710.510.310.3

Specialissues 4

.4

.4

.4

.7

.62.23.24.2

5.47.09.0

12.716.3

20.024.629.031.733.9

33.735.939.241.242.6

43.945.645.843.643.743.743.444.345.145.446.145.845.545.745.6

45.345.545.645.246.146.846.346.746.246.146.045.8

1 Total includes non-interest-bearing debt, fully guaranteed securities (except those held by the Treas-ury), Postal Savings bonds, prewar bonds, adjusted service bonds, depositary bonds, and armed forcesleave bonds, not shown separately. Not all of total shown is subject to statutory debt limitation.

2 Includes bills, certificates of indebtedness, and notes.3 Includes Series A bonds and, beginning in April 1951, Series B convertible bonds.4 Issued to U. S. Government investment accounts. These accounts also held 9.4 billion dollars of public

marketable and nonmarketable issues on December 31, 1957.5 Less than 50 million dollars.6 The last series of treasury savings notes matured in April 1956.7 Of this amount, $274.6 billion was subject to the statutory debt limitation of $275 billion.

Source: Treasury Department.

171

TABLE F-49.—Estimated ownership of Federal obligations, 1939-57

[Par values», billions of dollars]

End of period

1939-

1940.1941-1942-1943-1944-

1945-1946-1947-1948-1949.

1950-1951_1952-1953-1954-

1955-1956-1957 s



Gross public debt and guaranteed issues 2

Total

Heldby U.S.

Gov-ern-

mentinvest-ment

ac-counts

47.6

50.964.3

112.5170.1232.1

278.7259.5257.0252.9257.2

256.7259.5267.4275.2278.8

280.8276.7275.0

280.1280.2276.4275.8276.8272.8

272.7275.6274.3275.4277.1276.7

1957: January 276.3February 276.4March 275.1April 274.1May 275.3June 270.6

JulyAugustSeptemberOctoberNovember 8__December s--_

272.6274.0274.5274.2274.9275.0

6.5

7.69.5

12.216.921.7

27.030.934.437.339.4

39.242.345.948.349.6

51.754.055.2

51.751.851.951.652.553.5

53.854.454.253.954.254.0

53.954.154.253.754.955.6

55.255.855.455.455.355.2

Held by others

TotalFederalReserveBanks

41.1

43.354.7

100.2153.2210.5

251.6228.6222.6215.5217.8

217.5217.2221.6226.9229.2

229.1222.7219.8

228.4228.4224.5224.3224.3219.3

218.9221.2220.2221.5222.9222.7

222.4222.3221.0220.4220.5215.1

217.4218.2219.1218.7219.6219.8

Come mercial

banks3

2.5

2.22.36.2

11.518.8

24.323.322.623.318.9

20.823.824.725.924.9

24.824.924.2

23.523.523.623.323.523.8

23.423.923.723.824.424.9

23.422.923.123.223.123.0

23.423.523.323.323.724.2

Mutualsavingsbanksand in-surance

com-panies

15.9

17.321.441.159.977.7

90.874.568.762.566.8

61.861.663.463.769.2

62.059.358.7

60.559.558.358.557.857.1

56.557.657.658.058.659.3

58.357.758.158.057.755.8

56.856.658.358.158.258.7

Stateandlocal

ations * govern-ments 5

9.4

10.111.915.821.228.0

34.736.735.932.731.5

29.626.325.525.023.8

22.820.919.5

22.722.422.222.121.921.6

21.621.421.421.321.120.9

20.920.820.620.520.420.2

20.220.120.120.019.719.5

Othercorpor-

2.2

2.04.0

10.116.421.4

22.215.314.114.816.8

19.720.719.921.619.2

23.318.616.5

23.623.720.820.520.917.4

17.718.617.518.519.218.6

20.220.918.017.918.515.7

16.316.816.116.116.616.5

0.4

.5

.71.02.14.3

6.56.37.37.98.1

9.611.112.714.4

15.116.117.3

15.415.615.715.715.815.7

15.815.916.016.016.116.1

16.216.316.616.816.816.9

16.917.117.217.217.317.3

Individ-

10.1

10.613.623.737.653.3

64.164.265.765.566.3

66.364.665.164.863.6

65.567.167.6

66.767.267.467.767.767.5

67.667.567.767.567.567.1

67.167.568.268.067.667.4

67.568.068.267.967.967.6

Miscel-laneousinves-tors?

.7

.92.34.47.0

9.18.18.48.99.4

10.510.611.713.213.9

15.615.916.0

16.016.416.516.516.616.2

16.216.316.316.316.015.9

16.216.216.316.016.416.1

16.316.016.016.116.216.0

1 United States savings bonds, series A-F and J, are included at current redemption value.2 Excludes guaranteed securities held by the Treasury. Not all of total shown is subject to statutorydebt limitation.3 Includes commercial banks, trust companies, and stock savings banks in the United States and inTerritories and possessions; figures exclude securities held in trust departments. Since the estimates in thistable are on the basis of par values and include holdings of banks in United States Territories and possessions,they do not agree with the estimates in Table F-41, which are based on book values and relate only to bankswithin the continental United States.

4 Exclusive of banks and insurance companies.5 Includes trust, sinking, and investment funds of State and local governments and their agencies, andof Territories and possessions.6 Includes partnerships and personal trust accounts.7 Includes savings and loan associations, nonprofit institutions, corporate pension trust funds, dealersand brokers, and investments of foreign balances and international accounts in this country. Beginningwith December 1946, the foreign accounts include investments by the International Bank for Reconstruc-tion and Development and the International Monetary Fund in special non-interest-bearing notes issuedby the U. S. Government. Beginning with June 30, 1947, includes holdings of Federal land banks.

8 Preliminary estimates by Council of Economic Advisers.NOTE.—Detail will not necessarily add to totals because of rounding.Source: Treasury Department (except as noted).

172

TABLE F-50.—Federal budget receipts and expenditures and the public debt, 1929-1959


Year

Fiscal year:1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949

195019511952.19531954

1955 -1956_1957 31958*1959*

Calendar year:19461947 -19481949

19501951195219531954

195519561957 5

Net budgetreceipts 1

3,861

4,0583,1161,9242,0213,064

3,7304,0694,9795,6154,996

5,1447,10312, 55521,98743,635

44, 47539, 77139, 78641, 48837, 696

36, 49547, 56861,39164,82564,655

60,39068,16571,02972, 40074, 400

38, 56840,38940,86437, 514

37,30652, 97964,84063, 84161,171

63,35870,99472, 400

Budget ex-penditures

3,127

3,3203,5774,6594,623

6,5218,4937,7566,7928,858

9,06213,26234, 04679, 40795, 059

98, 41660, 44839, 03233,06939, 507

39, 61744,05865, 40874, 27467, 772

64, 57066, 54069,43372, 78873,934

41,08037,95535,62341,106

37, 72856,33770, 68272, 99764,854

66,12967, 21671,800

Surplus ordeficit ( - )

734

738-462

- 2 , 735- 2 , 602- 3 , 630

- 2 , 791- 4 , 425- 2 , 777-1,177- 3 , 862

- 3 , 918-6,159

- 2 1 , 490-57,420-51,423

-53,941-20 , 676

7548,419

-1,811

-3,1223,510

-4,017- 9 , 449-3,117

-4,1801,6261,596-388

466

-2,5122,4345,241

- 3 , 592

-422- 3 , 358-5,842-9,157-3,683

- 2 , 7713,779

600

Public debtat end of

year 2

16, 931

16,18516, 80119, 48722, 53927, 053

28, 70133, 77936, 42537,16540, 440

42, 96848, 96172, 422136, 696201, 003

258, 682269, 422258, 286252,292252, 770

257,357255,222259,105266, 071271, 260

274,374272, 751270, 527271,200271, 200

259,149256,900252,800257,130

256, 708259,419267, 391275,168278, 750

280, 769276, 628274,898

1 Gross receipts less refunds of receipts and transfers of tax receipts to the Federal old-age and survivorsinsurance trust fund, the Federal disability insurance trust fund, the railroad retirement account, and thehighway trust fund.2 Excludes guaranteed obligations. The change in the public debt from year to year reflects not onlythe budget surplus or deficit but also changes in the Treasury's cash balances, the effect of certain trust fundtransactions, and direct borrowing from the public by certain Government enterprises.

3 Preliminary.* Estimate.5 Estimated by Council of Economic Advisers from data through January 15, 1958. May therefore differ

from figures in Treasury Department monthly statement of receipts and expenditures to be released aboutJanuary 20, 1958.

NOTE.—Detail will not necessarily add to totals because of rounding.Sources: Treasury Department and Bureau of the Budget (except as noted).

173

TABLE F—51.—Federal budget receipts by source and expenditures by function, fiscal years 1946-59


Fiscalyear

1946194719481949-.-.

19501951195219531954

195519561957 3 . . .1958<-.-1959'-.-

Budget receipts by source

Total

39,77139,78641,48837,696

36,49547, 56861,39164,82564,655

60,39068,16571,02972,40074,400

Indi-vidualincometaxes

16,15717,83519,30515,548

15,74521,64327,91330,10829,542

28,74732,18835,62037,20038,500

Corpo-rationincometaxes

11,8338,5699,678

11,195

10,44814,10621, 22521,23821,101

17,86120,88021,16720,38520,400

Excisetaxes

6,9997,2077,3567,502

7,5498,6488,8519,8689,945

9,1319,9299,0558,8989,280

Allother

re-ceipts i

4,7826,1755,1503,451

2,7523,1713,4013,6104,068

4,6505,1695,1885,9176,220

Budget expenditures by function

Total

60,44839,03233,06939,507

39,61744,05865,40874,27467, 772

64,57066,54069,43372,78873,934

Majorna-

tionalsecurity

43,20714,37211,77112,907

13,00922,44445,96351,83047,872

42,08941,82544,41444,87145,836

Veter-ans'serv-icesand

bene-fits

4,4167,3816,6546,726

6,6465,3424,8634,2984,256

4,4574,7564,7935,0345,012

Agri-cul-tureandagri-

cultu-ral re-sources

7471,243

5752,512

2,783650

1,0452,9362,557

4,4114,9134,5824,9244,601

Inter-est

4,8165,0125,2485,445

5,8175,7145,9346,5836,470

6,4386,8467,3087,8677,869

Allother

expend-itures 2

7,26211,0228,820

11,917

11,3619,9077,6038,6276,618

7,1768,1998,336

10,09110,616

Budgetsurplusor defi-cit ( - )

-20,676754

8,419-1,811

-3,1223,510

-4,0L7-9,449-3,117

-4,1801,6261,596-388

466

1 Includes employment taxes, estate and gift taxes, customs revenues, and miscellaneous receipts.2 Includes expenditures for international affairs and finance (excluding military assistance and defense

support under the mutual security program), labor and welfare, natural resources, commerce and housing,and general government; also includes adjustment to daily Treasury statement (for actuals) and allowancefor proposed legislation and contingencies (for estimates).

3 Preliminary.< Estimate.


Sources: Treasury Department and Bureau of the Budget.

174

T A B L E F-52.—Government cash receipts from and payments to the public, 1946-59


Period

Calendar year:1946194719481949

1950195119521953 - .1954

195519561957*

Fiscal year:195519561957*1958 5

1959*

Total

Cashre-

ceipts

53.057.560.057.9

60.579.293.193.493.2

98.4109.3115.2

93.4105.2111.8

Cashpay-

ments

50.950.852.160.0

61.378.494.799.395.3

100.2105.2116.2

97.5101.8111.6

Excessof re-ceipts

orof pay-ments

2.16.67.9

- 2 . 1

- . 7.8

- 1 . 6- 5 . 9- 2 . 0

- 1 . 84.1

- 1 . 0

Z. 4.3

Federal

Cashre-

ceipts

41.444.344.941.3

42.459.371.470.168.6

71.480.384.7

67.877.182.185.187.3

Cashpay-

ments

41.438.636.942.6

42.058.073.176.369.7

72.274.883.4

70.572.680.084.986.7

Excessof re-ceipts

orof pay-ments

5.78.0

- 1 . 3

.41.2

- 1 . 6- 6 . 1- 1 . 1

- . 75.51.3

- 2 . 74.52.1.2.6

State and local*

Cashre-

ceipts 2

11.613.215.116.6

18.119.921.723.324.7

26.929.030.5

25.628.129.7

Cashpay-

ments 2

9.512.215.217.4

19.320.321.623.025.6

28.030.432.8

27.029.231.6

Excessof re-ceipts

orof pay-ments

2.01.0

- . 1- . 8

- 1 . 2- . 4

. 1

.3- . 9

- 1 . 1- 1 . 4- 2 . 3

- 1 . 4- 1 . 0- 1 . 8

1 Estimates by Council of Economic Advisers.2 Federal grants-in-aid have been deducted from State and local government receipts and payments

since they are included in Federal payments.3 Less than 50 million dollars.* Preliminary.8 Estimate.


Sources: Treasury Department and Bureau of the Budget (except as noted).

175

TABLE F—53.—Government receipts and expenditures as shown in the national income accounts,1954-57!

[Calendar years, billions of dollars]

Receipt or expenditure

Total government

ReceiptsE xpendituresExcess of receipts or of

expenditures (-)

Federal Government

ReceiptsPersonal tax and non-

tax receiptsCorporate profits tax

accrualsIndirect business tax

and nontax accruals.Contributions for so-

cial insurance

ExpendituresPurchases of goods

and servicesTransfer paymentsOrants-in-aid to State

and local govern-ments

Net interest paidSubsidies less current

surplus of Govern-ment enterprises

Excess of receipts or ofexpenditures (—).

State and local govern-_____

ReceiptsPersonal tax and non-

tax receiptsCorporate profits tax

accrualsIndirect business tax

and nontax accruals.Contributions for so-

cial insuranceFederal grants-in-aid - -

E xpendituresPurchases of goods

and services. - -Transfer payments. _Net interest paidLess: Current surplus

of Government en-terprises

Excess of receipts or ofexpenditures (—)

Year

90.296.6

64.0

29.2

16.7

10.1

8.1

69.4

48.911.6

2.94.8

1.2

-5.4

29.1

3.8

20.1

1.62.9

30.1

27.73.4

.4

1.4

-1.0

1954

Firsthalf 2

1955

89.697.6

- 8 . 0

63.7

29.0

51.211.2

2.74.8

1.2

- 7 . 3

28.5

19.9

1.52.7

29.3

26.93.3

.4

1.4

Sec-ond

half 2

90.895.6

- 4 . 8

64.3

29.3

17.016.3

10.2

8.1 I 8.1

71.0 67.9

46.712.2

3.14.8

- 3 . 6

29.7

3.9

20.3

1.63.1

30.8

28.43.4

1.4

- 1 . 2

Year

101.198.6

2.G

72.5

31.5

20.6

11.0

9.3

68.9

46.812.5

3.04.7

1.8

3.6

4.2

1.0

21.8

1.73.0

32.7

30.33.5

.5

- 1 . 0

Firsthalf 2

.3

70.3

19.4

10.9

9.1

68.5

46.712.4

2.74.7

2.0

31.7 i 30.7

4.2

21.2

1.62.7

32.3

29.83.5.5

1.5

- i .e

Sec-ond

half 2

104.099.1

4.9

74.6

32.1

21.7

11.2

9.6

69.3

46.912.6

3.44.8

5.3

32.8

4.3

1.0

22.4

1.73.4

33.2

30.83.5

.5

1.6

- . 4

Year

109.0104.2

4.8

78.2

35.1

21.0

11.6

10.5

72.0

47.213.5

3.35.2

2.8

6.2

34.1

4.6

1.0

23.4

1.83.3

35. 5

33.03.7

.5

1.7

- 1 . 4

1956

Firsthalf

J07.6102.0

5.5

77.1

34.7

20.9

11.2

10.3

70.1

46.313.2

2.95.1

2.6

7.0

33.4

4.5

1.0

23.2

1.82.9

34.9

32.53.6

.5

1.7

- 1 . 5

Sec-ond

half >

110.4106.4

4.0

79.3

35.5

21.1

11.9

10.8

74.0

48.113.8

3.65.3

3.1

5.3

34.8

4.6

1.0

23.7

1.93.6

36.1

33.63.7

.6

1.8

- 1 . 2

Year

115. 7114.1

1.7

83.3

38.1

20.5

12.2

12.5

79.3

50.516.0

4.05.4

3.5

4.0

36.6

5.0

. 9

24.6

2.04.0

38.7

36.04.0.6

1.9

- 2 . 2

1957 3

Firsthalf a

115.2112.9

2.3

83.1

37.7

20.9

12.2

12.4

78.5

.50.715.3

3.75.4

3.4

4.6

35.8

4.9

1.0

24.3

1.93.7

38.1

35.53.9.6

1.9

- 2 . 3

Sec-ond

half*

116.2115.2

.8

83.4

38.5

20.0

12.3

12.6

80.1

50.316.6

4.2

5.4

3.6

2.9

37.1

5.1

.9

24.9

2.04.2

39.2

36.54.1

2.0

- 2 . 2

1 These accounts, like the cash budget, include the transactions of the trust accounts. Unlike both theconventional budget and the cash statement, they exclude certain capital and lending transactions. Ingenera], they do not use the cash basis for transactions with business. Instead, corporate profits taxes areincluded in receipts on an accrual instead of a cash basis; expenditures are timed with the delivery insteadof the payment for goods and services; and CCC guaranteed price-support crop loans financed by banks arecounted as expenditures when the loans are made, not when CCC redeems them.

2 Seasonally adjusted annual rates.3 Prelimininary; fourth quarter estimates by Council of Economic Adviseis.

NOTE.—Federal grants-in-aid to State and local governments are reflected in Federal expenditures andState and local receipts and expenditures. Total government receipts and expenditures have been adjustedto eliminate this duplication.



I 76

T A B L E F—54.—Reconciliation of Federal Government receipts and expenditures as shown in thenational income accounts with receipts and expenditures as reported in the consolidated cash state-ment and the conventional budget^ fiscal years 1955-57

[Fiscal years, billions of dollars]

Receipts or expenditures 1955 1956 1957

National income accounts

Receipts

Expenditures

Excess of receipts or of expenditures (—)

Reconciliation of receipts

Receipts as shown in the national income accounts

Less:Excess of taxes included in national income accounts over cash collections:

PersonalCorporate profitsOther

Federal Government contributions to:Employee retirement fundsVeterans life insurance funds

Federal Government employee contributions to employee retirement funds.

67.268.1

- 1 . 0

76.169.7

Plus:Realization upon loans and investmentsInterest, dividends, and other earningsProceeds from sale of Government property.Recoveries and refundsDistrict of Columbia revenuesMiscellaneous adjustments

Equals: Federal receipts from the public (consolidated cash receipts)

Less: Trust fund receipts

Plus:Intragovernmental transactions

Receipts from exercise of monetary authority

Equals: Conventional budget receipts

Reconciliation of expenditures

Expenditures as shown in the national income accountsLess:

Federal Government contributions to:Employee retirement fundsVeterans life insurance funds

Federal Government employee contributions to employee retirement funds.Accrued interest on savings bonds and Treasury billsCommodity Credit Corporation guaranteed nonrecourse loans (net change).Miscellaneous adjustments

67.2

.3

.4

.4

.6

.2

.2

67.8

9.5

2.1.0

60.4

Plus:Loans and other adjustments, government enterprises

Federal National Mortgage Association secondary market operations. __Other

Interest received and proceeds of government sales netted out of nationalincome expenditures

District of Columbia expendituresPurchase of land and existing assetsTrust and deposit fund expenditures, not included in national income

expenditures.Miscellaneous adjustments

Decrease in clearing accountIssuance of International Monetary Fund notesOther

Equals: Federal payments to the public (consolidated cash expenditures)

Less:Trust fund expendituresGovernment-sponsored enterprise expenditures (net)

Plus:Intragovernmental transactions rAccrued interest and other noncash expenditures (net)

Equals: Conventional budget expenditures

68.1

.0

.1

.5

.5- 1 . 0- . 4

.9- . 11.0

.2

.1

.5- . 2

.1- . 2- . 1

70.5

8.5.1

2.1.6

6.4

76.1

.3

.4

.5

.6

.2

.3

77.1

11.7

2.7.0

68.2

69.7

.2

.1

.6

.4- . 4

1.7.1

1.6

.2

.1

.8- . 2- . 3- . 2

.3

72.6

9.4.3

2.7.9

81.476.2

5.3

81.4

- . 2- . 3

.6

.5

.0

.7

.3

.5

.4

.4

.2

.1

82.1

3.2.0

71.0

76.2

.5

.0

.7

.6- . 2

.4

2.71.01.7

.2

.1

.51.7

.7

.3

64.6 66.5

13.0.0

3.2- . 8

69.4


Sources: Department of Commerce, Bureau of the Budget, and Treasury Department.

177

TABLE F—55.—State and local government revenues and expenditures, selected fiscal years, 1927-56


Fiscal year 1

1927

1932193419361938 .

19401942194419461948

1950195219531954

1955.1956

Revenues by source 2

Total

7,271

7,2677,7138,5049,228

9,60910,41810,90812,35717,251

20,91125,18127, 30629,013

31,07334,667

Prop-ertytaxes

4,730

4,4874,0764,0934,440

4,4304,5374,6044,9866,126

7,3498,6529,3759,967

10,73511, 749

Salesandgross

re-ceiptstaxes

470

7521,0081,4841,794

1,9822,3512,2892,9864,442

5,1546,3576,9277,276

7,6438,691

Indi-vidualincometaxes

70

7480

153218

224276342422543

788998

1,0651,127

1,2371,538

Corpo-ration

netincometaxes

92

7949

113165

156272451447592

593846817778

744890

Reve-nuefromFed-eralGov-ern-

ment

116

2321,0511,057

800

945858954855

1,861

2,4862,5662,8702,966

3,1313,335

Allotherreve-nue 3

1,793

1,6431,4491,6041,811

1,8722,1232,2692,6613,685

4,5415,7636,2516,897

7,5848,465

Expenditures by function 2

Total

7,210

7,7657,1817,6448,757

9,2299,1908,863

11,02817,684

22, 78726,09827, 91030,701

33,72436,711

Edu-cation

2,235

2,3111,8312,1772,491

2,6382,5862,7933,3565,379

7,1778,3189,390

10,557

11,90713,220

High-ways

1,809

1,7411,5091,4251,650

1,5731,4901,2001,6723,036

3,8034,6504,9875,527

6,4526,953

Publicwel-fare

151

444889827

1,069

1,1561,2251,1331,4092,099

2,9402,7882,9143,060

3,1683,139

Allo the r 4

3,015

3,2692,9523,2153, .547

3,8623,8893,7374,5917,170

8,86710,34010,61911, 556

12,19613,397

1 Fiscal years not the same for all governments.2 Excludes revenues or expenditures of publicly owned utilities and liquor stores, and of insurance-trust

activities. Intergovernmental receipts and payments between governments in these categories are alsoexcluded.

3 Includes licenses and other taxes and charges and miscellaneous revenues.4 Includes expenditures for health, hospitals, police, local fire protection, natural resources, sanitation,

housing and community redevelopment, local recreation, general control, interest on general debt, andother and unallocable expenditures.

NOTE.—Data are not available for intervening years.See Table F-47 for net debt of State and local governments.Detail will not necessarily add to total because of rounding.

Source: Department of Commerce (Bureau of the Census).

178

CORPORATE PROFITS AND FINANCE

TABLE F-56.—Profits before and after taxes, all private corporations, 1929—57


PeriodCorporate

profitsbeforetaxes

Corporatetax

liability »

Corporate profits after taxes

Total Dividendpayments

Undistrib-uted

profits

1929.

1930.1931.1932.1933.1934.

1935.1936.1937.1938.1939.

1040.1941.1942.1943.1914..

1945..1946..1947..1948..1949..

1950.1951..1952..1953..1954..

1955..1956..1957 3

1955: First quarterSecond quarter..Third quarter. _.Fourth quarter..


1957: First quarterSecond quarter .Third quarter3..Fourth quarter 3.

9.6

3.3- . 8

- 3 . 0.2

1.7

3.15.76.23 46.49.3

17.020.924.623.3

19.022.629.532.826.2

40.041.235.937.033.5

42.543.042.0

1.4

.8

.5

.4

.5

.7

1.01.41.51.01.4

2.87.6

11.414.112.9

10.79.1

11.312.510.4

17.822.519.820.317.4

21.522.021.4

8.3

2.5- 1 . 3- 3 . 4- . 41.0

2.24.34.72.35.0

6.59.49.5

10.510.4

8.313.418.220.315.8

22.118.716.116.716.0

21.021.020.6

5.8

5.54.12.62.12.6

2.94.54.73.23.8

4.04.54.34.54.7

4.75.86.57.27.5

9.29.19.09.39.9

11.011.912.3


10.210.410.812.0

11.712.012.111.5

12:412.512.611.7

2.4

- 3 . 0- 5 . 4- 6 . 0- 2 . 4- 1 . 6

- . 7- . 2

- . 91.2

2.44.95.26.05.7

3.67.7

11.713.08.3

12.99.67.17.46.1

9.99.28.3

9.39.7

10.710.7

9.58.77.8

10.8

9.18.07.9

1 Federal and State corporate income and excess profits taxes.* 48 million dollars.3 Preliminary; fourth quarter by Council of Economic Advisers.< Not available.NOTE.—No allowance has been made for inventory valuation adjustment. See Table F-9 for profits

before taxes and inventory valuation adjustment.Detail will not necessarily add to totals because of rounding.


179

TABLE F—57.—Relation of profits before and after taxes to stockholders'' equity and to sales, privatemanufacturing corporations, by asset size class, 1947-50 average and 1956—57

Asset size class (thousandsof dollars)

All asset sizes

Under 250250-9991,000-4,9995,000-99,999100,000 and over

All asset sizes

Under 250250-9991,000-4,9995,000-99,999100,000 and over

All asset sizes

Under 250250-9991,000-4,9995,000-99,999100,000 and over

All asset sizes

Under 250250-9991,000-4,9995,000-99,999100,000 and over

1947-50aver-age

Ratio oi

24.6

16.722.724.225.224.9

Ratio ol

14.8

9.813.114.114.915.3

1956

Firstquarter

Secondquarter

Thirdquarter

Fourthquarter

profits before Federal taxes (annual(percent)

23.8

17.318.921.422.825.4

24.2

24.022.121.524.124.9

20.2

25.223.021A22.418.6

22.3

13.012.818.922.424.0

1957

Firstquarter

Secondquarter

Thirdquarter

rate) to stockholders' equity

22.5

15.615.718.820.824.5

21.6

19.419.219.721.422.2

r profits after Federal taxes (annual rate) to stockholder(percent)

12.5

10.39.5

10.611.213.7

13.0

15.611.510.412.013.9

11.0

15.311.710.711.110.8

12.6

5.85.89.1

11.414.5

11.9

8.47.58.9

10.113.6

11.6

11.110.09.6

10.612.4

19.1

18.220.418.720 018.8

s' equity

10.5

11.010.19.1

10.010.9

Profits before Federal taxes in cents per dollar of sales

11.1

4.47.49.0

11.313.2

6.7

2.64.35.26.78.1

10.2

3.34.66.99.8

13.1

10.3

4.65.26.9

10.112.8

9.0

4.95.36.99.7

10.5

9.3

2.42.95.99.4

11.9

9.7

3.13.76.39.0

12.4

9.4

3.74.56.39.1

11.6

Profits after Federal taxes in cents per dollar of sales

5.3

1.92 S3.44.87.0

5.5

3.02.73.35.07.1

4.9

3.02.73.54.86.1

5.2

1.11.32.94.87.2

5.1

1.71.83.04.46.9

5.0

2.12.33.14.56.5

8.5

3.54.76.08.8

10.3

4.7

2.12.32.94.46.0

NOTE.—The sample for these series was changed beginning with the third quarter of 1951 and againbeginning with 1956. However, the 1947-50 averages have not been adjusted to either of these samplesand, therefore, are not strictly comparable with data for later periods. For explanatory notes concerningcompilation of the series, see Quarterly Financial Reports for U. S. Manufacturing Corporations by FederalTrade Commission and Securities and Exchange Commission.

Sources: Federal Trade Commission and Securities and Exchange Commission.

180

TABLE F-58.—Relation of profits after taxes to stockholders'1 equity and to sales, privatemanufacturing corporations, by industry group, 1947-50 average and 7956-57

Industry group1947-50aver-

1956

First iquarter

Second,quarter

Thirdquarter

Fourthquarter

1957

Firstquarter

Second iquarter

Thirdquarter

Ratio of profits after Federal taxes (annual rate) to stockholders'equity (percent)

All private manufacturingcorporations

Lumber and wood products (exceptfurniture)

Furniture and fixturesStone, clay, and glass productsPrimary iron and steel industriesPrimary nonferrous metal indus-

tries

Fabricated metal productsMachinery (except electrical)Electrical machinery, equipment,

and suppliesMotor vehicles and equipmentOther transportation equipment

Instruments and related products. _.Miscellaneous manufacturing (in-

cluding ordnance)Food and kindred productsTobacco manufacturesTextile mill products 1.

Apparel and related productsPaper and allied productsPrinting and publishing (except

newspapers)Chemicals and allied productsPetroleum refining

Products of petroleum and coal (ex-cept petroleum refining)

Rubber productsLeather and leather products

14.8

17.114.315.212.9

12.5

15.314.5

17.821.76.6

14.6

11.413.612.114.5

12.016.2

13.415.9

115.1

(2)12.810.4

12.5

9.110.712.614.7

19.9

10.911.9

10.316.714.3

8.7

9.78.2

10.06.4

6.812.1

16.315.013.1

7.711.99.6

13.0

11.011.417.215.1

18,0

11.514.2

12.113.116.7

11.9

10.49.9

12.04.8

4.512.2

15.014.714.0

11.113.16.6

11.0

9.013.015.96.0

13.9

11.012.0

11.66.9

13.6

12.5

13.310.412.75.5

10.911.0

11.013.113.2

12.011.06.3

12.6

5.611.213.615.1

14.1

9.412.3

11.415.716.1

16.3

13.08.7

12.16.4

10.011.3

10.013.915.3

8.412.86.4

11.9

2.07.3

10.013.8

12.4

9.512.3

13.918.814.8

10.6

6.97.4

10.34.4

6.710.2

12.313.714.4

4.311.56.6

11.6

6.29.2

13.713.0

9.7

10.913.0

12.915.316.4

12.4

7.58.4

11.94.4

5.99.0

14.813.911.8

8.211.66.5

10.5

6.59.7

13.8

8.1

11.010.1

11.59.2

13.9

11.6

10.410.413.94.8

9.78.7

11.913.111.1

10.810.9


181

TABLE F-58.—Relation of profits after taxes to stockholders* equity and to sales, privatemanufacturing corporations^ by industry group, 7947-50 average and 1956-57—Continued

Industry group1947-50aver-age

1956

Firstquarter

Secondquarter

Thirdquarter

Fourthquarter

1957

Firstquarter

Secondquarter

Thirdquarter

All private manufacturingcorporations _..

Lumber and wood products (exceptfurniture) -

Furniture and fixturesStone, clay, and glass productsPrimary iron and steel industriesPrimary nonferrous metal industries

Fabricated metal productsMachinery (except electrical)Electrical machinery, equipment,

and supplies _Motor vehicles and equipmentOther transportation equipment

Instruments and related products...Miscellaneous manufacturing (in-

cluding ordnance)Food and kindred productsTobacco manufactures _.Textile mill products

Apparel and related products. _Paper and allied productsPrinting and publishing (except

newspapers)Chemicals and allied productsPetroleum refining.

Products of petroleum and coal (ex-cept petroleum refining).

Rubber productsLeather and leather products

6.7

9.25.08.97.28.8

6.67.1

6.37.43.4

7.9

5.33.64.86.6

3.18.6

5.09.1

111.0

(2)4.83.4

Profits after Federal taxes in cents

5.3

4.43.17.3

10.2

4.25.2

3.66.03.6

4.5

3.22.24.52.8

1.46.4

5.48.5

10.6

3.84.32.8

5.5

4.73.39.1

9.8

4.25.8

4.05.03.8

5.8

3.42.65.02.2

1.06.4

5.08.1

12.0

4.74.61.9

4.9

3.84.08.6

8.1

4.05.3

3.93.33.2

6.1

4.12.75.32.6

2.15.9

3.77.6

11.4

5.34.11.8

5.2

2.53.17.8

8.7

3.55.2

3.55.83.2

6.6

3.82.25.12.8

1.95.9

3.07.9

12.3

3.84.71.8

per dollar of sales

5.1

1.02.36.6

8.1

3.75.3

4.56.33.2

5.3

2.42.04.72.0

1.45.7

4.07.8

11.0

2.14.41.8

5.0

2.92.88.1

6.6

4.15.5

4.35.73.3

5.8

2.42.24.92.0

1.24.9

4.87.9

10.2

3.64.31.9

4.7

3.13.17.86.16.0

4.24.7

4.04.03.1

5.7

3.22.65.52.2

1.84.9

3.87.6

4.44.02.0

1 Petroleum refining and products of petroleum and coal combined.2 Not available separately for this period.NOTE.—The sample for these series was changed beginning with the third quarter of 1951 and again

beginning with 1956. However, the 1947-50 averages have not been adjusted to either of these samples and,therefore, are not strictly comparable with data for later periods. For explanatory notes concerning com-pilation of the series, see Quarterly Financial Reports for U. S. Manufacturing Corporations by Federal TradeCommission and Securities and Exchange Commission.

Sources: Federal Trade Commission and Securities and Exchange Commission.

182

TABLE F-59.—Sources and uses of corporate funds, 1946-57 l


Source or use of funds

Total uses.

Plant and equipment outlaysInventories (change in book

value)Change in customer net receiv-

ables 3Cash and U. S. Government

securitiesO ther assets

Total sources

Internal sources..

Retained profits and deple-tion allowances

Depreciation and amortiza-tion allowances

External sources

Change in Federal incometax liability

Other liabilitiesChange in bank loans and

mortgage loansNet new issues

Discrepancy (uses less sources)..

1946

19.5

12.5

11.2

1.1

-4.7-.6

18.2

11.4

7.2

4.2

6.8

-1.62.1

3.92.4

1.3

1947

28.2

17.0

7.1

3.1

1.0(4)

27.9

16.6

11.4

5.2

11.3

2.11.5

3.34.4

.3

1948

27.0

18.8

4.2

2.8

1.0.2

27.7

18.6

12.4

6.2

9.1

1.0.4

1.85.9

-.7

1949

16.8

16.3

-3.6

.9

3.2(4)

15.6

14.7

7.6

7.1

.9

-2.2.5

-2.34.9

1.2

1950

36.5

16.9

9.8

5.0

4.5.3

34.7

20.2

12.4

7.8

14.5

7.21.0

2.63.7

1.8

1951

36.4

21.6

9.4

2.0

2.8.6

36.1

18.1

9.1

9.0

18.0

4.41.9

5.46.3

.3

1952

27.3

22.4

.9

3.1

.1

.8

27.4

16.8

6.4

10.4

10.6

-2.82.4

3.17.9

(4)

1953

28.4

23.9

1.5

.7

2.1.2

28.5

18.3

6.5

11.8

10.2

.42.2

.57.1

-.1

1954

21.5

22.4

-2.0

2.3

-1.0-.2

21.5

18.9

5.4

13.5

2.6

-3.0.3

-.65.9

(4)

1955

39.4

24.2

5.0

4.9

4.7.6

40.2

24.0

8.8

15.2

16.2

2.81.7

4.77.0

-.8

1956

38.8

29.9

7.9

4.7

-4.0.3

39.0

24.8

8.1

16.7

14.2

-1.52.0

5.58.2

-.2

19572

39.0

32.5

1.5

4.0

- 1 . 52.5

39.0

25.5

»7.0

18.5

13.5

2.5

1.511.0

1 Excludes banks and insurance companies.2 Preliminary estimates.3 Receivables are net of payables, which are therefore not shown separately.* Less than 50 million dollars.^ Preliminary estimate by Council of Economic Advisers.


Source: Department of Commerce based on Securities and Exchange Commission and other financialdata (except as noted).

183

TABLE F-60.—Current assets and liabilities of U. S. corporations, 1953-57 *

[Billions of dollars, end of period]

Asset or liability

Total current assetsCash on hand and in

banksU. S. Government se-

curitiesReceivables from U. S.

Government2

Other notes and ac-counts receivable

InventoriesOther current assets 3.

Total current liabilities

Advances and prepay-ments, U. S. Gov-ernment 2

Other notes and ac-counts payable

Federal income tax lia-bilities

Other current liabili-ties

Net working capital

1953

190.6

31.1

21.5

2.6

65.967.22.4

98.9

2.2

57.3

18.7

20.7

91.8

1954

194.6

33.4

19.2

2.4

71.265.33.1

102.8

2.4

61.4

15.5

23.5

91.8

1955

214.6

34.0

23.3

2.3

81.670.03.5

115.7

2.3

69.9

18.4

25.1

98.9

1956

First*quarter

213.4

30.9

20.8

2.3

82.473.13.9

112.4

2.3

69.2

15.3

25.6

101.0

Secondquarter

214.7

32.1

17.4

2.3

84.374.83.8

112.1

2.5

71.4

12.3

25.8

102.7

Thirdquarter

220.4

32.6

17.5

2.4

88.176.03.8

117.0

2.5

73.0

14.4

27.1

103.4

Fourthquarter

225.7

34.7

18.6

2.6

88.877.33.6

121.3

2.4

74.9

16.8

27.2

104.4

1957

Firstquarter

224.9

31.9

18.0

2.5

89.479.14.0

118.9

2.5

74.1

14.4

28.0

106.0

Secondquarter

224.5

32.5

15.7

2.5

90.579.34.0

117.6

2.6

74.4

12.2

28.3

107.0

Thirdquarter

228.9

33.2

16.1

2.4

92.980.04.2

121.2

2.6

75.2

13.8

29.6

107.7

1 All corporations in the United States, excluding banks, savings and loan associations, and insurancecompanies. Data for 1953-54 are based on Statistics of Income, covering virtually all corporat'ons in theUnited States. Statistics of Income data may not be strictly comparable from year to year because of changesin the tax laws, basis for filing returns, and processing of data for comp lation purposes. Data for 1955-57are estimates based on data compiled from many different sources, including data on corporations registeredwith the Commission. As more complete data become available, estimates are revised.

2 Receivables from and payables to U. S. Government do not include amounts offset against each otheron the corporation's books or amounts arising from subcontracting which are not directly due from or tothe U. S. Government. Wherever possible, adjustments have been made to include U. S. Governmentadvances offset against inventories on the corporation's books.

3 Includes marketable securities other than U. S. Government.


Source: Securities and Exchange Commission.

184

T A B L E F-61.—State and municipal and corporate securities offered, 1934-57'*


Period

Stateand

munici-pal se-curitiesofferedfor cash(prin-cipal

amounts)Total

Corporate securities offered for cash 2

Gross proceeds 3

Com-monstock

Pre-ferredstock

Bondsand

notesTotal

Proposed uses of net proceeds *

New money

Total

57

208858991681325

569868474308657

1,0803,2794,5915,9294,606

4,0066,5318,1807,9606,780

7,9579,663

11,931

1,9881,8141,6992,457

1,9472,5892,3692,758

3,2232,9902,7842,934

Plantand

equip-ment

32

111380574504170

424661287141252

6382,1153,4094,2213,724

2.9665,1106,3125,6475,110

5, 3336,7099,052

1,2581,230

8981,948

1.0761,8641,6372,132

2,6232.2621,8812,285

Work-ing

capi-tal

Retire-mentof se-

curities

Otherpur-poses

1934

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954

195519561957 5

1955: First quarter._Second quarter.Third quarter._Fourth quarter

1956: First quarter. _.Second quarter.Third quarter..Fourth quarter.

1957: First quarter . .Second quarter.Third quarter-.Fourth quarter

939

1,2321,121908

1,1081,128

1,238956524435661

7951,1572,3242,6902,907

3,5323,1894,4015,5586"~"

397

2,3324,5722,3102,1552,164

2,6772,6671,0621,1703,202

6,0116,9006,5777,0786,052

6,3617,7419,5348,8989,516

5,977 10, 2405, 446 10,9396, 879 12, 997

1,4091,4291,1362,002

1,5171,617928

1,384

1, 7581,6891,5491,883

2,5302,4132,3582,939

2,2502,9892,6903,010

3,5963,3052,9873,108

222722852587

1081103456163

397891779614736

8111,2121,3691,3261,213

2,1852,3012,550

758562405460

352532457960

74975640:644

271406

183167112124

7581,127762492425

631838564489816

635636412

111208150167

19114699199

9713772105

372

2,2244,0281,6182,0441,980

2,3862,390

91"990

2,670

4,8554,8825,0365,9734, 890

4,9205,6917,6017,0837,488

384

2,2664,4312,2392,1102,115

2,6152,6231,0431,1473,142

5,9026,7576,4666,9595,959

6,2617,6079,3808, 7559,365

7, 420 10, 0498, 002 10, 74910,035 12, 810

1,6621,6431,8042,312

1,7062,3112,1341,851

2,7502,4122,5132,360

2, 4852,3592,3142,892

2,2092,9352,6412,964

3,5323,2432,9413,093

26

96!478!417177155

145J207187)16714051

, |1,182i1, 708882

1,04111, 42l|1, 868j2, 313i1, 670;

2,6242,954!2, 8791

730584801,5091

871 j725732626

600

90316491

231

1, 865|3,3681,1001, 206!l,69oj

1,8541,583396739

2, 3891

4, 555]2, 868:1,352307!401

1, 271486664260

1,875

1,227364225

320!307403197

10613086421

545963!

95

19320414822295

19217217310096

267610524722952

984589537535709

864721654

177238212237

155215187164

25519494111

1 These data cover substantially all new issues of State, municipal, and corporate securities offered forcash sale in the United States in amounts over $100,000 and with terms to maturity of more than 1 year.

2 Excludes notes issued exclusively to commercial banks, intercorporate transactions, and issues soldthrough continuous offerings, such as securities of open-end investment companies and employee-purchaseplans.

3 Number of units multiplied by offering price.4 Net proceeds represents the amount received by the issuer after payment of compensation to distributors

and other costs of flotation.5 Preliminary.


Sources: Securities and Exchange Commission, The Commercial and Financial Chronicle, and The BondBuyer.

185

TABLE F-62.—Common stock prices and stock market credit, 1939-57

Period

Commonstockpricesindex,

1939=100(SEC)

Stock market credit

Customer credit (excluding U. S.Government securities)

Total Net debitbalances J

Bank loansto

"others" 3

Bank loansto brokers

anddealers *

Millions of dollars

1939

19401941194219431944

19451946194719481949

19601951195219531954

195519561957

1956: January.-.-February..MarchAprilMayJune

JulyAugustSeptember.October.—November.December _

1957: January—February..MarchAprilMayJune

JulyAugustSeptember.October---.November.December.

100.0

94.285.774.999.2

108.1

131.2149.4130.9132.7127.7

154.1184.9195.0193.3229.8

304.6345.0331.4

325.7330.0350.9355.4347.0341.4

359.4359.4344.8341.6338.5344.0

338.2325.1328.5338.6352.2354.6

361.8343.2327.9306.4301.8298.5

(*)0)(4)

1,374976

1,032968

1,249

1,7981,8261,9802,4453,436

4,0303,984

()

4,0403,9914,0384,0434,0474,009

4,0263,9793,9503,9143,9463,984

3,9023,8463,8323,9383,9244,031

4,0043,9293,8823,6433,577

942473517499821

1,2371,2531,3321,6652,388

2,7912,823)

2,7862,7402,7862,7882,8102,786

2,8122,7852,7822,7482,7842,823

2,7612,7292,7132,7922,7942,887

2,8852,8332,7892,5682,517

()

()353

432503515469428

561573648780

1,048

1,2391,1611,066

1,2541,2511,2521,2551,2371,223

1,2141,1941,1681,1661,1621,161

1,1411,1171,1191,1461,1301,144

1,1191,0961,0931,0751,0601,066

715

584535850

1,3282,137

2,7821,471784

1,3311,608

1,7421,4192,0022,2482,688

2,8522,2142,190

2,5292,4222,4362,3472,4352,380

2,2411,9482,0191,9751,9152,214

1,6891,7601,6701,8421,7651,842

1,6601,8101,7481,6421,6102,190

1 As reported by member firms of the New York Stock Exchange carrying margin accounts. Includesnet debit balances of all customers (other than general partners in the reporting firm and member firms ofnational exchanges) whose combined accounts net to a debit. Balances secured by U. S. Governmentobligations are excluded. Data are for end of period.

2 Loans by weekly reporting member banks to others than brokers and dealers for purchasing or carryingsecurities except U. S. Government obligations. However, some U. S. Government securities may beincluded after 1952. Series revised beginning July 1946 and March 1953. Data are for last Wednesday ofperiod.

3 Loans by weekly reporting member banks for purchasing or carrying securities, including U .S . Govern-ment obligations. Series revised beginning July 1946 and January 1952. Data are for last Wednesday ofperiod.

* Not available.

Sources: Securities and Exchange Commission, Board of Governors of the Federal Reserve System, andNew York Stock Exchange.

186

TABLE F-63.—Business population and business failures, 1929-57

Period

1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954

1955195619571956: January

FebruaryMarchAprilMayJuneJulyAugustSeptember. __OctoberNovemberDecember

1957: JanuaryFebruaryMarch. __AprilMayJuneJulyAugustSeptember.. _OctoberNovember,._December _̂

Operating businesses andbusiness turnover (thou-

sands of firms) i

Operat-ing

busi^nesses2

Newbusi-

nesses3

3, 029. 0

2, 993. 72, 916. 42, 828. 12, 782.12, 884. 0

2,991.93, 069. 83, 136. 33, 073. 73, 222. 2

3,318.93, 276. 03, 295. 33, 030. 02, 839.1

2, 995. 43, 242. 53,651.23, 872. 93, 984. 2

4, 008. 74, 067. 34,121.34, 178. 84,185. 3

4,189. 04, 245. 24, 287. 0

4, 245. 2

4, 294. 2

4, 287. 0

4, 322. 0

275.2290.0121.2146.0330.9

422.7617.4460.8393.3331.1

348.2363.2363.9340. 5334.2

380.4380.8

223. '

Dis-con-tin-uedbusi-ness-es 3

Busi-ness

trans-fers3

211.0

318.1270.7386.5337.0174.

175.6208.7239.2282.0306.5

289.6309.3306.3334.0330.6

324.2338.9

174.'

176.0

C5)(5)

()359.4473.2626.9571.9501.3434.7

419.4378.3374.9356. 2319.7

327.0327.3

186.1

193.2

Newbusi-ness

incor-pora-tions(num-ber)3

()132, 916112,63896, 10185, 491

92, 92583, 64992, 819102, 545117,164

139, 651140, 775136,673

13, 36312, 50312, 82212, 47513,14211,952

11,51311,3399,58311, 5469,74910, 788

13, 38710,79112,04912,31212, 22011,26911,68611,36110,52611,2519,27010,551

Business failures, by size of liability 3

Number of failures

TotalUnder

$100,000

22,909

26, 35528, 28531, 82219, 85912, 091

12, 2449,6079,490

12, 83614, 768

'13,61911,8489,4053,2211,222

1, 1293,4745,2509,246

9,1628,0587, 6118,862

11,110, 96912, 68613, 739

1,0481,0241, 170985

1,1641,105

1,0181,101932

1,158999982

1,1481,1461, 3361,1751,2001,084

1,0591,1451,0711,1221,1731,080

Liability sizeclass

22,165

25, 40827, 23030, 197

1 18, 88011,421

11, 6919, 2859,20312, 55314, 541

' 13, 40011, 6859,2823,1551, 176

7591,0023,1034, 8538,708

8,7467,6267,0818,075

10, 226

10,11311,61512, 547

971909

1,081905

1,0511,020

963982859

1,051925

1,0221,0421, 2251,0711,069988

9741,070984

1,0321, 075995

and

i

744947

1, 0551,6256 979670

553322287283227

6 2191631236646

50127371397538

416432530787

8561,0711,192

7711589801138555119731077484

12610411110413196

857587909885

Amount of currentliabilities (millions of

dollars)

Total

483.3

668.3736.3928.3

B 457. 5334.0

310.6203.2183. 3246.5182. 5

6 166. 7136.1100.845.331.7

30.267.3

204.6234.6308.1

248.3259.5283.3394.2462.6

449.4562.7615.3

42.949.242.641.959.943.0

48.755.039.350.039.950.354.165.455.857.152.651.5

44.343.545.447.452.945.3

Liability sizeclass

Under$100,000

261.5

303.5354.2432.6

e 215. 5138.5

135. 5102.8101.9140.1132.9

6 119.9100.780.330.214.5

11.415.763.793.9

161.4

151.2131.6131.9167.5211.4

206.4239.8267.1

20.519.721.318.821.221.520.418.718.021.619.219.0

21.023.125.223.121.520.7

19.723.420.922.323.622.6

$100,000andover

221.8

364.8382.2495. 7

6 242. 0195.4

175.1100.481.4

106.449.7

M6.835.420.515.117.1

18.851.6

140.9140.7146.7

97.1128.0151.4226.6251.2

243.0322.9348.2

22.429.521.423.138.721.5

28.336.321.328.420.631.3

33.042.330.634.031.030.824.620.224.525.129.322.7

* Excludes firms in the fields of agriculture and professional services. Includes self-employed persononly if he has either an established plane of business or at least one paid employee.

2 Annual data through 1939 are averages of end-of-quarter estimates centered at June 30. Beginning1940, annual data are for January 1.

3 Total for period.* Commercial and industrial failures only. Excludes failures of banks and railroads and, beginning 1933,

of real estate, insurance, holding, and financial companies, steamship lines, travel agencies, etc.5 Not available.6 Series revised; not strictly comparable with earlier data.


Sources: Department of Commerce and Dun & Bradstreet, Inc.

187

AGRICULTURETABLE F-64.—Income of the farm population, 1929-57

Period

1929

19301931 . .193219331934

1935..193619371938 . -1939

19401941194219431944

1945J946.1947 _ -_1948. . .1949

19501951195219531954

195519561957 «

1956First quarter..Second quarterThird quarter.Fourth quarter1957First quarter».Second quarter'Third quarter *Fourth quarter^

Income from agricultural sources

Farm operators' income

Realized gross farm income

Total i

13.9

11.48.46 47.18.5

9.710 711.310.110.6

11.013.818.823 424.4

25.829.334.034.631 6

32 137.136 735.133.7

33.234 434.8

33.734.234.435.2

34.735.234.934.4

Cash re-ceipts frommarketings

Live-stockand

prod-ucts

6.2

5.23.82 82.83.3

4.14 74.94.54.5

4.96.59.0

11 511.4

12 013.816.517.115 4

16 019.718 317.116.3

15.916 217.2

(4)(4)(<)(4)

(4)(4)(4)(4)

Crops

5.1

3.92.52 02.53.0

3.03 63.93.23.3

3.54 66.58 19.2

9 711.013.113.112 5

12 413.214 314.013 7

13. 714 113.0

(4)(4)(4)(4)

(4)(4)(4)(4)

Gov-ern-

mentpay-

ments

0

0000.1

.4

.633

.4

.8

.75

.668

7.8. 3.3

2

3. 3

3.2

3

.26

1.0

(4)(4)(4)(4)

(4)(4)(4)(4)

Farmpro-duc-tionex-

penses

Net farmincome 2

Real-ized(ex-

clud-

netchange

minven-tories)

Total(in-

clud-ingnet

changein

tories)3

Billions of dollars

7.6

6.95.54 44.34.7

5.15 66.15.86.2

6.77 79.9

11 512 2

12 914.316.818 617 9

19 222.322 521.221 5

21.622 322.9

6.3

4.52.91 92.83.9

4.65 15.24.34.4

4.36.28.8

11.912.2

12 815.017.215.913 7

12 914.814.313.912.2

11.612 111.9

6.1

4.33.32.02.62.9

5.34 36.04.44.5

4.66.69.9

11 811.8

12 414.915.517 712 9

13 716.115 113.312 7

11.911 611.6

Wagesnf

farmresi-dent

work-ers

0.9

.8

.6

.5

.4

.5

.66

.7

.7

.7

.7

.91.21 41.5

1 61.81.92.01 8

1 71.91.91.81.8

1.71 81.8

Total(in-

ingnet

changein

inven-tories)

7.0

5.14.02 53.03.4

5.95 06.85.15.2

5.37.5

11.113 213.4

14 016.717.419.714 7

15 518.017 015.114.4

13.613 413.5


22.022.322.322.6

22.723.022.822.9

11.711.912.112.6

12.012.212.111.5

11.411.511.512.0

11.511.711.811.5

(4)(4)(4)(4)

(4)(4)(4)(4)

(4)(4)(4)(4)

(4)(4)(4)(4)

Incomefromnon-agn-cul-

turalsources

(4)

(4)

(4)(4)(4)

1.9

2.02 32 52.32.5

2.73 13.84 24 4

4 24.34.95.15 2

5 35.66 16.05 8

6.36 76.3

(4)(4)(4)(4)

(4)(4)(4)(4)

Incomefromall

sources(in-

clud-ingnet

changein

tories)

(4)

(4)(4)(4)(4)

5.3

7.97 39 37.47.7

8.010 614.917 417 8

18 221.022.324 819 9

20 823.623 121.120 2

19.920 119.8

(4)(4)(4)(4)

(4)(4)(4)(4)

Percapitaincome

fromall

sources(dollars)

(4)

(4)(4)(4)(4)

165

244228296239249

262349509654696

720793822958765

828977953930925

898902970

(4)(4)(4)(4)

(4)(4)(4)(4)

1 Also includes nonmoney income furnished by farms (value of farm products consumed in farm house-holds and gross rental value of farm dwellings), not shown separately.

2 Realized gross farm income less farm production expenses.3 Data prior to 1952 differ from farm proprietors' income shown in Tables F-9 and F-12 because of revi-

sions by the Department of Agriculture not yet incorporated into the national income accounts of theDepartment of Commerce.

4 Not available.5 Preliminary.


Source: Department of Agriculture.

188

TABLE F-65.—Farm population, employment, and productivity, 1929-57

Period

1929

19301931193219331934

19351936193719381939

19401941194219431944

194519461947. . . .19481949

19501951195219531954

195519561957 6

Farm popu-lation »

Num-ber

(thou-sands)(April

1)

As per-cent oftotal

populat i s

30,580

30,52930,84531,38832, 39332, 305

32,16131, 73731, 26630, 98030,840

30, 54730, 27329, 23426, 68125,495

25, 29526, 48327,12425,90325, 954

25, 05824,16024, 28322, 67921,890

22,15822, 25720,396

Net mi-grationto andfromfarms(thou-

sands)8

25.1

24.824.925.125.825.6

25.324.824.323.923.6

23.122.721.719.518.4

18.118.718.817.717.4

16.515.715.514.213.5

13.413.211.9

-477

- 6 1156607

-463-527

-799-834-661-545-703

-633-1,424- 2 , 975-1,563

-564

151-1,686

-371-1,314

-1,302-271

-1,996-1,171

- 9 1

-2568-2,236

Farm employment(thousands) *

Total workers workers

12, 763

12,49712, 74512,81612, 73912, 627

12, 73312, 33111, 97811,62211, 338

10, 97910,66910, 50410, 44610, 219

10,00010, 29510, 38210,3639,964

9,3428,9858,6698,5808,451

8,2377,8697,634

Family

9,360

9,3079,6429,9229,8749,765

9,8559,3509,0548,8158,611

8,3008,0177,9498,0107,988

7,8818,1068,1158,0267,712

7,2526,9976,7486,6456,521

6,3416,0185,796

Hired

Averagegross

hourlyearn-

ings ofhiredfarm

workers(dol

lars)

3,403

3,1903,1032,8942,8652,862

2,8782,9812,9242,8072,727

2,6792,6522,5552,4362,231

2,1192,1892,2672,3372,252

2,0901,9881,9211,9351,930

1,8961,8511,838

$0. 241

.226

.172

.129

.115

.129

.142

.152

.172

.166

.166

.169

.206

.268

.353

.423

.472

.515

.547

.580

.559

.561

.625

.661

.672

.661

.675

.705

.728

Man-hours

offarmwork

Farmoutput

perman-hour

Crop produc-tion

Perman-hour

Peracre

Index, 1947-49=100

135

134137132132118

123119129120121

119117122121120

11210810310097

8991898885

858380

55

5458585351

5955646666

7074797881

869192104104

112113120123127

132136141

53

5256575149

5852626565

6973797781

869291105104

115112123124129

135140149

79

7583797159

7665888585

9510195

106

9798

103103101

106108112

1 Farm population as defined by the Department of Agriculture and Department of Commerce, i. e.civilian population living on farms, both urban and rural, regardless of occupation.

2 Total population as of July 1 including armed forces overseas.3 Net change for year beginning in April, estimated by Department of Agriculture. For 1940 and sub-

sequent years, includes inductions and enlistments into the armed forces, and persons returning from thearmed forces. For all years, includes persons who have not moved but who are in and out of the farmpopulation because agricultural operations have begun or have ceased on the place where they are living .

* Includes persons doing farm work on all farms. These data, published by the Department of Agri-culture, Agricultural Marketing Service, differ from those on agricultural employment by the Departmentof Commerce, Bureau of the Census (see Table F-17) because of differences in the method of approach, inconcepts of employment, and in time of month for which the data are collected. For further explanation,see monthly reports on Farm Labor by the Department of Agriculture.

5 Weighted average of all farm wage rates on a per-hour basis.6 Preliminary.7 Not available.

Sources: Department of Agriculture and Department of Commerce.

189

TABLE F-66.—Farm production indexes, 1929-57

[1947-49=100]

Year

1929

19301931193219331934

19351936193719381939

19401941194219431944

19451946194719481949

19501951195219531954

195519561957*.--

Farmout-put 1

74

7279767060

7265827980

8386969497

969895104101

100103107108108

112113113

Livestock and products

Total 2

77

7880818275

7277767985

8792102111105

10410110097103

107112112114117

120122121

Meatani-mals

77

7882838673

6674717787

8994107120108

10310110097103

109117117116121

127123121

Dairyprod-ucts

82

8486868785

8687868990

929610099101

10310210198101

101100100105107

108110111

Poul-tryandeggs

63

6563636259

5963636569

707789102102

106999896106

111116117120125

123136135

Crops

Total 3

79

7684807158

7664888382

8586979096

939893106101

9799103103101

105106106

Feedgrains

83

7384957348

8053878483

859110496100

9710581116103

10497102101106

112112121

Hayandfor-age

88

7579867967

9674879893

106106115110109

11310410310097

106111107110109

116111126

Foodgrains

66

7276624544

5352727561

6776806985

899210810389

83821059685

808479

Vege-tables

81

8283838087

8883898988

91929610399

1011109810399

9892929694

9610196

Fruitsandnuts

76

7594767772

9172958598

9510210087102

9311010496100

104106102104104

104112112

Cot-ton

104

98119919168

75871338483

8875908086

636183104113

7010610611596

1039377

To-bac-co

75

8176496854

6558786994

7262707096

981141059897

101115112103110

10910883

Oil-bear-ing

crops

21

2323211821

3427303647

5661929882

888591109100

116106104102116

128153147

1 Farm output measures the annual volume of farm production available for eventual human use throughsales from farms or consumption in farm households. Total excludes production of feed for horses and mules.

2 Includes certain items not shown separately.3 Includes production of feed for horses and mules and certain other items not shown separately.4 Preliminary.


T A B L E F—67.—Indexes of prices received and prices paid by farmers, and parity ratio, 1929-57

[1910-14= 100]

Period

1929

19301931193219331934.

19351936193719381939

1940 .1941194219431944._ . _

1945 - .1946194719481949

19501951 .195219531954

1955 . .19561957

1956:January...FebruaryMarchAprilMay...June ...

JulyAugust ...September.OctoberNovember.December.

1957:JanuaryFebruary...MarchApril. .MayJune

JulyAugustSeptember.OctoberNovember. .December

Allfarmprod-ucts i

148

12587657090

1091141229795

100124159

3 1933 197

3 207»236276287250

258302288258249

236235242

227227229234240245

243236236234234235

238234238242243244

247248245240242242

£A

ll

135

11575577198

1031081188082

90108145187199

202228263255224

233265268242242

236240234

232233237242249261

255233233231237237

238234237242244241

239233228224224218

1fei

1116

9356446690

971081207572

8497120148166

172201271250218

224243244231232

229224225

221221223229226219

216218222225232234

236235235233225218

218217217219221221

Prices received by farmers

Crops

g05xn.9I1118

10674485795

1071031257172

8592115152172

167202256258177

193226234208206

187185170

172173174185192192

194197196178182185

187181181180179173

170169163156152152

ton

Cot

150

104644968101

9899947074

83111156167172

179238274272246

282336310268274

272268264

259262268275270273

274263275270270262

256255252258266270

273278279273263239

I

Tot

171

1409884107156

171163200173152

134157247319348

360376374380398

402436432429439

437453465

452452453453454453

453451455453443461

457458459459457457

460469484483473466

COfto

bfl

.5

bear

Oil-

143

111734457103

1271201299596

103138183202222

228260363351242

376339296274279

250250253

236239245253265259

250249235249262264

266260265264263260

261252244231235237

Livestock and products

o5 *-<

tock

luct

:A

ll

159

13498727081

114119126112107

109138171198196

211242288315272

280336306272255

236230249

221221221227232231

231238239236230233

238234238242241245

254260259254258264

g'IC3

s

155

13391635968

115118130113110

108143186203190

3 2073 248329361311

340409353296292

249238278

208217222238250251

246257254243231239

254249263275278287

297301291274278294

CO

rodi

ft

Dai

166

1421118687101

114125131115110

120140163

3 1983 222

3 2293 268273301252

249286302274252

253259263

260256250246247245

251257266274279274

270266260253248247

252260269277279275

75

M05

TJCJa

1161

12898817489

11611511111096

98122152191177

198201223242221

186228206221176

188177162

206188187181178172

174171172167163165

155157150150144145

155167174180188185

Prices paidfarmers

Allitems,inter-est,taxes,andwagerates(par-ityin-dex)

160

151130112109120

124124131124123

124133152171182

190208240260251

256282287279281

281285296

280280281284286286

287287287288289290

292294295296296296

295295296296298299

Fam-ilyliv-ing

items

154

144124106108122

124124128122120

121130149166175

182202237251243

246268271270274

273278286

272272274274278280

282281279279281283

283284284285286287

287287287286289288

Lby

Pro-duc-tionitems

146

1351139999114

122122132122121

123130148164173

176191224250238

246273274253252

249249258

246245246248250248

248250252250252252

255256258260259257

257257258258260262

Par-ityra-tio 2

92

8367586475

SS92937877

8193105113108

109113115110100

1011071009289

848282

818181828486

858282818181

828081828282

848483818181

1 Includes items not shown separately.2 Percentage ratio of index of prices received by farmers for all farm products to parity index.3 Includes wartime subsidy payments.


TABLE F-68.—Comparative balance sheet of agriculture, 1940-58


Beginningof year

19401941194219431944

19451946194719481949

19501951195219531954._

1955195619571958 3

Assets

Total

53.055.162.573.383.8

93.1101.9113. 7125. 0131.9

130. 7149. 5165. 3162.9159.6

164.6168.2177.1188.3

Realestate

33.634. 437.541.648.2

53.961.068.573.776.6

75.386.896.096.694.7

98.8102.7109. 5118.0

Other physical assets

Live-stock

5.15.37.19.69.7

9.09.7

11.913.314.4

12.917. 119. 514.811.7

11.210.711.2(4)

Ma-chin-eryand

motorvehi-cles

3.1o n

4.04.95.3

6.35.25. 16.99.3

11.212.814.915.415.9

16.016.517.3(4)

Crops i

2.73.03.85.16.1

6.76.37.19.08.6

7.67.98.89.09.2

9.68.38.4

(4)

House-holdfur-

nish-ingsand

equip-ment2

4.34.34.54.64.6

4.74.85.36. 16.9

7.78.69.3

10.010.6

11.111.612.0(4)

Financial assets

Depos-itsandcur-

rency

3.23.54.25.46.6

7.99.4

10.29.99.6

9.19.19.49.49.4

9.49.59.5

(4)

U. S.savings

bonds

0.2.4. 5

1.12.2

3.44.14.14 44.6

4.84.94.95.05.2

5.45.65.7

0)

Invest-mentin co-opera-tives

0.8. 9.9

1.01.1

1.21.41.51. 71.9

2.12.32. 52.72.9

3.13.33.5

(*)

Total

53.055.162.573.383.8

93.1101.9113.7125.0131.9

130.7149.5165.3162.9159.6

164.6168.2177.1188.3

Claims

Realestatedebt

6.66.56.46.05.4

4.94.84.95.15.3

5.66.16. 77.37.8

8.39.19.9

10.6

Otherdebt

3.43.94.14.03.5

3.43.23.64.26.1

6.97.07.98.89.4

9.59.89.69.3

Pro-prie-tors'equi-ties

43.044.752.063.374.9

84.893.9

105.2115. 7120.5

118.2136.4150.7146.8142.4

146.8149.3157.6168.4

1 Includes all crops held on farms for whatever purpose and crops held off farms as security for CommodityCredit Corporation loans. The latter on January 1, 1957, totaled 1.6 billion dollars.

2 Estimated valuation for 1940, plus purchases minus depreciation since then.3 Preliminary.* Not available,NOTE:—Detail will not necessarily add to totals because of rounding.Source: Department of Agriculture.

TABLE F-69.- - Level-oj-living indicators for farm-operator families, selected years, 1920-56

Year

19201930194019451950195419564

Level-of-living index '(U. S. average in 1945=100)

UnitedStates

North-east

75 10279

100122140145

115138152167169

NorthCentral

104104128147161165

South

44496592

113119

West

93102127145163167

Percentage of all families reporting:

Elec-tricity 2

3 7133348789394

Tele-phones

39342532384752

Auto-mobiles

31585862637174

Run-ningwater

10162229435964

Me-chan-ical

refrig-erators

153263

90

Tele-vision

33653

Homefreezers

123239

1 Indexes based on percent of farms with electricity, telephones, and automobiles and the average valueof products sold or traded in the year preceding the appropriate Census of Agriculture.

2 Differs in minor respects from series shown in Table F-70.3 Gas or electric lights.4 Based on Special Cooperative Survey of Farmers' Expenditures.Source: Department of Agriculture.

192

T A B L E F—70.—Selected indicators of farming conditions, 1929—57

Period

1929

19301931193219331934

1935193619371938..1939

19401941194219431944

1945.1946194719481949

19501951195219531954

195519561957 9

Numberof farms(thou-sands)

6,512

6,5466,6086,6876,7416,776

6,8146,7396,6366,5276,441

6,3506,2936,2026,0896,003

5,9675,9275,8735,8045,723

5,6485,5355,4215,3085,201

5,0874,9694,850

Averagevalue of

productionassets per

farm(dollars) i

(8)

(8)(8)(8)(8)(8)

(8)(8)(8)(8)(8)

6,0946,3407,4498,934

10,328

11,34612,43514,13215,86817,106

16,96220,45323,45123,22523,000

24,20025,42927,000

Total invest-ment in farm

plant andequipment(millions of

dollars)

Gross

966

717408194189376

560756903685774

8721,1991,202

9181,488

1,5332,0353,2294,2594,534

4,5385,0384,6594,6594,295

4,2444,1124,174

Net a

50

-238-448-540-455-274

-10428

107-148

- 7

76325

-168-485

25

193811

1,6132,1992,104

1,7951,7961,2551,120

650

492291176

Real estatedebt as

percent ofvalue of

real estate(percent)'

20.3

20.121.524.527.523.9

22.821.720.319.819.9

19.618.917.014.311.2

9.27.87.26.96.9

7.47.37.17.78.3

8.58.89.0

Fore-closurerate per

1,000farms 4

14.8

15.718.728.438.828.0

21.020.318.114.313.4

12.510.46.14.33.0

1.91.51.11.01.2

1.41.51.61.31.7

2.02.32.0

Operators'net income

per farm(dollars) «

962

691437288410571

676762788655682

675978

1,4231,9502,035

2,1542,5312,9272,7472,389

2,2762,6742,6302,6152,344

2,2772,4322,450

Farm in-come perworker

(dollars) «

:

]]

593

456298203266360

423487519452475

484694995

1,3311,411

,515L, 704[,9261,829L, 660

1,671L, 9741,9681,9431,764

L, 7381,888L,920

Percent ofall farms

withcentralstation

electricalservice 7

(8)

(8)(8)(8)(8)(8)

10.912.315.819.122.1

30.434.938.340.342.2

45.754.361.068.678.2

77.284.288.190.892.3

93.494.295.0

' Farm real estate less value of dwellings, crops held for feed, livestock, machinery and equipment less 60percent of the value of automobiles, and demand deposits used for production.

2 Gross investment less depreciation and other capital consumption.3 Data are for January 1.4 Data are for year ended March 15.5 Including Government payments and excluding the net change in inventories.8 Net income of farm operators including Government payments and excluding the net change in in-

ventories, plus farm wages of resident workers and other hired workers.7 Data are for June 30, except for the Census of Agriculture years: 1935 (January 1), 1940 (April 1), 1945

(January 1), and 1950 (April 1).s Not available.9 Preliminary.


193

INTERNATIONAL TRANSACTIONS

TABLE F-71.—United States balance of payments, 1953-57Excluding transfers of goods and services under military grant programs


Item

United States payments: Total

Imports of goods and services: Total

Merchandise, adjusted, excludingmilitary

TransportationTravelMiscellaneous services, excluding

militaryMilitary expendituresIncome on investments:

PrivateGovernment

Unilateral transfers, net, excludingmilitary: Total

Government grantsRemittances and other transfers. _

United States capital, net: Total

Private, net: Total

Direct investments, netNew issuesRedemptionsOther long-term, netShort-term, net

Government, net: Total

Long-term capital, outflowRepaymentsShort-term, net

United States receipts: Total

Exports of goods and services: Total..

Merchandise, adjusted, excludingmilitary

TransportationTravelMiscellaneous servicesMilitary transactionsIncome on investments:

Direct investmentsOther privateGovernment

Foreign long-term investments in theUnited States

Balance (net United States receipts):Total

Increase in liquid dollar holdingsby foreign countries and inter-national institutions

United States gold sales [purchases(-)]

Errors and omissions

1953

19, 685

16, 644

10,9901,081929

6592,535

36486

2,4541,837617

587

369

721270

-139-316-167

218

716-487-11

17, 287

17,081

12, 2811,198574926192

1,442216252

206

-2,398

941

1,161

296

1954

19, 876

16, 088

10, 3541,0261,009

6772,603

36059

2,2621,647615

1,526

1,619

664309

-124135635

-93

306-507108

18,193

17,949

12, 7991,171595978179

1,725230272

244

-1,683

1,218

298

167

1955

21, 944

17, 937

11, 5271,2041,153

7282,823

40894

2,4861,901585

1,521

1,211

779128

-190303191

310

383-416343

20,349

20, 003

14, 2801,420654

1,001204

1,912258274

346

-1, 595

1,108

41

446

1956

25, 748

19, 810

12, 7911,4321,275

7842,910

464154

2,3321,695637

3,606

2,980

1,839457

-169319534

626

534-479571

24,060

23,518

17, 3211,619705

1,059156

2,160304194

542

-1,688

1,302

-306

692

First 3 quarters

1956

19,093

14, 967

9,5801,0851,035

5872,225

348107

1,7001,234466

2,426

1.901

1,142309

-115309256

525

410-307422

17, 426

16,997

12, 4621,183543777120

1,537220155

429

-1,667

1,577

-279

369

1957

20, 480

15, 533

9,8741,0761,099

6052,397

332150

1,8051,270535

3,142

2,542

1,698438

-111301216

600

402-521719

20,153

19, 810

14,6641,464599828151

1,680264160

343

-327

102

-700

925


194

TABLE F—72.—United States balance of payments with individual areas, 1953—57Excluding transfers of goods and services under military grant programs


Area and type of transaction

Continental Western Europe and de-pendencies:

United States payments: Total-. .

Nonmilitary imports of goodsNonmilitary imports of services.._Military expendituresRemittance and other transfers...Government grants and capital.._Private capital, net outflow

United States receipts: Total _

Exports of goods _ _ .Income on investments abroadExports of other servicesForeign long-term investments in

the United States

Balance (net United States receipts)..

Sterling area:United States payments: Total . .. .

Nonmilitary imports of goodsNonmilitary imports of services...Military expenditures .Remittances and other transfers.._Government grants and capitalPrivate capital, net outflow


Exports of goodsIncome on investments abroadExports of other servicesForeign long-term investments in

the United States

Balance (net United States receipts)..

Canada:United States payments: Total

Nonmilitary imports of goodsNonmilitary imports of services.._Militarv expendituresRemittances and other transfers. _Government grants and capital...Private capital, net outflow


Exports of goodsIncome on investments abroadExports of other services „ .Foreign long-term investments in

the United States

Balance (net United States receipts) _.

1953

4,834

2,083860

1,047218736

- 1 1 0

3,465

2,600186616

63

- 1 , 3 6 9

3,273

1,70871628994

42145

2,623

1,614407546

56

- 6 5 0

3,546

2,435526192115

377

4,132

3,123336607

66

586

1954

5,055

1,931899

1,19618974595

3,946

3,010219636

81

- 1 , 1 0 9

3,174

1,52675341797

164217

2,939

1,740481583

135

- 2 3 5

3,493

2,364487194

2443

3,823

2,855371615

- 1 8

330

1955

5,911

2,2001,1001,381

218797215

4,786

3,562258761

205

- 1 , 1 2 5

3,556

1,80180446596

31080

3,435

2,146563632

94

- 1 2 1

3,763

2,678556217

15Q

306

4,421

3,326423669

3

658

1956

6,335

2,6081,2311,295

248568385

5, 981

4,650259857

215

- 3 5 4

4,317

2,00090756897

293452

3,710

2,348534648

180

- 6 0 7

4,743

2,913597259

12

967

5,368

4,114487674

93

625

First 3 quarters

1956

4,749

1,887962

1,014179433274

4,265

3,285205624

151

- 4 8 4

3,325

1,492699439

73264358

2,634

1,647368471

148

- 6 9 1

3,458

2,139478185

9

652

3,982

3,034328518

102

524

1957

4,879

2,0201,0081,036

191447177

5,113

3,926219779

189

234

3,433

1,63271753780

287180

3,113

2,084357539

133

- 3 2 0

3,707

2,179490218

10

810

4,044

3,103399555

— 13

337

195

TABLE F—72.—United States balance of payments with individual areas, 1953-57—ContinuedExcluding transfers of goods and services under military grant programs


Area and type of transaction

Latin America:United States payments: TotaL

Nonmilitary imports of goods .Nqnmilitary imports of services ..Military expendituresRemittances and other transfers .Government grants and capital _Private capital, net outflow _


Exports of goods ..Income on investments abroad.. _Exports of other servicesForeign long-term investments in

the United States

Balance (net United States receipts) .

Other countries:United States payments: Total

Nonmilitary imports of goods.- ..Nqnmilitary imports of services _ .Military expendituresRemittances and other transfers.Government grants and capital .. _Private capital, net outflow


Exports of goodsIncome on investments abroad..Exports of other servicesForeign long-term investments in

the United States

Balance (net United States receipts)-.

International institutions:United States payments: Total

Nonmilitary imports of goods.,.. _Nqnmilitary imports of services. .Military expendituresRemittances and other transfers..Government grants and capital _ _Private capital, net outflow

United States receipts: Total.

Exports of goodsIncome on investments abroad..-.Exports of other servicesForeign long-term investments in

the United States

Balance (net United States receipts).

1953

4,621

3.5817412732373

-133

4,396

3,045611726

14

-225

3,255

1, 180231980262429173

2,596

1,892357348

-1

-659

156

9117

75

71347

8

-81

1954

4,823

3,445739243876501

4,711

3,323645711

32

-112

3,137

1,088216772284510267

2,677

1,842497334

-460

194

1955

4,840

3,4708122140119378

4,802

3,282745753

22

-38

3,759

1,378278739216915233

2,808

1,937440421

10

-951

115

"37"

79-1

97

271543

12

-18

1956

5. 831

3 7759852740178826

5,615

3,830918834

33

-216

4,362

1,495342761240

1,162362

3,290

2,354445482

-1,072

160

47

125-12

251544

12

-64

First 3 quarters

1956

4,262

2,9227242130150415

4,083

2,789661620

13

-179

3,146

1,140257566175824184

2,386

1,683339357

7

-760

153

"42"

-77

1957

4,925

2,9187292837167

1,046

4,872

3,396760699

17

-53

3,264

1,125260578216911174

2,935

2,134357437

7

-329

271

""58

58155

76

211233

10

-195


196

TABLE F—73.—United States merchandise exports and imports for consumption, by leadingcommodities, 1936-38 average and 1953-57

[In millions of dollars]

Commodity 1

Exports of U. S. merchandise: Total.

Nonmilitary exports: Total2

Exports, excluding "special category" commodities:Total»

Agricultural commodities: Total.

Raw cotton, excluding lintersVegetable oils, fats, and oilseeds «.Tobacco, unmanufacturedWheat, including flourOther grains and preparationsOther agricultural commodities- - -

Nonagricultural commodities: Total5.

Machinery s

Automobiles, parts, and accessories 5

Chemicals and related products 5

Textile manufacturesIron and steel-mill products, including scrap.Petroleum and products 5

CoalNonferrous metals, including ferroalloysOther nonagricultural commodities 5

Imports for consumption: Total

Agricultural commodities: Total-

CoffeeCane sugarCocoa or cacoa beansOther foodstuffsCrude rubberWool, unmanufacturedOther agricultural commodities.

Nonagricultural commodities: Total..

Nonferrous metals and ferroalloysPetroleum and productsPaper and paper-base stocksTextile manufacturesMachineryAutomobiles, parts, and accessoriesSawmill productsChemicals and related productsFish, including shellfishIron oreIron and steel-mill products, excluding scrap_Other nonagricultural commodities

1936-38aver-age

2,925

778

3135

1436254

201

2,147

44029212987

19934456

114486

2,461

1,260

14115235

32317957

373

1,201

17842

221174191

188731

519

406

1953

15,652

12,141

11, 525

2,847

517173341589470757

8,677

2,747963800640495498335176

2,023

10, 779

4,185

1,469425167908332296588

6,594

1,6627629374642455323629319497251

1,400

1954

14, 981

12,726

12,123

3,054

780306304427323914

9,069

2,5951,036983621516431304305

2,278

10,240

3,973

1,486411252827262223512

6,267

1,39282992644024053252249210119116

1,441

1955

15,421

14,165

13, 509

3,198

469324356482459

1,108

10,311

2,8241,2381,077615818442485319

2,493

11,337

3,982

1,357415185798442260525

7,355

1,5281,02698558527785323255214177145

1,755

1956

18,928

17,171

16,476

4,168

718447334797544

1,328

12,308

3,4681,3571,237629

1,075567732415

2,828

12, 516

3,962

1,440437144778398242523

8,554

1,7111,2861,092648355145306274238250230

2,019

January-September

1956 1957

13,748

12,343

11,827

2,836

401292219578380966

8,991

2,5881,024

937460750338529296

2,069

9,329

3,105

1,129377121589299196394

6,224

1,24194081248126697236203177184152

1,435

15, 674

14, 575

13,987

3,376

803315237688377956

10, 611

2,886988

1,036497

1,092668648364

2,432

9,585

2,900

99538195620258173378

1,2761,150777485320228183206188214178

1,480

1 Commodity data for 1936-38 and 1953-56 have been adjusted to conform as nearly as possible to 1957statistical classifications. The distributions of nonagricultural exports by principal commodities, how-ever, are based on total exports in 1936-38 and on exports excluding "special category" items in 1953 andlater periods. (See footnote 3.)

2 Data represent total exports minus shipments of military equipment and supplies by the Departmentof Defense under the Mutual Security Program. Commodity breakdowns of nonmilitary exports are notavailable.

3 "Special category" commodities are those to which security restrictions applied in 1956 as regards publi-cation of detailed export statistics.

* Data exclude essential oils.s Data for 1953 and later periods exclude "special category" exports. (See footnote 3.)NOTE.—Detail will not necessarily add to totals because of rounding.Source: Department of Commerce.

197

TABLE F—74.—U. S. Government grants and credits, excluding military supplies and services,by areas, total postwar period and fiscal years 1953-57


Item Total

WesternEurope(includ-

ingGreece

andTurkey1)

East-ern

Europe

NearEast,

Africa,and

SouthAsia 2

Vietnam,Laos,Cam-bodia,China,

andKorea 3

OtherAsiaand

Pacific

LatinAmer-ica *

Otherinter-

nationalinstitu-

tionsand un-specified

Gross new grants:Total postwar period 5...Fiscal year 1953Fiscal year 1954Fiscal year 1955Fiscal year 1956Fiscal year 1957

Reverse grants and returnson grants:

Total postwar period 5__Fiscal year 1953Fiscal year 1954Fiscal year 1955Fiscal year 1956Fiscal year 1957

Net new grants:Total postwar period 5_.Fiscal year 1953Fiscal year 1954Fiscal year 1955Fiscal year 1956Fiscal year 1957

New credits:Total postwar period 5__Fiscal year 1953Fiscal year 1954Fiscal year 1955Fiscal year 1956Fiscal year 1957

Repayments:Total postwar period «„Fiscal year 1953Fiscal year 1954Fiscal year 1955Fiscal year 1956Fiscal year 1957

Net new credits:6

Total postwar period 5_.Fiscalyear 1953Fiscal year 1954Fiscal year 1955Fiscal year 1956Fiscal year 1957

Total net grants and credits:Total postwar period 5__Fiscal year 1953Fiscal year 1954Fiscal year 1955Fiscal year 1956Fiscal year 1957

32,9252,0461,6812,0391,7771,782

1,46910585536366

31, 4561,9411,5971,9861,7141,717

13, 023635624444475431

4,539528501460512639

8,485107124

-16-37

-208

39, 9402,0491,7211,9701,6771,508

21, 3121,4611,0031,059630469

1,2349480495162

20,0771,367923

1,010579406

8,9422571671128947

2,507402371234275289

6,435-145-204-121-186-242

26,5131,222719889392165

1,070

39

1,031

123

70-4-4-5-5

1,100- 4105

-15

1,490142277281316273

13882213

1,353134275278314270

905107578911290

24812171217134

65795397795

-43

2,009229314356409227

310270532623733

3,962309268531613733

264

13021111

134- 22

-14216

4,096307267530655749

3,5407443447097

3,508734244

1,0763511781145125

67551341007187

402-1683

-197437

3,9105612524144134

4602534547795

1,06535415957106

4602534547795

1,48522827615887152

7475360106129121

73817521652

-4331

1,19819925010734126

1,06535415957106

228

1792134142

506

- 5')

- 1 4- 2

1,11540365944104

1 Includes European Coal and Steel Community, European Payments Union, European ProductivityAgency, and Organization for European Economic Cooperation.

2 Includes United States contribution to United Nations for Palestine Relief.3 Includes United States contribution to United Nations Korean Reconstruction and Relief Adminis-

tration.* Includes United States contribution to Organization of American States.5 Postwar period covers July 1, 1945 through June 30, 1957. Excludes United States subscriptions to

International Bank for Reconstruction and Development and International Monetary Fund.6 Does not include $2,257 million prior grants converted into credits in the postwar period (Western

Europe $1,970 million, Eastern Europe $222 million, Near East and Africa $11 million, China $50 million,and Latin America $3 million), Western Europe $1,000 million in fiscal year 1954, and Latin America $1million in fiscal year 1957.

7 Less than $500,000.



198

TABLE F—75.—U. S. Government grants of military supplies and services, by areas,total postwar period and fiscal years 1953—57

[Fiscal years, millions of dollars]

Area

Gross military grants 3

Less: Reverse grants and returns

Equals: Net military grants 2

Western Europe (excluding Greece and Turkey)2 .Near East (including Greece, Turkey, and Africa).Other Asia and PacificAmerican RepublicsUnspecified

Totalpostwarperiod1

20,312

255

20, 057

12,0252,6664,832

334199

1953

4,320

62

4,258

3,120314768

2135

1954

3,506

9

3,497

2,326381725

4521

1955

2,540

10

2,531

1,582289596

4320

1956

3,027

14

3,013

1, 834387732

3821

1957

2,376

11

2,365

1,243393633

7225

1 Postwar period covers July 1, 1945 through June 30, 1957.2 Includes cash contributions to the multilateral-construction program of the North Atlantic Treaty

Organization.



TABLE F—76.—Estimated gold reserves and dollar holdings of foreign countries andinternational institutions, 1937 and 1949-57


End ofyear

1937

1949

19501951195219531954

195519561957 1

Total

15.1

19.0

23.223.324.727.329.6

31.532.932.5

Sterling area

Total

4.9

2.8

4.63.93.54.34.4

4.04.23.9

UnitedKing-dom

4.4

2.0

3.72.92.53.23.4

2.93.12.7

Conti-nentalOEEC

countriesand

depend-encies

6.8

6.1

7.07.28.5

10.111.6

13.214.114.4

OtherEuropeancountries

1.0

.6

.5

.5

.5

.6

.6

.7

.6

.6

Canada

0.4

1.5

2.12.32.62.52.7

2.63.03.2

LatinAmericanRepublics

1.0

3.1

3.53.43.43.73.8

4.04.34.7

Allother

countries

1.0

1.7

2.22.52.72.52.6

3.03.12.8

Inter-national

insti-tutions

3.3

3.33.43.53.63.9

4.03.52.9

1 As of September 30.NOTE.—Includes gold reserves and dollar holdings of all foreign countries with the exception of U. S. S. R.

gold reserves, and of international institutions (International Bank for Reconstruction and Development,International Monetary Fund, United Nations, and others). Holdings of the Bank for InternationalSettlements (both for its own and EPU accounts) and of the Tripartite Commission for Restitution cfMonetary Gold are included with the holdings of continental OEEC countries and dependencies. Figuresrepresent (1) reported and estimated gold reserves of central banks and governments, (2) official andprivate short-term dollar holdings reported by banks in the United States, including foreign-held deposits,U. S. Government securities, and certain other short-term liabilities to foreigners, and (3) estimated hold-ings of U. S. Government bonds and notes with original maturities of more than one year. Figures for1937 are not strictly comparable with those for subsequent years owing to exclusion of long-term U. S. Gov-ernment bonds and notes.


199