Full text of Supplement to Economic Indicators : 1955
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84th Congress, 1st Session
1955
HISTORICAL AND DESCRIPTIVE
SUPPLEMENT TO
Economic Indicators
Prepared for the foint Committee on the Economic Report
by the Committee Staff and the
Office of Statistical Standards, Bureau of the Budget
UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON : 1955
JOINT COMMITTEE ON THE ECONOMIC REPORT
(Created pursuant to Sec. 5 (a) of Public Law 304, 79th Cong.)
PAUL H. DOUGLAS, Illinois, Chairman
WRIGHT PATMAN, Texas, Vice Chairman
RICHARD BOLLING (Missouri)
JOHN SPARKMAN (Alabama)
WILBUR D. MILLS (Arkansas)
J. WILLIAM FULBRIGHT (Arkansas)
AUGUSTINE B. KELLEY (Pennsylvania)
JOSEPH G. O'MAHONEY (Wyoming)'
JESSE P. WOLCOTT (Michigan)
RALPH E. FLANDERS (Vermont)
HENRY O. TALLE (Iowa)
ARTHUR V. WATKINS (Utah)
THOMAS B. CURTIS (Missouri)
BARRY GOLDWATER (Arizona)
GROVER W . ENSLEY, Staff Director
JOHN W . LEHMAN, Clerk
[PUBLIC L A W 1 2 0 — 8 1 S T CONGRESS; CHAPTER 2 3 7 — 1 S T SESSION]
JOINT RESOLUTION [S. J. Res. 55]
To print the monthly publication entitled "Economic Indicators"
Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That the Joint
Committee on the Economic Report be authorized to issue a monthly publication entitled "Economic Indicators,"
and that a sufficient quantity be printed to furnish one copy to each Member of Congress; the Secretary and the
Sergeant at Arms of the Senate; the Clerk, Sergeant at Arms, and Doorkeeper of the House of Representatives; two
copies to the libraries of the Senate and House, and the Congressional Library; seven hundred copies to the Joint
Committee on the Economic Report; and the required number of copies to the Superintendent of Documents for
distribution to depository libraries; and that the Superintendent of Documents be authorized to have copies printed
for sale to the public.
Approved June 23, 1949.
ii
Letters of Transmittal
November 1, 1955.
To Members of the Joint Committee on the Economic Report:
For the information of the members of the Joint Committee on the Economic Report and others
interested there is transmitted herewith a revision of the supplement to the committee's monthly publication Economic Indicators containing both historical tables of the various indicators now published and a
description of the derivation, limitations, and uses of each indicator. These materials were developed by
the committee staff and the Office of Statistical Standards, Bureau of the Budget, with the cooperation of
the agencies responsible for each series.
As you are undoubtedly aware, there has been widespread interest in having this information readily
available. The first issue of the Historical and Descriptive Supplement to Economic Indicators has been
used not only by Members of Congress and other users of Economic Indicators both within the Government
and among the nearly 4,500 private subscribers but has become an important teaching aid in college courses
in statistics. It is believed that this revision of the original publication will be equally useful.
PAUL H .
DOUGLAS,
Chairman, Joint Committee on the Economic Report.
November 1, 1955.
The Honorable P A U L H. DOUGLAS,
Chairman} Joint Committee on the Economic Report,
United States Senate, Washington, D. C.
D E A R SENATOR D O U G L A S : Transmitted herewith is the 1 9 5 5 supplement to the Committee's monthly
publication Economic Indicators, containing for each indicator (1) historical data and (2) a description and
references to additional technical explanations. This supplement brings up to date both the descriptive
materials and the historical tables which were published in thefirstedition in December 1953. It is intended
to answer most of the many requests for general information which cannot be carried each month in the
Committee's publication but which is often essential to the interpretation and use of the current materials.
The description shown for each series in Economic Indicators attempts in a nontechnical way to explain
how the series is derived, what its limitations are, and the uses for which it is appropriate or, in some cases,
warning of uses for which it is especially not appropriate. Both the historical data and the descriptions
which are included in this supplement are designed for general users of the data rather than for technicians.
The Government Printing Office sold nearly 6,000 copies of the 1953 supplement.
It might be helpful to point out for the benefit of persons not familiar with Economic Indicators that
this is a monthly publication printed by the Congress in accordance with Public Law 120, 81st Congress,
chapter 237, 1st session, a copy of which is reproduced on the back of the title page of this supplement.
Economic Indicators was first published by the Joint Committee on the Economic Report as a committee
print in 1948 to provide its members with information on current economic trends and developments in a
concise and graphic form. Knowing that other Members of the Congress, businessmen, farm leaders, labor
organizations, and representatives of the press also sought such information the Joint Committee at the same
time sponsored legislation which later resulted in authorizing publication on a permanent basis. Economic
Indicators is prepared each month for the Joint Committee on the Economic Report by the Council of Economic Advisers.
Ail intensive review of Economic Indicators, which was undertaken by the Committee staff with the
cooperation of the Council of Economic Advisers and the Bureau of the Budget, was completed in July of
this year. Users of Economic Indicators made a number of suggestions for improvements which were most
helpful in this review. The Joint Committee will continue to welcome comments directed toward making
Economic Indicators a more useful publication. It should be understood, of course, that the materials
included must be limited to those series of most general use by Members of Congress, executive Government
agencies, and others. The Committee policy has been to carry standard series and relationships without
interpretation. Other publications of the Committee and the executive agencies are considered the medium
for interpretations of the data.
Economic Indicators currently has a list of nearly 4,500 paid subscribers. It is used widely by schools
and libraries as a reference source and has an extensive circulation of foreign subscribers, covering all major
nations of the world. The monthly Indicators is sold through the Superintendent of Documents, United
States Government Printing Office, Washington, D. C., price 20 cents per copy; $2 per year; $2.50 foreign.
The development and supervisory work on the first issue of the supplement was done by the Committee staff. Descriptions of the series were written by members of the staff of the Office of Statistical
Standards, Bureau of the Budget, and the tables were prepared by Miss Frances James and the agencies
compiling the original data. Both text and tables of the 1955 supplement were prepared by the Office of
Statistical Standards, with the cooperation of the agencies compiling the data, in response to a request directed
to the Bureau of the Budget by the Subcommittee on Economic Statistics.
Respectfully submitted.
G R O V E R W . E N S LEY, Staff Director.
Contents
TOTAL OUTPUT, INCOME, AND SPENDING
The Nation's Income, Expenditure, and Saving
Gross National Product or Expenditure
National Income
Sources of Personal Income
Per Capita Disposable Income
Disposition of Personal Income
Farm Income
Corporate Profits
~
Gross Private Domestic Investment
Expenditures for New Plant and Equipment
Page
1
4
6
8
8
10
11
14
16
18
EMPLOYMENT, UNEMPLOYMENT, AND WAGES
Status of the Labor Force
Nonagricultural Employment
Average Weekly Hours—Selected Industries
Average Hourly Earnings—Selected Industries
Average Weekly Earnings—Selected Industries
20
24
28
28
30
PRODUCTION AND BUSINESS ACTIVITY
Industrial Production
Production of Selected Manufactures
Weekly Indicators of Production
New Construction
Housing Starts and Applications for Financing
Sales and Inventories—Manufacturing and Trade
Merchandise Exports and Imports
31
34
35
39
40
44
46
PRICES
Consumer Prices
Wholesale Prices
Prices Received and Paid by Farmers
48
50
52
CURRENCY, CREDIT, AND SECURITY MARKETS
Currency and Deposits
Bank Loans, Investments, and Reserves
Consumer Credit
Bond Yields and Interest Rates
Stock Prices
56
58
60
62
65
FEDERAL FINANCE
Budget Receipts and Expenditures
Cash Receipts from and Payments to the Public
66
68
V
TOTAL OUTPUT, INCOME, AND SPENDING
THE NATION'S INCOME, EXPENDITU RE, AND SAVING
Description of series.—The Nation's income, ex- noncorporate as well as corporate businesses are
penditure, and saving, representing a summary of included in the business expenditure account. The
the Nation's economic accounts, are shown in the actual or imputed rent of dwellings is included in
accompanying table in terms of total receipts and consumer expenditure; but residential construction,
total expenditures for consumers, business, and whether for owner occupancy or for rental purposes,
government. The accounts shown here represent is included with business investment.
In the business account, receipts or gross retained
a statement of the gross national product in terms
of receipts and expenditures for these three cate- earnings include the undistributed profits of corgories : for every dollar of expenditure there must be porations after adjustment for inventory valuation,
a. dollar of receipts. Thus the combined receipts plus the capital consumption allowances of both
(consumer disposable income, gross retained earnings corporate and noncorporate enterprises and instituof business, and government receipts) must equal tions, including residences. The capital consumption
the combined expenditures (consumption expendi- or depreciation allowances must be added to receipts
tures, gross private domestic investment plus net since investment is on a gross basis—i. e., before
foreign investment, and government expenditures). deduction for depreciation. Business investment
It follows that for any period in which the receipts includes additions to plant and equipment and invenfor any of the three categories exceed expendi- tories of both corporate and noncorporate entertures, the difference will be offset by an excess of prises, as well as residential construction. Because
expenditures over receipts in another category or of conceptual difficulties and limitations in the data
categories. The relationship of receipts to expendi- which prevent differentiating investment items in the
tures for each of the three categories is shown by present consumer and government accounts, as shown
quarters for the past several years in the first chart here business investment constitutes the only current
savings of the Nation identified in real terms.
in Economic Indicators.
The government account shows receipts and
The exact balancing of the combined receipts and
expenditures reported for the three categories—con- expenditures on an income and product account
sumers, business, government—requires recognition basis, rather than on either a cash or a conventional
of a statistical discrepancy, since the estimating budget basis, to be consistent with the receipts and
procedure involves somewhat independent data on expenditures of consumers and business and with
each side of the accounts and does not produce the the gross national product total. The government
identity which is conceptually present. In the receipts include personal, corporate and indirect
accompanying table, the total of consumer, business, business taxes, and contributions for social insurance.
and government receipts plus the statistical dis- Although government transfer payments, such as
crepancy equals the total of consumer, business, and interest charges and social security and veterans'
government expenditures, which equals the gross benefits, represent income to the recipients, they are
not included in the gross national product, and are
national product as published.
The consumer account summarizes the more de- therefore subtracted here from both receipts and
tailed statistics on personal income and consumption expenditures.
shown elsewhere in Economic Indicators, particularly The government income and product accounts
in the table on Disposition of Personal Income are on a consolidated basis, just as the cash accounts
(see below, p. 11). It should be noted that, although are, but they depart from the latter because of the
the consumer income account includes the income timing of the items included in each and because of
of unincorporated businesses and farms, the con- conceptual difference!. The income and product
sumer expenditure account includes only expendi- accounts of the government are designed to be in
tures for consumption purposes. Investments of accord with the accrual records maintained by pri-
1
vate business. Thus, business taxes, especially those to check their forecasts as to consistency with past
on corporate profits, are recorded on an accrual patterns of fluctuations in activity in both the
rather than a collections basis, and government economy as a whole and in its various segments,
expenditures for goods are corrected for the lag and consistency among the various assumptions as
between deliveries and payments therefor. All to income, savings, investment, prices, and employcapital transactions, such as receipts from the sale ment that underlie the forecast.
Certain limitations must be recognized in using
of government property and changes in loans and
investments of government credit agencies, are these economic accounts. First, needless to say, the
excluded from the income and product accounts statistics do not throw light on all aspects of the
although such transactions are included in both the economy but only on broad summary categories; thus
they must be supplemented by the use of additional
cash and conventional budgets.
Uses and limitations.—A set of economic accountseconomic information, such as that contained in
for the Nation reduces the voluminous detail of other parts of Economic Indicators. Second, since the
economic activity to understandable proportions by data are national in coverage, their trends and
providing the factual background for seeing in per- changes must be carefully interpreted and supplespective the operations of the major categories of the mented by other data for use in the analysis of
economy—consumer, business, and government— regional or individual industry problems. Third,
and the interrelationships or transactions between they do not, of course, provide the assumptions or
and among them. A statement of these accounts the reasons which one should have for explaining or
serves a number of purposes:
projecting economic changes; they provide only the
(1) In summarizing the pattern of change in the relevant statistical background for intelligent reasoneconomy over recent periods, the statement indi- ing and judgment. Finally, it must be recognized
cates what one should look for among the other that for some of these categories estimates for both
charts and tables included in Economic Indicators. receipts and expenditures rest upon data collected for
(2) The accounting methodology needed to pre- other purposes, or upon crude or indirect estimates
pare this statement helps to assure that the various in cases where no direct survey is regularly conducted.
estimates such as income, expenditures, savings, in- Thus there will be times when it will be difficult to
vestment in the other charts and tables are consistent. interpret the meaning of some of the changes in the
(3) It is frequently necessary to project and evalu- accounts if statistical discrepancies arising from
ate the likely economic impact of public and private technical problems in estimating various items are
programs on the economy. These accounts make so large that they throw doubt on the importance
possible the quantitative expression of the com- of movements in the accounts.
bination of such public and private plans within a
References.—The estimates included in the Naframework of the flows of incomes and expenditures tion's economic accounts are all taken from the
of various groups in the economy so as to measure national income and product statistics of the Departinconsistencies or imbalances between and among ment of Commerce: see references below, under
them, and inconsistencies between and among the National Income (p. 7).
assumptions upon which these plans are based.
See also Technical Notes on the Nation's Economic
Preparation of a Nation's economic budget for a Budget, Appendix A: Report of the Joint Committee
future period, using these accounts, is especially on the Economic Report on the January 1952
helpful when government programs are of such Economic Report of the President, Senate Report
magnitude and importance that they dominate No. 1295, 82d Congress, 2d session, pages 99-105,
changes in the economy; in other words, when and statistical materials prepared by the Council of
government spending and tax plans are the main Economic Advisers for inclusion with the Economic
forces making for changes in the economy. At Report of the President.
other times, its main benefit is in identifying and
For arnrnal projections of these accounts, see the
measuring inflationary and deflationary programs March reports of the Joint Committee—for example,
of govenment and private economic groups and in Joint Economic Committee Report on the Economic
pointing out areas in which adjustments are neces- Report of the President, March 14, 1955, Senate
sary to achieve economic stability and growth.
Report 60, 84th Congress, 1st session. For longer
(4) Another use, related to the preceding, is that run projections, see Potential Economic Growth of
of enabling those who must make actual forecasts, the United States During the Next Decadei 1954,
such as businessfirms,private economists and others, Joint Committee Print, 83d Congress, 2d session.
2
The Nation's Income, Expenditure, and Saving
[Billions of dollars]
Year
Consumption expenditures
Disposable income
Government
Business
Consumers
Saving
( + ) or
dissaving ( - )
Gross retained
earnings
Investment 1
Excess of
earnings
( + ) or
investment (—)
ExpendiReceipts
tures for
(less transgoods and
fers, etc.)
services
Excess of
receipts
( + ) or
expenditures (—)
Statistical
discrepancy 2
1929
83. 1
79.0
+4. 2
11. 5
17. 0
-5. 5
9. 5
8. 5
+ 1. 0
+ 0.3
193 0
193 1
193 2
193 3
193 4
74. 4
63. 8
48. 7
45. 7
52.0
71. 0
61. 3
49. 3
46. 4
51.9
+ 3.4
+ 2. 5
6
6
+. 1
8.
5.
2.
2.
4.
8
2
7
6
9
11.0
5. 7
1. 1
1. 5
3.3
-2. 2
5
+ 1.6
+ 1. 1
+ 1.6
8.9
6.4
6. 4
6.7
7.4
9.
9.
8.
8.
9.
3
-2.8
-1. 7
-1.4
-2. 4
-1. 0
+.8
+.8
+.9
+.7
1935,...
193 6
193 7
193 8
1939....
58.3
66. 2
71. 0
65. 7
70.4
56.
62.
67.
64.
67.
3
6
3
6
6
-J-2. 0
4-3. 6
+ 3. 7
+ 1. 1
+ 2.9
6.
6.
7.
7.
8.
3
5
8
8
3
6. 2
8.3
11. 8
7. 8
10. 2
+. 1
-1.8
-4. 0
+. 1
-1.9
8. 0
8.9
12. 3
11. 2
11. 2
10. 0
11.8
11.7
12. 8
13. 3
-2.
-3.
+.
-1.
-2.
0
0
6
6
1
-.2
+ 1. 1
-. 2
+.5
+ 1.2
1940....
1941
1942....
1943....
1944
76. 1
93. 0
117. 5
133.5
146. 8
71.
81.
89.
100.
109.
9
9
7
5
8
+ 4. 2
+ 11. 1
+ 27. 8
+ 33. 0
+ 36.9
10.4
11. 5
14. 1
16.3
17. 2
14. 7
19. 2
9.7
3. 4
5. 0
-4. 3
-7.7
+ 4. 5
+ 12.9
+ 12. 2
13. 3
21. 0
28.3
44. 4
44 6
14.
24.
59.
88.
96.
1
8
7
6
5
-. 7
-3.8
-31.4
-44. 2
-51. 9
+.8
+.4
-. 8
-1. 7
+ 2.8
194 5
194 6
1947....
194 8
194 9
150. 4
159. 2
169. 0
187. 6
188.2
121. 7
146. 6
165. 0
177.6
180. 6
+ 28. 7
+ 12. 6
+ 4. 0
+ 10. 0
+7.6
15.
14.
20.
27.
28.
6
0
0
4
7
9.0
31. 7
38. 6
43. 1
33. 1
+ 6. 6
-17. 7
-18.7
-15.7
-4.4
43. 1
35. 1
41.9
44. 4
40. 4
82.9
30. 9
28. 6
36. 6
43. 6
-39. 7
+4.2
+ 13.3
+ 7.9
-3. 2
+ 4. 5
+.9
+ 1.4
-2. 1
+. 1
1950
1951....
195 2
195 3
195 4
206.
226.
236.
250.
254.
194. 0
208. 3
218.3
230. 6
236. 5
+
+
+
+
+
28.
31.
33.
34.
36.
6
9
6
4
8
49. 0
57. 1
49. 4
49. 4
47.0
-20.
— 25.
-15.
-15.
-10.
50.
69.
74.
78.
69.
42. 0
62. 8
77.5
84. 5
77. 0
+ 8. 1
+ 6.2
-3. 3
-6. 0
-7.2
+.2
+ 1.3
+.7
+ 1.3
-.8
|
1
1
7
4
8
12. 1
17. 7
18. 4
19. 8
18.3
4
2
8
1
2
1
0
1
5
7
2
2
1
0
8
1 Gross private domestic investment plus net foreign investment.
a Excess of the value of the estimated gross national product computed by the final products method over its independently estimated value computed by adding
necessary conceptual adjustments to the national income. Discrepancy shown may differ from that derived from income and expenditure items shown in this table
because of rounding.
Source: Department of Commerce.
68166—55
2
3
GROSS NATIONAL PRODUCT OR EXPENDITURE
Description of series.—Gross National Product
(often called GNP) represents the total national output of goods and services at current market prices.
It measures this output in terms of the expenditures
by which these goods are acquired. These expenditures are the sum of four major items: (1) personal
consumption expenditures, (2) gross private domestic investment, (3) net foreign investment, and
(4) Government purchases of goods and services.
The goods and services included in the GNP are for
the most part those actually bought for final use in
legal markets. There are a number of exceptions,
the most important of which is the rental value of
owner-occupied dwellings.
The GNP series measures the product attributable
to the factors of production—labor and property—•
supplied by residents of continental United States.
For the most part these factors are located in this
country, but the GNP total also includes earnings
of American employees of the United States Government stationed abroad, foreign interest and dividends received by Americans, and the profits from
foreign branches of American business.
"Personal consumption expenditures" measures
the sum of money and imputed expenditures made
by consumers (individuals, nonprofit institutions
such as hospitals, etc.) for goods and services. This
series is described below, in the section on Disposition
of Personal Income.
"Gross private domestic investment" consists of
new construction, producers' durable equipment, and
changes in business inventories. This component
of GNP is described below, in a separate section
(p. 16).
"Net foreign investment" measures the net change
in the international assets and liabilities of this
country (including our gold stocks) arising out of
current transactions with foreign countries. It is
the sum of (1) domestic output sold abroad minus
United States purchases of foreign output, (2) cash
gifts and contributions received from abroad minus
those sent abroad, and (3) production abroad by
United States labor and property minus production
in the United States by foreign-owned labor and
property.
"Government purchases of goods and services"
are those made by Federal, State, and local governments. They include (1) net purchases of new
goods (such as school buildings and armaments),
(2) payments for services (principally compensation
for Government employees), (3) gross investment
by Government enterprises, and (4) net Government
4
purchases from abroad and international contributions. Items which do not represent current productive activity—such as transfer payments (e. g.,
social security and veterans' payments), Government interest, subsidies, loans, and other financial
transfers—are excluded. The GNP series on Government purchases differs from expenditures shown
in the Federal Budget, which include many but not
all of these items. Differences may also arise because
of variation in the time at which expenditures occur
and are recorded.
Statistical procedures.—Hundreds of basic economic
series are evaluated, adjusted, and combined, in the
process of preparing the GNP estimates. For example, consumer expenditures are estimated for
benchmark years primarily from data in the Censuses
of Business and Manufactures, reports of the Department of Agriculture, Internal Revenue Service,
and Interstate Commerce Commission, with current
quarterly estimates carried forward by the extensive
sample reports of the Census Bureau's Monthly
Report on Retail Trade, and data from other sources.
Construction activity is estimated jointly by the
Departments of Commerce and Labor, as described
below in the section on New Construction (p. 39).
Investment in producers' durable equipment is
estimated for benchmark years from Census of
Manufactures and related data, with current quarterly and annual totals estimated from sample surveys of the Department of Commerce and financial
reports to other agencies. For details of the methods
used, reference should be made to the comprehensive
study by the Department of Commerce, the 1954
National Income Supplement to the Survey of Current Business.
Relation to other series.—Two other series widely
used as indicators of the general level of economic
activity are national income and the Federal Reserve
index of industrial production. Gross national product and national income are compiled from the same
series of accounts, but whereas the former measures
the market value of total output, the latter measures
only the earnings of labor and property (net of depreciation) which flow from that output. National
income is smaller than the gross national product
chiefly because the latter includes (1) allowance for
depreciation and similar capital consumption, and (2)
indirect taxes (such as sales and excise taxes).
The GNP measures total output, whereas the
Federal Reserve index of industrial production
covers only two sections of the economy—manufactures and mining. The products in the GNP
Gross National Product or Expenditure
[Billions of dollars]
Government purchases of goods and services
Year
Personal
Total gross consumption
national
expendiproduct
tures
Gross
private
domestic
investment
Net foreign
investment
Federal
Total i
Total i
National
security 3
Other
State and
local
8.5
1.3
(3)
(3)
7.2
- 7
.2
2
2
.4
9.2
9. 2
8. 1
8.0
9.8
1.4
1.5
1. 5
2.0
3.0
(33)
6.3
8.4
11.7
6.7
9.3
1
-. 1
. 1
1. 1
,9
10. 0
11.8
11.7
12. 8
13.3
2.9
4.8
4.6
5.3
5. 2
71. 9
81. 9
89.7
100. 5
109.8
13.2
18. 1
9.9
5.6
7. 1
1.5
1. 1
2
-2. 2
-2. 1
14. 1
24.8
59. 7
88. 6
96. 5
6.2
16. 9
52.0
81.2
89. 0
2.2
13. 8
49.6
80.4
88.6
213. 6
209. 2
232. 2
257.3
257.3
121.
146.
165.
177.
ISO.
7
6
0
6
6
10. 4
27. 1
29.7
41. 2
32. 5
-1.4
4.6
8. 9
2.0
5
82.9
30.9
28.6
36.6
43. 6
74.8
20.9
15.8
21.0
25. 4
75.9
21. 2
13.3
16.0
19.3
1. 0
2.5
3.8
5.6
6. 6
8.
10.
12.
15.
18.
285. 1
328.2
345.2
364. 5
360. 5
194. 0
208. 3
218. 3
230. 6
236.5
51. 2
56.9
49. 6
51.4
47.2
-2. 2
2
2
-2. 0
3
42.0
62. 8
77.5
84. 5
77. 0
22. 1
41.0
54.3
59.5
49.2
18.5
37.3
48.8
51.4
43. 2
3.9
4.2
5. 8
8.5
6.3
19. 9
21.8
23.2
25. 0
27.8
1929
104.4
79. 0
16.2
1930
1931
1932
1933
1934
91. 1
76.3
58.5
56.0
65. 0
71. 0
61. 3
49.3
46.4
51. 9
10.3
5. 5
. 9
1.4
2.9
1935
1936
1937
1938
1939
72.5
82. 7
90. 8
85. 2
91. 1
56.3
62. 6
67.3
64.6
67.6
1940
1941
1942_—
1943
1944
100. 6
125. 8
159. 1
192. 5
211.4
1945
1946
1947
1948
1949
1950
1951
1952
19531954
0.8
(*)
3
v3)
(33)
()
()
(33)
(3)
()
7.8
7.7
6.6
6.0
6.8
(3)
(33)
()
(3)
(3)
(33)
(3)
()
3.9
7.1
7.0
7. 2
7.5
8.2
4.0
3.2
2.7
1. 5
1. 6
7.9
7.8
7.7
7.4
7.5
()
1.3
1
0
8
6
2
* Less Government sales.
1 Includes expenditures for military services, international security and foreign relations (except foreign loans), development and control of atomic energy, promotion of the merchant marine, promotion of defense production and economic stabilization, and civil defense. For further details, see Economic Report of the President,
January 1955 (p. 137), and National Income, 1954 Edition (p. 148). These expenditures are not comparable with the "national security" category in The Budget of the
U. S. Government for the Fiscal Year Ending June SO, 1956, and shown in Economic Indicators under Federal budget receipts and expenditures (see below, p. 67).
« N o t available.
NOTE.—Quarterly data available beginning 1939; annual from 1929.
Detail will not necessarily add to totals because of rounding.
Source: Department of Commerce.
series are final product, whereas the Federal Reserve physical volume of output are combined, and moveindex includes both final and intermediate product, ments in the total from quarter to quarter should not
and thus may show an increase or decrease in activity be interpreted as necessarily representing changes in
to be reflected later or not at all in the flow of final the physical quantity of goods and services produced
output. The GNP series in current prices combines by the economy. On an annual basis, however,
price and volume changes, whereas the Federal GNP estimates corrected for price changes ("deflated
Reserve index measures physical volume.
GNP") are available which show changes in the total
Uses and limitations.—The GNP total is the most volume of national output. One of the most iminclusive monetary measure of trends in the economy portant characteristics of the GNP isf that changes
as a whole which is currently estimated. It also in the total can be analyzed by examination of
has high value as an analytic tool, since the move- changes in its components, notably purchases by
ments of many sectors of the economy, including the consumers, the investment of private business, the
sales of many industries and enterprises, are quite expenditures of Government, and the movement of
closely related to changes in the level of GNP.
foreign trade.
Since GNP is measured in current dollars, the
References.—See below, under National Income.
effects of changes in both the price level and the
5
NATIONAL INCOME
Description of series.—National Income is the
aggregate of earnings by labor and property from
the current production of goods and services by the
Nation's economy. It is the sum of five major
items: (1) Compensation of employees, (2) proprietors' income, (3) rental income of persons, (4) net
interest, and (5) corporate profits.
"Compensation of employees" is the sum of wages,
salaries, and certain supplements, such as employer
contributions for social insurance.
"Proprietors' income" measures the monetary
earnings and income in kind of sole proprietorships
(including doctors, lawyers, and other self-employed),
partnerships and producers' cooperatives, exclusive
of capital gains or losses. The farm proprietors' income shown here is conceptually the same as farm
operators' net income including adjustment for
inventory change, as shown below in the section on
Farm Income. Some variations between the two
series result from differences in the timing of revisions. The supplementary income which individuals obtain from renting property does not
appear here, but under rental income of persons.
"Rental income of persons" consists of (1) net
money income from rental of real property, (2) estimated net rental value to homeowners of their
homes, and (3) royalties received from patents,
copyrights, and rights to natural resources.
"Net interest" measures both the money interest
and the imputed interest accruing to the Nation's
residents from private business and from abroad,
minus Government interest disbursements to business which appear as part of business incomes.
Imputed interest consists of the value of financial
services received by persons without explicit payment and property income withheld by life-insurance
companies and mutual financial intermediaries on
account of persons.
"Corporate profits" are the earnings of corporations organized for profit, measured before Federal
and State profit taxes, but without deduction of
depletion charges and exclusive of capital gains and
losses. (For a more extended discussion, see section
on Corporate Profits below, p. 14.)
"Corporate inventory valuation adjustment"
measures the excess of the value of change in the
volume of corporate inventories (in terms of average
prices during the period) over the change in terms of
book values. This adjustment is required since, as is
customary in business accounting, corporate profits
are reported inclusive of inventory profits or loss,
whereas only the value of the real change in inven6
tories is counted as current output in the national
product.
Statistical procedures.—The methods of estimation
employed in the very complex area of national
income are described in detail in the 1954 National
Income Supplement to the Survey of Current Business. The following indicate briefly the types of
estimating procedures used:
"Compensation of employees"—reliable data are
available each year from the social-security system,
with current monthly estimates resting chiefly on
employer reports to the Bureau of Labor Statistics
on employment and earnings.
"Proprietors' income"—estimated from income-tax
returns to the Internal Revenue Service, usually
obtained every second year, with current quarterly
data derived from analysis of trends in sales and
corporate profits in individual industries.
"Rental income of persons"—estimated from a
variety of Census Bureau, Internal Revenue Service,
Department of Agriculture, and BLS data on rents
paid and on the distribution of property ownership
and rental income between persons and business.
"Net interest"—estimated from reports to the
Internal Revenue Service, Bureau of the Census,
Board of Governors of the Federal Reserve System,
and other agencies on interest and debt.
Relation to other series.—The relation of national
income to gross national product is discussed above
(p. 4); and the relation to personal income is defined
below (p. 9).
Uses and limitations.—The national income measures earnings from current output and is a useful
measure of the rate of flow of such earnings. By
definition it excludes income from the revaluation
of past output—e. g., capital gains and losses. The
movements of this series correspond with movements
in production. However, the value of the national
income series lies more in the composition than in
the total. It may mean little to know that national
income (unadjusted for price changes) has gone up;
but it may be very important to know the relative
contribution of wages and profits to that increase.
The chief cautions for use result partly from the
definitions used, and partly from the nature of the
basic data. With respect to the first, care must be
taken not to interpret movements in the series as
measuring something other than they are intended
to measure- For example, variations in wages and
profits do not necessarily indicate changes in the
welfare of workers or in the ability of corporations to
provide new capital. For such purposes, these
National Income
[Billions of dollars]
Total
national
income
Year
Compensation
of employees 1
Proprietors' income
Farm
Business
and professional
Rental
income
of
persons
Net
interest
Corporate profits and inventory valuation adjustment
Total
Profits Inventory
before
valuation
taxes adjustment
1929
87. 8
51. 1
6.0
8.8
5. 4
6.4
10. 1
9.6
0.5
1930
1931
1932
1933
1934
75.7
59. 7
42. 5
40. 2
49. 0
46. 8
39. 7
31. 1
29. 5
34.3
4. 1
3.2
1. 9
2.4
2.4
7. 4
5. 6
3.4
3. 2
4. 6
4.8
3. 8
2.7
2. 0
1. 7
6.0
5.8
5.4
5. 0
4. 9
6. 6
1. 6
-2.0
-2. 0
1. 1
3.3
-. 8
-3. 0
. 2
1. 7
3.3
2.4
1. 0
-2. 1
6
1935
1936
1937
1938
1939
57.
64.
73.
67.
72.
1
9
6
6
8
37.3
42. 9
47. 9
45.0
48. 1
5.0
4. 0
5. 6
4.3
4.3
5.4
6. 5
7. 1
6.8
7.3
1. 7
1.8
2. 1
2. 6
2.7
4.
4.
4.
4.
4.
8
7
7
6
6
2.9
5.0
6.2
4.3
5.7
3. 1
5. 7
6.2
3.3
6.4
1940
1941
1942
1943
1944
81.6
104. 7
137.7
170.3
182.6
52. 1
64.8
85.3
109. 6
121.3
4. 6
6.5
10. 0
11.4
11.5
8.4
10. 9
13. 9
16. 8
18. 0
2. 9
3. 5
4. 5
5. 1
5.4
4.
4.
4.
3.
3.
5
5
3
7
3
9. 1
14.5
19.7
23.8
23.0
9.3
17.0
20.9
24.6
23.3
-.2
-2.5
-1. 2
-.8
-.3
1945
1946
1947
1948
1949
181.
179.
197.
221.
216.
2
6
2
6
2
123. 2
117. 7
128. 8
140. 9
140.9
11. 8
13.9
14. 5
16. 7
12. 7
19. 0
21. 3
19. 9
21. 6
21.4
5. 6
6.2
6.5
7. 2
7.9
3. 2
3. 1
3.8
4. 5
5. 2
18.4
17. 3
23. 6
30.6
28. 1
19.0
22.6
29.5
32. 8
26.2
-.6
-5.3
-5.9
-2.2
1.9
240. 0
277. 0
289.5
303. 6
299. 7
154. 3
180.4
195.3
209. 2
207. 9
13.3
16.0
14. 3
12. 3
12. 0
22. 9
24. 8
25. 7
25. 9
25.9
8.5
9. 1
9. 9
10. 3
10. 5
5.9
6.8
7.4
8.8
9.5
35. 1
39.9
36.9
37.2
33.8
40.0
41.2
35.9
38.3
34.0
-4.9
-1.3
1.0
-1.1
-.2
1
1950
1951
1952
1953
1954
i Includes employer contributions for social Insurance.
' Less than $50 million.
2
-.2
-.7
()
1.0
7
(See also table on Sources of Personal Income, p,
r data available beginning 1939; annual from 1929.
1 not necessarily add to totals because of rounding.
Source: Department of Commerce
variations must be considered in the light of other
factors such as the cost of living and the cost of newplant and equipment. With respect to the second—
which is particularly applicable to the current data
on proprietors' income, rental income of persons,
and the corporate inventory valuation adjustment—
it should be recognized that many of the available
data permit only fair approximations of the phenomena being measured, and therefore too great
reliance should not be placed on these statistics as
instruments of precise measurement.
References.—The official quarterly estimates for the
series included in the national income and product
accounts are published by the Office of Business
Economics, Department of Commerce, in the Survey
of Current Business: First quarter in the May issue,
second quarter in August, third quarter in November, and fourth quarter in the following February.
Preliminary quarterly estimates by the Council of
Economic Advisers appear in Economic Indicators
in the month following the end of each quarter.
Preliminary annual estimates are published by the
Office of Business Economics in the February issue
of the Survey, revised estimates in the July issue.
Complete statistics for 1929-53 and a detailed
explanation of fundamental concepts and underlying
procedures are given in the 1954 National Income
Supplement to the Survey of Current Business.
Data for 1952-54, including revisions for 1952 and
1953, are presented in the July 1955 issue of the
Survey, with an explanation of the revisions.
7
Sources of Personal Income
[Billions of dollars]
Year
Total
personal
income
Labor income Proprietors' income
(wage and
salary disbursements
Business
and other
and proFarm
labor income)1
fessional
85.8
1929
51.0
6.0
8.8
Rental
income
of
persons
Dividends
Personal
interest
income
Transfer payments
Less: Personal contributions
for social
insurance
Nonagricultural
personal
income 2
5.4
5.8
7.4
1. 5
0. 1
77.7
1. 5
2.7
2. 2
2. 1
2. 2
. 1
. 2
.2
. 2
. 2
70. 8
60.9
46. 9
43. 6
49.8
1930
1931
1932..
1933
1934
76.
65.
50.
47.
53.
9
7
1
2
6
46.7
39. 6
30. 9
29.4
34. 1
4. 1
3. 2
1. 9
2. 4
2.4
7.4
5. 6
3.4
3. 2
4.6
4. 8
3.8
2.7
2. 0
1.7
5.
4.
2.
2.
2.
5
1
6
1
6
6.9
6.9
6.6
6.2
6. 1
1935
1936
1937.
1938
1939
60.
68.
73.
68.
72.
2
5
9
6
9
37.2
42. 5
46.7
43. 6
46. 6
5.0
4. 0
5. 6
4. 3
4. 3
5.4
6. 5
7. 1
6.8
7. 3
1.7
1.8
2. 1
2. 6
2.7
2.9
4. 5
4.7
3.2
3.8
5.9
5.8
5. 9
5.8
5.8
2. 4
3. 5
2.4
2.8
3.0
. 2
.2
. 6
. 6
. 6
53. 9
63.2
67.0
62.8
67. 1
1940
1941
1942
1943.
1944
78.7
96. 3
123. 5
151.4
165. 7
50.5
62. 8
83. 0
106.7
118. 5
4. 6
6. 5
10. 0
11.4
11. 5
8.4
10.9
13. 9
16. 8
18. 0
2. 9
3. 5
4. 5
5. 1
5.4
4.0
4.5
4.3
4. 5
4.7
5.8
5.8
5.8
5. 8
6.2
3. 1
3. 1
3. 1
3.0
3. 6
.7
.8
1. 2
1.8
2. 2
72.6
88.0
111. 5
137. 6
151. 6
1945
1946,
1947
1948
1949
171.
178.
190.
208.
206.
2
0
5
7
8
119. 4
113.8
125. 2
137. 9
137.4
11.
13.
14.
16.
12.
8
9
5
7
7
19.
21.
19.
21.
21.
0
3
9
6
4
5.6
6. 2
6. 5
7.2
7.9
4.7
5. 8
6. 5
7.2
7. 5
6. 9
7.6
8.2
9.0
9.8
6. 2
11. 4
11.8
11. 3
12.4
2. 3
2.0
2. 1
2. 2
2. 2
156.8
161. 1
172. 8
188. 5
190.8
1950
1951
1952
1953__
1954
227.
255.
271.
286.
287.
1
3
1
2
6
150.
175.
190.
204.
202.
13. 3
16. 0
14.3
12. 3
12. 0
22.
24.
25.
25.
25.
9
8
7
9
9
2. 9
3.4
3. 8
3.9
4.5
210.
235.
253.
270.
271.
3
6
5
6
8
8.
9.
9.
10.
10.
5
1
9
3
5
9.
9.
9.
9.
10.
2
1
0
3
0
10. 6
11.6
12. 3
13. 8
14. 7
3 15.
12.
13.
14.
16.
1
6
2
0
2
5
7
1
2
9
i Compensation of employees (see national income table, p. 7) excluding employer contributions for social insurance.
4 Personal income exclusive of net income of unincorporated farm enterprises, farm wages, agricultural net interest, and net dividends paid by agricultural
corporations.
* Includes $2.7 billion National Service Life Insurance dividend, most of which was paid in the first half of the year.
NOTE—Quarterly data available beginning 1939; annual from 1929.
Detail will not necessarily add to totals because of rounding.
Source: Department of Commerce.
SOURCES OF PERSONAL INCOME and PER CAPITA DISPOSABLE INCOME
"Proprietors' income" and "Kental income of
{Because of their close relationship, these
persons" are defined above, in the section on Natwo series are discussed together.)
Description of series.-—"Personal income" is com-tional Income.
posed of income received currently by individuals,
"Dividends" are cash dividend disbursements by
by unincorporated businesses, and by nonprofit corporations organized for profit to stockholders who
institutions (including pension, trust, and welfare are United States persons.
funds). This income is here divided into labor
"Personal interest income" is the "Net interest"
income, proprietors' income, rental income of per- component of National Income plus net interest paid
sons, dividends, personal interest, and transfer pay- by the Government.
ments. Capital gains and losses are excluded.
"Transfer payments" include payments not resultAlthough most of the income is in monetary form, ing from current production, such as social-security
there are important exceptions—chiefly estimated benefits, military pensions, corporate gifts to nonrental value to owner-occupants of their homes and profit institutions, direct relief, and consumer bad
value of food consumed on farms.
debts. They do not include Government interest.
"Labor income" is principally wages and salaries.
"Disposable personal income" is equal to personal
It excludes employer contributions for social income less taxes on individuals (including income
insurance.
and other taxes not deductible as business expense)
8
Per Capita Disposable Income
Total disposable personal
income (billions of dollars)1
Per capita disposable personal income (dollars)1
Year
1954
prices 2
Current
prices
Current
prices
1954
prices s
1929.
83. 1
130. 1
682
1, 067
1930.
1931.
1932.
1933.
1934.
74.4
63. 8
48. 7
45. 7
52.0
119. 6
112.8
95. 6
94.9
104.4
604
514
389
364
411
971
908
764
755
825
1935.
1936.
1937.
1938.
1939..
58.
66.
71.
65.
70.
3
2
0
7
4
114. 1
128. 1
132. 7
125. 1
136.3
458
517
551
505
538
1940_.
1941_.
1942..
1943-.
1944,.
76.
93.
117.
133.
146.
1
0
5^
5
8
145. 7
169.7
193. 6
207.0
224. 1
576
697
871
977
1, 060
1,
1,
1,
1,
1,
1945..
1946..
1947..
1948..
1949..
150.4
159. 2
169. 0
187. 6
188.2
224
219.
203.
209.
212.
4
3
1
6
1
1,
1,
1,
1,
1,
075
126
173
279
261
1, 604
1, 551
1,410
1, 429
1, 422
1950..
1951_,
1952..
1953_.
1954_.
206. 1
226. 1
236. 7
250. 4
254.8
230. 3
233.8
239.4
251. 1
254. 8
1,
1,
1,
1,
1,
359
465
508
568
569
1,
1,
1,
1,
1,
Population
(thousands)3
896
1, 000
1, 030
962
1, 041
103
272
435
515
618
518
515
525
573
569
1 Income less taxes.
3 Dollar estimates in current prices divided b y consumer price index on base 1954—100.
® Includes Armed Forces overseas. Annual data as of July 1.
NOTE.—Quarterly data available beginning 1939; annual from 1929.
Source: Department of Commerce.
and other general Government revenues received
from individuals as individuals.
"Disposable personal income in 1954 prices" is
the preceding series valued in 1954 prices by dividing
the series in current dollars by the Consumer Price
Index (with 1954=100). As a result, the income
difference, for example, between 1939 and 1954 is
far less in real terms than is indicated by comparing
the current dollar estimates of 70.4 billion and 254.8
billion, respectively. Prices were so much lower in
1939 that the income for that year should almost be
doubled for comparison with real income in 1954.
"Per capita disposable personal income" is obtained simply by dividing the disposable personal
income series by the total midyear population.
Relation to other series.—Personal income differs
from national income by including transfer payments
and Government interest and by excluding contributions for social insurance (by employee and employer), the corporate inventory valuation adjust-
ment and corporate profits tax liability and undistributed corporate profits.
Uses and limitations.—The estimates for personal
income and its components and for disposable income provide a measurement of trends in spending
power of individuals. The inclusion of substantial
nonmonetary items—imputed rent, interest, food,
fuel—should be noted for some purposes, but the
effect of including these items should not be overemphasized. They tend to make the income estimates generally more stable, but should have little
effect on the ability of the estimates to show when a
change is occurring and the direction of the shift.
Disposable personal income gives a more direct
measure of income available for spending, since it
approximates take-home income, than does personal
income. For measuring changes, in real terms, in
consumers' buying power, the estimates of disposable
income in constant prices are to be preferred.
References.—See above under National Income.
9
DISPOSITION OF PERSONAL INCOME
Description of series.—"Personal income" and data. For service items a great variety of sources
"Disposable personal income" are discussed in the and procedures are used.
Current estimates of consumption expenditures
preceding section.
"Personal consumption expenditures" is the sum rest chiefly on the month-to-month trends shown by
of money and imputed expenditures made by con- the Census Bureau's retail sales figures by kind of
sumers (individuals, nonprofit institutions such as store, Federal Reserve Board data for department
hospitals, etc.) for goods and services. The expendi- stores, State sales-tax reports, and other source data.
Relation to other series.—Estimates of personal
ture total covers total purchase cost to consumers,
consumption
expenditures will show much the same
including general sales taxes. The full cost of
trends
from
quarter
to quarter as the figures for
automobiles, refrigerators, furniture, and the like is
included in the period when sold—quarter or year— total retail sales. However, personal consumption
regardless of when payments are made or completed. expenditures also include a wide variety of services
The purchase of homes is not included as an expendi- and such items as food produced and consumed on
ture: instead the estimated rental value to the farms which are outside of retail trade. Conversely,
retail trade includes some commodity items, such as
homeowner is included if he occupies the home.
"Durable goods" are those items which generally building materials, gasoline and trucks, which are
last three years or longer in use. "Nondurable not part of personal consumption expenditures.
The estimate of personal net saving and the net
goods" are items with a shorter life. "Services"
claims
estimate of the Securities and Exchange Cominclude housing, telephone, electricity, shoe repair,
mission
differ in level and trend. The chief reason
gas and water, and also such items as the expense of
for
the
difference
is the inclusion in the personal savhandling life insurance, and banking services furing
series
(and
not
in the net claims estimates) of
nished without payment (such as free checks where
net
purchases
of
nonfarm
residences and net ina minimum balance is maintained).
creases in persons' equities in farms and other unin"Personal saving" is equal to disposable personal
corporated businesses. (For a detailed reconciliaincome less personal consumption expenditures. As
tion of the two series, see table 6, p. 12, of the July
such, it conceptually includes not merely cash and
1955 issue of the Survey of Current Business.)
bank deposits but changes in reserves of life insurance
Uses and limitations.—The estimates of personal
companies, increase in equity of farmers (e. g., land,
consumption expenditures represent a generally usemachinery), homeowners, etc.
ful, reliable measure of trends in consumer purchases.
Statistical procedures.—Most personal consumption
They may be used to study trends in the ratio of
expenditures for goods are estimated for benchmark
wages, or more generally of income, to expenditure,
years from the value of the output of specified items
and to review the division of the national output
as reported in the census of manufactures, less the
between consumer takings, business capital formaportion of this output bought by business and Gov- tion, and Government defense or other expenditures.
ernment or exported. To the consumer portion of
The estimates of personal saving are among the
manufactured products is added the value of non- least satisfactory of the significant series which apmanufactured consumer goods (for example, non- pear in the national income accounts. They are the
processed foods) to derive producers' output for residual from two larger estimates. The errors and
consumers. Successive adjustments are added for limitations present in the hundreds of series, detransportation, imports and exports, wholesale and veloped for other purposes, which must be used at
retail inventory changes, wholesale and retail mark- present in estimating the national income do not
ups, and sales taxes. Transportation charges are completely cancel out. To this extent these errors
computed from data on transportation compiled by are transmitted into the saving estimate. Quarterthe Interstate Commerce Commission and other to-quarter changes are, however, subject to revision
sources. Wholesale and retail markups are derived as better data become available.
from census of business and Internal Revenue Service
References.—See above, under National Income.
10
Disposition of Personal Income
Less:
Equals:
DisposPersonal
able
income Personal
taxes 1 personal
income
Year
Less: Personal consumption
expenditures
Equals:
NonDurable durable
goods
goods
Personal
saving
Total
Services
Billions of dollars
1929
85. 8
2. 6
83. 1
79. 0
9. 2
37. 7
32. 1
4. 2
5.0
1930
1931
1932
1933—i
1934
76.
65.
50.
47.
53.
9
7
1
2
6
2.
1.
1.
1.
1.
5
9
5
5
6
74. 4
63. 8
48.7
45.7
52.0
71.
61.
49.
46.
51.
0
3
3
4
9
7. 2
5. 5
3.6
3. 5
4.2
34.
28.
22.
22.
26.
0
9
8
3
7
29. 8
26. 9
22. 9
20. 7
21.0
3. 4
2. 5
—. 6
6
1
4.6
3. 9
-1. 3
-1.4
.2
1935
1936
1937
1938
1939
60.
68.
73.
68.
72.
2
5
9
6
9
1. 9
2. 3
2. 9
2.9
2.4
58. 3
66.2
71. 0
65. 7
70.4
56. 3
62. 6
67.3
64. 6
67. 6
5. 1
6. 3
6.9
5.7
6.7
29.
32.
35.
34.
35.
3
8
2
0
1
21. 9
23. 5
25. 1
25.0
25. 8
2.0
3. 6
3. 7
1. 1
2. 9
3. 5
5.4
5.3
1.6
4. 1
1940
1941
1942
1943
1944_
78.7
96. 3
123. 5
151. 4
165. 7
2. 6
3. 3
6.0
17. 8
18. 9
76. 1
93.0
117. 5
133. 5
146. 8
71. 9
81. 9
89. 7
100. 5
109.8
7.8
9.7
7.0
6. 6
6.8
37. 2
43. 2
51. 3
59. 3
65.4
26.9
29.0
31. 5
34. 7
37.7
4.
11.
27.
33.
36.
2
1
8
0
9
5. 5
11.9
23.6
24.7
25.2
171.
178.
190.
208.
206.
2
0
5
7
8
20.
18.
21.
21.
18.
150.4
159. 2
169.0
187.6
188. 2
121. 7
146. 6
165.0
177.6
180. 6
8.
15.
20.
22.
23.
73.2
84. 5
93. r
98.7
96.9
40.4
46.2
51. 3
56. 7
60. 1
28. 7
12. 6
4. 0
10.0
7.6
19. 1
7.9
2.4
5.3
4.0
227.
255.
271.
286.
287.
1
3
1
2
6
20. 9
29. 3
34.4
35. 8
32.8
206.
226.
236.
250.
254.
194.
208.
218.
230.
236.
28. 6
27. 1
26. 6
29.8
29. 3
65.0
70. 1
75.7
81.8
86.4
12. 1
17.7
18.4
19.8
18. 3
5.9
7.8
7.8
7.9
7.2
1945
1946
1947
1948
1949,
-
1950
1951
1952
1953
1954
9
8
5
1
7
1
1
7
4
8
0
3
3
6
5
1
9
6
2
6
100.4
111. 1
116. 0
118. 9
120. 9
* Includes also such Items as fines, penalties, and donations.
NOTE.—Quarterly data available beginning 1939; annual from 1929.
Detail will not necessarily add to totals because of rounding.
Source: Department of Commerce.
FARM INCOME
Description of series.—Farm operators' gross and have been deducted; and "Net income, including
net farm income and farm production expenses are adjustment for inventory change" takes into account
estimated annually and quarterly by the Agricul- changes in farmers' holdings of animals and crops.
tural Marketing Service of the Department of Agri- The "Net income per farm (including adjustment for
culture. "Realized gross farm income" of farm inventory change)" is calculated by dividing the
operators is the sum of (1) cash receipts from farm U. S. totals by the estimated number of farms.
Statistical procedures.—For the computation of
marketings, (2) the value of farm products consumed
directly in farm households, (3) gross rental value gross farm income, the estimates of cash receipts from
of farm dwellings, and (4) Government payments marketings are based upon information collected by
to farmers. "Farm production expenses," which the Department of Agriculture on the quantity sold
now account for nearly two-thirds of gross farm and average prices received by farmers for the various
income, are the aggregate of all current farm operat- farm commodities. The current estimates of crop
ing expenses and overhead costs to farm operators. marketings are based on estimated production, the
Farm operators' "Net income, excluding adjustment normal percentage of the crop sold, and the usual
for inventory change" is the remainder of realized seasonal movement to market, supplemented by
gross farm income after farm production expenses available current data on market receipts. For most
6S16G—55
3
11
of the important livestock items, current reports on operators, adjustment for inventory change, and
production or market receipts are available and are wages paid to farm workers who live on farms.
used to estimate current livestock marketings. The This series, plus farm wages, interest, and rents paid
estimates of cash receipts from marketings are later to persons not living on farms, comprises the estirevised as more complete data on production, crop- mates of "Net income from agriculture."
Uses and limitations.—The estimates of farm
year sales and monthly marketings become available.
The value of farm products consumed directly in operators' realized gross farm income are for the
farm households is estimated on the basis of informa- most part based on a comprehensive body of basic
tion obtained from farmers on the volume of home data and are considered to be reasonably accurate.
consumption, valued at prices received by farmers The estimates of farm production expenses, however,
for the sale of similar products. The gross rental are based in part on outdated expenditure patterns
value of farm dwellings is designed to represent the and may be subject to a fair-sized margin of error.
amount which would have to be paid if the dwellings Any errors in the expense estimates are fully reflected
were rented separately from the farm. Government in the estimates of net income of farm operators. A
payments to farmers comprise all payments made comprehensive survey of farmers' expenditures will
directly to farmers by the Federal Government in be made early in 1956, and the results of this survey
which a sale or title transfer is not involved—at the will be used to improve present estimates of farm
present time, only conservation, wool and Sugar Act production expenses and hence of farm operators'
payments. Net Commodity Credit Corporation net income.
Information on total farm income and on net
loans and purchase-agreement deliveries are included
income per farm is useful as a general indicator of
in cash receipts from marketings.
The estimates of the farm production expenses of the economic well-being of a broad sector of the
farm operators are based on about 40 separate series. economy. Its usefulness is limited, however, beSome of the operating expense series are based on cause of the wide variation in type-of-farming operadata obtained in the censuses of agriculture, with tions and in size of farms: some segments of the
interpolations for intercensal years; others are based farm economy may prosper at the same time that
on special surveys and trade information. Deprecia- other segments are seriously distressed. In order
tion charges on buildings, motor vehicles, and other to supply more detailed data on how the different
farm machinery and equipment are estimated segments of the farm economy are affected by
annually as the amount which farmers would have changing prices of farm products and of farm prohad to pay if they had replaced, at prices prevailing duction items, the Production Economics Research
during the year, the amount of plant and equipment Branch of the Agricultural Research Service has
used up during the year. Estimates are also made developed data on farm costs and returns for about
for taxes on farm property, interest on outstanding 20 of the more important typoof-farming areas,
indebtedness, and net property-insurance premiums. and several more are being developed.
Annual estimates are made of the number of farms,
References.—The basic release of the farm income
based upon census of agriculture data adjusted for data is the Farm Income Situation, published biincompleteness. (A postenumeration survey made monthly by the Agricultural Marketing Service.
by the Bureau of the Census following the 1950 The annual series are also published, with other
Census of Agriculture found that the underenumera- principal series relating to agriculture, in the Departtion of farms amounted to 5.1 percent, and of crop- ment of Agriculture's annual Agricultural Statistics.
land in farms to 2 percent.) National estimates for The methods used to estimate farm operators'
intercensal years are the sum of separate State income are described in detail in Agricultural Estiestimates. They are based on data which vary from mating and Reporting Services (Department of
State to State.
Agriculture Miscellaneous Publication No. 703),
Relation to other series.—The series on net income December 1949. The methods used for the quarof farm proprietors including adjustment for inven- terly estimates of farm operators' income in terms
tory change is conceptually the same as farm pro- of seasonally adjusted annual rates are described
prietors' income in the national income series (see in the July 1954 issue of Agricultural Economic
above, p. 6), although some variations exist because Research, published by the Agricultural Marketing
Service. The individual studies of commercial
of differences in the timing of revisions.
The Department of Agriculture also publishes family-operated farms by type and location are
estimates of "Net income of persons on farms from published annually by the Agricultural Research
farming," which include net farm income of farm Service in Farm Costs and Returns.
12
Farm Income
Farm operators' income
Net irtcome 3
Year
Realized
gross farm
income 1
Farm production
expenses
Including
Excluding
adjustment
adjustment
for invenfor inventory change1 tory change4
Net income per farm (ineluding adljustment for
inventory change)
Current
prices
Billions of dollars
3.5
3. 6
3.8
4. 0
4. 0
3.
3.
3.
3.
3.
9
6
8
9
7
4.2
3.3
4. 4
3.7
4. 1
649
520
686
572
637
8. 1
9.6
13. 3
16. 4
17. 8
4. 2
4. 8
6. 1
7. 5
8.3
3.
4.
7.
8.
9.
9
8
2
9
5
4. 2
4. 5
8.2
8. 8
9. 0
1920
1921
1922_
1923
1924
15. 9
10. 5
11.0
12. 1
12. 7
8. 8
6. 6
6. 6
7. 0
7.4
7.
3.
4.
5.
5.
1
9
4
1
3
1925
1926
1927
1928
1929
13. 7
13. 3
13.3
13. 6
13. 9
7. 3
7.4
7.4
7. 7
7. 6
6.
5.
5.
5.
6.
1930
1931
1932
1933
1934
11. 4
8.4
6. 4
7. 1
8. 5
6.
5.
4.
4.
4.
9
5
4
3
7
1935
1936
1937
1938
1939
9. 7
10. 7
11.3
10. 1
10. 6
5. 1
5. 6
6. 1
5.8
6. 2
1940
1941
1942
1943
1944
11. 0
13. 8
18. 8
23.4
24.4
6.
7.
9.
11.
12.
1945
1946
1947
1948
1949
1950
1951
1952
19531954
1915
1916
1917
1918
1919
...
:
1954
prices 6
Dollars
7. 5
7.2
7.7
7. 9
7.7
1910
1911
1912
1913
1914
Number of
farms
(thousands)
1, 803
1, 444
1,854
1, 589
1, 722
6, 406
6, 425
6, 430
6, 437
6,447
653
691
1, 266
1, 354
1, 381
1,
1,
2,
2,
1,
674
536
344
083
794
6,
6,
6,
6,
6,
458
463
478
488
506
7.8
3.3
4. 3
5. 0
4. 8
1, 190
510
661
774
743
1, 469
864
1, 160
1, 334
1, 281
6,
6,
6,
6,
6,
518
511
500
492
480
3
9
9
8
3
6. 7
5. 9
5.7
6. 0
6. 1
1, 035
914
879
922
943
1,
1,
1,
1,
1,
754
549
516
590
626
6,
6,
6,
6,
6,
471
462
458
470
512
4.
2.
1.
2.
3.
5
9
9
8
9
4. 3
3.3
2. 0
2. 6
2. 9
650
506
305
382
434
1, 182
1, 076
782
979
964
6,
6,
6,
6,
6,
546
608
687
741
776
4.
5.
5.
4.
4.
6
1
2
3
4
5. 3
4. 3
6.0
4.4
4. 5
778
643
911
675
697
1,
1,
1,
1,
1,
729
429
938
500
584
6,
6,
6,
6,
6,
814
739
636
527
441
7
7
9
5
2
4.
6.
8.
11.
12.
3
2
8
9
2
4. 6
6. 6
9.9
11.8
11.8
1,
1,
1,
1,
720
044
600
942
967
1,
2,
2,
3,
3,
636
175
857
132
026
6,
6,
6,
6,
6,
350
293
202
089
003
25.8
29. 3
34. 0
34. 6
31. 6
12. 9
14.3
16.8
18. 6
17. 9
12.
15.
17.
15.
13.
9
0
2
9
7
12.4
14. 9
15. 5
17. 7
12. 9
2,
2,
2,
3,
2,
080
518
632
049
248
3, 059
3, 403
3, 060
3,314
2, 526
5,
5,
5,
5,
5,
967
927
873
804
723
32. 1
37. 1
36. 9
35.2
34. 0
19. 2
22.3
22. 9
21.8
22. 2
12.
14.
14.
13.
11.
9
8
1
4
8
13.
16.
14.
12.
12.
2,
2,
2,
2,
2,
428
919
778
445
413
2,
2,
2,
2,
2,
5,
5,
5,
5,
5,
648
520
360
240
100
7
1
9
8
3
698
978
806
470
413
* Includes cash receipts from farm marketings, value of farm products consumed directly in farm households, gross rental value of farm dwellings, and Government payments to farmers.
i Excludes (a) farm wages paid to workers living on farms and (6) any income to farm people from nonfarm sources. These items In 19M were as follows: (a) 2.0
billion dollars and (6) 5.7 billion dollars.
* Realized gross income less farm production expenses.
« Same as farm proprietors' income on pages 7 and 8, except that figures given here include revisions by the Department of Agriculture not yet incorporated into
the national income accounts of the Department of Commerce.
4 Dollar estimates in current prices divided by index of prices paid b y farmers for items used in family living, on base 1954=100.
NOTE.—Annual data available beginning 1910; quarterly from 1929.
Source: Department of Agriculture.
13
CORPORATE PROFITS
Description of series.—The corporate profits series until about 2 years after the close of the year to
of the Office of Business Economics, Department of which they refer, other bases for the estimates for
Commerce, contains profits estimates for past years the most recent 2 years and for quarters must be
and recent quarters for all United States corporations used. These estimates for current periods are made
organized for profit, estimates of the distribution of by extrapolating the benchmark estimates, i. e., the
those profits between dividends and retained earn- latest estimates based upon Internal Revenue tabuings, and estimates of corporate tax liability (Federal lations of corporation tax returns. The extrapolaand State corporate income and excess profits taxes). tors are based upon regular quarterly reports from
The national income concept of profits of OBE is manufacturing corporations to FTC and SEC and
used in this series. This concept of profits differs from public utility corporations to Federal regulatory
from the conventional accounting concept of profits agencies, upon nongovernmental surveys, and upon
(which is used in the Internal Revenue Service tabu- miscellaneous sources of varying reliability. When
lation of profits and in the financial report series of the Internal Revenue tabulations of tax returns for
the Federal Trade Commission and Securities and a given year become available, the estimates for
Exchange Commission) in that dividends received that year are revised to conform to the Internal
by corporations are deducted from profits (and Revenue tabulations.
dividends) to obtain unduplicated totals reflecting
The series on "Corporate tax liabilit}r"-is derived
income originating in United States corporations; by procedures generally similar to those described
profits are calculated inclusive of depletion, which is for corporate profits.
not considered an element of capital consumption in
Relation to other series.—The corporate profits
the national income and product accounts; capital series is designed primarily to measure the contrigains and losses are eliminated from profits because bution of corporate profits to the national income.
they do not measure gains or losses originating from It is, therefore, as consistent with the concepts and
current production; and adjustments for inter- other series which are a part of the national income
national flows affecting profits are made. The esti- accounts as the basic data permit, and can be used
mates are based largely on tabulations from income- in conjunction with the other national income series
tax returns and, for the 2 or 3 most recent years (e. g., net interest, proprietors' and rental income,
covered at any time, from reports to the SEC, compensation of employees, etc.) with confidence of
FTC, and other regulatory agencies. The cor- conceptual comparability.
porate profits series as initially published are revised
The corporate profits series is, as it must be, based
to reflect more comprehensive data when those upon reports from companies rather than establishdata become available.
ments. Thip results in some noncoinparability with
Statistical procedures.—The annual data publishedseries based upon reports from establishments.
in the corporate profits series are, except for the 2 or Furthermore, surveys based upon the establishment
3 most recent years, based upon tabulations by the unit of classification are not confined to establishInternal Revenue Service of unaudited corporate- ments of corporations but include establishments of
income-tax returns. The data in these tabulations other forms of organization as well. The corporate
are adjusted in various ways to make them com- profits series, or any other series based upon comparable, statistically and conceptually, with other pany reports, cannot safely be assumed to be directly
entries in the national income accounts. The im- comparable with these establishment series unless
portant accounting conceptual adjustments arc sug- the reports on the different bases have been recongested by the statement above of differences between ciled. These factors are more important when series
the conventional accounting concept of profits and for specific industries are being compared, however,
the national income concept. Another important than when the broad aggregates published in
adjustment of the tabulations is the audit adjust- Economic Indicators are compared.
ment which makes allowance for additional profits
The series on expenditures for new plant and
disclosed" by-auditing of the income-tax returns by equipment (p. 18) and-sales and inventories (p. 44)
Internal Revenue. Mutual insurance companies are are also based primarily upon company reports.
not considered part of the corporate universe for All three series are produced for recent periods by
national income purposes, and profits of these com- extrapolating benchmark estimates based upon
panies are removed from the tax-return tabulations. Internal Revenue Service tabulations of income-tax
Since the tax-return tabulations are not available returns. The plant and equipment expenditures
14
Corporate Profits
[Billions of dollars]
Year
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
-
:
Corporate profits after taxes
Corporate
profits
before taxes
Corporate
tax
liability
9. 6
1. 4
8.3
5.8
2. 4
3.3
-.8
-3.0
. 2
1.7
.8
.5
,4
.5
7
2. 5
-1. 3
-3.4
4
1.0
5.5
4. 1
2. 6
2. 1
2. 6
-3. 0
— 5. 4
-6. 0
-2. 4
-1. 6
3. 1
5. 7
6.2
3.3
6. 4
1. 0
1.4
1. 5
1. 0
1. 4
2.2
4.3
4. 7
2.3
5.0
2. 9
4.5
4.7
3.2
3.8
-. 7
-.2
Total
Dividend
payments
Undistributed
profits
C1)
9
1. 2
9.3
17. 0
20. 9
24. 6
23. 3
2.
7.
11.
14.
12.
8
6
4
1
9
6. 5
9. 4
9. 5
10. 5
10.4
4.0
4. 5
4. 3
4.5
4.7
2. 4
4. 9
5.2
6. 0
5.7
19.0
22. 6
29. 5
32. 8
26. 2
10.7
9. 1
11.3
12. 5
10. 4
8.3
13. 4
18. 2
20. 3
15. 8
4. 7
5.8
6. 5
7.2
7.5
3. 6
7.7
11. 7
13. 0
8.3
40.0
41. 2
35.9
38. 3
34. 0
17. 8
22. 5
19. 8
21. 3
17. 1
22. 1
18.7
16. 1
17. 0
17. 0
9.2
9. 1
9. 0
9.3
10. 0
12. 9
9.6
7. 1
7.7
7. 0
i Less than $50 million.
NOTE.—No allowance bas been made for inventory valuation adjustment. See National Income table (p. 7) for corporate profits and inventory valuation adjust
ment.
Quarterly data available beginning 1939; annual from 1929. Detail will not necessarily add to totals because of rounding.
Source: Department of Commerce.
and tlie sales and inventories series differ from the annual estimates for periods more than 2 years prior
corporate profits series in that they cover unincor- to the current year. There are two principal reasons for this: (a) Quarterly income statements, upon
porated as well as incorporated businesses.
Uses and limitations.—The corporate profits series which the quarterly series must be based, are inis an important economic indicator, reflecting the herently less reliable than annual income statements
state of health of a substantial part of the Nation's because they are affected by seasonal influences that
business community. Certain limitations of the are not completely accounted for in company reseries require that it be used with caution, however. ports; and (6) wide gaps in the financial data avail(1) As its title indicates, the series measures only able quarterly make the underlying basis of the
the profits of corporations. It does not, therefore, quarterly estimates weaker than that of the annual
estimates, even before the Internal Revenue tabulaportray fully the profit position of all business.
(2) The total corporate profits series is too gen- tions become available.
References.—See above, under National Income.
eral to provide any indication of the profit positions
of specific industries. In some situations knowledge A complete statement of the methods and the sources
of the profits experience of specific industries is vital of data used in preparing these estimates is presented
in pages 92-97 of the 1954 National Income Suppleto correct economic analysis.
(3) The quarterly corporate profits estimates are ment to the Survey of Current Business.
less reliable than the annual estimates, especially the
15
GROSS PRIVATE DOMESTIC INVESTMENT
Description of series.—Gross Private Domestic In- ment in greater detail than was possible in other
vestment is one of the major components of gross years. For the years since 1940, except 1947, the
national product. The series measures gross fixed paucity of data has prevented the detailed applicainvestment and net changes in business inventories. tion of the commodity-flow approach, but it has
Gross fixed investment (or gross fixed capital forma- been possible to develop "secondary" benchmark
tion) is defined as all newly produced durable goods estimates from data arising out of the 1942^6 and
(i. e., those with an average life exceeding 1 year) 1950-52 production control programs for some inacquired by their ultimate business users. New dustries, and, beginning with 1949, from data colresidental construction pin-chased by owner-occu- lected by the Bureau of the Census in its annual
pants is also included because homeownership is sample surveys of manufactures. Since 1952, estitreated as a business in the national accounts. The mates of purchases of producers' durable equipment
"Change in business inventories" series measures have been made by extrapolating the 1952 secondary
physical changes in business inventories valued at benchmarks on the basis of percent change estimates. The extrapolators are developed from the
average prices prevailing during the year.
Separate statistical series are published for "Fixed series on new plant and equipment expenditures
investment" (which in turn consists of separate (see next section) by adjusting that series primarily
series for "New construction" and "Producers' to exclude expenditures on new plant and include
durable equipment") and for "Change in business expenditures on new farm equipment, but also to
inventories." The "New construction" series used correct for other conceptual differences.
The primary source for estimates of changes in
in computing gross private domestic investment is
derived from the private construction component the nonfarm portion of business inventories is
of the new construction series described below (p. 39) reported accounting data on the book value of inventories at the beginning and end of the period for
by adding oil- and gas-well drilling.
A major revision of the "Producers' durable equip- which the estimates are made. Because inventory
ment" series was undertaken in conjunction with the calculation by individual business firms varies
preparation of the 1954 National Income Supplement widely in method, numerous adjustments in the
to the Survey of Current Business. The estimates reported data are necessary to arrive at an estimate
consistent with the basic concept. The principal
were revised for the entire period since 1929.
The quarterly estimates of producers' durable adjustment is that of removing the price-change
equipment and changes in business inventories are element in the reported figures and revaluing invenrevised annually to reflect more complete data than tory change in current dollars.
were available when the initial estimates were made.
Relation to other senes.—The relationship between
The revisions in the "Changes in business inven- the "Producers' durable equipment" series and the
tories" series have sometimes been quite sizable, and "Durable goods" series in Expenditures for New
have resulted primarily from revisions in the basic Plant and Equipment, to which it is most closely
book value inventory aggregates.
related, is discussed in the following section.
Statistical procedures.—The principal method of The "Change in business inventories" series is
estimation used for the "Producers durable equip- most closely related to the estimates of "Inventories,"
ment" series has been the commodity-flow technique. discussed in the section on Sales and Inventories
In brief, this technique consists of (1) estimating the (p. 44). A basic difference between these series is
purchases of durable equipment by business by segre- that the series on business inventory change, included
gating finished producers' durable goods from total here, is concerned with changes in inventories over a
manufacturing output to obtain an estimate of the period of time, whereas the inventories series premanufacturers' sales value of those goods, (2) trac- sented below is concerned with the level of inventories
ing the flow of those goods, (3) measuring their dis- at a given point in time. The series also differ
tributive costs and (4) adding the estimate of those conceptually in their measurement of inventories:
distributive costs to manufacturers' sales value to the inventories series is based upon data as reported
arrive at an estimate of the costs of those goods to by the reporting companies, whereas for the inventheir purchasers.
tory-change series OBE adjusts the reported data to
For the years 1929-39 and for 1947, data available reflect a uniform method of valuation.
from the manufactures and trade censuses made it
Uses and limitations.—The gross private domestic
possible to carry out the commodity-flow technique investment series measure an economic factor of
of estimating purchases of producers' durable equip- crucial importance in business conditions.
16
Gross Private Domestic Investment
[Billions of dollars]
Change in business inventories
Fixed investment
Year
Total
gross
private
domestic
investment
New construction
Total
Total
Residential
nonfarm
7
1. 4
5.8
+ 1.7
1. 2
,8
4. 5
—. 4
-1. 3
16. 2
14. 6
8.7
3. 6
3.
1930.
1931.
1932.
1933
1934.
10. 3
5. 5
. 9
1.4
2. 9
10. 6
6. 8
3. 5
3. 0
4.0
4. 0
1. 9
1.4
1. 7
6. 2
2. 1
3. 0
1935.
1936.
1937.
1938.
1939.
6. 3
8.4
11. 7
6. 7
9. 3
5. 4
7.4
9. 5
7. 6
8. 9
2. 3
3. 3
4.4
4.0
4. 8
1940.
1941.
1942.
1943.
1944
13. 2
1945
1946.
1947.
1948.
1949.
10.
27.
29.
41.
32.
4
1
7
2
5
30. 7
37. 0
35. 3
3. 8
10. 3
14. 0
17. 9
17.5
1950.
1951.
1952.
1953.
1954.
51.
56.
49.
51.
47.
2
9
6
4
2
43.
46.
46.
50.
50.
22. 7
23. 3
23.7
25. 8
27. 8
1
1
18. 1
9. 9
5. 6
7. 1
11.
13.
8.
6.
8.
0
6
1
4
2
11. 5
21. 0
9
5
8
2
1
5. 5
6. 6
3.7
2. 3
2. 7
.6
5
1. 6
.8
6
,6
7
1. 0
.7
1. 1
1. 6
1. 9
2.0
2.7
3. 0
3. 5
1. 7
9
.8
1. 1
4.0
6.3
8.6
8. 3
12.
11.
11.
11.
13.
6
0
1
9
5
Total
All
other 2
1929
1. 6
Producers'
durable
equipment
Commercial and
industrial1
1. 6
1. 1
1. 2
1. 6
1
1. 3
.8
1. 0
2.
1.7
4. 2
4. 9
5. 7
5. 3
7
7.2
7. 5
5.
8. 4
8. 6
5
4
4
,6
6
.9
8
.8
. 9
1. 0
.7
7
,9
1. 1
2.8
1. 6
1. 6
2. 3
3.
4.
5.
3.
4.
1
2
1
6
2
5. 5
6. 9
4.3
4. 0
5. 4
2. 8
3. 6
3.9
7. 7
10. 7
16. 7
19. 1
17.8
4. 5
5. 1
5.2
5.4
5. 7
21.
23.
23.
24.
22.
2. 1
1
2
1
4
3
-2.
6
-1. 6
-1. 1
+.9
+ 1.0
+ 2. 2
9
+.4
+ 2.2
+ 4.
5
+ 1.8
-.8
-1. 0
-1. 1
+ 6. 1
-1.0
+ 4. 2
-2. 7
+ 7. 4
+ 10.4
+ 2.8
+ 1.2
-2. 9
Includes public utility.
Includes petroleum and natural gas well drilling.
NOTE.—Quarterly data available beginning 1939; annual from 1929.
Detail will not necessarily add to totals because of rounding.
Source: Department of Commerce.
Limitations in the "Fixed investment" series can
be traced to limitations in the data on which they are
based, especially in the data available for current
quarters. The absence of reliable current data on
government purchases of producers' durable equipment constitutes a special problem when the commodity-flow method of estimation is used; and the
limitations of data on manufacturers' commodity
sales and on new plant and equipment expenditures
for use in estimating fixed investment carry forward
to some extent in the current estimates. Nevertheless, the discrepancies between initial quarterly
estimates and the revised estimates based on more
complete data have generally not been great.
The figures on "Change in business inventories,"
although rough estimates to a considerable degree,
are useful indicators of the physical-volume change
in inventories during the period under review. A
serious limitation in the series is inherent in the basic
method of calculation that must be used. The
estimates are calculated as the difference between
large and possibly- volatile inventory totals at two
points in time. Even small errors in the estimates
of total inventories can lead to large relative errors
in the estimates of inventory change. Because
comprehensive accounting data on inventories become available only after a lag of several years,
current estimates of inventory change are based
upon less satisfactory data than are the estimates
for past years.
References.—See above, under National Income.
For a full discussion of the concepts and statistical
methods, see particularly pages 43-45 and 122-138
in the 1954 National Income Supplement.
17
EXPENDITURES FOR NEW PLANT AND EQUIPMENT
Description oj series.—The series on expenditures ICC. The group of reporting companies account for
for new plant and equipment, published jointly by about three-fifths of aggregate investment in plant
the Securities and Exchange Commission and the and equipment, although the sample is not randomly
Office of Business Economics, Department of Com- selected. Coverage is quite small in a few areas,
merce, measures the expenditures by all private such as nonrail transportation and mining, and quite
businesses except agriculture, professions, and institu- high in railroads, public utilities, and some manufactions for plant and types of machinery and equip- turing industries.
The seasonal factors used for adjusting the actual
ment for which the reporting companies maintain
depreciation accounts. Expenditures charged off expenditures data for changes due to seasonal flucas expense during the period in which made are tuations are based on the "ratio to moving average"
excluded. Estimates are made for both actual technique. Adjustments are also made where necesplant and equipment expenditures for recent quarters sary in the estimates of plant and equipment
(and calendar years) and anticipated expenditures for expenditures to correct for biases due to changes
the two succeeding quarters (and calendar year). in the business population which are not reflected
These estimates are based upon information in the data reported by the relatively constant
contained in annual reports of all corporations sample of companies used.
Relation to other series.—The SEC-OBE series on
registered with SEC and quarterly reports from a
group of registered corporations who make approxi- actual plant and equipment expenditures by manmately 85 percent of the capital expenditures by ufacturers utilizes the same definitions of investment
registered corporations; and annual and quarterly as those of the 1947 Census of Manufactures and
reports by a group of manufacturing and retail trade the later annual surveys of manufactures of the
companies to OBE and by class I railroads to the Census Bureau. There is a substantial difference
between the Census Bureau data on expenditures
Interstate Commerce Commission.
The last major revision in the series was published for plant and equipment and the SEC-OBE manin two parts, the revision for manufacturing indus- ufacturing series, however, in that the SEC-OBE
tries in the December 1951 issue of the Survey of series obtains reports on companywide outlays
Current Business and the revision for nonmanu- whereas the Census Bureau obtains reports on outfacturing industries in the August 1952 issue. The lays of establishments. Thus, the Census Bureau's
revision established a benchmark based on gross annual series covers only establishments whose
capital assets as reported to the Internal Revenue primary activity is manufacturing, whereas the
Service for the 1948 tax year, and introduced SEC-OBE quarterly and annual series cover all
improvements in the estimating procedures being activities, manufacturing as well as nonmanuused. For example, information contained in the facturing, of companies whose primary activity
mandatory annual reports of corporations registered is manufacturing and excludes manufacturing acwith the SEC was used for the first time and adjust- tivities of companies whose primary activity is
ments were made for biases arising out of changes in nonmanufacturing.
the business population.
The SEC-OBE series covering all industries differs
Because of the method of estimating used (the somewhat in concept from the "Producers' durable
extrapolation of benchmark estimates on the basis equipment" and "New construction" components of
of less than complete current data), lesser revisions of gross private domestic investment (see p. 16).
in the estimates of actual expenditures for plant and The SEC-OBE series is confined to nonagricultural
equipment for any given quarter or year are made industries, and excludes expenditures of institutions
to take into account new data as they become and professional persons and outlays on plant and
available.
equipment charged off as expenses during the period
Statistical procedures.— The benchmark for the of the expenditure; it is based on a survey requesting
estimates is the gross capital assets of the full universe information on expenditures for capital goods for
of companies as derived from reports to the Internal which depreciation accounts are maintained. The
Revenue Service for the tax year 1948. The estima- current estimates of investment in producers' durable
tion of year-to-year and quarter-to-quarter move- equipment are for the most part derived indirect!}'
ments in these expenditures are made by extrapolating by extrapolating benchmarks on the basis of percentthe benchmark estimates on the basis of the annual change estimates developed from the equipmentand quarterly reports received by SEC, OBE, and expenditures portion of the SEC-OBE series; and
18
Expenditures for New Plant and Equipment
[Billions of dollars]
Manufacturing
Total »
Year
Durable
goods
Nondurable goods
1. 94
0. 76
1. 19
Total
1939
5. 51
1
Transportation
Mining
Railroads
Other
Public
utilities
Commercial and
other 2
0.33
0.28
0. 36
0. 52
2. 08
1945
1946
1947
1948
1949
8.
14.
20.
22.
19.
69
85
61
06
28
3.
6.
8.
9.
7.
98
79
70
13
15
1,
3.
3.
3.
2.
59
11
41
48
59
2.
3.
5.
5.
4.
39
68
30
65
56
38
43
. 69
.88
79
55
. 58
.89
1. 32
1. 35
57
.92
1. 30
1. 28
,89
. 50
.79
1. 54
2. 54
3. 12
2. 70
5.33
7.49
6. 90
5.98
1950
1951
1952
1953
1954
20.
25.
26.
28.
26.
60
64
49
32
83
7.
10.
11.
11.
11.
49
85
63
91
04
3.
5.
5.
5.
5.
14
17
61
65
09
4.
5.
6.
6.
5.
36
68
02
26
95
71
. 93
. 98
, 99
98
1.
1.
1.
1.
,
1.
1.
1.
1.
1.
3.
3.
3.
4.
4.
6.
7.
7.
8.
8.
1
1
11
47
40
31
85
21
49
50
56
51
31
66
89
55
22
78
24
09
00
23
Excludes agriculture.
Includes trade, service, finance, communications, and construction.
NOTE.—These figures do not agree with the totals included in the gross national product estimates of the Department of Commerce, principally because the latter
cover agricultural investment and also certain equipment and construction outlays charged to current expense.
Detail will not necessarily add to totals because of rounding.
Data on Expenditures for New Plant and Equipment are not available for the years prior to 1939 and for the years 1940-44.
Sources: Securities and Exchange Commission and Department of Commerce.
the estimates of new private construction are developed from both direct and indirect sources.
The SEC-OBE series on manufacturers' expenditures for new plant and equipment is directly comparable in classification and scope with the OBE
series on manufacturers' sales, new orders, and inventories (seep. 44). It has a different scope from the
Federal Trade Commission-Securities and Exchange
Commissionfinancialreports series in manufacturing,
mainly in that the FTC-SEC estimates of balancesheet and income-statement items cover only corporations and a different degree of consolidation is
involved.
Uses and limitations.—This series is one of the
very few economic series in which estimates of
anticipated events as well as historical events are
made. The series measures economic phenomena
of great importance in the analysis of business conditions. The predictive reliability of estimates of
anticipations is difficult to ascertain. An estimate
of anticipated expenditures for a period can be different from actual expenditures for the same period
either because the estimating procedures and statistical techniques employed are faulty or because the
anticipated expenditures were—for any number of
reasons—not made in fact. Except in a few periods
in the past when marked differences between esti-
6816C—55
4
mates of .anticipated expenditures and actual expenditures for the same period have occurred as a
result of unanticipated developments, such as the
outbreak of Korean hostilities, the anticipatory survey has generally proved a reliable indicator of the
overall trend of capital expenditures. The survey
has generally reflected the cyclical turning points in
the postwar period, although its predictive reliability
has yet to be tested during a major cycle.
There are two principal deficiencies in the statistical procedures employed in making the estimates of
expenditures for new plant and equipment. One of
these, mentioned above, is the inadequacy of the
sample coverage for some industries. Efforts are
being made, to the extent that available resources
permit, to strengthen the sample coverage in these
industries. The second deficiency is that for many of
the industries the benchmark data for several areas
are of limited reliability.
References.—These estimates are published quarterly in Department of Commerce and Securities and
Exchange Commission press releases and in the Survey of Current Business. For a fuller description of
the methods employed in making the estimates and
of the latest revisions in the series, see the December
1951 and August 1952 issues of the Survey of Current
Business.
19
EMPLOYMENT, UNEMPLOYMENT, AND WAGES
STATUS OF THE LABOR FORCE
The sum of the employed and the unemplo3Ted
constitutes the civilian labor force. All other civilDescription of series.—Each month, the Bureau of ians 14 years of age and over are classified as "not
the Census of the Department of Commerce pub- in the labor force" (housewives, students, retired or
lishes estimates of the labor force and of total em- disabled persons, those doing less than 15 hours of
ployment and unemployment. In addition to the unpaid family work, and the voluntarily idle).
overall figures, detail is presented on the characterThe sample survey was started in March 1940.
istics of employed and unemployed persons, such as Prior to that date there was no direct enumeration
age, sex, color, marital status, and veteran status. of the labor force. The estimates shown for 1939
Employed persons are further subdivided into those and earlier years were prepared by the Bureau of
employed in agriculture and in non agricultural Labor Statistics, using information such as the 1930
pursuits, by class-of-worker (wage and salary and 1940 Censuses of Population, and employment
workers, self-employed, etc.), by broad occupation trends from BLS and Department of Agriculture
groups, and by hours worked during the survey series for intervening years. The techniques used
week and reasons for part-time work. Duration of in preparing the estimates for the earlier years are
unemployment is shown for the unempk>3red.
described in "Labor Force, Employment, and UnThe estimates are obtained by means of a sample employment, 1929-39: Estimating Methods," which
survey of households, representing all persons in the appeared in the July 1948 issue of the Labor Departcontinental United States except those living in ment's Monthly Labor Review.
institutions (such as prisons or homes for the aged).
Since the survey was instituted in 1940, there have
On the basis of responses to the Census Bureau been a number of revisions in the series. In Nointerviewers, all persons 14 years and over in the vember 1943 an improved sample design was introsample households are classified as employed, duced and the estimates were revised back to 1940
unemployed, or not in the labor force for the calendar using the 1940 Census of Population figures as a
week ending nearest the 15th of the month. Prior benchmark for that date. Starting in July 1945, a
to July 1955, the reference week was the calendar modified set of questions was used which resulted in
week containing the 8th of the month; this change a more nearly complete count of employed persons;
was made to improve comparability with other the estimates were again revised back to 1940 to take
series.
account of the improvement in interviewing proceCounted as employed are all persons who, during dure. In January 1954 the sample was spread from
the survey week, were either (a) "At work"—those 68 sample areas to 230 sample areas (although retainwho did any work for pay or profit, or those who ing the overall size of 25,000 dwelling units and other
worked without pay for 15 hours or more on a family living quarters), in the interest of improving the
farm or business; or (b) "With a job but not at reliability of the estimates. The estimates for 1953,
work"—those who did not work and were not which were deficient in certain respects, were revised
looking for work but had a job or business from to achieve greater comparability with those from the
which they were temporarily absent because of new sample. Estimates prior to 1953 are not exvacation, illness, industrial dispute, bad weather, or actly comparable with those from the expanded samlayoff with definite instructions to return within 30 ple, although for most major items the series can be
days of layoff. Also included are persons who had regarded as reasonably consistent.
new jobs to which they were scheduled to report
Statistical procedures.—Starting with the expanded
within 30 days.
sample in 1954, a new method of preparing estimates
Included as unemployed are those persons who did
was introduced. This method involves the preparanot work at all during the survey week and who were
looking for work. Also included as unemployed are tion of two intermediate estimates for a given item
persons who would have been looking for work except each month: (1) an estimate obtained by applying
that (a) the}' were temporarily ill, (6) they expected to the final estimate for the preceding month an
to return to a job from which they had been laid off estimate of month-to-month change based on those
for an indefinite period, or (c) they believed no work parts of the sample common to the 2 months (roughly
was available in their line of work or in the com- 75 percent of the sample units) and (2) an estimate
munity.
based on the data for the current month only in20
Labor Force
flated to independent estimates of the population by
age, sex, and color (previously the sole estimation
procedure used). The final estimate is then obtained
from a weighted average of the intermediate estimates (1) and (2), achieving a substantial reduction
in sampling variability for most items.
Relation to other series.—The Census Bureau's
estimates of employment, obtained from a sample
of households, differ in a number of respects from
estimates of employment prepared from reports of
employing establishments and based on payroll
records, such as the Bureau of Labor Statistics current nonagricultural employment series and the
Department of Agriculture estimates of farm employment. Because of these differences and sampling variability, changes in the various series may
not always be consistent. The Census estimates
provide information on the work status of the
population: persons employed at more than one job,
either because they hold more than one job concurrently or because they changed jobs during the survey week,
are counted only once by the Census and are classified according to the job at which they work the
greatest number of hours during the week. Estimates based on reports from business establishments
and farms, on the other hand, count persons who
work for more than one establishment as many
times as the number of different payrolls on which
their names appear. The Census estimates relate
to all type of workers, including domestic service
workers, unpaid family workers (working 15 hours or
more during the week) and self-emplo}^ed persons,
groups which are excluded from employment series
based on establishment reports. On the other hand,
the Census excludes workers less than 14 years of
age whereas the payroll-based series have no age
exclusions. An additional difference arises from the
fact that persons with a job but not at work are
likely to be included with the employed in the Census
estimates, whereas only part of this group (those
receiving pay while away from work) are included
in the BLS estimates.
For a number of reasons, the unemployment
estimates of the Bureau of the Census are not
directly comparable with statistics derived from
unemployment insurance operations. In the first
place, some unemployed persons are not eligible for
unemployment insurance, particularly young persons
looking for their first jobs, domestic servants, most
former State and local government workers, agricultural workers, and persons who lost their jobs in
firms too small to be covered by the various State
unemployment insurance laws. Unemployed persons who have already received all of the benefits to
which they are currently entitled are not included
in the unemployment insurance claims figures. Also,
the qualifications for drawing unemployment insurance differ from the definition of unemployment used
by the Census Bureau. For example, persons with
a job but not at work and persons working only a few
hours during the week are frequently eligible for
unemployment insurance, but are classified by the
Census Bureau as employed. Furthermore, some
persons may be reported to the Census Bureau as not
looking for work even though they may be registered
at public employment offices, consider themselves
available for jobs and be eligible for unemployment
insurance.
Uses and limit itions.—One of the chief advantages
of the Census labor force, employment and unemployment estimates is that they provide the only
comprehensive figures covering the employment
status of the whole population. The data are
collected monthly and published promptly. The
estimates of unemployment, in particular, are used
as a current indicator of the general health of the
economy.
Another advantage of the household enumeration
method of obtaining labor force information is the
possibility of relating work status to other personal
and family characteristics. Classifications are made
not only by broad occupation and industry groups,
but also by sex, age, and color, by marital status
and number of children. For example, changes in
the employment of married women, and of married
women with small children, can be studied. By
asking supplementary questions from time to time
other information concerning the family can be
similarly estimated, such as family incomes and the
amount of migration during the course of a year.
All these analyses throw light on the changing size
and composition of the labor force.
It should be noted that in the classification used,
anyone who did any work for pay during the survey
week (or did 15 or more hours of unpaid work in a
family enterprise) is counted as employed. Also
counted as employed are those who did not work nor
look for work but who had definite jobs waiting for
them. (The numbers in these groups are shown
separately in Census releases.) Thus the survey
indicates roughly the total demand for jobs: the
number of persons who have jobs (the employed) and
the number seeking jobs (the unemployed). To
understand current trends, the summaryfiguresneed
to be supplemented by the detailed data. The
information provided regularly on hours worked
shows the number of full-time and part-time employed. Starting in May 1955, information is also
21
provided monthly on the extent of voluntary and Insured Unemployment
involuntary part-time employment, and the amount
Description of series.—Weekly data on claims for
of underemployment arising from economic causes;
benefits
under employment security programs, obthese data, were available only quarterly or less
tained
by
the Bureau of Employment Security,
frequently prior to that date. Monthly data on
Department
of Labor, as a byproduct of operations,
changes in the duration of unemployment add
represent
a
measure
of unemployment among workers
meaning to the total count of unemployment.
covered
by
the
programs.
In addition to the States
Since the estimates are prepared from a relative^
employment
security
programs,
the volume of insmall sample, the user should not attach significance
sured
unemployment
for
all
programs
includes
to very small changes. Estimates of the range of
"Korea
veterans"
filing
under
the
Veterans'
Resampling variabilit}- in the data are regularly
adjustment
Assistance
Act
of
1952
(as
it
did
after
published and more detailed information on this
subject is being compiled for the guidance of the World War II with respect to veterans eligible for
users. The relative sampling error for the 230-area benefits under the Servicemen's Readjustment Act
sample is estimated at about 0.6 percent for summary of 1944) and insured unemployment under the
estimates of the civilian labor force, total employ- program administered by the Railroad Retirement
ment, and nonagricultural employment; and roughly Board. Since January 1955, the program for Federal
4 percent for agricultural employment and total employees has been included in the "all programs"
figure.
unemployment.
Insured unemployment represents the number of
The user should also keep in mind that the inforcovered
workers totally or partially unemployed
mation is collected by personal interview, usually
during
a
given
week for which they have filed unemwith the housewife. She may not, in some cases,
have exact knowledge for all members of the house- ployment insurance claims. Weekly insured unemhold. For this reason, as well as because of the rela- ployment figures are available for each State for the
tively small size of the sample, only broad occupa- State, Federal employee, and veteran programs, and
tional and industry groupings of the data are pub- nationally for the Railroad Retirement Board prolished. Finally, the measurement of unemployment gram. Monthly averages are also provided. In
is in some cases difficult, since it depends in part on addition, insured unemployment under the State
the attitude of the person interviewed. The classi- programs is published for the week ending nearest
fication of a person as unemployed has been made as the 15th of each month for 145 major labor market
objective as possible, by using the criterion of "look- areas.
A series on initial claims—notices of the beginning
ing for work/' but no method has been as yet developed which will insure consistent reporting of activ- of a period of unemployment for which benefits
ity month after month. Some marginal (usually may be claimed—is also available on a weekly basis
very small) groups may be reported as unemployed for each State. This series provides a measure of
in some circumstances whereas they would be re- the volume of new unemployment among workers
ported as not in the labor force in others. Most of covered by the State, Federal employee, and vetthese problems of measurement affect persons whose eran programs. Data on initial claims are not
attachment to the labor force is casual or inter- added to the insured unemployment count, however,
mittent, especially married women and youths still since such claims do not certify to completed weeks
of unemployment.
in school looking for part-time jobs.
Statistical procedures.—The insured unemployment
References.—The regular monthly estimates of the
figures
are complete counts of completed weeks of
civilian labor force are published by the Bureau of
unemployment
for which benefits are claimed under
the Census in the Monthly Report on the Labor Force
(Current Population Reports, Series P-57), which in- the various programs. The BES sums the data
cludes also descriptions of the data and an indication reported by the State employment security agencies
of the reliability of the estimates A further de- and the Railroad Retirement Board to get national
scription of the new estimating method may be found totals weekly. Since the claims figures reported by
in the Bureau of the Census Current Population the States are dated by the weeks in which the
Reports, Series P-23, No. 2, July 30, 1954. Annual claims were filed rather than by the weeks in which
summaries and supplementary information on part- the unemployment occurred, BES adjusts both the
time workers, income, migration, etc., are published individual State and the National figures to refer to
in special labor-force reports (Current Population the actual periods of unemployment. For States
paying claims on a calendar-week basis this is done
Reports, Series P-50).
22
Status of the Labor Force
!
Year
Employment
Total
labor
force (including
armed
forces)1
Civilian
labor
force
Total
Unemployment 4
2
Agricul- Nonagricultural
tural
Temporary
layoffs 3
Number
Percent
of
civilian
labor
force
I
• • •
Insured unemployment
Percent of
Thousands
covered
of persons
employment
(all pro(State
programs)5
grams)8
Thousands of persons 14 years of age and over 7
1929__
49, 440
49, 180
47, 630
10, 450
37, 180
(8)
1, 550
3. 2
(8)
(8)
1930
1931
1932
1933
1934
50,
50,
51,
51,
52,
080
680
250
840
490
49,
50,
51,
51,
52,
820
420
000
590
230
45,
42,
38,
38,
40,
480
400
940
760
890
10,
10,
10,
10,
9,
340
290
170
090
900
35,
32,
28,
28,
30,
140
110
770
670
990
(*)
(8)
()
(8)
4, 340
8, 020
12, 060
12, 830
11,340
8.7
15.9
23. 6
24,9
21. 7
(8)
(88)
(8)
()
(8)
(8)
(88)
(8)
(8)
()
1935
1936
1937
1938
1939
53,
53,
54,
54,
55,
140
740
320
950
600
52,
53,
54,
54,
55,
870
440
000
610
230
42,
44,
46,
44,
45,
260
410
300
220
750
10,
10,
9,
9,
9,
110
000
820
690
610
32,
34,
36,
34,
36,
150
410
480
530
140
(88)
()
(88)
()
(8)
10,
9,
7,
10,
9,
610
030
700
390
480
20. 1
16. 9
14.3
19.0
17. 2
(88)
()
(88)
()
(8>
(88)
(8)
(8)
()
(8)
1940
1941
1942
1943
1944
56,
57,
60,
64,
66,
180
530
380
560
040
55,
55,
56,
55,
54,
640
910
410
540
630
47,
50,
53,
54,
53,
520
350
750
470
960
9,
9,
9,
9,
8,
540
100
250
080
950
37,
41,
44,
45,
45,
980
250
500
390
010
(88)
()
(88)
(8)
()
8,
5,
2,
1,
120
560
660
070
670
14.6
9.9
4.7
1.9
1.2
1, 330
841
661
149
111
5. 6
3. 0
2. 2
. 5
.4
1945
1946
1947
1948
1949
65,
60,
61,
62,
63,
290
970
758
898
721
53,
57,
60,
61,
62,
860
520
168
442
105
52,
55,
58,
59,
58,
820
250
027
378
710
8,
8,
8,
7,
8,
580
320
266
973
026
44,
46,
49,
51,
50,
240
930
761
405
684
(B)
97
123
141
185
1,
2,
2,
2,
3,
040
270
142
064
395
1.9
3.9
3.6
3.4
5.5
714
2,803
1,803 1, 461
2, 470
2. 1
4.3
3.1
3.0
6. 2
1950
1951
1952
1953
1954
64,
65,
66,
67,
67,
749
982
560
362
818
63,
62,
62,
63,
64,
099
884
966
815
468
59,
61,
61,
62,
61,
957
005
293
213
238
7,
7,
6,
6,
6,
507
054
805
562
504
52,
53,
54,
55,
54,
450
951
488
651
734
92
117
142
167
221
3,
1,
1,
1,
3,
142
879
673
602
230
5.0
3. 0
2. 7
2. 5
5.0
1, 599
996
1, 064
1, 058
2, 039
4.6
2.8
2.9
2.8
5.2
C8O
1 Data for 1910-52 revised to include about 150,000 members of the armed forces who were outside the continental United States in 1940 and therefore were not
enumerated in the 19 tO census and were excluded from 1940-5? estimates.
3 Includes part-time workers and those with jobs but not at work for such reasons as vacations, illness, bad weather, temporary layoff; and industrial disputes;
excludes armed forces.
3 Shown separately to afford a basis for further analysis of employment and unemployment.
4 See footnote 3.
s Weekly averages of unemployed workers, covered by unemployment Insurance programs, who have completed at least 1 week of unemployment.
State, veteran,
and railroad retirement programs are included; Servicemen's Readjustment Act benefits (World War II) included, September 1944-August 1951.
6 State unemi)loyment ins'irance programs during the period shown excluded from coverage agricultural workers, Government employees, domestic servants,
workers in nonprofit organizations, unpaid family workers, the self-employed, and (in most States) workers in very small firms.
T Labor force data for 1953 revised; 1946-53 data based on 68-area sample; beginning in 1954, based on 230-area sample.
Earlier data based on smaller sample are
revised (1940-45^; labor force data prior to 1940 are based on estimates from other sources rather than direct enumeration.
• Not available.
NOTE.—Monthly labor force data available beginning March 1940, based on the week containing the 8th of the month.
ployment data available beginning July 1945.
Monthly and weekly insured unem-
Sources: Department of Commerce (labor force, 1940-54) and Department of Labor (labor force, 192&-39, and insured unemployment).
by dating the claims for the preceding week; for
those on a "flexible" week, the figures for the current
and preceding weeks are averaged..
Relation to other series.—For a comparison with
the Current Population Survey, see above, under
Labor Force (p. 21).
Uses and limitations.—The BES series are based
011 a complete count of claims-taking transactions.
Being derived from administrative records, the series
have certain unique advantages and certain inherent
limitations as economic indicators.
The advantages stem from the fact that the data
are complete counts rapidly available on a weeldy
basis. Coverage of the Federal and State programs
has expanded until currently about 80 percent of all
wage and salary workers in nonagricultural industries
both public and private, are covered.
The insured unemployment figures serve two purposes as economic indicators. First, since they are
available weekly, they provide the most up-to-date
information on current trends in unemployment.
Second, geographic detail can be provided, for labor
market areas as well as for States. In using these
figures for such purposes, however, their limitations,
23
which are based on the fact that the series are
byproducts of administrative records, must be kept
in mind.
The unemployment insurance programs exclude
certain groups of workers—self-employed persons,
unpaid family workers, new entrants into the labor
market, and persons employed in specific industries.
The most important industries excluded are agriculture, domestic service, nonprofit organizations, and
most State and local governments. (Prior to 1955,
Federal Government workers were also excluded.)
In addition, employees of firms below a specified size
within the "covered" industries are excluded in many
States.
Aside from these broad exclusions, some groups of
covered workers who are unemployed may not be
eligible for benefits and are therefore not included in
the insured unemployment figures. These groups
include unemployed workers whose previous jobs
were in covered industries but who did not earn
sufficient wage credits or were not employed the
required length of time; unemployed covered workers
who are disqualified for various reasons, such as voluntary quitting without good cause, discharge for
misconduct, refusal of suitable work, or temporary
illness; persons who are eligible to receive benefits
but for one reason or another do not apply; and
finally, workers who have exhausted their benefit
rights. In a period when unemployment is substantial and of long duration, the volume of exhaustions may have an important bearing on the magnitude of the insured unemployment levels.
These limitations vary over time as well as between States. During the years since 1939, exclu-
sions on account of "size-of-firm" provisions have
become less important, and will become still smaller
with the extension of coverage in January 1956.
Weekly data are subject to some variation from
week to week as holidays call for a rescheduling of
the claimant's appearance at the local office.
Monthly data are presented as "average weekly
volume of insured unemployment" and are not
significantly affected by holiday weeks. The
monthly data, however, are influenced to some
extent by administrative factors. Forty States
and the District of Columbia operate on an "individual benefit year" basis. In such States a worker
who previously had insufficient wage credits ma}'
become eligible for benefits when the earnings of a
new quarter become a part of his base period.
This administrative factor exerts an upward influence
on insured unemployment during the first month of
each quarter in most States. Similarly, eight States
which operate on a "uniform benefit year" usually
show an administrative rise in insured unemployment
at the beginning of the new benefit year.
References.—The basic release of the weeldy data
is the BES Unemployment Insurance Claims, which
contains initial claims as well as insured unemployment for the State, Federal employee and veteran
programs by States/and for the Railroad Retirement
Board program nationally. Weekly figures and
monthly averages are also reprinted in the BES
monthly publication, The Labor Market and Employment Security. A technical note, "Source, Nature,
and Limitations of Insured Unemployment Statistics," appears in the April 1954 issue of The
Labor Market and Employment Security.
NONAGRICULTURAL EMPLOYMENT—Selected Industries
Description of series.—Current monthly series on the payroll period, including part-time as well as
employment in nonagricultural establishments, with full-time, temporary as well as permanent, emrelated information on hours and earnings (see ployees. Workers on an establishment's payroll who
below), are prepared by the Bureau of Labor Sta- are on paid sick leave, paid holiday or paid vacation,
tistics. Employment estimates are published for or who work a part of a specified pay period and are
more than 200 separate industry groups and sub- unemployed or on strike during the other part are
groups as well as 8 major industry divisions (manu- considered employed. Persons on the payroll of
facturing, mining, trade, etc.). Estimates of women more than one establishment during the pay period
employed in manufacturing industries are available are counted each time reported. On the other hand,
quarterly.
persons are not considered employed who are laid
Employment figures represent the total number off, on leave without pay, or on strike for the entire
of persons employed in nonagricultural establish- pay period. Proprietors, the self-employed and
ments in the continental United States during a unpaid family workers, and domestic workers in
specified payroll period which (for all industries households are not included. Government employexcept Government) is that ending nearest the 15th ment statistics refer to civilian employees only, but
of the month. Employed persons include all those include employees of State and local governments as
who worked during or received pay for any part of well as Federal.
24
Nonagricultural Employment
[Thousands of wage and salary workers
Manufacturing
Year
Total
Total
Durable
goods
Nondurable
goods
786
997
839
786
534
(2)
(22)
(2)
()
(22)
()
(2)
(22)
(2)
(2)
()
9,
8,
6,
7,
8,
401
021
797
258
346
(22)
(2)
(2)
()
(2)
(22)
(2)
()
(2)
26, 792
28, 802
30, 718
28, 902
30,311
8,
9,
10,
9,
10,
907
653
606
253
078
(2)
(22)
()
(2)
1940
1941
1942
1943
1944
32,
36,
39,
42,
41,
058
220
779
106
534
10,
12,
15,
17,
17,
780
974
051
381
111
1945
1946
1947
1948
1949
40,
41,
43,
44,
43,
037
287
462
448
315
15,
14,
15,
15,
14,
302
461
290
321
178
1950
1951
1952_
1953
1954
44,
47,
48,
49,
48,
738
347
303
681
285
14,
16,
16,
17,
15,
967
104
334
238
989
1919
26, 829
10, 534
1920
1921
1922
1923
1924
27,
24,
25,
28,
27,
088
125
569
128
770
10,
8,
8,
10,
9,
534
132
986
155
523
1925
1926
1927
1928
1929
28,
29,
29,
29,
31,
505
539
691
710
041
9,
9,
9,
9,
10,
1930
1931
1932
1933
1934
29,
26,
23,
23,
25,
143
383
377
466
699
1935
1936
1937
1938
1939
4, 683
5,
6,
8,
11,
10,
Mining
Contract
construction
Wholesale
and retail
trade
Government
(Federal,
State,
local)
Other
(2)
1, 124
1, 021
4,664
2, 671
6,815
(2)
(22)
()
(22)
()
1, 230
953
920
1, 203
1, 092
1,
1,
1,
1,
848
012
185
229
321
4,
4,
5,
5,
5,
623
754
084
494
626
2,
2,
2,
2,
2,
603
531
542
611
723
7,250
6,743
6, 852
7, 436
7, 485
fl
(22)
(2)
()
(2)
1,
1,
1,
1,
1,
1,
1,
1,
1,
1,
446
555
608
606
497
5,810
6, 033
6, 165
6, 137
6, 401
2,
2,
2,
2,
3,
802
848
917
996
066
7, 581
7,930
8, 057
8, 144
8, 465
00
1, 000
864
722
735
874
1, 372
1, 214
970
809
862
6,
5,
4,
4,
5,
064
531
907
999
552
3,
3,
3,
3,
3,
149
264
225
167
298
8,
7,
6,
6,
6,
157
489
756
498
767
(2)
(22)
(2)
()
888
937
1, 006
882
845
1,
1,
1,
1,
912
145
112
055
150
5,
6,
6,
6,
6,
692
076
543
453
612
3,
3,
3.
3,
3,
477
662
749
876
995
6,
7,
7,
7,
7,
916
329
702
383
632
202
660
483
080
043
7,
8,
8,
8,
9,
926
433
759
973
141
5, 394
080
176
105
041
078
337
945
804
077
858
5,
6,
6,
6,
6,
443
028
247
304
253
916
947
983
917
883
1,
1,
2,
1,
1,
294
790
170
567
094
6, 940
7,416
7,333
7, 189
7, 260
4,
4,
5,
6,
6,
9, 079
7, 739
8, 372
8,312
7,473
6,
6,
6,
7,
6,
222
722
918
010
705
826
852
943
982
918
1,
1,
1,
2,
2,
132
661
982
169
165
7,
8,
9,
9,
9,
522
602
196
519
513
5, 944
5, 595
5, 474
5,650
5, 856
9,311
10, 116
10, 577
10, 807
10, 686
6, 882
7,024
6, 994
7, 133
6, 870
889
916
885
852
770
2,
2,
2,
2,
2,
333
603
634
622
527
9,
10,
10,
10,
10,
645
012
281
527
498
6,
6,
6,
6,
6,
10,
11,
11,
11,
11,
8,
9,
9,
10,
9,
085
080
340
105
120
026
389
609
645
751
878
322
563
797
751
1 Includes all full- and part-time wage and salary workers in nonagricultural establishments who worked during or received pay for any part of the pay period
ending nearest the 15th of the month. Excludes proprietors, self-employed iJersons, domestic servants, unpaid family workers, and personnel of the armed forces.
Total derived from this table not comparable with estimates of nonagricultural employment of the civilian labor force reported by the Department of Commerce
(p. 23) which includes proprietors, self-employed persons, unpaid family workers, and domestic servants; which count persons as employed when they are not at
work because of industrial disputes; and which are based on an enumeration of population, whereas the estimates in this table are based on reports from employing
establishments.
2 Not available.
NOTE.—Monthly data available beginning January 1939; annual from 1919.
Source: Department of Labor.
Information on employment, hours and earnings
is collected each month from a sample of establishments under cooperative arrangements with State
agencies (primarily State employment security
agencies). The cooperating State agencies mail
questionnaires to the reporting establishments and
edit them when returned, before passing the information on to the BLS. To eliminate duplicate
reporting, the same establishment reports are used
for preparing State, area, and national estimates.
Durable goods manufacturing industries include:
ordnance and accessories (except Governmentoperated establishments), lumber and wood products, furniture and fixtures, stone, clay and glass
products, primary metal industries, fabricated metal
products, machinery, transportation equipment, instruments and miscellaneous manufacturing industries. All other manufacturing industries are included in the nondurable manufacturing estimates.
Statistical procedures.—Current estimates depend
25
In addition to total employment in each industry,
011 monthly reports from a sample of employers.
The sample of about 155,000 establishments is de- BLS also prepares estimates of production-worker
signed to obtain reports from most if not all the large employment for mining and manufacturing indusestablishments in each industry but the proportion tries. These estimates are exactly comparable with
of total employment covered varies considerably the average hours and earning series (see below)
from industry to industry. It is high (68 percent) which are prepared from information reported on the
in manufacturing, for example, and much lower in same questionnaires as the employment figures.
In general, BLS employment estimates are comwholesale and retail trade (19 percent) and service
parable with other data collected from establishindustries.
In order to compute total employment from the ments, such as employment, production, and similar
sample reports, month-to-month changes in the data obtained by the Census Bureau in the manusample establishments are applied to a total employ- facturing censuses and annual surveys. Some
ment figure (benchmark) separately for each in- differences will be found, however, especially for
dustry. The benchmark figures are obtained from individual industries, caused chiefly by differences in
sources which, singly or in combination, insure definitions of the industries covered, the business
either a complete count of employment for the units considered parts of an establishment, and in
specified benchmark period, or an estimate of reason- the industrial classification of establishments.
More serious differences are found between the
able accuracy. This method takes advantage of
benchmark data which are byproducts of other BLS establishment-based series and those based on
reports from companies, such as financial reports on
governmental functions.
Since 1939 the basic sources of benchmark infor- profits, because the industry totals that result when
mation have been periodic tabulations of employ- a single industry classification is assigned to an entire
ment data by industry compiled by State agencies company differ substantially from those in which
from reports of establishments covered under State each establishment of the company has been assigned
unemployment insurance laws. Supplementary tab- to the industry of its principal activity. (See Corulations prepared by the United States Bureau of porate Profits, above, p. 14.)
Old-Age and Survivors Insurance are used for smallUses and limitations.—Current employment statissize establishments exempt from State unemployment tics are widely used as a timely indicator of changes
insurance laws. For industries not covered by either in economic activity in various sectors of the econof the two programs, benchmarks are compiled from omy. Comparable information for a large number
other sources: for example, for interstate railroads, of detailed industries is provided within a few weeks.
from information reported to the Interstate Com- Furthermore, because of the promptness with which
merce Commission; for State and local government, basic information is supplied in considerable industry
from data reported to the Bureau of the Census; detail, the BLS employment estimates are frequently
for the Federal Government, from data compiled by incorporated in other Federal statistical series, parthe Civil Service Commission. Establishments are ticularly in making current estimates of production,
classified into the same industrial groupings for productivity, and national income.
benchmark purposes as for monthly reporting.
The publication of comparable State and local
The most recent benchmark adjustment was to area estimates by the cooperating State agencies
data for the first quarter of 1954 (published in May using the same concepts and methods provides a
1955). These revisions were carried back to 1953 means whereby business trends can be followed for
where appropriate, and some changes in the govern- all States and the District of Columbia and for about
ment and the finance and service components have 100 of the large metropolitan areas.
been carried back as far as 1939.
The national estimates are not all of uniform qualThe seasonally adjusted estimates of the total ity, however. In general, those for manufacturing
number of employees in nonagricultural establish- industries are most reliable. Since "cutoff" samments, as shown in current issues of Economic pling rather than a probability design has been used,
Indicators, were introduced by the BLS in 1954, it is not possible to calculate the sampling variability
with seasonally adjusted and nonadjusted indexes of monthly estimates. Experience with the program
of employment. In preparing the seasonally adjusted has shown that the monthly employment data in
estimates and indexes, the BLS uses the monthly some industries tend to have an increasing bias for
factors developed by the Federal Reserve Board.
the successive months between two benchmarks.
Relation to other series.—For a comparison with theAlthough this error cannot be adjusted precisely on a
Current Population Survey, see above (p. 21).
current basis, average adjustment is made through
26
Average Weekly Hours
IHours per week, for production workers or nonsupervisory employees]
Manufacturing
Year
Total
Durable
goods
Nondurable
goods
Building
construction
Retail
trade 1
1914.J.
49. 4
(*)
(2)
(2)
1919
46. 3
(2)
(2)
(2)
<2)
1920
1921
1922
1923
1924
47.4
43. 1
44. 2
45. 6
43. 7
(2)
(2)
(22)
(2)
()
(2)
(22)
(2)
()
(22)
()
1925
1926
1927
1928
1929
44. 5
45. 0
45. 0
44.4
44. 2
(32)
()
(2)
1930
1931
1932
1933
1934
42. 1
40. 5
38.3
38. 1
34. 6
(2)
(22)
(2)
()
(2)
(2)
(22)
(2)
()
(22)
(2)
()
(22)
()
(32)
((2))
1935
1936
1937
1938
1939
36.
39.
38.
35.
37.
6
2
6
6
7
37.3
41.0
40. 0
35.0
38.0
36. 1
37. 7
37.4
36. 1
37.4
30. 1
32. 8
33.4
32. 1
32. 6
1940
1941
1942
1943
1944
38.
40.
42.
44.
45.
1
6
9
9
2
39.
42.
45.
46.
46.
3
1
1
6
6
37.
38.
40.
42.
43.
0
9
3
5
1
33. 1
34. 8
36.4
38. 4
39. 6
42.
42.
41.
40.
40.
5
1
1
3
4
1945
1946
1947
1948
1949
43. 4
40.4
40.4
40. 1
39. 2
44.
40.
40.
40.
39.
1
2
6
5
5
42.3
40. 5
40. 1
39.6
38.8
39. 0
38. 1
37. 6
3 37.3
36. 7
40.
40.
40.
40.
40.
3
7
3
3
4
1950
1951
1952
1953
1954
40. 5
40. 7
40.7
40. 5
39.7
41. 2
41. 6
41. 5
41.3
40. 2
39.7
39. 5
39. 6
39. 5
39. 0
36. 3
37.2
38. 1
37.0
36.2
00
2
(2)
(2)
()
00
(2)
00
2
()
«
00
00
(22)
()
32. 6
34. 8
33.9
(32)
()
41. 9
40.0
35. 1
C)
(2)
00
28. 9
(22)
()
(22)
(2)
()
(2J)
()
00
00
42. 7
40. 5
40. 2
39. 9
39. 2
39.2
i Hours and earnings data exclude eating and drinking places.
N o t available.
Data beginning with January 1948 not strictly comparable with those for earlier years.
3
3
NOTE.—Monthly data available beginning 1932 for manufacturing industries, 1934 for building construction, and 1939 for retail trade.
manufacturing industries available for years 1909 and 1914 and on continuous basis beginning with 1919.
Annual data for total
Source: Department of Labor.
the use of bias adjustment factors before publication.
Appropriate changes in employment levels are also
made, when necessary, at the next revision to new
benchmarks. Revisions to 1954 benchmarks showed
adjustment of 0.02 of 1 percent for the nonagricultural total; of 0.3 percent for manufacturing; and of
3.1 percent for building construction, where the
greatest relative correction was needed.
References.—The basic monthly release for the
employment, hours and earnings series is the BLS
681G6—55
r»
Employment and Earnings, which contains national
estimates, State and area estimates, and explanatory
notes. The national employment, hours and earnings
series for 13 months are also reprinted in the Monthly
Labor Review. More detailed technical notes on
"Measurement of Industrial Employment" and
"Hours and Earnings in Nonagricultural Establishments" appear in Techniques of Preparing Major
BLS Statistical Series (BLS Bulletin 1168), December
1954.
27
AVERAGE WEEKLY HOURS—Selected Industries
Uses and limitations.—Changes in hours worked
(Table on p. 27.)
Description oj series.—With the employment supplement the information on employment, since
figures for the specified payroll period, described in frequently hours worked are affected even before emthe preceding section, BLS collects from the sample ployment by changes in economic activity. The
establishments total man-hours of production or hoursfiguresare used in compiling the average earnnonsupervisory workers actually worked or paid for, ings figures discussed below. They also serve as a
including hours paid for holidays, sick leave, and basis for current production estimates for some industries (see description of the index of industrial provacations taken.
Statistical procedures.—The average hour figuresduction, p. 31).
Hours paid for as measured by these series differ
are obtained by dividing the number of production
and related workers (or nonsupervisory workers in from hours worked, and from "plant man-hours,"
industries other than mining and manufacturing) into which do not include hours paid for vacation, sick
the total man-hours reported for each industry. The leave, or holidays.
References—See above, under Nonagricultural
average hours are normally less than scheduled hours
because of such factors as absenteeism, labor turn- Employment (p. 27).
over, part-time work, and stoppages.
AVERAGE HOURLY EARNINGS—Selected Industries
Description of series.—The payrollfigureson which and late-shift work, and changes in output of workers
these averages are based are collected by BLS with paid on an incentive basis. The changing employthe employment and hours figures, described above. ment of workers as between relatively high-paid and
They are reported before deductions for taxes, social low-paid work, and relatively high-wage and lowinsurance, etc. They include pay for sick leave, wage industries, also affects the hourly earnings
holidays, and vacations taken, but exclude retro- averages.
active pay and bonuses, unless earned and paid
Hourly earnings refer to the actual return to the
regularly each pay period. Earnings in 1954 prices worker for a stated period of time, and should not
are the average hourly earnings figures adjusted for be confused with wage rates, which represent the
changes in purchasing power as determined by the rates stipulated for a given unit of work or time.
Consumer Price Index, with 1954=100.
Since certain types of payments (see above) as well
Statistical procedures.—Average hourly earnings as payments to workers excluded from the producare derived by dividing total payrolls by total man- tion worker (or nonsupervisory employee) definition
hours reported for each industry. Only the sample are not included, the earnings series should not be
data are used, since there are no benchmarks avail- taken to represent labor costs to the employer.
able for hours and earnings.
The fact that large establishments predominate in
Uses and limitations.—Average hourly earnings the BLS sample may affect somewhat the level of
figures are widely used in collective bargaining, in the average earningsfiguresfor some industries, but
"escalating" long-term sales contracts (such as labor has no measurable effect on the trends in average
costs for equipment which takes a number of months hourly earnings.
or years to build), and in general economic analysis.
References.—See above, under Nonagricultural
The hourly earningsfiguresreflect not only changes Employment (p. 27). Estimates of hourly earnings
in basic hourly and incentive wage rates, but also excluding overtime are also published in Employment
such variable factors as premium pay for overtime and Earnings.
28
Average Hourly Earnings
[For production workers or nonsupervisory employees]
All manufacturing
Durable goods
manufacturing
Nondurable goods
manufacturing
Building
construction
Retail trade
1
Year
Current
prices
1954
prices 2
Current
prices
1954
prices 2
Current
prices
1954
prices 2
Current
prices
1954
prices 2
Current
prices
1954
prices 2
1914
$0. 223
$0. 606
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
191 9
.477
.740
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
192 0
192 1
192 2
192 3
1924...
. 555
. 515
,487
. 522
. 547
, 743
773
.780
. 822
. 859
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(5)
(3)
(3)
(3)
(3)
(3)
(3)
V3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
1925—
192 6
192 7
192 8
192 9
.
.
.
.
.
547
548
550
562
566
.838
. 832
.851
, 879
886
(3)
(3)
V3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(33)
()
(33)
()
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
193 0
193 1
1932—
1933—
193 4
552
515
.446
.442
. 532
.887
. 910
, 876
. 917
1. 068
(3)
(3)
$0. 497
.472
.556
(3)
(3)
$0. 976
.979
1. 116
(3)
(3)
$0. 420
,427
515
(3)
(3)
$0. 825
. 886
1. 034
<3)
(3)
(3)
(3)
$0. 795
(3)
(3)
(3)
(3)
SI. 596
(3)
(3)
(3)
(3)
v3)
(3)
(3)
(3)
(3)
(3)
193 5
193 6
193 7
193 8
193 9
. 550
.556
624
. 627
. 633
1.
1.
1.
1.
1.
076
075
166
194
224
.577
.586
.674
686
.698
1.
1.
1.
1.
1.
129
133
260
307
350
530
529
577
. 584
,582
1.
1.
1.
1.
1.
037
023
079
112
126
(3)
1940—
194 1
194 2
194 3
1944—
, 661
. 729
.853
. 961
1. 019
1.
1.
1.
1.
1.
266
330
405
490
556
.724
, 808
. 947
1. 059
1. 117
1.
1.
1.
1.
1.
387
474
560
642
705
.602
. 640
.723
.803
. 861
1.
1.
1.
1.
1.
153
168
191
245
315
194 5
194 6
194 7
1948—
194 9
1.
1.
1.
1.
1.
023
086
237
350
401
1.
1.
1.
1.
1.
527
496
487
508
579
1. I l l
1. 156
1. 292
1.410
1. 469
1.
1.
1.
1.
1.
658
592
553
575
656
.904
1. 015
1. 171
1. 278
1. 325
1.
1.
1.
1.
1.
349
398
407
428
494
195 0
1951.__
195 2
195 3
195 4
1.
1.
1.
1.
1.
465
59
67
77
81
1.
1.
1.
1.
1.
637
64
69
78 .
81
1.
1.
1.
1.
1.
1.
1.
1.
1.
1.
717
73
79
88
92
1.
1.
1.
1.
1.
1.
1.
1.
1.
1.
540
53
56
61
66
537
67
77
87
92
378
48
54
61
66
815
824
.903
, 908
, 932
.
1.
1.
1.
1.
595
594
688
730
803
(3)
(3)
(3)
(3)
$0. 542
1.
1.
1.
1.
2.
835
843
891
941
014
. 553
. 580
626
. 679
. 731
1.
1.
1.
1.
1.
059
058
031
053
116
2.058
2. 036
2. 020
2. 065
2. 182
.783
.893
1. 009
1. 088
1. 137
1.
1.
1.
1.
1.
169
230
213
216
282
2.
2.
2.
2.
2.
1.
1.
1.
1.
1.
1.
1.
1.
1.
1.
314
30
33
40
45
958
010
148
252
319
1. 379
1. 478
1. 681
< 1. 848
1. 935
2.
2.
2.
2.
2.
1.
•1.
1.
1.
1.
031
19
31
48
60
4
269
26
34
49
60
176
26
32
40
45
(3)
(3)
$1. 048
1 Hours and earnings data exclude eating and drinking places.
Earnings In current prices divided by consumer price index on base 1954=100.
» N o t available.
4 Data beginning with January 1948 not strictly comparable with those for earlier years.
2
NOTE.—Monthly data available beginning 1932 for manufacturing Industries, 1934 for building construction, and 1939 for retail trade.
manufacturing industries available for years 1909 and 1914 and on continuous basis beginning with 1919.
Annual data for total
Source: Department of Labor.
29
Average Weekly Earnings
[For production workers or nonsupervisory employees]
All manufacturing
Durable goods
manufacturing
Nondurable goods
manufacturing
Building
construction
Retail trade 1
Year
Current
prices
1954
prices3
Current
prices
1914.
$11. 01
$29. 92
()
()
1919.
22. 08
34. 23
Is)
()
3
1954
prices2
Current
prices
3
3
()
3
3
()
1954
pricess
s
()
3
()
Current
prices
1954
prices2
Current
prices
3
s
()
3
()
3
()
()
8
3
1920.
1921
1922
1923
1924
26.
22.
21.
23.
23.
30
18
51
82
93
35. 21
33. 30
34. 47
37. 51
37.57
1925
1926.
1927.
1928.
1929
24. 37
24. 65
24. 74
24.97
25. 03
37. 32
37.41
38. 30
39. 08
39. 17
26.
26.
26.
27.
27.
39
61
66
24
22
40.
40.
41.
42.
42.
41
38
27
63
60
22.44
22. 75
23. 01
22. 88
22. 93
34.
34.
35.
35.
35.
36
52
62
81
88
1930.
1931.
1932.
1933.
1934.
23. 25
20. 87
17.05
16. 73
18. 40
37.
36.
33.
34.
36.
38
87
50
71
95
24.
21.
16.
16.
18.
77
28
21
43
87
39.
37.
31.
34.
37.
82
60
85
09
89
21.
20.
17.
16.
18.
35.
36.
34.
35.
36.
11
22
52
04
24
1935.
1936.
1937.
1938.
1939.
20.
21.
24.
22.
23.
13
78
05
30
86
39.
42.
44.
42.
46.
39
13
95
48
15
21.
24.
26.
24.
26.
52
04
91
01
50
42. 11
46. 50
50.30
45. 73
51. 26
19. 11
19. 94
21. 53
21. 05
21.78
37.40
38. 57
40. 24
40. 10
42. 13
24.
27.
30.
29.
30.
51
01
14
19
39
47.
52.
56.
55.
58.
96
24
34
60
78
3)
;3)
$23. 14
1940.
1941.
1942
1943.
1944.
25.
29.
36.
43.
46.
20
58
65
14
08
48.
53.
60.
66.
70.
28
98
38
88
35
28.44
34. 04
42. 73
49. 30
52. 07
54.
62.
70.
76.
79.
48
12
40
43
50
22.
24.
29.
34.
37.
27
92
13
12
12
42.
45.
47.
52.
56.
66
47
99
90
67
31.
35.
41.
48.
52.
70
14
80
13
18
60.
64.
68.
74.
79.
73
12
86
62
66
23. 50
24. 42
25. 73
27.36
29. 53
1945.
1946.
1947.
1948.
1949.
44. 39
43. 82
49. 97
54. 14
54,92
66.
60.
60.
60.
61.
25
36
06
49
92
49.
46.
52.
57.
58.
05
49
46
11
03
73.
64.
63.
63.
65.
21
04
05
81
42
38.
41.
46.
50.
51.
29
14
96
61
41
57.
56.
56.
56.
57.
15
67
44
55
96
1950.
1951.
1952.
1953.
1954.
59. 33
64. 71
67.97
71. 69
71. 86
66.
66.
68.
71.
71.
29
92
73
91
86
63.
69.
73.
77.
77.
32
47
46
23
18
70.75
71. 84
74. 28
77.46
77. 18
54.
58.
60.
63.
64.
71
46
98
60
74
61.
60.
61.
63.
64.
13
46
66
79
74
(8)
(8)
(3)
$25. 78
25. 84
(3)
(3)
(3)
$40. 60
40.57
(3)
(3)
h
$21. 94
22. 07
84
50
57
89
05
(3)
(8)
(3)
$34. 55
34. 65
(3)
(3)
(3)
(3)
()
(3)
()
3
TO
(3)
()
(3)
(3)
(3)
3
09
(3)
(8)
(3)
(3)
()
(«)
(3)
(3)
(3)
$22. 97
53. 73
56. 24
63. 30
* 68. 85
70. 95
73.
81.
88.
91.
94.
73
47
01
76
12
8
(a)
(3)
<3)
(8)
$46. 12
80. 19
77.47
76. 08
4 76. 93
79. 99
82.
84.
88.
92.
94.
38
25
99
04
12
3)
3)
31.
36.
40.
43.
45.
55
35
66
85
93
47.63
50. 65
52. 67
54. 88
56. 84
i Hours and earnings data exclude eating and drinking places.
Earnings in current prices divided by consumer price index on base 1954=100.
* N o t available.
4 Data beginning with January 1948 not strictly comparable with those for earlier years.
9
NOTE.—Monthly data available beginning June 1914 for all manufacturing industries, 1923 for durable and nondurable goods manufacturing 1934 for building
construction, and 1939 for retail trade. Annual data for all manufacturing Industries also available for year 1909.
manuiaciunng,
lor ouuaing
Source: Department of Labor.
AVERAGE WEEKLY EARNINGS—Selected Industries
Average weekly earnings are obtained by multi- ductions have been made for income and socialplying average weekly hours and average hourly security taxes, group insurance, occupational supearnings for each industry (see above under Non- plies, union dues, or other payroll deductions.
agricultural Employment, pp. 24-26). They come
References,—See above, under Nonagricultural
closer than the hourly earnings to measuring what Employment (p. 27). Estimates of net spendable
the worker has to spend, since they are affected by weekly earnings in manufacturing and earnings in
changes in the length of the workweek. However, 1947-49 dollars for selected industries are also pubthey do not represent take-home pay, since no de- lished in Employment and Earnings.
30
PRODUCTION AND BUSINESS ACTIVITY
INDUSTRIAL PRODUCTION
Description of series.—The Index of Industrial
Production is computed by the Board of Governors
of the Federal Reserve System. It is designed to
measure changes in the physical volume or quantity
of output of manufactures and minerals. It does
not register changes in the value of such production,
nor does it include other productive activities often
regarded as industrial, i. e., construction and public
utilities. The manufacturing and mining industries
covered by the index produce about one-third of the
value of the total production of goods and services
in the United States.
The manufactures and minerals indexes are based
on figures compiled by the Bureau of the Census,
Bureau of Mines, Department of Agriculture, Tariff
Commission, Bureau of Labor Statistics, the Internal
Revenue Service, and a few other Government
agencies, and by trade associations and trade
journals. The component series are carefully chosen
to represent the industries, industry groups, and
other subdivisions in the index, and where necessary
and possible they are adjusted for undercoverage or
other deficiencies. For example, shipment series are
adjusted for inventory changes, where feasible; value
data, for price changes; man-hours, for estimated
changes in output per man-hour.
Both annual and monthly data are utilized.
Annual data, which are generally more reliable and
available in greater detail than the monthly data,
are used to compute an annual index and a set of
annual group, subgroup, and industry indexes measuring year-to-year output changes. Monthly data
are utilized to make monthly indexes comparable to
the annual indexes. The use of comprehensive
annual indexes to determine levels makes it possible
to employ fewer but more selective component series
to represent each industry in the monthly indexes.
Manufactures.—The annual index of manufactures
includes about 1,370 detailed series, and the monthly
index, 164 series. The series selected are classified
into the 21 major industry groups for manufacturing
of the Standard Industrial Classification. These 21
major industry groups are regrouped to form the
subtotals of durable and nondurable manufactured
goods. Series on quantities of products manufactured or shipped, or quantities of materials consumed
or supplied, account for about three-fourths of the
weights assigned in the annual index, and about
one-half of the weights in the monthly index. The
remaining series in the annual index are mostly
68166—55
6
deflated value figures, estimates based on several
types of data, or adjusted man-hour data, with the
last accounting for 4 percent of the weight. The
remaining components in the monthly index consist
largely of man-hour data adjusted for estimated
changes in output per man-hour to represent output.
The use of so large a proportion of man-hour data
in the monthly index has been questioned, but it
should be remembered that only the current changes
for the industries concerned are governed by these
man-hour series, with the index levels determined
largely by annual data on quantities of products
produced or shipped or other types of data.
Minerals.—The annual index of minerals is composed of about 70 separate series, and the monthly
index of 11 series, classified into the 5 major industry
groups for mining of the Standard Industrial Classification. The annual series on minerals, representing
the production of all the important minerals, are in
physical volume units, and all but one of the monthly
series are also in physical volume units. The exception is the man-hour series used to represent stone
and earth minerals, to which less than 10 percent
of the weight of the minerals index is assigned, and
which, of course, is adjusted to annual physical
volume levels.
jRevision in 1953.—Since its first publication in
1927 the index has undergone several major revisions. The most recent revision was completed in
1953, and the revised index introduced in December
1953. The principal changes were—
1. Increase in the number of component
monthly series from 100 to 175, and many improvements in the series used.
2. Use of component series to represent certain industries formerly represented only indirectly.
3. Use of a comprehensive and detailed annual
index, based on about 1,400 series, to check and
correct the annual levels of the individual
monthly measurements.
4. Use of 1947 value added data for calculating weights, in place of the 1937 value added
data previously employed, for the segment of
the index from 1947 to date.
5. Change of the comparison base period
from 1935-39 to 1947-19.
6. Adoption of the latest Standard Industrial
Classification code as the basis for organizing
the index and its components.
31
The new version of the index is confined for the most cases estimated on the assumption that they
present to the period since January 1947. In revising are proportional to value of the product.
Since the value-added data used relate to 1947,
the index for the earlier period, use will be made
largely of the major group components of the bench- while the component series are expressed as relatives
mark index of manufactures (computed by Federal with the average for the base period 1947-49 as 100,
Reserve and the Census Bureau from data of the it is necessary to adjust the 1947 value added for
1939 and 1947 Censuses of Manufactures, and pub- each series by the ratio of the level of that series in
lished in 1952) to determine the 1939 levels of the 1947 to the average level of that series in 1947-49.
comparable indexes relative to 1947. Pending this The value-added data so adjusted, expressed as
detailed revision, interim benchmark adjustments percentages of the total for all manufacturing and
have been made to the old indexes for durable and non- mining, are the weight factors used in combining the
durable manufactures—and also for minerals and individual series into the group and total industrial
total industrial production—from January 1939 to production indexes.
December 1946. The old indexes beginning in 1919
Components of the index are adjusted for two
have been linked on to the respective revised meas- kinds of short-time recurring fluctuations—differures to form a series of continuous indexes from 1919 ences in the number of working days from month to
to the present.
month and seasonal variations. The first adjustStatistical procedures.—The method used in com-ment is accomplished by reducing reported quantity
bining the individual series is the weighted average figures to average daily output in the month. For
of relatives. This consists of (1) reducing each this purpose, only regular weekend closings—where
series into relatives with the average for the base in effect—are treated as nonworking days. No alperiod, 1947-49, as 100; (2) multiplying each series lowance is made for holiday shutdowns, whose
of relatives by a base-year weight factor; and (3) effects on production are adjusted by the seasonal
adding the products (series of relatives multiplied variation factors. No working-day adjustment is
by weights) for any one month to obtain the index needed for the man-hour series which are reported in
number for the month. The weights used are per- terms of rates.
centage weight factors, that is, percentage of the
The adjustment for seasonal fluctuations is made
weight assigned to each series to the total weight directly for the 21 manufacturing and 5 mineral
assigned to all series in the base period. Since the major industry group indexes, and the adjusted
total of the percentage weight factors is equal to indexes for the larger aggregates—such as durable
100, the sum of the products of all series for any one and nondurable manufactures, manufactures, minmonth (all series times their respective weight fac- erals, and industrial production—are obtained as
tors) gives the index of industrial production for combinations of these.
that month. The products of the component series
Relation to other series.—As an important general
and their weights give the number of points con- economic indicator, the index of industrial productributed to the index by individual series. This tion is related in varying degree to other general
method of computation facilitates analysis of the economic indicators. Among the more important
changes in the index. For example, it makes it series to which the index is closely related are those
possible to observe the points contributed by each on manufacturers' sales. It should be observed,
series or group of series, and therefore to determine however, that these are value or dollar-volume
what series or group of series are responsible for the series, and are therefore influenced by price as well
month-to-month changes in the total index or in the as quantity changes. The industrial production
index for any group or subgroup of industries.
index, on the other hand, being a measurement of
The weights used are based on value added—the physical volume, registers quantity changes only.
difference between the value of products and the cost Differences in movement between the production
of materials or supplies consumed—in individual index for manufacturing and the shipment series for
mining and manufacturing industries in 1947. The manufacturing are also possible for other reasons:
value-added data for mining are based on estimates production differs from shipments because of changes
prepared by the Bureau of Labor Statistics in con- in factory inventories; the production index uses the
nection with its input-output studies. The value- establishment as the unit for industry classification,
added figures for manufacturing are obtained from whereas the shipments series uses the company as
the Census of Manufactures for 1947. However, the unit; and the production index uses value added
since value-added data are not available for indi- as weights for the series, whereas the shipments
vidual products of each industry, such data are in series implicitly uses value of shipments.
32
Industrial Production
[1947-49-100]
Total
industrial
production
Year
Manufactures
Total
Durable
Nondurable
Minerals
1919
39
38
38
37
45
1920
1921
1922
1923
1924
41
31
39
47
44
39
30
39
45
43
42
24
37
47
43
36
34
40
44
42
53
42
45
62
57
1925
1926
1927
1928
1929
49
51
51
53
59
48
50
50
52
58
49
52
49
53
60
46
48
50
51
56
59
63
64
63
68
1930
1931
1932
1933
1934
49
40
31
37
40
48
39
30
36
39
45
31
19
24
30
51
48
42
48
49
59
51
42
48
51
1935
1936
1937
1938
1939
47
56
61
48
58~
46
55
60
46
57
38
49
55
35
49
55
61
64
57
66
55
63
71
62
68
67
87
106
127
125
66
88
110
133
130
63
91
126
162
159
69
84
93
103
99
76
81
84
87
93
1945
1946
1947
1948
1949
107
90
100
104
97
110
90
100
103
97
123
86
101
104
95
96
95
99
102
99
92
91
100
106
94
1950
1951
_
1952
i
1953 *
1954 i
112
120
124
134
125
113
121
125
136
127
116
128
136
153
137
111
114
114
118
116
105
115
114
116
111
1940
1941_
1942
1943
1944
__
i Preliminary estimates.
NOTE.—Monthly and annual data available beginning 1919.
Source: Board of Governors of the Federal Reserve System.
The component indexes are used to determine the
The production index is not comparable in coverage
with deflated gross national product: it covers areas in which the occurrence of important changes
manufacturing and mining only, whereas the gross accounted for the observed changes in the total
national product includes all output. In recent index. They are also used in analyses relating to
years, product originating in manufacturing and individual industries. Many companies, for instance,
mining has accounted for about one-third of gross make continuing studies of their own output and
sales figures in relation to the output movements of
national product.
Uses and limitations.—The total index of industrial the industry. They also use the industry and prodproduction is probably most widely used as a business uct series in studies of potential markets, and in
barometer. Both in whole and in detail it is used other types of research. The new index includes
with related data on employment, inventories, trade, many more detailed industry and product series than
prices, and other economic variables, in analyzing the old, and this expansion in detail—e. g., for
consumer durable items—greatly facilitates analysis
short- and long-run developments in the economy.
33
of current developments in markets for different mate data in many cases, some of the components are
less reliable than others.
types of industrial materials andfinishedgoods.
References —The index of industrial production is
Because the coverage of the index is limited to
manufacturing and mining, it should not be used as published monthly in the Federal Reserve Bulletin.
a measure of total production, or even as a measure Seasonally adjusted indexes are available for all major
of total production of goods; the important goods- groups and larger aggregates, and separate comproducing sectors of agriculture, construction, and ponent indexes of manufactures, minerals, durable
utilities are not included. It might be noted, how- manufactures, nondurable manufactures, individual
ever, that changes in the output of manufactures and manufacturing and mineral industries, and individual
minerals are especially significant, in part because manufacturing and mineral products are also pubthey account for a large part of variation in the total lished monthly in the Bulletin} without seasonal
adjustment. The method of constructing the index
of all economic activity.
is
described in the December 1953 Bulletin.
Because it is necessary to use estimated or approxi-
PRODUCTION OF SELECTED MANUFACTURES
The "Consumer durable goods" index is also
The "Durable manufactures" and "Nondurable
manufactures" series shown in Economic Indicators compiled by Federal Reserve. It is a revised and
are selected from the component-group indexes pre- expanded version of an earlier index for major
pared by the Board of Governors of the Federal durable goods first published by the Board in OctoReserve System for the index of industrial produc- ber 1951. In this index, individual series are comtion, described above. The table on Production of bined by means of gross-value weights rather than
Selected Manufactures presents index figures for the value-added weights used in the industrial pronine of the major components of the index of manu- duction index. The index of consumer durable
goods is essentially an index of the volume of factory
factures.
The relative importance of each of these nine output of finished consumer durable commodities.
industry indexes, as well as of the minerals and The index of industrial production, on the other
manufactures indexes, in the overall index of indus- hand, is essentially an index of the volume of factory
trial production may be seen in the following tabula- output by industries which reflects output by stage
tion, which shows the percent of the weight of each of manufacture.
Since May 1954, the Federal Reserve has published
to the total weight of the index in the base period,
monthly indexes, with and without seasonal adjust1947-49:
ment, covering the period 1947 to date for total conIndustrial production
100. 00
sumer durables, for major durables (including autos,
household furniture, floor coverings, ranges, refrigMinerals
9. 98
Manufactures
:
90.02
eration appliances, laundry appliances, heating apparatus, radio sets, television sets), and for other
Durable manufactures
45. 17
consumer durables (including auto parts and tires,
Primary metals
6. 70
and miscellaneous home and personal goods).
Fabricated metal products
5. 73
Monthly indexes are also published for groupings of
Machinery (electrical and nonelectrical)
13. 68
these commodities. Indexes in greater detail are
Transportation equipment
7. 54
compiled annually. In addition, monthly indexes
Lumber and products (except
without seasonal adjustment for individual housefurniture)
3. 09
hold
durable goods are also compiled and are availAllother
8.43
able on request.
Nondurable manufactures
44. 85
Textiles and apparel
11. 87
An analysis of the consumer durable goods indexes
Paper and printing
8. 93
for the period 1947-53 and a description of the
Chemical and petroleum prodmethods used in preparing these indexes are preucts
9.34
sented in the May 1954 issue of the Federal Reserve
Foods, beverages, and tobacco. _ 11. 51
Bulletin.
All other
3. 20
34
Production of Selected Manufactures
[1947-49= 100]
Durable manufactures
Year
Nondurable manufactures
FabriTranspor- Lumber
Primary
cated
Machintation
and
metals
metal
ery 1
equipprodproducts
ment
ucts 2
Textiles
and
apparel
Paper
and
printing
Chemical
Foods,
and petro- beverleum
ages, and
products tobacco
Consumer
durable
goods
1939
54
52
38
47
80
80
66
49
65
1947
1948
1949
103
107
90
103
104
93
103
104
93
96
102
102
101
106
93
99
103
97
96
103
101
97
103
100
101
100
100
98
102
101
1950
1951
1952
1953
1954 4
115
126
116
132
108
115
122
121
136
123
114
130
147
160
142
120
135
154
189
175
113
113
111
118
115
110
106
105
107
100
114
118
118
125
125
118
132
133
142
142
103
105
106
107
106
133
114
105
127
116
3
()
i Electrical and nonelectrical,
i Except furniture.
* Not available.
< Preliminary estimates.
Source: Board of Governors of the Federal Reserve System.
WEEKLY INDICATORS OF PRODUCT
The following brief descriptions relate to the
weekly series presented each month in Economic
Indicators for a number of selected indicators—
steel, electric power, bituminous coal, freight, paperboard, and cars and trucks. The series are useful as
current measures, available more promptly than
monthly or annual figures. They are subject,
however, to erratic movements not shown in comparable series covering longer time periods.
The historical table of annual data presented here
is in terms of weekly averages, in order to facilitate
comparison of historic levels with the current series
in Economic Indicators. Weekly averages for years,
as shown in this table, are computed by dividing the
total annual figures by 52. Weekly averages for
months, as shown in current issues of Economic Indicators, are computed by assigning individual weeks
to the month in which a majority of the days fall.
from more than 90 percent of the industry, giving
actual production for the preceding week and advance estimates of production for the coming week.
The production for the 10 percent of the industry
not reporting weekly is estimated on the basis of the
reported previous months1 production of the companies included in this group.
The Institute publishes the weekly series each
Monday in a mimeographed release, showing production for the preceding week and estimated production for the coming week. It also publishes each
month detailed production of steel by types of furnaces, whether ingots or castings, and volume of
alloy steel. Monthly production of blast furnaces
shows volume of pig iron and ferroalloys produced.
Both series are supplemented with statistics showing
geographical district in which the steel and iron were
produced. Annual statistics in similar detail are
presented in the Institute's Annual Statistical Report.
Steel Produced
With its weekly, monthly and annual figures on
production,
the Institute publishes a series on "PerThe weekly series on steel production is compiled
by the American Iron and Steel Institute. It in- cent of theoretical capacity" and an "Index of ingot
cludes steel for ingots and castings produced by open- production, 1947-49 = 100." The figures on percent
hearth, Bessemer, and electric-furnace processes, ex- of capacity are the ratio of the weekly production to
cept for the small amount of steel for castings pro- average weekly capacity on the first of the year.
duced in foundries operated by companies which do This series, which measures the operating rate in
not produce ingots. The small quantity of crucible relation to full capacity, is useful as an indicator of
steel now produced is included with the production the general economic level but cannot be used for
year-to-year comparisons of the volume of steel
of electric furnaces.
The series is based on current reports received production. The index, on the other hand, provides
35
an accurate comparative measure of the volume of
steel production from one period to another, regardless of changes in capacity.
The weekly series was initiated in October 1933.
Comparable annual data on steel production are
available from 1867,
Bituminous Coal Mined
The series on production of bituminous coal is
compiled weekly by the Bureau of Mines, Department of the Interior. It includes bituminous coal
and lignite, and is a very close approximation of total
production in the United States.
The figures are estimated on the basis of carloadElectric Power Distributed
ings and river shipments. The method of estimaThe weekly series on electric power distributed is tion consists of raising the rail and river shipment
compiled by the Edison Electric Institute. It may figures by factors to represent the coal that is not
be defined as the energy sold to ultimate consumers transported by rail or river, such as truck shipments,
plus line losses and unaccounted-for losses; or as net local sales, colliery fuel, and coal produced by small
generation plus net import over international bound- mines for local use. The weekly estimates are adaries, less energy used by the producer and the justed annually by the actual figures on production
distributor. It includes operations of all private, of coal and lignite collected each year from all promunicipal, cooperative, and governmental enter- ducers by the Bureau of Mines. The correction is
prises engaged in the production or distribution of negligible—within less than one-half of 1 percent.
electricity for the use of the public; it does not include The daily average for the week is obtained by dividing
energy generated by captive plants of industrial the weekly production by the maximum number of
establishments.
working days (not days actually worked) in that
The weekly figures are collected by the Institute week.
by telegraph from approximately 105 reporting
Although bituminous coal is still an important inutilities (either companies or groups of intercon- dustrial fuel, its importance has decreased in recent
nected companies) representing about 95 percent of years. In 1920 it accounted for 67.8 percent of the
the total energy available for public consumption. total supply of energy from mineral fuels, in 1940 for
The estimated 100 percent production is obtained by 47.9 percent, and in 1954 for 27.5 percent. The
applying the ratio of the monthly output of all series on production of bituminous coal and lignite
utilities as collected and presented by the Edison has other weaknesses as an indicator of industrial
Electric Institute for the previous month.
activity. Coal mines normally operate at a fraction
The weekly series is useful in economic analysis of their capacity—about 3 days a week—and the
because it is available promptly and is a reliable coal-using industries carry considerable stocks to
measure of net energy distribution to the public allow for changes in industrial activity, with resultant
supply. It is not a sensitive measure of important changes in coal consumption, without regard to the
changes in industrial activity, however, since it ups and downs in coal output. The figures on coal
includes energy used for nonindustrial purposes, production should therefore be analyzed in conjuncsuch as air-conditioning loads, requirements of the tion with related series, also compiled by the Bureau
Atomic Energy Commission, and sales to residential of Mines, on the consumption of coal by industries
and rural consumers.
and deliveries to retail dealers, and on stocks of coal
The weekly series is issued each Wednesday by the held by industries and retail dealers.
Edison Electric Institute. The Institute also pubThe weekly estimates of total production and averlishes monthly research statistics, including addi- age production per working day and series on contional data on source and disposal of energy, for sumption and consumers' stocks are published in the
which the data on generation are obtained from the Bureau of Mines multilithed Weekly Coal Report. A
Federal Power Commission. The Federal Power description of the method used in making the estiCommission issues a monthly bulletin on Electric mates and more detailed annual data may be found
Power Statistics, with monthly and annual data on in the chapter on "Bituminous Coal and Lignite"
production, fuel consumption, requirements, and which appears in each annual issue of the Bureau of
supply.
Mines Minerals Yearbook.
The weekly series was initiated in 1928. Annual
Weekly data on production of bituminous coal and
data on the production of electrical energy are avail- lignite are available from 1917, and annual data from
able from 1902, but data for 1935 and prior years are 1807.
not strictly comparable with those beginning in 1936.
26
Weekly Indicators of Production
[Weekly averages]
Steel produced
Year
Thousands Percent of
theoretical
of net
tons
capacity 1
Electric
power
distributed
(millions of
kilowatthours)
Bituminous
coal mined
(thousands
of short
tons) 3
Freight
loaded
(thousands
of cars)
Paperboard
produced
(thousands
of tons)
(4)
4
)
(44)
(4)
(4)
()
Cars and trucks assembled
(thousands) 3
Total
Cars
Trucks
1914..
491
60. 0
(4)
(4)
(4)
1915
1916
1917
1918
1919
675
895
955
940
731
1
0
3
9
4
(44)
(4)
(44)
(4)
(4)
(44)
(4)
1,
1,
1,
1,
1,
847
356
379
845
573
868
756
831
958
933
692
864
684
631
740
985
1, 021
993
992
1, 016
60
65
67
74
82
82. 0
82. 7
65.4
83. 8
103.0
71. 8
72.8
56. 5
72. 6
88.2
10.
9.
8.
11.
14.
64. 5
45. 9
26. 3
37.0
52. 9
53. 5
37. 9
21.8
30. 3
41. 8
11. 0
8.0
4. 5
6. 7
11. 1
79.
95.
92.
85.
64.
()
0)
4
(4)
()
()
1, 512
()
805
11. 0
10. 5
0. 5
18.
31.
36.
22.
36.
7
1
0
5
1
17.
29.
33.
18.
31.
2
3
6
1
8
1. 4
1. 8
2. 5
4.4
4 3
42.
31.
48.
77.
69.
8
1
9
6
3
36.
28.
43.
69.
61.
6
2
7
7
3
6. 2
2. 8
5. 2
7.9
8.0
1920
1921
1922
1923
1924
883
415
747
940
793
76.
34.
61.
77.
64.
7
9
7
3
6
(44)
()
(44)
(4)
1925
1926
1927
1928
1929
953
1,015
945
1, 083
1, 184
75.
84.
75.
84.
88.
4
1
4
6
7
(4)
(44)
()
1, 551
1, 733
1,
1,
1,
1,
1,
1930
1931
1932
1933
1934
855
549
289
493
560
62.
38.
19.
33.
37.
8
0
7
5
4
1,
1,
1,
1,
1,
714
646
488
544
655
1,
1,
1,
1,
1,
522
243
007
090
173
882
714
542
562
593
76
73
64
76
76
1935
1936
1937
1938
1939
732
1, 023
1, 086
609
1,013
48.
68.
72.
39.
64.
7
4
5
6
5
1, 793
2, 037
2, 256
2, 148
2,398
1,
1,
1,
1,
1,
217
432
456
139
293
606
694
724
586
652
88
103
107
95
114
75.
85.
92.
47.
69.
9
7
5
9
5
62. 5
70. 6
75.3
38. 5
55.7
13.4
15. 1
17. 2
9.4
13.8
1940
1941_
1942...
1943
1944
1,
1,
1,
1,
1,
281
589
650
704
715
82.
97.
96.
98.
95.
1
3
8
1
5
2,
3,
3,
4,
4,
684
142
552
155
385
1,
1,
1,
1,
2,
503
695
909
907
009
699
814
823
816
835
122
152
138
147
153
86.8
93. 4
20. 8
14. 5
15.2
71. 7
72. 3
4. 0
(5fi)
()
15.
21.
16.
14.
15.
1945
1946
1947
1948
1949
1,
1,
1,
1,
1,
529
277
628
695
496
83.
72.
93.
94.
81.
5
5
0
1
1
4,
4,
4,
5,
5,
244
235
821
300
500
1, 891
1, 745
2, 058
1, 948
1, 427
806
795
856
822
691
153
163
180
184
177
15. 1
59. 6
92.2
101. 5
120.4
1. 6
41. 5
68. 4
75.2
98. 6
13. 5
18. 1
23. 8
26.3
21.8
1950.
1951
1952
1953
1954__
1, 857
2,018
1, 782
2, 141
1, 694
96.
100.
85.
94.
71.
9
9
8
9
0
6,
6,
7,
8,
8,
183
958
451
244
883
1, 687
1, 772
1, 548
1, 521
1, 304
748
779
730
737
651
214
229
213
241
236
154. 2
129.8
106. 8
141. 1
125. 6
128.4
102.7
83. 4
118. 0
106. 0
25.9
27. 2
23.4
23. 2
19. 7
()
(44)
()
(4)
M
(4)
2
9
9
2
8
1
0
9
5
2
1 Percent of capacity based on weekly net ton capacity.
* Daily average.
« Production figures for 192^-54; factory sales figures for 1928 and preceding years.
4 Comparable figures not available.
4 Less than 500.
NOTE.—Detail will not necessarily add to totals because of rounding.
Sources: American Iron and Steel Institute, Edison Electric Institute, Department of the Interior, Association of American Railroads, National Paperboard
Association, and Ward's Automotive Reports.
37
Freight Loaded
tainers and boxes for packaging and shipping numerous products, the production of paperboard moves
The weekly revenue freight loaded series, com- closely with general economic activity.
piled by the Association of American Railroads, was
The weekly data are issued by the Association in
initiated in 1919 as an operations report for railroad a one-page release on Wednesday of the week followofficers. The published data are totals of weekly ing that to which the figures relate. More detailed
reports received by the AAR from all class I railroads. statistics are presented in the Association's annual
Revisions in the data are necessary in only a very Paperboard Industry Statistics. The Association also
few cases, usually only when a preliminary estimate publishes a series on "percent of activity" based on
is filed to meet the reporting deadline and then cor- industry reports of the time in use of the machines
rected when a final figure is available. The weekly on an inch-hour basis (1 inch of machine width
revenue freight loaded report fco the AAR contains operated for 1 hour).
information on revenue freight and on total loads
Comprehensive monthly and annual data on pulp,
received from connections, by eight broad commodity paper, and paperboard are collected by the Bureau
groups, by railroad geographical district, and by in- of the Census and published in its Facts for Industry
dividual class I railroads. Comparisons are shown series. The paperboard component of the Census
for the corresponding weeks of each of the 2 preced- series is not completely comparable with the Assoing years.
ciation series, though the differences are not large.
The weekly revenue freight loaded series is widely
The Association's weekly data on paperboard proused by business analysts as one of the indicators of duction was initiated in 1933. Comparable annual
general business activity. It should be remembered, data are available from 1925.
however, that long-term changes in the series are
affected by other factors than business activity, such Cars and Trucks Assembled
as increased use of competing means of transportaThe weekly series on output of cars and trucks is
tion (primarily truck).
compiled
by Ward's Reports, Inc., and is based on
The detailed freight loaded data are published by
information
received from each of the individual
the AAR in its CS-54A report, "Revenue Freight
Loaded and Received from Connections." The re- producers in the United States. It is published each
port is published weekly on the Thursday following Monday in Ward's Automotive Reports, which shows
a breakdown of the weekly total by cars and trucks
the week to which the data relate.
and by makes, and current and cumulative monthly
The freight loaded data are available from 1919.
totals, with similar data for Canada. Detailed data
Faperboard Produced
are presented in Ward's Automotive Yearbook.
Monthly and annual data on factory sales are comThe weekly series on production of paperboard,
piled and published by the Automobile Manufaccompiled by the National Paperboard Association,
turers Association. The sales figures differ somemeasures the production of container board, bending
what from the productionfigures,principally because
board, nonbending board, special paperboard stock,
they include some units produced in earlier periods
cardboard, and other miscellaneous types of paperand exclude some units produced in the current
board. The data are obtained from weekly reports
month.
which the Association collects from member comIn the accompanying historical table, data for the
panies, currently accounting for about 87 percent of
years
1929 through 1954 are production figures, as
total production. The estimated 100 percent producreported
in Ward's 1955 Yearbook; data for earlier
tion is calculated on the basis of the ratio of the
years
are
factory salesfigures,as reported in the 1954
annual production of the companies which submit
edition
of
Automobile Facts and Figures, published
weekly reports to total production for the previous
by
the
Automobile
Manufacturers Association.
year. The figures on total annual production are a
The
weekly
production
figureshave been published
summation of annual data reported to the Association by practically all mills. Because of the exten- by Ward's since 1925. Annual data on factory sales
sive use of paperboard in the manufacture of con- of cars and trucks are available from 1900.
38
NEW CONSTRUCTION
Description &f series.—The series on new con- allow for projects not included in these reports—
struction activity represent the dollar value of new chiefly small projects and work done by a firm's own
construction put in place. The Business and Defense force. Information on starting date and cost is
Services Administration in the Department of Com- obtained from contractors or owners of the larger
merce and tke Bureau of Labor Statistics in the projects. Allowance is also made for construction
Department of Labor are jointly responsible for the in 11 Western States not covered by Dodge by
series, BDSA having primary responsibility for applying the ratio of valuation of building authorized
private nonresidential construction and BLS for in these States to the total valuation of permits in the
private residential and all public construction. entire country for each of several types of construcSeasonally adjusted monthly data, prepared by tion. An estimate of the valuation of dwelling units
these two agencies, are published in current issues started is obtained by multiplying the number of
units reported in the "New nonfarm housing starts"
of Economic Indicators.
Construction covers the erection of fixed structures series (p. 40) by valuationfiguresreported in building
and utilities. It includes building and nonbuilding permits, the latter having been adjusted on the basis
structures such as dams, reservoirs, docks, highways, of periodic field surveys to reflect construction costs.
airfields, and utility lines. Installed service facilities These estimates of valuation of work started are then
which become integral parts of structures are in- translated into estimates of the value of work put in
cluded, but movable equipment and machinery are place by the application of typical progress patterns
not included. Drilling of oil, gas, and water wells, which have been developed for different types and
digging and shoring of mines, and operations which sizes of projects by surveying actual projects.
The second method—reports of physical progress—
are an integral part of farming such as plowing,
terracing, and digging drainage ditches, are not con- provides the basis for estimates of construction
sidered as construction. Major additions and altera- activity on most Federal public-construction projects
tions are counted as new construction, but main- as well as on some State-and local jobs receiving Federal aid. Progress reports are supplied by the Fedtenance and repairs are not.
eral
agencies administering the various programs.
The distinction between private and Federal, State,
The
third method—based on financial reports—is
and local public construction is made here on the
basis of ownership, not source of funds. Residential used for estimating most utility construction. The
construction includes nonhousekeeping facilities such method is to apply a monthly trend pattern to an
estimated annual total based on the previous year's
as hotels and dormitories as well as dwelling units.
The series on construction contracts awarded, level and other information on anticipated activity.
compiled by the F. W. Dodge Corporation, covers The trend data are based on Dodge reports of concontract awards in the 37 Eastern States, for private tract awards and quarterly reports of some types of
and public ownership, for nonresidential, residential, companies to the Securities and Exchange Commisand public works and utilities construction. It does sion. These monthly estimates are revised when the
not have complete coverage of force-account or financial reports become available after the end of the
smaller construction projects, and rural areas are year. Construction expenditure estimates for telecovered less fully than urban. Current issues of phone and telegraph are based on monthly estimates
Economic Indicators also show annual rates of the received from the companies; those for railroads are
contract-awards data for recent months, with and based on monthly estimates compiled by the Interwithout seasonal adjustment. The seasonal adjust- state Commerce Commission.
Monthly estimates of farm construction are prement of this series is made by the National Bureau of
pared by projecting annual estimates for the precedEconomic Research.
Statistical procedures.—Three general methods areing year on the basis of the trend of farm income and
used by BDSA and BLS in making the estimates of applying a seasonal pattern to the annual totals.
The Dodge data on construction contracts awarded
new construction activity, depending on the availin
the 37 Eastern States are compiled as a byproduct
ability of sources of data on different types of conof the corporation's news reporting service. News
struction.
Thefirstmethod—converting data on work started reporters interview architects, contractors, owners,
to estimates of work put in place—is used for most real-estate brokers, and others who supply informatypes of private and non-Federal public construction. tion on construction jobs being planned and the
Information in the Dodge reports is adjusted to awarding of construction contracts.
39
Relation to other series.—The new construction directly to the total use of construction labor and
activity series is one of the components in the gross materials.
Because of the many different sources of data, and
national product series (see above, p. 4) and in the
gross private domestic investment series (see p.16). the various estimating procedures used, the error in
The definition of construction used in the new the estimates cannot be statistically measured.
construction series is more inclusive than that in Year-to-year trends are probably quite good but
some of the series pertaining to labor. The non- caution should be exercised in drawing conclusions
agricultural employment series contains a component from relatively small month-to-month changes.
While extensive adjustments are made for underfor employment in contract construction only,
excluding employment on construction performed by coverage of the source data now used, there is no
force account. (For a fuller discussion of noncom- satisfactory factual basis for making these adjustparability of these data, see the Technical Note in ments, and much reliance is placed on judgment
the March 1955 issue of Construction Review.) The and opinion. The construction patterns used in
series on average weekly hours and average hourly translating work started into work put in place may
and weekly earnings cover contract construction of be obsolete and do not reflect short-run changes due
to such factors as weather or the labor and materials
buildings only.
Uses and limitations.—Although the new con- supply situation.
References.—Data used in this series are published
struction series indicates the current volume of this
in
more detail by type of construction, ownership,
segment of economic activity, it does not serve the
same purpose as would a series on new work started. and source of funds in Construction Review, a monthly
The future trend in the series is determined to a publication of the Departments of Commerce and
considerable extent by past commitments made. Labor. Data on contracts awarded are published
The figures cannot be used as an indicator of the in more detail by type of construction, geographic
physical volume of construction without extensive location, and ownership in Dodge Statistical Research
adjustments for changes in prices and wage rates, Service, a monthly subscription service of the F. W.
technological changes, and other relevant factors. Dodge Corporation. More detailed descriptions of
A series reflecting some of these adjustments, pub- the sources of data and the methods of compiling
lished monthly in Construction Reviewt shows the the estimates are contained in Techniques of Preparvalue of new construction put in place in terms of ing Major BLS Statistical Series (BLS Bulletin 1168),
1947-49 prices. Also, since the series does not December 1954, and in the annual construction
include maintenance and repair, it cannot be related activity supplement to Construction Review.
HOUSING STARTS AND APPLICATIONS FOR FINANCING
Description of series.—The series on the total num- Statistical procedures.—Each month BLS mails a
ber of new nonfarm dwelling units on which con- questionnaire to some 7,000 local government
struction is started in the United States each month, officials who issue building permits, located in incorwith the breakdown by public and private ownership, porated places or in counties and townships,
is compiled by the Bureau of Labor Statistics, as throughout the country. Information is requested,
described below. Independently of that compilation, among other things, on the number of dwelling units
the Federal Housing Administration and the Vet- for which building permits were issued during the
erans Administration provide reports on the number month.
of units involved in their respective programs.
Reports from permit-issuing places are classified
For the purpose of the BLS series the dwelling unit by type of place, size, geographic area, and whether
is defined as a dwelling place containing permanent inside or outside a metropolitan area. Reports in
cooking facilities, i. e., accommodations with house- each class are weighted to account for places not
keeping facilities designed for family living. Units reporting, and added to give the total number of
such as transient hotels and dormitories which lack units for which permits were issued. Adjustments
housekeeping facilities, and such dwellings as trailers, are made to allow for difference in time between
houseboats, sheds, and shacks, and temporary World issuance of permit and start of construction and for
War II housing built by the Government are not permits not used. The result is an estimate of
included. Dwelling units are classified as public or private units started in permit-issuing places.
private on the basis of ownership.
Information on new housing starts in areas not
40
New Construction
[Billions of dollars]
Year
Total new
construction
Private
Total
private
Residential
(nonfarm)
Federal,
State, and
local 1
uuier
Construction
contracts
awarded in
37 Eastern
States
1915
1916
1917
1918
1919
3.3
3.8
4. 6
5. 1
6.3
2. 5
3. 1
3. 3
2.9
4.3
1. 2
1.4
1. 2
.9
1.8
1.3
1.8
2. 1
2.0
2.5
0.7
.7
1. 3
2. 2
2.0
(22)
()
(22)
()
1920
1921
1922
1923
1924
6.7
6.0
7.6
9.3
10.4
5. 4
4. 4
6.0
7.7
8. 5
2.0
2. 1
3.4
4.4
5. 1
3.4
2.3
2. 6
3. 3
3.4
1.4
1. 6
1.7
1.6
1.9
(2)
(22)
()
(32)
()
1925
1926
1927
1928
1929
11.4
12. 1
12. 0
11. 6
10. 8
9. 3
9. 9
9.6
9. 2
8.3
5.5
5. 6
5. 2
4. 8
3. 6
3.8
4.3
4.5
4.4
4.7
2. 1
2. 1
2.4
2.5
2.5
6.0
6.4
6.3
6.6
5.8
1930
1931
1932
1933
1934
8.7
6.4
3. 5
2. 9
3.7
5.9
3.8
1.7
1. 2
1.5
2. 1
1. 6
6
.5
,6
3. 8
2. 2
1.0
,8
,9
2.9
2.7
1. 9
1. 6
2. 2
4.5
3. 1
1.4
1.3
1.5
1935
1936
1937
1938
1939
4. 2
6.5
7.0
7.0
8.2
2.0
3. 0
3.9
3. 6
4. 4
1. 0
1. 6
1. 9
2. 0
2.7
1.0
1.4
2.0
1. 6
1.7
2. 2
3. 5
3. 1
3.4
3.8
1.8
2.7
2. 9
3.2
3. 6
1940
1941
1942
1943
1944
8. 7
12.0
14. 1
8.3
5.3
5. 1
6. 2
3.4
2.0
2. 2
3.0
3. 5
1. 7
9
8
2.
2.
1.
1.
1.
1
7
7
1
4
3. 6
5.8
10.7
6.3
3. 1
4. 0
6.0
8.3
3.3
2.0
1945
1946
1947
1948
1949
5. 6
12. 0
16.7
21. 7
22. 8
3. 2
9. 6
13.3
16. 9
16.4
1. 1
4.0
6. 3
8. 6
8. 3
2. 1
5. 6
6. 9
8.3
8. 1
2.4
2.4
3.4
4.8
6.4
3.3
7.5
7.8
9.4
10.4
1950
1951
1952
1953
1954
28. 5
31. 2
33.0
35. 3
37. 6
21. 5
21.8
22. 1
23. 9
25. 8
12. 6
11.0
11. 1
11.9
13. 5
8. 9
10. 8
11.0
11.9
12.3
7.0
9.4
10. 9
11.4
11. 8
14. 5
15.8
16.8
17.4
19.8
1
J
(*)
Includes public residential construction.
Not available.
NOTE.—Monthly data on new construction activity available beginning 1939; annual from 1915. Monthly and annual data on contracts awarded available from
1925. Detail will not necessarily add to totals because of rounding.
Sources: Department of Commerce, Department of Labor, and F. W . Dodge Corporation.
41
covered by building permits is obtained from field
surveys in a sample of 53 areas embracing 131 counties. The national estimate of starts in all nonpermit-issuing areas is based on a ratio type of computation which depends on the relationship between
the volume of starts in the nonpermit and the permit
parts of the sample areas. This estimate is added
to that for permit areas to give the total number of
private nonfarm units started.
Information on number of public units started is
obtained directly from the sponsoring Federal, State,
and local agencies. This figure added to the estimate for private units gives the estimate of the total
number of nonfarm dwelling units started each
month.
The seasonally adjusted annual rate of starts of
private units, published in current issues of Economic
Indicators, is computed each month by dividing the
estimate of private starts for that month by the
respective seasonal index and multiplying the result
by 12.
A preliminary estimate is issued approximately
15 days following the end of the month. The estimating technique for permit places involves the
computation for identical places of the percent change
from the previous month, using all places which have
reported in time. The preliminary estimate of starts
in nonpermit places is obtained by projecting the
most recent final estimate for such places on the
basis of the trend of starts in permit places, with
adjustments for seasonal factors affecting the relation between permit and nonpermit places.
The figures for the FHA and VA programs under
"New nonfarm housing starts" are based on administrative reports of the number of units on which
first compliance inspections have been made by
those agencies. The first inspection is usually made
after the footings are in—normally only a slight lag
from the time construction is considered started in
the BLS series. The FHA and VAfiguresfor "Proposed home construction" are also based on administrative reports of the two agencies. The number
of units for which FHA lias received applications is
limited to those for commitments on 1- to 4-family
home mortgages, thus making it more nearly comparable with the VA series since the VA program
covers only homes to be built for occupancy by
veteran owners.
Relation to other series.—Data compiled for the
BLS housing starts series are used in the preparation
of estimates for the series on new construction,
described in the preceding section.
The BLS series on new housing starts has a
limited relationship to census of housing figures.
42
Units started should not be added to census inventory figures without an adjustment to allow time
for completion. Also, although new construction
usually accounts for the greater part of the difference in inventory reported in successive housing
censuses, there are other changes too, such as demolition, disaster losses, additions and losses due to
conversions, and changes in classification as farm or
nonfarm. The census also includes certain types of
places where people live which would not be counted
as dwelling units under the definition for the new
housing starts series.
The BLS also publishes data on building authorized
for all reporting places. Thesefiguresdiffer from the
new housing starts series in that they represent totals
taken from building permit reports without any adjustment for lag and lapse.
Uses and limitations.—The BLS series on nonfarm
housing starts serves as an important guide in the
formulation of national housing policy and as an indicator of a substantial part of all building activity and
related economic trends. One deficiency, which affects its use as a timely indicator,, is the fact that the
revised nonfarm starts estimate, made 3% months
after the month affected, may differ fairly substantially from the preliminary estimate. For the
6-year period, 1949-54, these changes averaged 2.8
percent, but ranged from an increase of 12.8 percent
in the final estimate over the preliminary to a decrease of 6.1 percent. Increases have been slightly
more frequent and larger than decreases.
The revised or final estimates are subject to two
kinds of errors. The first, amounting to about 2 percent, is error due to sampling in nonpermit places
and lack of complete information reported from
permit-issuing places. The amount of the second
type of error cannot be measured. It stems from a
variety of sources, such as building without permits
and short-run changes in the time of starting construction after permits are issued.
The FHA and VA series indicate the importance of
these Government programs in the field of new home
construction. Certain limitations in these series
should be observed, however, particularly in their
relation to other data. Although FFIA and VA may
make inspections during construction and the units
may be counted as FHA or VA "starts," the permanent financing after completion may not be
underwritten. Also, some applications for FHA
commitments or requests for VA appraisals lapse or
never result in inspections, even though construction
is started. There is some duplication of units in
applications for FHA commitments and requests for
VA appraisals. In cases where both agencies issue
Housing Starts and Applications for Financing
[Thousands of units]
Proposed home construction
New nonfarin housing starts
Privately financed
Year
Publicly
financed
Total
Government underwritten
Total
Total
FHA
Applications for
FHA commitments 1
VA
1915.1916.1917-1918-1919--
475.0
480. 0
230. 0
120. 0
330. 0
475. 0
480.0
230.0
120.0
330.0
1920..
1921 _
1922,_
1923-.
1924..
247.
449.
716.
871.
893.
0
0
0
0
0
247.0
449.0
716.0
871.0
893.0
1925_„
1926._
1927-,
1928._
1929__
937. 0
849. 0
810. 0
753. 0
509. 0
937.0
849.0
810.0
753.0
509. 0
1930..
1931._
1932-.
1933._
1934-_
330. 0
254. 0
134.0
93. 0
126. 0
330.0
254.0
134.0
93.0
126. 0
1935._
1936..
1937-_
1938._
1939,_
221. 0
5.
14.
3.
6.
56.
3
8
6
7
6
215.7
304. 2
332. 4
399.3
458.4
14. 0
49. 4
60.0
118. 7
158. 1
14. 0
49. 4
60. 0
118.7
158. 1
20.
47.
49.
125.
167.
1940_ _
1941_.
1942._
1943„_
1944__
602. 6
706. 1
356. 0
191.0
141. 8
73.0
86. 6
54. 8
7.3
3. 1
529.6
619. 5
301. 2
183.7
138. 7
180. 1
220.4
165.7
146.2
93.3
180. 1
220.4
165. 7
146.2
93.3
217. 9
277. 7
234. 8
144.4
62. 9
1945._
1946_.
1947._
1948._
1949._
209. 3
670. 5
849.0
931. 6
1, 025. 1
3.4
18. 1
36.3
208. 1
662.5
845. 6
913.5
988.8
( 2)
(2 )
( 2)
(3)
()
41. 2
69.0
229. 0
294. 1
363. 8
1950__
1951._
1952.
1953._
1954__
1, 396. 0
1,091.3
1, 127. 0
1, 103. 8
1, 220. 4
43.
71.
58.
35.
18.
686. 7
412.2
421. 2
408. 6
583. 3
486.
263.
279.
252.
276.
319.
336.
406.
515.
0
0
0
0
1.2
8.0
8
2
5
5
7
2
1, 352. 2
1, 020. 1
1, 068. 5
1, 068. 3
1, 201. 7
7
5
9
0
3
6
8
8
1
8
(2)
CO
(2)
(2)
(2)
56. 6
121. 7
286. 4
293. 2
327.0
3 200. 0
148. 6
141.3
156. 6
307.0
397.7
192. 8
267. 9
253. 7
338. 6
' Units represented by mortgage applications for new home construction.
* Not available.
3 Partly estimated.
NOTE.—Monthly data on new nonfarm housing starts available beginning 1939; annual from 1910.
Detail will not necessarily add to totals because of rounding.
Sources: Department of Labor, Federal Housing Administration ( F H A ) , and Veterans Administration ( V A ) .
valuation commitments, FHA makes the compliance
inspection and the unit is reported as an FHA start,
even though the mortgage may finally be underwritten by VA or by neither agency. As mentioned
above, the FHA series on housing starts includes
rental housing, whereas the FHA applications series
covers only 1- to 4-family homes.
References.—Data presented in this series are published in somewhat greater detail in Construction
Review, published monthly by the Departments of
Labor and Commerce. A more detailed technical
description of the methods used is given in Techniques
of Preparing Major BLS Statistical Series (BLS
Bulletin 1168) December 1954.
43
SALES AND INVENTORIES
Manufacturing and Trade
reflecting the level of economic activity at the three
major stages of the distributive process. The sales
Description of series.—-Total sales and inventories series reflect the demand for goods and services at
for manufacturing and trade are estimated monthly these three stages, and constitute a basic measure of
by the Office of Business Economics, Department of the state of business for the periods covered. The
Commerce, by summing the estimates computed inventories series reflect the difference between outseparately for manufacturing, retail trade, and whole- put and consumption in the economy. In most past
sale trade. The sales estimates include all business periods of business decline and recovery, the rate of
receipts of the reporting companies or establishments, inventory depletion or accumulation has accounted
not just receipts from sale of merchandise. In gen- for a large part of the aggregate change in overall
eral, the inventory estimates are based on the values economic activity.
carried on the books of the reporting panels. The
The monthly estimates are tested against more
current estimates are adjusted for seasonal variation comprehensive data when those data become availin Economic Indicators.
able at some later time. The estimates for such
Statistical procedures.—The estimates of manufac- aggregates as total manufacturers' sales and estituring and wholesale monthly sales and end-of-month mates for many industry groups have in the past
inventories and retail end-of-month inventories are proved generally accurate, but preliminary estimates,
made by extrapolating benchmark estimates: the In- especially for some of the industrial detail published
ternal Revenue Service's Statistics of Income, 1952, by the Census Bureau and OBE, have occasionally
Part
for manufacturers' sales and inventories; a been changed appreciably.
modified 1948 Census of Wholesale Trade base for
References.—Sales and inventory data for manuwholesale sales and inventories, and the Census Bu- facturers, wholesale trade and retail trade are pubreau's 1951 and 1952 Annual Retail Trade Report
lished monthly in the form of press releases and in
for retail inventories. As new annual data become
the Survey of Current Business. Retail sales estiavailable the benchmark estimates are extrapolated
mates are also published by the Census Bureau in a
to more recent annual estimates which in turn are
separate Monthly Retail Trade Report and in an
extrapolated primarily on the basis of monthly data
Advance Retail Trade Report 10 days after the close
reported to the Census Bureau and OBE. The estiof the month.
mates are revised as more comprehensive data beMore complete descriptions of the various series
come available. A sample survey recently initiated
have been presented in issues of the Survey of Curb}^ the Census Bureau will soon provide direct dollar
rent Business: for .Manufacturers, October 1951,
estimates for merchant wholesalers.
October 1952, December 1953, and May 1955; for
Monthly estimates of retail sales, unadjusted for
Wholesale Trade, August 1948, October 1951, Octoseasonal variation, are derived directly from a
ber 1952, and December 1953; and for Retail Trade,
monthly survey, based on a random area sample,
September and November 1952, and January 1954.
conducted by the Census Bureau. The estimates
The Bureau of the Census has also issued a descripare computed directly from the imported sales of
tion of the sample used in the monthly retail trade
stores in the sample by weighting the reported sales
report.
of each member of the sample by a value dependent
upon its probability of selection. These estimates Department Stores
* are not linked to a benchmark. Adjustments for
seasonal variation are made by OBE.
Description of series.•—Monthly indexes of departThe wholesale trade and retail trade series de- ment store daily average sales and end-of-month
scribed above are based upon the establishment unit inventories are prepared as a joint product of the
of classification, whereas the manufacturers' series Federal Reserve Board's Division of Research and
are based upon the company unit of classification. Statistics and the research departments of the 12
The Office of Business Economics adjusts the whole- Federal Reserve district banks. The coverage and
sale series to remove the major sources of duplication collection methods and the procedures used in comwith manufacturers' sales so that they can be summed puting these indexes are described in detail in the
to obtain a consistent series for total business sales.
December 1951 issue of the Federal Reserve Bulletin.
Relation to other series.—The index of department
Uses and limitations.—The monthly sales and inventories series are important economic indicators, store sales is closely related in scope to the Commerce
44
Sales and Inventories
Manufacturing
and trade
Year
Sales i
Inventories 2
Sales 1
Inventories 2
Retail
Wholesale
Manufacturing
New
orders 1
Sales i
Inventories 2
Sales »
Department stores
Inventories 2
0)
(4)
5.9
12. 8
1939
10. 8
20. 1
5. 1
11. 5
1940
1941
1942
1943
1944
12.
15.
18.
21.
23.
1
8
6
9
8
22.2
28. 8
31. 1
31. 3
31. 1
5.9
8. 2
10. 4
12. 8
13. 8
12.
17.
19.
20.
19.
8
0
3
1
5
6.
9.
13.
12.
11.
1945
1946
1947
1948
1949
23.
27.
33.
36.
34.
9
2
2
4
7
30.
42.
50.
55.
52.
9
9
6
6
1
12.
12.
15.
17.
16.
9
6
9
6
4
18.
24.
28.
31.
28.
39.
44.
45.
48.
46.
9
9
9
4
7
64. 1
75. 2
76. 7
80. 3
76.9
19.
22.
22.
24.
23.
3
3
8
9
4
34.
42.
43.
45.
43.
1950
1951
1952
1953
1954
5
5
(4)
(<)
5.4
Inventories 3
Index 1947-49 =
100
Billions of dollars
1929
Sales 1
(4)
4.0
0)
2.2
3. 1
3. 5
5. 5
8
8
3
?
9
2. 4
3. 0
3.4
3. 8
4.2
3.2
4. 0
3. 8
3.7
3.9
3. 9
4. 6
4. 8
5.3
5. 9
6.
7.
8.
7.
7.
4
5
9
7
9
10. 5
13. 7
15. 6
17.4
15. 9
4. 5
6.0
7.3
7. 9
7.4
4. 6
6. 6
7.6
8. 1
7. 9
3
8
8
9
3
21. 0
24. 5
23. 6
23.4
22. 4
8. 7
9.4
9.4
9.3
9. 1
10.
11.
11.
11.
11.
5
1
3
7
5
6.
8.
10.
10.
10.
5
5
0
9
9
12. 0
5 13.2
13. 7
14. 2
14. 2
5
1
8 '
0
6
6
38
48
35
36
37
44
50
56
62
38
46
64
55
58
7.
11.
14.
15.
15.
9
9
1
8
3
70
90
98
104
98
60
78
94
107
99
19.
21.
21.
22.
22.
3
2
6
7
1
105
109
110
112
111
109
128
118
126
122
Monthly average for year.
* Book value, end of year.
Average of pnd-of-month book value.
* N o t available.
8 Revised series on retail trade beginning 1951; not comparable with previous dat3.
Old series estimates of monthly retail sales for 1951—12.7; and of end-of-vear
retail inventories for 1950—19.9. See Survey of Current Business, September and November 1952, for detail on revision of sales series, and January 1954 for detail on
revision of inventories series.
1
3
NOTE.—Monthly data available beginning 1919 for department store indexes and begin"ing 1939 for all others; comparable quarterly data on manufacturing sale8
and inventories from 1926 shown in April 1949 issue of Survey of Current Business (p. 16). Detail will not neeesssarily add to totals because of rounding.
Sources: Department of Commerce and Board of Governors of the Federal Reserve System.
(Census Bureau and Office of Business Economics) bank districts and for some cities or areas within
series on department store sales. The series are not those districts, as well as for the Nation, are comcompletely comparable. The Commerce series in- puted and published by Federal Reserve. Considercludes sales taxes in the total receipts figure; the able use is made of the indexes at the local level,
Federal Reserve sales index is based upon a receipts especially in the department store field.
figure from which sales taxes are excluded. The
The department store sales and inventories indexes
Census Bureau's dollar-volume series, which is un- are useful as indicators of the relative sales and
adjusted for seasonable variation, measures total inventories positions of this limited, although imporsales during a calendar month, whereas the Federal tant, segment of retail trade. However, one should
Reserve unadjusted index measures daily average not attribute to the department store indexes the
sales on the trading days in the month. All other characteristics of all retail trade. Comparison of
things being equal, the Census Bureau's estimates month-to-month changes in department store sales
will vary with the number of trading days in the with month-to-month changes in total retail sales
month; the department store sales index should not shows that, while changes in the two series have been
be affected by changes in the number of trading days almost always in the same direction, the magnitudes
in the month. OBE adjusts the Census Bureau's of the changes are substantially different for a
series for seasonal variation and for number of trad- majority of the months for which data are available.
ing days in the month. The Commerce adjusted
References.—The indexes of department store sales
dollar series is, therefore, comparable in this respect
and
inventories are published monthly in the
with the Federal Reserve adjusted index of departFederal
Reserve Bulletin. A detailed description of
ment store sales.
the
series
appeared in the December 1951 issue of
Uses and limitations.—Economic Indicators publishes the national indexes of department store sales the Bulletin, and an explanation of "Adjustment for
and inventories. Indexes for the 12 Federal Reserve Seasonal Variation" in the June 1941 issue.
45
MERCHANDISE EXPORTS AND IMPORTS
Description of series.—This monthly Bureau of the ported merchandise shall be the foreign or export
Census series on exports gives the value of mer- value, whichever is higher. In general, they approxichandise (except in-transit merchandise) shipped mate those f. o. b. the exporting country. Transfrom the United States to foreign countries. Exports portation costs and United States customs duties
of Alaska, Hawaii, and Puerto Rico to foreign coun- are therefore excluded. The values given in the
tries are shown as United States exports. Ship- published statistics are those reported by importers
ments between the United States and its Territories on the Bureau of Customs Import Entry Form.
Relation to other series.—Concurrently with the
and possessions are not regarded as exports or imports. Both Government and non-Government publication of monthly totals for exports (including
exports are included. The former include mutual reexports) and general imports, the Bureau of the
security program, military and economic aid, and Census also shows exports of domestic merchandise
Department of the Army civilian supply shipments, and imports for consumption. The latter includes
but shipments to United States armed forces and imports for immediate consumption, plus withdiplomatic missions abroad for their own use are drawals for consumption from customs bonded wareexcluded. Also excluded are exports of gold and houses. The difference between total merchandise
silver, oil and coal bunkers laden at United States exports and imports should not be confused with the
ports on vessels in foreign trade, and a number of more inclusive gross national product series of net
items of relatively small importance such as low- foreign investment, which is a measure of the excess
valued or noncommercial shipments by mail and of goods and services transferred to foreigners over
those acquired from foreigners (see p. 4).
gifts valued below $100.
Except for Department of Defense shipments as
Uses and limitations.—These overall series provide
explained below, exportfiguresare obtained from the accurate monthly indicators of the movement of
Shippers' Export Declaration which exporters are merchandise exports and imports. They do not disrequired to file with the collectors of customs. These tinguish between Government and non-Government
shipments are valued at the time and place of ex- transactions. Although the exports are divided into
port—that is, actual selling price, or cost if not sold, "Grant-aid" and "Excluding grant-aid," the latter
including inland freight, insurance and other charges also includes some Government-sponsored exports,
to the place of export. Transportation and other as noted in the table. The import totals include
costs beyond the United States port of exportation private shipments and those under Government
are excluded. For exports made by the Department sponsorship, such as purchases of strategic materials
of Defense of grant-aid military equipment and sup- and reverse lend-lease. When United States trade
plies under the mutual security program and for statistics are compared with those of other countries,
other Department of Defense shipments such as special attention needs to be given to the extent to
those under the civilian supply program, informa- which the series being compared differ as to valuation is compiled by the Bureau of the Census from tion and coverage. Changes in exports relative to
the records of the Department of Defense. In most imports may indicate significant changes in our
instances, these records show values f. o. b. point of merchandise trade with other countries, but do not
origin. These are adjusted to show value at the necessarily reflect changes in the balance of payments
United States port of exportation.
of the United States, which must take nonmerchanThe monthly series on imports gives the value of dise items into account.
"general imports" into the United States, that is,
References.—Preliminary totals for exports (includmerchandise released from customs custody imme- ing reexports) and general imports are published
diately upon arrival, plus merchandise entered into monthly in the Census Bureau release, FT 900-P,
customs bonded warehouses on arrival. As in the "Preliminary (Estimated) Export and Import Tocase of exports, Alaska, Hawaii, and Puerto Rico tals." Compiled totals for exports and general
are included with continental United States, and imports, exports of domestic merchandise, imports
both Government and non-Government shipments for consumption, and Department of Defense shipare recorded. Similarly, the exclusions with respect ments of grant-aid military equipment and supplies
to in-transit shipments, gold and silver, and low-value are published shortly afterward in the monthly
items apply.
release FT 900, "Total Trade." Cumulative totals
Imports are valued in accordance with the Tariff are provided in the "Quarterly Summary of Foreign
Act of 1930 which provides that the value of im- Commerce of the United States," which also contains
46
Merchandise Exports and Imports
[Monthly average, millions of dollars]
Excess of exports ( + )
or imports (—)
Merchandise exports
Year
Total i
Grant-aid
shipments2
Excluding
grant-aid
shipments
Merchandise
imports
Total
1914
176
149
+ 27
1919
660
325
+ 335
192 4
383
301
+ 82
192 5
192 6
192 7
192 8
192 9
409
401
405
427
437
352
369
349
341
367
+ 57.
+ 32
+ 56
193 0
193 1
193 2
193 3
193 4
320
202
134
140
178
255
174
193 5
193 6
193 7
193 8
193 9
190
205
279
258
265
.....
J
194 0
194 1
194 2
194 3
194 4
-
194 5
194 6
194 7
194 8
194 9
195 0
195 1
195 2
195 3
195 4
817
812
1,278
1, 054
1,004
j
|
!
|
+ 86
+ 70
+ 65
+ 28
110
121
+ 24
+ 19
+ 40
171
+ 19
+ 3
138
202
+ 22
257
163
193
335
429
673
1,080
1, 188
367
62
411
863
942
3
463
54
96
(3 )
()
217
247
354
757
1, 182
3
(3)
()
24
89
166
293
856
1,253
1,267
1,314
1,258
262
188
833
1, 164
1, 100
1,022
1,070
219
279
230
282
327
Excluding
grant-aid
shipments
+ 95
+ 72
+ 116
+ 88
+ 150
+ 443
+ 798
+ 32
-65
-80
+ 861
347
412
480
594
552
+ 470
+400
+ 798
+460
+ 452
738
914
893
906
851
+
+
+
+
+ 118
339
373
408
407
3
+ 7
+ 345
+ 702
( 3)
()
+ 95
+ 250
+ 207
+ 116
+ 219
1 Includes shipments under special programs such as those grant-aid programs listed in footnote 2 below as well as other grant-aid programs such as E C A (Marshall
Plan); other less important programs such as Surplus Incentive Material, Reorientation and Rehabilitation programs; and programs such as U N R R A , International
Refugee Organization, etc., which were grant-aid only in part.
2 Except for Army Civilian Supply exports for 1943-46 for which information is not available, the figures shown for 1947 and prior years Include exports under
tlje following programs (dates shown are the approximate periods the programs were in operation): Lend-lease (1941-47); Greek-Turkish Aid (1947-52); United States
Foreign Relief (1947-43); Interim Aid (1947-48); and Army Civilian Supply (1943-prescnt).
Figures are not shown for the years 1948-49 because separate information on E C A (Marshall Plan) economic aid exports is not available and these shipments
represented most of the grant-aid shipments during that period.
Figures for the years 1950-54 include only the Department of Defense shipments of grant-aid military supplies and equipment under the mutual security program—the only Important grant-aid program during that period for which separate export information is available. During this period E C A and mutual security
program economic aid exports were important, but by 1952 they were much less important than the military grant-aid exports shown. Army Civilian Supply shipments were also relatively unimportant by 1952. More precise information on military and other grant-aid extended to other countries by the United States is
provided in the balance of payments statistics.
3 Not available.
NOTE.—Monthly data available beginning 1866; annual from 1790.
Detail will not necessarily add to totals because of rounding.
Source: Department of Commerce.
index numbers for the several export and import
series. Detailed commodity by country data are
also published by the Census Bureau. A monthly
pamphlet, "Foreign Trade Statistics Notes/7 contains supplementary information on such items as
unusual transactions appearing in the statistics,
changes in the types of shipments included in the
statistics, special problems of valuation, commodity
classification, and the like. A comprehensive discussion of the scope and content of United States
foreign trade and shipping statistics is available in
Foreign Commerce and Navigation of the United
StateSj last published in 1946. A complete list of
all Census publications in the field of foreign trade
is available in the Catalog of United States Foreign
Trade Statistical Publications.
47
PRICES
CONSUMER PRICES
Description oi series.—The Consumer Price Index, unpriced groups of these items is estimated for use
compiled by the Bureau of Labor Statistics, is a in the computation of the monthly national index.
measure of changes in prices of goods and services
Prices for practically all of the commodities and
purchased by families of urban wage earners and many of the services are collected by personal intersalaried clerical workers. The goods and services view. Monthly rent information and a few prices
included in the index are those required to maintain (e. g., streetcar and bus fares, public utility rates,
the level of living characteristics of such families in fuel prices) are collected by mail.
the year ending June 1952. These families represent
In addition to the national index, separate indexes
about 64 percent of all people living in urban places, are computed for the 20 largest of the 46 cities—
and about 40 percent of the total United States monthly for the 5 largest and quarterly for the
population.
other 15.
A major revision of this series was introduced with
The index is based upon prices collected on about
300 items in 46 cities. The 300 items were selected the release of the January 1953 index. The prinby the BLS as representative of the thousands of cipal changes from the old series were: (1) change in
commodities and services purchased by families of the list of items priced to reflect current purchasing
wage earners and salaried clerical workers, as re- habits; (2) increase in the number of items priced
ported in a survey conducted in 91 cities. Detailed from about 225 to about 300, including for the first
specifications are used for the 300 items so that, time used cars, home purchase and maintenance, and
insofar as possible, prices are obtained for articles restaurant meals; (3) revision and expansion of the
of the same quality in successive price periods. list of cities in which prices are collected, to reflect
Revisions in the individual specifications are made price changes affecting wage-earner and clericalfrom time to time, as former descriptions become worker families in all urban areas; and (4) change of
the base period of the index from 1935-39 to 1947-49.
obsolete.
Current prices for the 300 items are collected
Statistical procedures.—The purpose of the index
regularly from a list of stores and service establish- is to show how much more or less it would cost to
ments in the 46 cities. This list includes chain purchase the same quantities and qualities of goods
stores, independent stores, department stores, spe- and services in one period than in an earlier period.
cialty stores, and public utilities, and is represent- Thefirststep in the index computation is to calculate,
ative of the types of outlets in which wage-earner for each city, a price relative for each item by comand clerical-worker families make then* purchases. paring the sum of the prices reported for that parPrices are also collected on such items as physicians' ticular item from the same retail outlets in the
and dentists' fees, hospital rates, and beauty-parlor current and preceding periods. This relative change
services. Sales and excise taxes are included in the for the item is next multiplied by the estimated cost
retail prices for commodities on which they are in the preceding period for a fixed quantity of the
imposed. Property taxes are included in the cost of item. (The fixed quantity, or weight, for each item
homeownership, and implicitly included in rental is determined by the average annual quantities of
costs. The index does not include income taxes that item purchased by urban wage-earner and clerior social security taxes.
cal-worker families in the year ending June 1952,
Prices are collected at intervals ranging from every plus the purchases of those unpriced commodities it
month to every fourth month. For some goods and represents in the index.) These calculations are then
services—such as rents, foods and a few other im- totaled for all items in a group—all food items, for
portant items—prices are collected monthly in each example, are combined into a total showing the food
of the 46 cities. For other goods and services, cost for the fixed quantities in the current period.
prices are collected every month in the 5 largest This total is compared with the food total for the
cities and every third or fourth month, depending preceding period to give a measure of the average
on the size of the city, in the other 41 cities. Pricing price change for all foods, from which the index
of these goods and services in the 41 cities is on a number of food for each city is computed. Similar
rotating cycle, so that several cities of each size calculations are made for apparel, rent, and all other
group are priced each month. Between the periodic groups of items priced.
pricing periods in a given city, the price change for
The national index is calculated by combining
48
Consumer Prices
f1947-49=100]
Year
1914
1915
1916
1917
1918
1919
All
items
42. 9
43.4
46. 6
54. 8
64. 3
74. 0
Housing
Food
Total *
Personal
care
Reading
and
recreation
Other
goods
and
services
00
00
00
2
h
()
76. 6
36. 5
(?)
(2)
(2)
40.0
45. 0
57.9
66. 5
74. 2
2
()
77.2
78. 1
77.4
78. 8
85. 3
37.3
40. 9
49.2
66. 6
88. 2
(22)
(2>
(2)
(2)
(2)
(22)
(2)
()
00
(2)
(a2)
(2)
(2)
(22)
(2)
()
(22)
100.
115.
118.
121.
125.
2
1
5
6
9
105. 1
80.9
65. 7
65.8
65.3
(22)
00
2
00
00
2
126.
125.
123.
120.
117.
4
2
2
3
4
64 0
63. 0
61. 8
60. 9
60.3
7
4
6
9
1
83.
63.
59.
61.
60.
6
5
4
4
8
1925
1926
1927
1928
1929
75.
75.
74.
73.
73.
0
6
2
3
3
65.
68.
65.
64.
65.
8
0
5
8
6
1930
1931
1932
1933
1934
71.4
65. 0
58. 4
55. 3
57. 2
62.
51.
42.
41.
46.
4
4
8
6
4
1935
1936
1937
1938
1939
58. 7
59. 3
61.4
60. 3
59. 4
49.
50.
52.
48.
47.
1940
1941
1942
1943
1944
59.9
62. 9
69. 7
74. 0
75. 2
1945
1946
1947
1948
1949
76. 9
83.4
95. 5
102. 8
101. 8
68.
79.
95.
104.
100.
9
0
9
1
0
1950
1951
1952
1953
1954
102.
111.
113.
114.
114.
101.
112.
114.
112.
112.
2
6
6
8
6
1
Medical
care
(2)
85.
76.
71.
72.
73.
1
Rent
Transportation
40.5
1920
1921
1922
1923
1924
8
0
5
4
8
Apparel
00
00
00
2
()
()
()
(22)
()
(22)
(>
(2>
(>
«( )
2
2
()
(22)
()
7
1
1
4
1
(22)
()
(32)
(2)
78. 2
80. 1
83.8
86. 5
86.6
50.6
51.0
53. 7
53.4
52. 5
(22>
(>
(a2)
47.8
52. 2
61. 3
68. 3
67. 4
(2)
(22)
(2)
(2)
()
(22)
()
86.9
88.4
90.4
90.3
90. 6
53.2
55.6
64. 9
67. 8
72. 6
(2)
(22>
(>
()
00
<*)
2
58. 9
53. 6
47.5
45. 9
50. 2
(*)
(2)
()
(z2)
()
«
114. 2
108. 2
97. 1
83. 6
78.4
()
()
(a2)
(2)
(2)
(>
«
()
(2>
00
(2)
(2)
(2)
()
(22)
()
(22)
(2)
(2)
(22)
(2)
(2)
(22)
(2)
(2)
(2)
2
()
(2)
(22)
(2)
(2)
()
e)s
(23)
()
(22)
()
(22)
(2)
(2)
()
()
()
()
(22)
()
00
2
()
()
()
00
00
2
()
00
(2)
(2)
(2)
00
00
2
()
(2)
00
00
M
2
()
00
(2)
00
00
00
(22)
00
oo
00
oo
p)
00
(22)
()
00
2
()
(2)
00
()
()
(2)
(22)
()
00
00
2
(2)
()
00
00
2
()
00
00
00
00
2
00
2
()
()
00
00
00
00
(2)
95. 0
101. 7
103. 3
90. 6
100. 9
108. 5
94. 9
100. 9
104. 1
97. 6
101.3
101. 1
95. 5
100. 4
104. 1
106. 1
112.4
114. 6
117.7
119. 1
108.
113.
117.
124.
128.
98.
106.
105.
104.
104.
1
9
8
8
3
111.
118.
126.
129.
128.
106. 0
111. 1
117. 2
121.3
125. 2
101. 1
110. 5
111. 8
112.8
113. 4
103.4
106. 5
107. 0
108.0
107. 0
00
00
00
00
2
00
3
7
1
5
4
3
4
2
7
0
00
00
()
76.
83.
97.
103.
99.
8
1
9
1
5
00
00
2
90. 9
91.4
94. 4
100. 7
105. 0
p)
2
00
00
00
96. 1
100. 5
103. 4
105.
109.
115.
118.
120.
2
7
4
2
1
Includes, In addition to rent, homeowner costs, utilities, housefurnlshings, etc.
Not available.
NOTE.—Monthly Indexes available from January 1913 for "all items" and " f o o d " ; from September 1&40 through September 1944 and from January 1947 for " r e n t " ;
from September 1940 for "apparel"; and from January 1947 for all others.
Source: Department of Labor.
city totals. Two-fifths of the weight is carried by
the 12 largest cities; one-fifth by the 9 cities selected
to represent the 42 cities with populations of 240,000
to 1,000,000; one-fifth by the 9 cities selected to
represent the 216 cities with populations of 30,500
to 240,000; and one-fiftli by the 16 small cities
selected to represent the 2,527 towns with populations
ranging from 2,500 to 30,500.
Uses and limitations—The index is designed to
measure only those changes in the spending of urban
families which result from changes in prices, not
those which result from changes in purchasing
habits or standards of living. Also, it measures
price changes for only a limited population group:
the families of wage earners and salaried clerical
workers living in urban areas. Other qualities of
commodities and weights would have to be used to
measure price changes for other groups, such as
49
farm families, single workers, retired people, etc.
The "fixed market basket" represents the average
quantities bought by all wage-earner and clericalworker families, and is not necessarily representative
of the purchases made by any single family.
The city indexes indicate the difference in the rate
of price movement in the various cities, but should
not be used to compare price levels in one city with
those in another. For instance, if the index for city
A is 113 and that for city B is 115, it does not
necessarily follow that prices are higher in city B
than in city A, since the base-period prices may have
been higher in city A. These indexes do show that
prices have increased more rapidly since the base
period in city B than in city A.
Although efforts are made to minimize the effects oi
quality changes on the "fixed market basket," it
is impossible in any index to measure these effects
with complete accuracy.
References.—The basic release of the index is the
report entitled "Consumer Price Index/' issued by
the Bureau of Labor Statistics toward the end of the
month following the month to which the figures
relate. A detailed description of the procedures, uses
and limitations of th3 index is presented in "The
Consumer Price Index—A Layman's Guide" (BLS
Bulletin 1140); in Techniques of Preparing Major
BLS Statistical Series (BLS Bulletin 1168); and
in an article in the February 1953 issue of the
Monthly Labor Review.
WHOLESALE PRICES
Description of series.—The Wholesale Price Index,
compiled by the Bureau of Labor Statistics, is a
measure of the general rate and direction of the
composite of price movements in primary markets,
and of the specific rates and directions of price
movements for individual commodities and groups
of commodities.
The index is based on price quotations for approximately 2,000 commodities selected to represent all
commodities sold on primary markets in the United
States. All types of commodities, from raw materials to fabricated products, are included in the
index. For commodities traded on organized exchanges, such as livestock and grains, the quotations
are furnished by the exchanges or Government
agencies, or are taken from published sources. For
some standardized commodities, such as certain
chemicals and specified constructions of cotton gray
goods, quotations are taken from authoritative trade
papers. For the majority of fabricated products,
prices are reported to the Bureau of Labor Statistics
by producers. Prices are quoted at the level of the
first commercial transaction, and, for each commodity, the reporter is requested to quote the price
which he charges to the channel of distribution to
which lie sells the largest volume of this particular
commodity. Consequently, the majority of the
quotations in the index are producers' prices, rather
than wholesalers^ prices. The prices relate to a
particular day of the month—usually Tuesday of
the week containing the 15th.
Initial contacts with manufacturers to solicit their
cooperation in reporting prices on specified commodities are made by personal interview; subsequent
price reports are mailed to Washington by the reporting firm. Insofar as possible, identical qualities of
50
the commodities are priced from period to period,
so that the index will measure only real price changes,
not differences due to changes in qualities or terms
of sale.
A major revision of this index was introduced with
release of the January 1952 index. The principal
changes from the old series were: (1) increase in the
number of items priced, from approximately 900 to
about 2,000; (2) change in the basis for weights from
average sales in 1929-31 to 1947 sales; (3) change of
the base period from 1926 to 1947-49; and (4) modification of the classification system. The weighting
diagram was again brought up to date with the release of the final index for January 1955, using average sales for 1952-53.
The relative importance of the groups, subgroups,
and items in the index at any one period depends on
the relation of the value aggregates as of that period.
As of December 1954, using the 1952-53 weights,
the relative importance of "Farm products" was
10.8, of "Processed foods" 13.7, and of "Other than
farm products and foods" (machinery, nonmetallic
minerals, fuels, etc.) 75.5.
In addition to the comprehensive index, indexes
are released each month for 15 major groups, such
as farm products and processed foods; 86 subgroups,
such as grains and cotton products; about 250 product
classes; and most of the individual series. BLS also
publishes monthly 20 special group indexes (e. g.,
building materials) and 34 economic sector indexes
(e. g., crude materials for further processing, components for manufacturing).
Statistical procedures.—Basically, the same statistical method is used in computing the Wholesale
Price Index and the Consumer Price Index. The
individual price series are combined into the index
Wholesale Prices
[1947-49=100]
Year
11 comlodities
Farm
products
Other than
farm products
and foods
Processed
foods
1914.
44. 3
39. 8
0)
47. 5
1915.
1916.
19171918.
1919.
45. 2
55. 6
76.4
85. 3
90. 1
39. 9
47. 1
72. 1
82. 7
88.0
C1)
48.
63.
81.
89.
92.
6
1
7
1
1
115.
75.
73.
74.
71.
3
0
2
6
3
1920.
1921.
1922.
1923.
1924.
100.
63.
62.
65.
63.
3
4
8
4
8
84.
49.
52.
55.
55.
1925.
1926.
1927.
1928.
1929.
67.
65.
62.
62.
61.
3
0
0
9
9
61. 3
55. 9
55. 5
59. 2
58.6
1930.
1931.
1932.
1933.
1034.
56. 1
47. 4
42. 1
42. 8
48.7
1935.
1936.
1937.
1938.
1939.
2
4
4
1
9
(0
0)
(0
«
l
()
0)
(')
C1)
0)
58.2
56.7
59.4
58. 5
73. 4
71. 5
67.2
66.4
65. 5
49. 3
36. 2
26. 9
28.7
36. 5
53.
44.
36.
36.
42.
3
8
5
3
6
60.
53.
50.
50.
56.
9
6
2
9
0
52.0
52. 5
56. 1
51. 1
50. 1
44.0
45. 2
48. 3
38. 3
36. 5
52. 1
50. 1
52. 4
45. 6
43.3
55.
56.
61.
58.
58.
7
9
0
4
1
1940.
1941.
1942_
1943.
1944.
51. 1
56. 8
64.2
67. 0
67. 6
37. 8
46. 0
59.2
68. 5
68.9
43.6
50. 5
59. 1
61. 6
60. 4
59.4
63. 7
68.3
69. 3
70. 4
1945.
1946..
1947_.
1948..
1949.
68. 8
78. 7
96. 4
104.4
99. 2
71. 6
83. 2
100. 0
107.3
92. 8
60. 8
77.6
98.2
106. 1
95. 7
71.3
78.3
95. 3
103.4
101.3
1950_
1951.
1952.
1953.
1954.
103.
114.
111.
110.
110.
97.
113.
107.
97.
95.
99.8
111.4
108.8
104. 6
105. 3
105.0
115. 9
113. 2
114.0
114. 5
1
8
6
1
3
5
4
0
0
6
0)
Not available.
NOTE.—Detail through product classes available from 1947 on the 1947-49=100 base. Monthly indexes availablo for "all commodities" and major groups from 1890
and for subgroups from 1913 on the 1926=100 base.
Source: Department of Labor.
by multiplying the weight assigned each item, by its
current price relative, and summing to obtain the
current aggregate. The current aggregates are
totaled by product classes, subgroups, groups, and
all commodities. The current index for each of these
is obtained by dividing the current aggregate by the
appropriate sales value in the base period.
Each commodity price series in the index, as
representative of prices for a group of commodities,
is assigned its own direct weight (the value of the
sales of that individual commodity), plus the weight
of other commodities it was selected to represent in
the index. Weights for commodities not priced for
the index are assigned to commodities which are
priced on the basis of similarity of price movements
if data are available for making such determinations.
When data are not available for such determinations,
BLS obtains advice from industry and other experts
on what commodity or group of commodities which
is priced has a price movement most similar to that
51
of the unpriced commodity, and assignments are indexes are based on different weighting patterns
and the lists of commodities priced are not identical.
made on the basis of these recommendations.
The index is designed to measure real price
Relation to other series.—The BLS publishes a
weekly index of wholesale prices based on that week's changes; that is, changes which are not occasioned
prices for a small sample (about 200) of the com- by changes in quality, quantity, terms of sale, etc.
modities included in the monthly index and an esti- It is not designed to measure changes in manufacturers' average realized prices which are affected by
mate of prices for all other commodities.
Uses and limitations.—The index is based for the product mix and terms of sale as well as by price
most part on producers' prices; therefore, it should movements.
References.—The basic release of the index is the
not be used as a measure of price change at the
wholesale market level. "Wholesale" as used in the report entitled "Wholesale (Primary Market) Price
title of this index refers to sales in large lots, not to Index," issued by the Bureau of Labor Statistics
prices paid or received by wholesalers, jobbers, or during the second week of the month following the
month to which the figures relate. A detailed
distributors.
A comparison of the movement of the subgroup description of the index and its uses and limitations
indexes of the Wholesale Price Index and the Con- is presented in the February 1952 Monthly Labor
sumer Price Index should not be used as a measure Review (Reprint No. R. 2067) and in Techniques of
of the change in retailers' margins for the specified Preparing Major BLS Statistical Series (Bulletin
groups of commodities, mainly because the two 1168), December 1954.
PRICES RECEIVED AND PAID BY FARMERS
Parity Index
The most recent revision of the index was introduced with the release of the January 1950 series.
Description of series.—The "Index of Prices Paid The principal changes in the revised series were: (1)
by Farmers for Commodities and Services, including addition to the index of cash wage rates paid to
Interest, Taxes, and Wage Rates" (commonly called hired farm labor; (2) adoption of a weighting pattern
the Parity Index) is computed by the Agricultural since March 1935 based on farmers' purchasing
Marketing Service (AMS) of the Department of Agri- habits during the period 1937-41, in place of 1924-29
culture. It is composed of five major groups: prices as used prior to March 1935; and (3) increase in the
paid for items used in family living, accounting for number of items included in the current index from
44.0 percent of the total weight for the period since about 175 to more than 300.
March 1935; prices paid for items used in farm proStatistical procedures.—Price reports from indeduction, 41.2 percent; interest on indebtedness se- pendent dealers are mailed to the AMS State offices,
cured by farm mortgages, 3.0 percent; taxes on farm where average prices for the State are calculated for
real estate, 3.8 percent; and rates of wages paid hired each item. Chain-store prices are reported directly
farm labor, 8.0 percent.
to the Washington office of AMS, where they are
The index is a measure of the changes in prices combined with the appropriate State averages of
paid by farm families for a list of commodities and independent-store prices. Final estimates by States
services used in family living and farm production. and commodities are then combined into national
As of July 1955, the index of prices paid for items averages for each item by weighting each State price
used in family living included price series for 191 estimate by an estimate of the amount of that comcommodities and services, and that for items used modity purchased by farmers in the designated
in farm production included 201, with 40 of the series State. These estimates of purchases are based upon
being used in both indexes. Until March 1953 the the distribution of farm population, farm income,
index was based on prices collected from independ- and other available information.
ent stores only, but since that date it has been based
Subgroup indexes are computed for 15 types of
on prices collected monthly from chain stores and
expenditures. Six of these subgroup indexes (food
quarterly from independent stores. Changes in the
and tobacco, clothing, autos and auto supplies,
index in the inter-quarterly months are estimated
household
operations, household furnishings, and
largely from changes in chain-store prices. Changes
building
materials
for house) are combined into the
in average costs of electricity and telephone services
are based upon an annual survey of 20,000 farmers. index of prices paid by farmers for items used in
family living; and 9 of the subgroup indexes (feed,
The base period is 1910-14 as set by law.
52
Prices Received and Paid by Farmers
Prices paid by farmers
for items used in
Year
Family
living
Production
Parity index
(prices paid,
interest,
taxes, and
wage rates)
Prices
received by
farmers
Parity ratio 1
Index, 1 9 1 0 - 1 4 = 1 0 0
1910
1911
1912
1913
1914
99
99
100
100
102
97
98
102
101
102
97
98
101
101
103
104
94
99
102
101
107
96
98
101
98
1915
1916
1917
1918
1919
104
115
143
170
202
104
115
156
180
195
105
116
148
173
197
99
119
178
206
217
94
103
120
119
110
1920
1921
1922
1923
1924
228
164
153
156
156
195
128
127
138
140
214
155
151
159
160
211
124
131
142
143
99
80
87
89
89
1925
1926
1927
1928
1929
161
158
155
156
154
145
141
141
148
146
164
160
159
162
160
156
145
140
148
148
95
91
88
91
92
1930
1931
1932
1933
1934
144
124
106
108
122
135
113
99
99
114
151
130
112
109
120
125
87
65
70
90
83
67
58
64
75
1935
1936
1937
1938
1939
124
124
128
122
120
122
122
132
122
121
124
124
131
124
123
109
114
122
97
95
88
92
93
78
77
1940
1941
1942
1943
1944
121
130
149
166
175
123
130
148
164
173
124
133
152
171
182
100
124
159
193
197
81
93
105
113
108
1945
1946
1947
1948
1949
182
202
237
251
243
176
191
224
250
238
190
208
240
260
251
» 207
2 236
276
287
250
109
113
115
110
100
1950
1951
1952
1953
1954
246
268
271
270
274
246
273
274
253
252
256
282
287
279
281
3
2
258
302
288".
258
249
101
107
100
92
89
1 Percentage ratio of Index of Prices Received by Farmers to Parity Index.
i Includes wartime subsidies paid on beef cattle, sheep, lambs, milt, and butterfat between October 1943 and June 1946.
NOTE.—For the Index of Prices Received by Farmers, monthly and annual data available from January 1910; for the Indexes of Prices Paid and the Parity
Index, annual data available from 1910, quarterly from 1923, and monthly from January 1937.
Source: Department of Agriculture.
53
livestock, motor supplies, motor vehicles, farm are current^ purchased in greatest volume by
machinery, building and fencing materials, fertilizer farmers. These qualities may change in response t
and lime, equipment and supplies, and seed) are changing levels of farm income or to changes in
combined into the index of prices paid for items used qualities commonly stocked by merchants.
Uses and limitations.—The Parity Index is used
in farm production.
These two group indexes of prices paid for items to compute parity prices by relating it to prices
used in family living and farm production are com- received by farmers for specific commodities in the
bined with the indexes for interest, taxes, and wage base period. Agricultural support programs are in
rates to form the Parity Index. The series on inter- many cases based on these parity prices.
The indexes of prices paid by farmers for items
est charges is developed annually on the basis of
data obtained from lending agencies and special used in family living and in farm production may be
surveys. The tax series is developed annually from affected somewhat by changes in qualities purchased,
data obtained from special surveys. The wage-rate and therefore do not necessarily measure changes in
series is based on information collected in a quarterly prices of particular grades of commodities.
mail survey of farmers.
Relation to other series.—The index of prices paidPrices Received by Farmers
by farmers for items used in family living is freDescription of series.—The Index of Prices Requently compared with the Consumer Price Index
ceived by Farmers is computed by the Agricultural
(CPI) to compare the movement of retail prices as
they affect farmers and urban workers, respectively. Marketing Service (AMS) of the Department of
Even though in some periods the movements of the Agriculture, as a measure of the change from month
two indexes have been quite similar, there are impor- to month in average prices of farm products. It is
tant differences between the two indexes which on based on average prices received for all grades and
occasion give rise to differences in movements. qualities of the important agricultural commodities
at the point of first sale—generally the local marSome of the principal differences are:
ket—about
the middle of the month.
1. The lists of commodities included in the two
The
index
is based on prices for 52 commodities
indexes are not identical, and different weights are
which
account
for about 92 percent of the total cash
used for individual commodities, since the CPI is
receipts
from
marketings
of all farm commodities
based on the purchasing habits of urban families and
for
which
data
are
available.
The price data are
the farm family-living index on those of farm
obtained
chiefly
by
mail
on
a
voluntary
basis from
families.
buyers
of
farm
products
(e,
g.,
country
mills and
2. All expenditures for commodities and services
purchased by urban families are represented in the elevators, creameries and milk plants, cooperative
weights for the CPI, whereas certain types of marketing organizations, and local dealers) and other
expenditures are not included in the weights for the persons with a knowledge of farm product prices (for
index of farm family-living expenses. For example, example, local bankers and well informed farmers).
In addition to the overall index for "all farm prodsince few farmers rent homes other than those that
ucts,"
indexes are prepared for "all crops," for
are rented with the farm, the farm family-living
index does not include residential rents. The CPI "livestock and livestock products" and for 13 subweights include all costs of homeownership— groups. Five of these subgroup indexes (fruit;
purchase, repairs and maintenance, and insurance; commercial vegetables; potatoes, sweetyotatoes, and
whereas only the costs of building materials for houses dry edible beans; dairy products; and poultry and
are represented in the farm family-living index. eggs) are published also on a seasonally adjusted
Services (medical care, utilities, public transporta- basis.
tion, personal care, etc.) carry a relatively heavy
Statistical procedures.—-Weights based on average
weight in the CPI; but only telephone and electricity quantities sold during 1937-41 have been used since
costs are represented in the farm family-living index. January 1935 to combine the United States average
3. Although both the CPI and the farm family- prices for individual commodities into subgroup
living index are composed of a fixed list of items for indexes. In combining the subgroup indexes into
any two successive dates, the CPI is designed to group and all-commodity indexes, the index numbers
measure price changes in successive periods for are weighted by the percentage ratio of cash receipts
specified qualities of the items, while the Index of from marketings for the particular commodity subPrices Paid by Farmers is designed to measure groups to the total for the same period—1937-41.
average prices for those qualities of each item which The subgroup and group indexes are then converted
54
from the 1937-41 to a 1910-14=100 base for publication purposes, as required by law.
Revisions have been made in the index series from
time to time, mainly involving revisions in basic
price series or changes in weights. A major revision
in January 1950 put the index on a basis more consistent with that of the Parity Index, improved the
weighting structure, and made minor changes in
commodity coverage. The index was also revised
in January 1954 to incorporate revisions in the component price series and to reflect some revisions in
the 1937-41 weight data.
Relation to other series.—The index described here
should not be confused with the farm-product com-'
ponent of the Wholesale Price Index. There are
significant differences. The Index of Prices Received by Farmers measures changes in prices at the
point of first sale, and is based on average prices for
all grades of a given commodity. The Wholesale
Price Index, on the other hand, measures prices in
selected central markets, and is based on average
prices of specific grades or qualities. Furthermore,
commodities traded among farmers never enter into
wholesale trade. Finally, there are differences in
the weights and base periods used in the t^o indexes.
Uses and limitations.—The index is widely used as
a measure of changes in average prices received by
farmers for commodities sold in local markets. It is
used in the computation of adjusted base-period
prices, which are needed in calculating parity prices
under the formula prescribed by the Agricultural
Adjustment Act of 1938, as amended.
The Index of Prices Received by Farmers is designed to measure the change in average prices for
all grades and qualities of the products sold by
farmers. Therefore the price changes it shows are
not necessarily a measure of price changes for specific
grades, as they may also reflect changes in the grades
or qualities sold.
As noted above, the index is based on commodities
which account for about 92 percent of the total value
of all commodities farmers have to sell. Adequate
marketing and price data are not available for the
other 8 percent (timber and other forest products,
greenhouse products, and a number of miscellaneous
and minor commodities), but these omissions are not
significant with respect to the index as a whole.
References.—The Parity Index and the Index of
Prices Received by Farmers are published monthly
by AMS in Agricultural Prices. Historical data
appear in the Department of Agriculture's annual
publications, Agricultural Statistics and Crops and
Markets. A detailed description of the price series
is presented in The Agricultural Estimating and Reporting Services of the United States Department of
Agriculture (Miscellaneous Publication No. 703 of
the Department of Agriculture).
ParitjrRatio
The Parity Ratio is computed by dividing the
Index of Prices Received by Farmers by the Parity
Index (Index of Prices Paid, Including Interest,
Taxes, and Wage Rates). It measures whether the
prices farmers receive for farm products are on the
average higher or lower in relation to the prices they
pay for goods and services than they were in the base
period, 1910-14.
55
CURRENCY, CREDIT, AND SECURITY MARKETS
CURRENCY AND DEPOSITS
Description of series.—These series measure the presents the data in somewhat more detail, and
supply of several types of assets of the highest includes in addition seasonally adjusted series for
liquidity, which have in varying degrees attributes recent months for "Demand deposits adjusted" and
associated with "money." The table covers "pri- "Currency outside banks."
The concept of "money supply" reflected here is
vately held" deposits and currency (including the
holdings of States and political subdivisions but ex- quite different from that measured by the wellcluding those of banks) and deposits to the credit known "Money in Circulation" figure published
of the Federal Government. Further details as to monthly by the Treasury. The latter covers only
precise coverage are given in the footnotes. The coins and paper money, and consists of the total
table is derived from a more inclusive Federal 4 outside the Treasury and the Federal Reserve banks,
Reserve tabulation of "Deposits and currency/' less an estimate of the amount of coin held abroad.
which covers in addition cash held by the Treasury The "money supply" data differ in that they include deposits, although they exclude the relatively
and net deposits due to foreign banks.
Monthly estimates are for the final Wednesday small amount of cash held by the banks.
This table, and the more detailed Federal Reserve
of the month, except that the June and December
estimates are later replaced by reported figures as deposits and currency table, are derived from data
in general available in other banking or Treasury
of the last day of the month.
Statistical procedures.—The aggregate of deposits statistics. Because of adjustments and special
and currency consists primarily of deposits, both groupings of items, however, the component series
demand and time, in commercial banks. Monthly of these two tables cannot necessarily be identified
estimates of these commercial bank deposits are precisely with series found elsewhere.
prepared in approximately the same manner as the
Uses and limitations:—The data on deposits and
estimates of loans and investments for "all commer- currency permit an adequate measurement of the
cial banks," as explained below in the following level and general trend of the supply of these types
section on Bank Loans, Investments, and Reserves. of highly liquid assets. Changes in the supply of
Data for the "weekly reporting member banks" are these assets are important factors affecting the funccombined with monthly reports from other com- tioning of the economic system.
mercial member banks, and an estimate is made for
There is no one accepted definition of "money."
nonmember banks on the basis of the reports from The Federal Reserve presentation of deposits and
the "country" (generally smaller) member banks. currency avoids the term "money" but makes it
Semiannual "all bank" figures later replace the possible for the user to adapt the data to his parWednesday figures for June and December. The ticular use by excluding one or more component
monthly estimate for deposits in mutual savings series. Thus the Economic Indicators category of
banks, which are largely outside the Federal Reserve "privately held money supply" excludes deposits of
System, is based on monthly statistics of the National foreign banks and Treasury cash holdings. A more
Association of Mutual Savings Banks covering the restrictive definition of money supply excludes time
bulk of mutual savings banks deposits. Postal deposits. On the other hand, a broader definition
Savings figures are obtained monthly from the Post might include savings and loan shares or Government
Office Department. Preliminary figures for Govern- savings bonds, for which data are available elsewhere.
ment bank deposits are estimates based on the
References.—The currency and deposits data are
Treasury Daily Statement, subject to later correction adapted from the monthly Federal Reserve table
on the basis of bank records. Currency outside entitled "Consolidated Condition Statement for
banks is based on the Treasury figures for currency Banks and the Monetary System," which appears
held outside the Treasury and the Federal Reserve first in the release G.7 (c), approximately 5 weeks
System, from which are deducted monthly estimates after the end of the month, showing changes from
of cash held by the commercial and savings banks. the previous month and a year ago. The table is
Relation to other series.—As noted above, the scope presented in more detail in the Federal Reserve
of this presentation of "Currency and deposits" is Bulletin, and its basis is discussed in the Bulletin
somewhat narrower than that of the Federal Reserve for January 1948. 'Historical data to 1892 are availtabulation of "Deposits and currency." The latter able in Banking and Monetary Statistics.
56
Currency and Deposits
[Billions of dollars]
Total excluding U. S. Government deposits
(privately held money supply) 2
End of period
U. S.
Government
deposits 1
Total deposits and
currency
Time
deposits
4
1. 5
10. 1
8.4
20. 6
24.2
27. 3
29. 9
34. 6
1. 6
1. 9
2.3
3. 3
3. 6
9.8
12. 0
13. 5
14.8
17. 6
9. 2
10. 3
11. 5
11. 7
13.4
4. 1
3. 7
3. 3
3.7
3.7
19. 6
17. 1
15.8
2
39. 6
37.4
38.8
43. 2
46. 8
18.0
19. 1
20. 9
17. 4
20. 4
•22. 2
23.
25.
27.
28.
5
1915—June1916— June.
1917—June.
1918—June 1919—June.
20.
24.
28.
31.
35.
1920—June
1921—Jun e
1922—Jun e
1923—December.
1924—December-
39. 9
37.8
39.0
43. 5
47. 1
1925—December.
1926—December.
1927—December.
1928—December.
1929—December -
50.
51.
54.
55.
54.
3
1
1
7
7
3
,3
,3
.3
50.0
50. 9
53. 8
55.4
54. 6
3.8
3. 8
3.7
3. 6
3.6
22.
21.
22.
23.
53.
48.
45.
42.
48.
6
4
4
6
1
3
5
.5
53.2
47. 9
44. 9
41. 5
46. 3
3. 6
21. 0
4.5
4. 7
4.8
4.7
17.
15.
15.
18.
28.
26.
24.
21.
23.
I. 5
51.3
56.4
55. 8
58. 1
63. 3
4.9
5.5
5.6
5.8
6.4
22. 1
25. 5
24. 0
24. 2
25.4
26.0
29. 8
26. 3
27. 1
70.0
76. 3
91. 3
112.4
7.3
9.6
13.9
27.7
27.7
28.4
32. 7
39. 8
48. 5
54. 0
56.4
57.5
58.6
1930—December. 1931—December-.
1932—December..
1933—December..
1934—December-
7
3
4
5
7
Demand
deposits
adjusted 3
20. 0
0. 1
20. 0
1914—June.
Currency
outside
banks
Total
()
1.6
1. 0
3
5
3
3
,2
1. 0
1. 8
52.7
57. 6
56. 8
59. 9
64. 7
1935—December..
1936—December..
1937—December.
1938—December.
1939—December.
.1
1. 1
1.2
1.0
1. 8
1.5
16. 6
3
7
7
1
22. 8
4
7
0
5
1940—December.
1941—December.
1942—December.
1943—December.
1944—December^
71. 1
79. 1
100. 5
123.4
151.4
21.2
130.2
23.5
34. 9
39.0
48. 9
60. 8
66.9
1945—December1946—December.
1947—December.
1948—December1949—December.
176.4
167. 5
172. 3
172.7
173. 9
25. 6
3.5
2.3
3. 6
4. 1
150. 8
164. 0
170.0
169. 1
169. 8
26. 5
26. 7
26.5
26. 1
25.4
75.9
83. 3
87. 1
85. 5
85. 8
180. 6
189.9
200.4
205. 7
214. 8
3.7
3.9
5. 6
4. 8
5. 1
176. 9
186.0
194. 8
200. 9
209. 7
25.4
26. 3
27. 5
28. 1
27. 9
1950—December.
1951—December.
1952—December.
1953—December.
1954—December.
1. 1
2.8
9. 2
II.0
18. 8
92.
98.
101.
102.
106.
3
2
5
5
6
9
3
4
7
28. 2
7
0
5
7
2
26. 2
59.
61.
65.
70.
75.
2
4
8
4
3
. Includes P . S. Government deposits at commercial and savins b a n ^ d (beginning 1916) at federal Reserve banks; b a n n i n g with 1938, includes United
States Treasurer's time deposits open account.
j i t
m
* Includes deposits in commercial banks, mutual savings banks, and rostai s a v i n g oja
deposits open account, and postal savings redeposited in banks.
Nora.—Mo^h^'d^ta available begtaning 1943; annual Irom 1892.
Detail
wlH not necessarily add to totafc because ot
Source: Board of Governors of the Federal Reserve System.
57
BANK LOANS, INVESTMENTS, AND RESERVES
Description of series.—"Commercial banks" are in and varying with the type of deposit and the classigeneral distinguished from other lending institutions fication of the bank. "Excess" reserves are member
by the fact that they accept deposits subject to check bank deposits maintained at the Reserve bank in
or withdrawal on demand. They number approxi- excess of the required minimum.
Statistical procedures.—The "All commercial
mately 13,800. Mutual savings banks are not included, nor are savings and loan associations or, in banks" and "Weekly reporting member banks"
general, any other "banking" institutions which do series are closely related. The weekly series is
based on weekly reports filed with Federal Reserve
not receive demand deposits.
banks
and compiled cooperatively by these banks
"Member banks" of the Federal Reserve System
are with few exceptions commercial banks. They and the Board of Governors. Published figures are
comprise approximately 4,800 nationally chartered simple aggregates for the reporting banks. The
banks ("national banks") plus about 1,900 State- monthly estimates for all commercial banks are
chartered banks, which are members of the Federal prepared, also by the Federal Reserve System, on
Reserve System. Member banks account currently the basis of the weekly reports, monthly reports from
for about 85 percent of the total loans and invest- all other member banks, and other information.
Estimates are made for nonmember banks, accountments of commercial banks.
The "Weekly reporting member banks" comprise ing currently for about 16 percent of commercialsome 400 selected member commercial banks in (or bank credit, on the basis of the relationship between
with head offices in) approximately 100 cities, ac- the movement of "country" member banks (those
counting currently for over half of the total com- outside the major cities) and that of the nonmember
mercial banking loans and investments. The cities banks, as determined semiannually when complete
are the more important banking centers within each reports for the banking system are available. The
Federal Reserve district; and within each city the June and December estimates are later replaced by
banks constitute a voluntary sample, usually ac- "benchmark" figures for all commercial banks.
counting for over 90 percent of member bank re- These benchmarks are compiled by the Federal
sources. The coverage of the weekly series was last Deposit Insurance Corporation on the basis of comsubstantially revised in 1947 and carried back 1 year, pulsory "call reports" filed by all banks subject to
with an increase of about 15 percent in loans and Federal supervision (national banks, State member
investments of reporting banks. More recent minor banks, and nonmember insured banks) with one or
another of the Federal bank supervisory agencies,
revisions affect the data from March 1952.
and
of information obtained from State banking
The category of "Loans" reported for all commercial banks covers all loans and discounts includ- authorities and other sources for the relatively few
ing open market paper. The "Business loan" cate- uninsured banks. These final June and December
gory for the weekly reporting banks is a major figures, being normally for a day other than Wednescomponent of total loans. Although it includes com- day, replace the earlier estimates. Interim monthly
mercial, industrial, and agricultural loans, it does estimates are revised only when some substantial
not cover loans to business or agricultural enter- error of estimate is suggested by the benchmarks.
prises if secured by real estate or for the purpose of
Prior to 1947 each of the Federal supervisory
purchasing or carrying securities. Monthly esti- agencies prepared separately a series of semiannual
mates for business loans of all commercial banks are "all-bank" statistics. Since 1947 a single series has
not available, but the weekly reporting banks cur- by agreement been prepared by- the FDIC. The
rently account for about 70 percent of all such loans. Federal Reserve monthly estimates for all commercial
Monthly figures shown for commercial banks and banks have been published only since 1948.
weekly reporting member banks are as of the last
The series on required and excess reserves and
Wednesday of the month except that final June and member-bank borrowing are based on reports of
December figures for "All commercial banks" are deposits, reserves, and borrowing from all member
as of the last day of the month.
banks, filed semimonthly or more frequently, de"Required reserve balances" for member banks pending on the class of bank.
are the minimum amount of deposits required to be
Relation to other series.—The Federal Government
maintained by member banks at their respective publishes a variety of statistical series covering all or
Federal Reserve banks pursuant to Federal Reserve part of the banking system. For purposes of general
regulations, measured as a percent of deposit liability analysis, these will not necessarily lead to significantly
58
Bank Loans, Investments, and Reserves
[Billions of dollars]
All commercial banks
End of period
1
Total
loans and
investments
Weekly
reporting
member
banks
Investments
Loans
Total
U. S. Government
securities
Other
securities
1914—June
16.9
13. 2
3.7
0.8
2.9
1919—June
9.4
5. 1
4.3
31.8
22.4
1924—'June
38. 1
27. 6
10. 5
4.4
6. 1
1929—June
49. 4
35.7
13. 7
4.9
8.7
1930—June
1931—June
1932—June
1933—June
1934—June
48.9
44. 9
36. 1
30.4
32. 7
34. 5
29. 2
21. 8
16.3
15. 7
14.4
15. 7
14. 3
14. 0
17. 0
5. 0
6.0
6. 2
7.5
10.3
9.4
9.7
8. 1
6.5
6. 7
Business
loans *
(4)
(4)
(4)
(4)
(44)
()
(44)
()
4
()
(44)
1935—June
1936—December
1937—December
1938—-December
1939—December
34. 6
39. 5
38. 3
38.7
40.7
14. 9
16. 4
17. 1
16. 4
17.2
19.7
23. 1
21. 2
22. 3
23. 4
12.7
15.3
14. 2
15. 1
16. 3
7.0
7.8
7. 1
7.2
7. 1
1940—December
1941—-December
1942—December
1943—December
1944—-December
43. 9
50. 7
67.4
85. 1
105. 5
18.8
21. 7
19. 2
19. 1
21. 6
25.
29.
48.
66.
83.
1
0
2
0
9
17.8
21. 8
41.4
59.8
77.6
7.4
7.2
6.8
6. 1
6.3
5.3
7. 1
6. 1
6.4
6.5
1945—December
1946—December
1947—December
1948—December
1949—December
124.0
114. 0
116. 3
114.3
120. 2
26. 1
31. 1
38. 1
42.5
43.0
97.9
82. 9
78. 2
71. 8
77. 2
90. 6
74. 8
69. 2
62. 6
67.0
7.3
8. 1
9.0
9.2
10. 2
1950—December
1951—December
1952—December _
1953—December
1954—December
126.
132.
141.
145.
155.
52. 2
57.7
64. 2
67.6
70. 6
74. 4
74.9
77. 5
78. 1
85. 3
62. 0
61. 5
63. 3
63.4
69.0
12.4
13.3
14. 1
14. 7
16. 3
7
6
6
7
9
()
5. 1
4. 2
4.7
7
7
All member banks
Reserve balances
Required
Excess
(4)
(4)
(4)
(4)
(4)
(4)
(5)
2.3
2. 3
2. 2
1. 9
• 1. 8
6 2. 1
0. 1
. 1
. 3
6. 5
6 1. 6
2. 5
3. 5
5. 6
5. 4
6.0
2. 5
2. 5
1. 2
2. 5
4.4
6.
8.
10.
11.
12.
9
1
0
1
2
6. 3
5.3
2. 7
1. 5
1. 0
7.3
11.3
14.7
15. 6
13. 9
13. 9
15.0
15. 6
17.2
17. 0
1. 1
17.8
21. 6
23. 4
23.4
22.4
15.
18.
19.
19.
18.
6
5
6
3
5
1. 0
.9
.8
.8
8
,8
7
7
,8
3
Borrowings at
Federal
Reserve
Banks
(5)
1.9
4
.9
(5)
(66)
(5)
()
(55)
()
(55)
()
(55)
()
.3
.3
5
2
1
.4
2
2
1
1
.1
,3
.8
.8
1
1 June dates prior to 1936 because end-of-year data not available for U . S. Government obligations; December dates thereafter.
For " W e e k l y reporting member
banks," Wednesday date nearest end of year.
s Includes commercial, industrial, and agricultural loans.
1 Figures for balances and borrowings are averages of daily figures for the calendar year period.
Figures for required and excess reserves prior to 1929 available only
for call report dates. Figures for borrowings for 1914-28 consist principally of rediscounts for and advances to member banks, but at times include small amounts of
loans on gold, and advances to nonmember banks, Federal intermediate credit banks, and individuals, partnerships, and corporations; for 1929 to date they represent only rediscounts and advances to member banks.
4 Not available.
4 Less than $50 million.
J Data from March 1933 through April 1934 for licensed banks only.
7 Series revised to extend coverage; previous figures not entirely comparable.
NOTE.—Monthly data available beginning October 1947; annual from 1914, except as noted.
Source: Board of Governors of the Federal Reserve System.
different conclusions, but the differences should be
kept in mind. Thus, the all-commercial bank series
should be distinguished from the somewhat larger
"all-bank" series which includes some 500 mutual
savings banks; and from various smaller aggregates
such as those for national banks and insured commercial banks. The all-commercial bank aggregates
here are for continental United States, and may
differ slightly from totals which include banks in the
possessions, published by the Comptroller of the
Currency and the FDIC.
The weekly series includes most of the larger banks
in larger cities and covers a substantial segment of
total commercial bank resources. Although the
series is not identical in coverage with any published
call report aggregate, it is similar in coverage to the
aggregate for all member banks other than "country"
banks. A more recently developed Federal Reserve
series showing changes in commercial and industrial
loans by type of business of borrower, weekly from
1951, is based on a subsample of the weekly reporting
banks and ties in with the business-loan figure.
59
The series on reserve and member-bank borrowings, being averages of daily figures, are not directly
comparable with week-end or month-end memberbank or Reserve-bank statistics.
Uses and limitations.—The all-commercial-bank
figures are useful indicators of business activity and
trends in bank credit use. Data for the weekly reporting member banks are more frequent and more
prompt than those for all commercial banks and provide the more detailed category of "business loans."
The weekly series also is a more sensitive indicator
of developments in the short-term money market,
because it covers the larger banks in the more important centers.
The series on reserves and borrowing are a partial
reflection of the credit potential of the banking
system. Excess reserves are available to the banks
holding them for further credit expansion. Memberbank borrowing from the Reserve banks reflects the
extent to which some banks (not holding excess
reserves) have borrowed temporarily to meet minimum reserve requirements. A measure known as
"free reserves" may be computed by subtracting
borrowings from excess reserves. The series on
required and excess reserves form an integral part of
the significant weekly and monthly Federal Reserve
tabulation entitled "Member Bank Reserves, Reserve Bank Credit and Related Items," which shows
interrelationships among various sources and uses of
reserve funds.
References.—The monthly estimates for all commercial banks appear initially about a month after
the date of the report in a set of Federal Reserve
releases—G.7, G.7 (a), G.7 (b)—showing the major
balance-sheet items and changes during the past
month and year for all banks, all commercial banks,
and member banks. The Federal Reserve Bulletin
also carries the estimates for recent months, with call
report data for selected years back to 1939.
The Wednesday data for the weekly reporting
member banks appear initially on the following
Wednesday in a Federal Reserve release (H.4.2),
showing also changes in assets and liabilities over the
last week and year. The Federal Reserve Bulletin
carries the weekly data and monthly averages for the
last 3 months. Recent revisions are explained in
the Bulletin for June 1947 and April 1953.
Figures for member-bank borrowings and preliminary estimates of excess and required reserves
appear first in the weekly release H.4.1, showing
weekly averages of daily figures, available the day
following the end of the week. The semimonthly
release J.l gives similar data for a half-month period,
available with a lag of about 20 days. Weekly and
monthly data appear in the Bulletin.
Banking and Monetary Statistics, published by
Federal Reserve in 1943, includes discussions and
historical tables dealing with all-bank data, the
weekly reporting member-bank series, and memberbank reserves and borrowings.
CONSUMER CREDIT
Description of series.—These series are estimates
of short- and intermediate-term consumer credit, in
total and by major types. Federal Reserve publishes additional detail by type of credit and by type
of financial institution or retail outlet to which the
debt is owed.
"Consumer credit" is defined as "all credit used to
finance the purchase of commodities and services for
personal consumption or to refinance debts originally
incurred for such purposes." Credit covers both
loans and sales involving deferred payment. Personal consumption is defined so as to exclude consumption not only by businesses.but by nonprofit
organizations. The estimates exclude home-mortgage credit, traditionally considered separately.
"Installment credit," accounting for the bulk of
consumer credit, is that scheduled to be repaid in
two or more payments. Installment credit classified as "Automobile paper" and "Other consumer
goods paper" includes credit for the purchase of, and
60
secured by, such goods regardless of whether originating as loans or as credit sales, and regardless of
whether the paper is held by a merchant or a financial institution. "Repair and modernization loans"
includes such loans held byfinancialinstitutions but
not by merchants. "Personal installment loans"
covers loans by financial institutions for all other
consumer purposes, such as to consolidate debts, to
pay medical expenses, or for education. Consumers'
"noninstallment credit" is classified by Federal
Reserve into three types: charge accounts; singlepayment loans; and service credit (consumer debts
to a variety of creditors, including hospitals, doctors,
utilities, and service establishments).
The definition of consumer credit cited above is
followed in general but not rigidly in the construction of the series. In the absence of sufficiently refined data, certain arbitrary decisions must be made.
For example, all bank credit to farmers is excluded
even though an undetermined part is for consump-
Consumer Credit
[Millions of dollars]
Total
consumer
credit
outstanding
End of year
1929
1930
1931
1932
1933
1934
6, 444
_
5,
4,
3,
3,
3,
767
760
567
482
904
Noninstallment
credit outstanding
Installment credit outstanding
Total
3, 151
2, 687
207
1, 521
1, 588
1, 871
Automobile
paper 1
(4)
W
(4)
0)
4
()
w
Other
Repair
consumer and modgoods
ernization
paper 1
loans 2
Personal
loans
Total
Charge
accounts
Installment
credit
extended 3
Installment
credit
repaid 3
(4)
(44)
()
(44)
(4)
()
(4)
(4)
3, 293
1, 602
5, 799
5, 350
(44)
(4)
()
(44)
()
(4)
(44)
(4)
(4)
()
3,
2,
2,
1,
2,
080
553
046
894
033
1, 476
1, 265
1, 020
990
1, 102
4,
3,
2,
2,
3,
814
866
435
480
125
5,
4,
3,
2,
2,
278
346
121
413
842
(4)
(44)
(4)
()
(44)
(4)
(4)
298
(4)
(44)
(4)
()
1, 088
2,
2,
2,
2,
2,
217
512
674
647
719
1,
1,
1,
1,
1,
183
300
336
362
414
4,
5,
6,
5,
6,
189
617
308
406
872
3,
4,
5,
5,
6,
366
688
916
730
060
1935
1936
1937
1938
1939
4, 911
6, 135
6, 689
338
7, 222
2,
3,
4,
3,
4,
694
623
015
691
503
1, 497
1, 620
1940
1941
1942
1943
1944
8,
9,
5,
4,
5,
338
172
983
901
111
5,
6,
3,
2,
2,
514
085
166
136
176
2, 071
2, 458
742
355
397
1, 827
1, 929
1, 195
819
791
371
376
255
130
119
1, 245
1, 322
974
832
869
2,
3,
2,
2,
2,
824
087
817
765
935
1, 471
1, 645
1, 444
1, 440
1,517
8,
9,
5,
4,
4,
219
425
239
587
894
7,
8,
8,
5,
4,
208
854
158
617
854
1945
1946
1947
1948
1949
5,
8,
11,
14,
17,
665
384
570
411
104
2,
4,
6,
8,
11,
462
172
695
968
516
455
981
1,924
3, 054
4, 699
1,
2,
2,
3,
816
290
143
842
486
182
405
718
843
887
1, 009
1, 496
1, 910
2, 229
2,444
3,
4,
4,
5,
5,
203
212
875
443
588
1,612
2, 076
2, 353
2,713
2, 680
5,
8,
12,
15,
18,
379
495
713
540
002
5,
6,
10,
13,
15,
093
785
190
267
454
1950
1951
1952
1953
1954
20,
21,
25,
29,
30,
813
468
827
537
125
14,
14,
18,
22,
22,
490
837
684
187
467
4,
4,
5,
5,
5,
337
270
328
831
668
1, 006
1,090
1, 406
1, 649
1, 616
2,
3,
3,
4,
4,
6,
6,
7,
7,
7,
323
631
143
350
658
3, 006
3, 096
3, 342
3,411
3,518
21,
22,
28,
30,
29,
256
791
397
321
304
18,
22,
24,
26,
29,
282
444
550
818
024
1
3
3
1
&
.
m
4
()
w
4
()
6,
6,
8,
10,
10,
342
242
099
341
396
()
805
235
851
366
787
Includes all consumer credit extended for the purchase of the specified consumer goods, and secured b y the Item purchased.
Includes only such loans held by financial institutions; those held by retail outlets are included in "other consumer goods paper."
Credit extended or repaid during the year.
Not available.
NOTE.—Revised series; see Federal Beserte Bulletin, April 1953, January 1954, June 1955. Monthly and annual data available beginning 1929, except as noted.
Source: Board of Governors of the Federal Reserve System.
tion. On the other hand, all credit for the purchase
In general, estimates for retail trade are based on
of automobiles by individuals is included even though the 1948 Census of Business, which provides inforan undetermined part of the use is for business pur- mation on credit held by the various retail lines.
poses.
These figures have been adjusted to exclude estiThe table deals primarily with consumer credit mated amounts of nonconsumer credit. Monthly
outstanding, but two series are included on install- figures are then arrived at by estimating, on the
ment credit extended and installment credit repaid, basis of sample monthly data, what change has taken
respectively. These series, first issued by Federal place since the benchmark data. For the more imReserve in 1954, report the flows of new credit portant credit-granting lines, monthly data on credit
through new loans or installment contracts and of receivables are collected from a sample of the firms.
repayments, which explain changes in the level of For other lines, monthly receivables are estimated by
means of a formula based on sales during the previous
credit outstanding.
Statistical procedures.—The "Consumer credit out-few months. Annual sample data on receivables,
standing" series are aggregates of separate estimates collected from many lines, provide a basis for correctof the consumer credit held by a number of different ing the monthly estimates.
types of creditors—financial institutions, retail and
For most types offinancialinstitution, benchmark
service establishments, and others. The procedures data are provided by the 1950 registration of installare complex, and vary for the different groups.
ment credit grantors under Regulation W and by
61
annual or more frequent statistics with complete cov- above, Federal Reserve points out that the estimate
erage. Monthly data on receivables are available of total short- and intermediate-term consumer
credit probably understates somewhat the true
from reporting samples of various types of lenders.
Service credit is in general based on less substan- total. Problems of definition and estimation are
tial data. The methods vary among the different discussed fully in the descriptive material on the
types. Although virtually complete monthly data series, cited below.
References.—The data appear originally in a
are received for telephone bills, the largest category
(medical debt) is based on an annual sample survey monthly release entitled "Consumer Credit (Short
of consumers, and is "moved" by statistics of indus- and Intermediate Term)/' which shows credit by
type, with selected change figures. Installment
trial illness.
The estimates of installment credit extended and credit is further classified by holder. The credit
repaid are derived with the aid of currently reported extended and repaid series are shown both with and
data from the reporting samples of lending and without seasonal adjustments. Tables in the Federal
installment-selling groups covering either collections Reserve Bulletin give annual data to 1939 or 1940,
and more detailed cross-classification by type and
or credit extended.
Uses and limitations.—The widespread interest inholder. The April 1953 issue of the Federal Reserve
consumer credit is due in part to its importance as Bulletin explains a recent major revision and gives
a source of consumer purchasing power, and espe- monthly data back to 1939 (and in less detail to
cially its significance in the market for consumer 1929). The January 1954 Bulletin explains the series
goods frequently bought on the installment plan. on credit extended and repaid and gives monthly
In part it is due to the fact that consumer credit data back to 1940. A subsequent article in the
reflects one aspect of the financial position of con- June 1955 Bulletin gives monthly estimates of
sumers. Consumer credit is also an important credit extended and repaid back to 1929, and
element in the demand for funds in the financial describes the methods used in preparing the estimates. A supplementary technical discussion of
community.
In the face of problems of adapting available data estimating methods is available in pamphlet form
to the precise definition of consumer credit outlined from Federal Reserve.
BOND YIELDS AND INTEREST RATES
3-Month Treasury Bills
Taxable Bonds
Treasury bills are issued weekly. An average disFully taxable long-term bonds were first issued in
count rate is computed for each weekly issuance, on 1941, and the average of fully taxable long-term
the basis of the varying rates at which portions of the bonds began in October 1941. Until April 1953 there
issue are awarded, in order, to the highest bidders. was a single series, with some variation in definition,
The monthly series presented in Economic Indicators representing all such long-term Treasury bond yields.
is a simple average of the average rates for the 4 or 5 In April 1953, as a result of the announcement of the
issues during the month.
new 25- to 30-year 3K's, the existing series was
The series is useful as a measure of a short-term designated "Bonds due or callable from 12 to 20
rate on relatively riskless borrowing. Issuance rates years," while a new series (initially only the 3%'s)
are similar to but not typically identical with market was designated "Bonds due or callable at 20 years
rates on outstanding issues of comparable maturity. and after." Separating the new 3K-percent issue
The monthly averages are first issued in an ad- from the bonds in the existing average prevented the
vance Federal Reserve release, G. 13, and are pub- much longer-term 3%'s from distorting the average.
lished in the Federal Reserve Bulletin. Rates for in- Beginning with June 1955 the average designated
dividual issues appear in the Treasury Bulletin. "Due or callable from 12 to 20 years" was revised
Textual discussion appears in Banking and Monetary by the Treasury to "Due or callable from 10 to
Statisticsy with data on the yields of 3- to 6-month 20 years" in order to allow the series to continue
Treasury notes and certificates for 1920-33.
beyond December 1955, when the longest bond in the
62
Bond Yields and Interest Rates
[Percent per annum]
U. S. Government security yields
Year
3-month
Treasury
bills 1
High-grade
municipal
bonds
(Standard
& Poor's)
Taxable bonds 2
Corporate bonds
(Moody's)
Prime
commercial
paper,
4 - 6 months
Baa
Aaa
1914.
4. 12
1915.
19161917.
1918.
1919.
4.
3.
4.
4.
4.
16
94
20
50
46
5. 49
7. 25
1920.
1921_
1922.
19231924.
4.
5.
4.
4.
4.
98
09
23
25
20
6.
5.
5.
5.
5.
12
97
10
12
00
8. 20
1925.
1926_
1927.
1928.
1929-
4.
4.
3.
4.
4.
09
08
98
05
27
4.
4.
4.
4.
4.
88
73
57
55
73
6.
5.
5.
5.
5.
4.
4.
4.
4.
4.
07
01
65
71
03
4.
4.
5.
4.
4.
55
58
01
49
00
8. 35
7.08
7. 24
6. 83
27
87
48
48
90
1930.
1931_
1932.
1933.
1934.
1. 402
.879
. 515
.256
1935.
19361937.
1938.
1939-
137
. 143
.447
.053
. 023
3. 40
3. 07
3. 10
2. 91
2.76
3.
3.
3.
3.
3.
60
24
26
19
01
5.
4.
5.
5.
4.
75
77
03
80
96
1940.
1941.
1942.
1943.
1944.
. 014
. 103
.326
2.46
2. 47
2. 48
2. 50
2. 10
2.
2.
2.
2.
2.
84
77
83
73
72
4.
4.
4.
3.
3.
75
33
28
91
61
1945.
19461947.
19481949.
.375
.375
. 594
1. 040
2. 37
2. 19
2.25
2. 44
2.31
1. 67
1. 64
2. 62
2. 40
2. 82
3.
3.
3.
3.
3.
29
05
24
47
42
1950.
1951„.
1952..
19531954..
1.
1.
1.
1.
.
1
2
.373
.375
1. 102
218
552
766
931
953
2. 36
2. 06
1. 86
2. 32
8
4
2. 68
2.21
2. 66
1. 98
2. 62
2. 19
2. 72
2. 37
2. 96
3. 20
2. 90
2. 00
2.57
2. 92
2. 52
2. 01
2. 53
2. 61
a
3. 16
2. 71
2. 86
5. 90
7. 62
9. 30
7. 76
6. 32
3. 24
3. 41
3. 52
3.74
3. 51
Rate on new issues within period.
Bonds in this classification were first issued in March 1941.
beginning April 1952, 2 -percent bonds first callable after 12 years; prior to April 1952, bonds due or callable after 15 years.
* Bonds due or callable from 10 to 20 years.
* Bonds due or callable at 20 years and after.
NOTE.—Monthly data available beginning 1931 (scattered issues beginning December 1929) for 3-month Treasury bills; 1941 for taxable bonds; 1900 for high-grade
municipal bonds (Standard & Poor's); 1929 for corporate Aaa and Baa bonds (Moody's); and 1890 for prime commercial paper, 4-6 months.
Sources: Board of Governors of the Federal Reserve System, Department of the Treasury, Standard & Poor's Corporation, Moody's Investor sService.
average (the 2%'s of December 1967-72) would have
dropped below 12 years to first call date. For consistency, the new 10- to 20-year average was computed back to April 1953, although changes from the
old average never exceeded 0.02 percent on a monthly
basis.
The series designated "Due or callable at 20 years
and after" now includes the 3's of 1995 issued
in February 1955, as well as the 3%'s 0 f 1978-83.
Both series are based on daily closing-bid quotations in the over-the-counter market as reported to
the Federal Reserve Bank of New York by leading
63
dealers in New York City. Each is ail unweighted daily beginning in 1932. Weekly and monthly
average of the individual yields. The table shows figures are averages of daily figures; annual figures
are averages of 12 monthly figures.
averages of daily figures.
The daily yield for each selected bond is computed
These series reflect the particular and changing
distribution of maturities of the bonds included, and on the basis of closing price, as reported in dealers'
the meaning of the yield will vary with the passage quotations. For each of the rating classifications
of time and as new bonds are added or old ones the 10 (or fewer) individual yields for each industrial
group are averaged, without weighting; and the
removed.
The series are published monthly in the Treasury corporate index is computed as the unweighted
average of the 3 industrial-group averages.
Bulletin and the Federal Reserve Bulletin, and in an
Issues included in each average are selected to
advance release (G.13—Open Market Money Rates)
by Federal Reserve. They are discussed in the represent typical long-term bonds in each rating
Treasury Bulletin of March 1944 and in footnotes to group. Occasional substitutions in the bond list
have been made when ratings have been changed,
the current tables.
when a bond has been called or sells too high above
High-Grade Municipal Bonds
its call price, or because of approaching maturity.
Suitable adjustments (usually small), which are gradThis series, compiled by Standard & Poor's Cor- ually amortized, are introduced to prevent such subporation, is an arithmetic average of the yield to stitutions from impairing the comparability of the
maturity of 15 high-grade domestic municipal bonds. series.
The issues are selected on the basis of quality, trading
These series are useful general indicators of the
activity, and geographic representation. The yields
level and movement of average yields of selected
are based on Wednesday's closing prices, and the
bonds of the respective grades with sufficiently long
monthly figures are averages of the 4 or 5 weekly
maturities and other features to afford adequate
figures for the month. Prior to 1929 the monthly
measures of long-term interest rates. They are not
figures were based on an average of the high and low
a measure of average yields of all Aaa or all Baa
prices for the month. The series is available back to
bonds available to the investor.
1929 on a weekly basis and to 1900 on a monthly
The daily corporate bond yield averages are pubbasis.
lished weekly in Moody's Bond Survey, which inThe series is published weekly in Standard & Poor's
cludes from time to time the list of bonds. HisOutlook and Bond Outlook. Monthly and annual
torical monthly data and annual averages for these
average figures back to 1900 and a description of
two series are available back to 1919, and are pubthe series and list of the issues used appears in the
lished in Moody's Industrial Manual.
1955 edition of Standard & Poor's Security Price
Index Record.
Prime Commercial Paper
Corporate Aaa and Baa Bonds
This series measures the prevailing rate on prime
4
to 6 months' commercial paper. The prevailing
These series measure the currently prevailing
daily
selling quotation is determined by the Federal
maturity yields on long-term corporate bonds of the
Reserve
Bank of New York on the basis of continuhighest quality and of "lower medium grade," as
ing
contacts
with New York City dealers handling
reflected in the yields of selected bonds rated Aaa
the
bulk
of
the
volume of commercial paper of the
and Baa by Moody's Investors Service. The series
inventory
type,
and
less frequent reports from dealshown here are 2 of a group of similar series computed
by Moody's, covering bonds classified by 4 rating ers outside New York. Monthly and weekly figures
groups (Aaa, Aa, A, Baa) and by 3 industrial groups. are averages of daily prevailing rates.
The series is useful as a measure of the cost of
The formula for these series was established in 1928
to include for each rating 10 industrial, 10 railroad, open-market short-term credit available to large
and 10 public utility bonds. Since 1935, however, business borrowers of the highest credit standing.
there have not been 10 suitable bonds for each classi- It is published in the Federal Reserve Bulletin and in
fication. The Aaa series currently includes 5 indus- the advance Federal Reserve monthly release, G. 13.
trials, 6 railroads, and 10 public utilities; and the Annual and monthly data are available back to 1890,
Baa 9 industrials, 10 railroads, and 10 public utilities. and back figures with some textual discussion may
The series were calculated on a monthly basis be found in Banking and Monetary Statistics, pubfrom 1919 through 1931; and have been calculated lished by Federal Reserve in 1943.
64
Stock Prices
[Weekly average; 1939=100]
IVlanufacturirig
Year
Composite
index 1
Durable
goods
Total
Nondurable goods
Transportation
Utilities
Trade,
finance,
and service
Mining
1939---
100. 0
100.0
100. 0
100. 0
100.0
100. 0
100. 0
100. 0
1940
1941
1942
1943
1944
94.2
85. 7
74.9
99.2
108. 1
93. 4
84. 8
75. 5
99. 1
106.9
92.
81.
73.
94.
104.
5
6
7
7
7
94.2
88. 0
77.2
103.5
109. 2
99.2
96.5
90.8
125. 1
140.8
99.9
89. 1
69.8
90. 5
99.0
90. 4
82. 0
71.3
101. 0
117.3
75.
71.
59.
83.
93.
6
1
7
5
3
1945
1946
1947
1948
1949
131.
149.
130.
132.
127.
129. 0
146. 6
132. 4
136.8
132. 1
129.
138.
119.
124.
116.
0
6
9
3
0
129. 2
154.5
144. 6
148. 6
147. 2
190.0
202.4
149. 1
158. 1
136.0
112.9
121.0
105.5
99. 3
98. 1
149. 3
204.3
162. 8
156. 9
160. 7
114.
125.
117.
133.
129.
3
5
2
0
4
1950
1951
1952
1953
1954
154. 1
184.9
195. 0
193. 3
229. 8
165.
206.
220.
220.
271.
150.2
178.5
188. 8
192. 6
245. 2
180.2
233. 1
249.3
245.2
295.2
160.0
199. 0
220. 6
218. 7
232. 6
108. 9
112. 6
117.9
121. 5
135.8
183.8
207. 9
206. 0
207. 1
235. 6
143.
204.
275.
240.
267.
5
9
7
5
0
2
4
9
7
7
7
8
2
1
3
* Includes 265 common stocks; 98 for durable goods manufacturing, 72 for nondurable goods manufacturing, 21 for transportation, 29 for utilities, 31 for trade, finance,
and service, and 14 for mining. Indexes are for weekly closing prices.
NOTE.—Monthly and weekly data available beginning with 1939.
Source: Securities and Exchange Commission.
STOCK PRICES
Description of series.—These indexes measure issue is changed an adjustment of the index is made
average price movement of 265 of the more active only if such change involves a change in the invested
common stocks listed on the New York Stock capital. The base value of the issue is then revised
Exchange. The stocks, classified in Economic Indi- in the ratio of the new to the old capitalization so
cators only by broad categories, are also classified in that the index will reflect only price movement.
Uses and limitations.—This is a moderately
the basic releases under 29 selected industry groups.
These groups and the individual stocks in them sensitive weekly index presented in terms of catewere selected on the basis of common-stock trading gories roughly comparable with the Standard Indusactivity on the Exchange in 1949. The selected trial Classification—a feature which facilitates use in
groups correspond in general to classifications in the conjunction with other series so presented.
The indexes will not necessarily reflect weekly
Standard Industrial Classification. The stocks thus
selected from a total of approximately 1,000 listed price movements of stocks not listed on the New
common stocks accounted for about 70 percent of the York Stock Exchange, of the less active stocks so
value of common-stock trading activity on the New listed, or of those from industries excluded from the
sample because of low volume of trading activity.
York Stock Exchange in 1949.
The prices reflected in the indexes are for the last This selectivity of industries should be borne in mind
sales of the respective stocks during the week as when using the indexes for the broader industrial
categories presented in Economic Indicators.
reported in the financial press.
Statistical procedures.—The index for each of the References.—The SEC data are first published in
29 industry groups measures the total current market a release issued each Monday entitled "SEC Indexes
value of the included issues (i. e., number of shares of Weekly Closing Prices of Common Stocks on the
outstanding times price) as a percentage of their New York Stock Exchange," showing data for the
total market value in 1939 (computed as an average 2 previous weeks, with percent change. The monthly
of 52 weekly figures). Each industry is weighted in SEC Statisticcl Bulletin shows price and change data
the larger aggregates according to the value of the for the 4 or 5 latest weeks. Data back to 1939 are
selected issues, and not necessarily according to the available on request. A release entitled "Computation of SEC Index," which includes a list of the
value of all listed issues in the industry.
When the number of outstanding shares of an selected stocks, may be obtained from SEC.
65
FEDERAL FINANCE
BUDGET RECEIPTS AND EXPENDITU
Description of series—Budget receipts represent
the income of the Federal Government and are derived mostly from various kinds of taxes, but also
include fees, fines, proceeds from the sale of property, and other miscellaneous items. Budget expenditures represent payments for Government programs, including capital outlays, purchases of goods
and services, transfer payments, grants to States,
and certain payments to Federal trust funds.
Budget expenditures are payable out of budget receipts or out of borrowing. Transactions of trust
funds are excluded from budget receipts and expenditures.
"Net budget receipts" include all money paid into
the Treasury to the credit of the general fund and of
special funds. They do not include money obtained
from borrowing; nor do they include receipts of revolving and management funds, since these funds
are reported on a net basis in the expenditure figures.
Amounts refunded by the Government (principally
for the overpayment of taxes arising from the withholding system) and amounts collected from various employment taxes which are transferred to the
appropriate trust fund are deducted in arriving at
net budget receipts.
"Net budget expenditures" cover the general
fund and the special funds (generally on a gross
basis) and revolving and management funds (on. a
net basis). Revolving and management funds comprise both intragovernmental funds and public
enterprise funds. In the accompanying table collections received by these funds are deducted from the
total of payments made, and the resulting figure is
included as the expenditure; where the collections
are larger than the payments from such funds, the
net amount included in the expenditures is a negative item. Starting with the 1955 Budget Document, the summary budget tables report the expenditures of the public enterprise funds on a gross basis
to arrive at "total budget expenditures." Applicable receipts of the public enterprise funds are then
deducted from the total to arrive at "net budget expenditures." Net budget expenditures do not include retirement of Government debt, nor do they
include investments of Government enterprises in
United States securities.
"Alajor national security" is a special classification
of budget expenditures which is currently used in
the Budget Document. It comprises: (1) Department of Defense, military functions; (2) the military
66
portion of the mutual security program; (3) development and control of atomic energy; and (4) stockpiling of strategic and critical materials.
"Budget surplus or deficit" represents the difference between the net budget receipts and net budget
expenditures.
"Public debt" consists of the outstanding gross
borrowings of the United States Treasury and the
guaranteed obligations of other Government agencies
not held by the Treasury. The budget surplus or
deficit is not the only factor which causes a change
in the public debt, although generally it is the major
influencing factor. The other factors operating to
increase or reduce the debt are: (1) changes in
Government cash balances; (2) the result of trust
fund transactions; (3) the use of Government corporation borrowing directly from the public as a
means of financing the corporation's budget expenditures (or the utilization of their net receipts to
repay such borrowing); and (4) changes* in the
amount of checks outstanding and other items in
the process of clearing through the accounts.
Statistical procedures.—Budget receipts and expenditures are published each month by the Treasury
Department in the Monthly Statement of Receipts
and Expenditures of the United States Government.
Under a new reporting procedure instituted in
February 1954, budget receipts are on a collections
basis, and budget expenditures are reported on the
basis of checks issued and cash payments made by
Government disbursing officers. The public debt
is compiled daily from records of the United States
Treasury and is published in the Daily Statement of
the United States Treasury (with details at the end
of each month) as well as in the Monthly Statement.
When an expenditure is made in the form of a
debt issuance instead of a check (for example,
armed-forces leave bonds issued in 1947) or an
increase in the public debt (such as the semiannual
increase in the redemption value of savings bonds),
the debt increase is included in budget expenditures.
On the other hand, amounts invested by the Government in its revolving and management funds,
and the collection of dividends and repayments of
amounts invested in such funds, are excluded from
both budget receipts and expenditures.
Relation to other series.—Several other statistical
series are derived in large part from data on budget
receipts and expenditures. For example, the series
on Federal cash receipts from and payments to the
Budget Receipts and Expenditures
[Billions of dollars]
Net budget expenditures
Fiscal year
Net budget
receipts
Total
Budget surplus ( + ) or
deficit (—)
Major
national
security 1
Public debt
(end of
period)2
1929
3.9
3. 1
0. 7
+ 0. 7
16. 9
1930
1931
1932
1933
1934
4. 1
3. 1
1.9
2. 0
3. 1
3.3
3. 6
4.7
4. 6
6. 7
.7
7
7
6
5
+ .7
5
-2. 7
»2.6
-3.6
16.
16.
19.
22.
27.
2
8
5
5
7
1935
1936
1937
1938
1939
3.7
4. 1
5. 0
5. 6
5.0
6. 5
8. 5
7.8
6.8
8.9
.7
9
. 9
1. 0
1. 1
-2. 8
-4.4
-2. 8
-1. 2
-3. 9
32.
38.
41.
42.
45.
8
5
1
0
9
1
1
6
0
6
9. 1
13.3
34. 0
79.4
95. 1
1. 5
6. 7
23. 9
63. 2
76.8
— 3.
-6.
— 21.
-57.
-51.
9
2
5
4
4
48.
55.
77.
140.
202.
5
3
0
8
6
44.5
39. 8
39. 8
41. 5
37.7
98.4
60. 4
39. 0
33. 1
39. 5
81.
43.
14.
11.
12.
3
2
4
8
9
-53. 9
-20. 7
+ .8
+ 8.4
-1. 8
259.
269.
258.
252.
252.
1
9
4
4
8
1950
1951
1952
1953...
1954
36.5
47. 6
61. 4
64. 8
64.7
39. 6
44. 1
65.4
74.3
67.8
13.
22.
43.
50.
46.
0
3
8
3
5
-3. 1
+ 3. 5
-4. 0
-9.4
-3. 1
257.
255.
2£9.
266.
271.
4
3
2
1
3
1955 s
60.3
64.5
40. 4
— 4. 2
274. 4
5.
7.
12.
22.
43.
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
— .
* Based on a current classification which covers expenditures for the military functions of the Department of Defense (including the Const Guard from 1941 to 1946J,
the military portion of the mutual security program, development and control of atomic energy, and stockpiling of strategic and critical materials. Several activities
closely related to national security are excluded; as a result. figures for war years probably understate war expenditures significantly.
1 Includes guaranteed securities, except those held by the Treasury.
Part of the public debt is not subject to the statutory debt limitation,
s Preliminary.
NOTE.—Detail will not necessarily add to totals because of rounding.
Sources: Bureau of the Budget and Treasury Department.
public (see following section) is calculated by start- Department of Commerce to obtain separately the
ing with the data on budget receipts and expendi- expenditures for goods and services, transfer pa}Ttures, adding trust fund transactions, and then mak- ments, and other outlays.
Uses and limitations.—Data on budget receipts
ing certain adjustments to arrive at the cash flow
of funds between the public and the Federal Govern- and expenditures are useful in several significant respects. First, they reflect the financial transactions
ment as a whole.
Budget receipts and expenditures are also used in of all Government-owned funds and therefore serve
obtaining the data for the Federal Government as an important indicator of executive and legislative
sector included in the Department of Commerce budget policy. Second, the relationship between
income and product series (see pp. 4 and 6). the receipts and expenditure figures serves as the
Since budgetary figures are reported on a checks- major determinant of increases or decreases in the
issued and collections-received basis, they are ad- public debt. Third, this series is prepared in detail
justed to the accrual accounting basis used in the based on the Government's financial accounts and
income and product accounts; for example, corpora- forms the basis for various other series on Federal
tion profits taxes are adjusted to show tax liabilities financial transactions which are important for
instead of tax collections. The budget expenditure economic analysis.
data also must be analyzed and adjusted by the
For purposes of appraising the effect of Federal
67
financial transactions on the economy, however, this
series has important limitations. For example,
business activity may be influenced by Government
financial operations long before such operations are
reflected in the figures on budget expenditures or
receipts; some of the economic impact is reflected
at the stage when contracts for goods and services
are let, i. e., when obligations are incurred, or when
tax liabilities are changed by a new tax measure.
Moreover, Federal guaranties and insurance of
private loans have an impact on economic activity
although they have a relatively minor effect on
budget receipts or expenditures. In addition, the
operations of the trust funds and Governmentsponsored enterprises play an important role in the
economy which is not reflected in the budget figures.
References.—The basic release of the budget
receipts and expenditures data is the Monthly.
Statement of Receipts and Expenditures of the United
States Government issued by the Treasury Department. A description of the basis for this statement
was published in the April 1954 issue of the Treasury
Bulletin, page A-2. Annual data are available in
the Budgets of the United States Government, issued
by the Bureau of the Budget, and are also reported
in the Combined Statement of Receipts, Expenditures,
and Balances of the United States Government, issued
by the Treasury Department. Data beginning with
1789 are published in the Annual Reports of the
Secretary of the Treasury and in Historical Statistics
of the United States, 1789-1945, Series P 89-108.
CASH RECEIPTS FROM AND PAYMENTS TO THE PUBLIC
Description of series —This series presents infor- and deposit funds; (2) net expenditures or receipts
mation on the flow of money between the public and of Government-sponsored enterprises as reflected in
the Federal Government as a whole, representing, in their transactions through the Treasurer of the
effect, a consolidated cash statement of Federal United States; and (3) changes in the clearing
transactions with the public other than borrowing accounts of the United States Treasurer to adjust
operations. The public is defined to include indi- for outstanding checks and other items. The folviduals, banks, other private corporations and asso- lowing items are eliminated: (1) intragovernmental
ciations, unincorporated businesses, the Federal Re- transactions, such as interest paid on securities held
serve System, the Postal Savings System, State and by trust funds (which is both a budget expenditure
local governments, foreign governments, and inter- and a trust receipt); (2) noncash expenditures in the
national organizations.
form of debt issuances or other increases in the public
Federal cash receipts from and payments to the debt which represent obligations of the Government
public include the transactions of trust and deposit to make cash payments in the future—eliminated
funds as well as the Federal funds included in budget in the year of the debt increase but added to exreceipts and expenditures. They also include trans- penditures in subsequent years as actual cash payactions of the Treasurer of the United States as ments are made (for example, the semiannual inagent for certain Government-sponsored enterprises crease in the redemption value of savings bonds,
which are not considered a part of the Government in which is a part of budget expenditures, is deducted,
the conventional budget data—mainly the Federal while interest actually paid to the public on savings
Deposit Insurance Corporation, Federal land banks, bonds redeemed during the year is added); and (3)
Federal home loan banks, and banks for cooperatives. receipts of the Government from exercise of the
Major intragovernmental and noncash transactions monetary authority (currently consisting mostly of
are excluded in the consolidation of Federal financial seigniorage on silver).
transactions.
Conceptual and statistical revisions of this series
The excess of Federal cash receipts or payments is were made in 1947. A few changes have been made
sometimes referred to as the cash surplus or deficit. since then to reflect similar changes in the concept
Statistical procedures.—This series is based on data of budget receipts and expenditures, such as the
published in the Daily Statement of the United Stateschange in reporting of refunds of receipts. Data
Treasury and the Monthly Statement of Receipts and beginning with fiscal year 1953 and calendar year
Expenditures of the United States Government.
1954 are on the new reporting basis (see p. 66)
To derive the figures on Federal cash receipts and instituted in February 1954.
payments to the public, several adjustments are
Relation to other series.—This series is similar to
made to budget receipts and expenditures. The the series on Treasury cash deposits and withdrawals
following items are added: (1) transactions of trust published in the Daily Statement of the United States
68
Cash Receipts From and Payments To the Public
Year
Federal cash
receipts from
the public
Federal cash
payments to
the public
Excess of receipts ( + ) or
payments (—)
Billions of dollars
Fiscal years:
1929—-
3.8
2. 9
+0.9
193 0
193 1
193 2
1933.—
193 4
4.0
3. 2
2.0
2. 1
3. 1
3. 1
4. 1
4.8
4. 7
6. 5
+.9
-1.0
-2.7
-2. 6
-3. 3
193 5
193 6
193 7
193 8
193 9
3.8
4.2
5. 6
7.0
6. 6
6. 3
7. 6
8.4
7. 2
9. 4
-2.4
-3. 5
-2.8
1
-2.9
194 0
194 1
194 2
194 3
194 4
6. 9
9. 2
15. 1
25. 1
47.8
9. 6
14.0
34. 5
78. 9
94.0
-2.7
-4.8
-19. 4
-53. 8
-46. 1
194 5
194 6
194 7
194 8
1949____
50. 2
43. 5
43. 5
45.4
41. 6
95.
61.
36.
36.
40.
2
7
9
5
6
-45. 0
-18. 2
+ 6. 6
+ 8.9
+ 1.0
1950„_.
1951_—
1952
1953„195 4
40. 9
53.4
68. 0
71.5
71. 6
43. 2
45.8
68. 0
76. 8
71. 9
-2.2
+ 7. 6
+. 1
-5. 3
2
1955 1
67.8
70.8
-3.0
Millions of dollars
Calendar years:
1943 3
1944
37, 863
48, 131
88, 987
94, 810
- 5 1 , 124
- 4 6 , 679
194 5
194 6
194 7
194 8
194 9
49,
41,
44,
44,
41,
423
441
282
922
346
86,
41,
38,
36,
42,
142
399
616
897
642
- 3 6 , 719
+ 42
+ 5, 666
+ 8 , 027
- 1 , 295
195 0
195 1
195 2
195 3
19541
42,
59,
71,
70,
68,
419
278
339
041
562
41,
58,
72,
76,
69,
969
034
980
194
622
+
+ 1,
-1,
-6,
-1,
450
244
641
153
060
1 Preliminary.
2 First calendar year for which data are available.
NOTE.—Detail will not necessarily add to totals because of rounding.
Sources: Bureau of the Budget and Treasury Department.
69
Treasury, and monthly in the Treasury Bulletin. Government contractual arrangements, such as the
The following are the differences between the two: program for lease-purchase of Government buildings,
(1) receipts from the exercise of the monetary have economic effects which cannot be measured by
authority are included in Treasury cash deposits the payments made in any one period.
References.—Current quarterly data on Federal
but are excluded from this series since they do not
represent cash received from the public; and (2) the cash receipts from and payments to the public are
Treasury series records only transactions which prepared for Economic Indicators. Annual data by
affect the cash balances of the United States Treas- fiscal years back to 1929 are published in the Statistiurer, resulting in a difference in coverage, since this cal Abstract. Starting with the 1944 Budget, each
series includes cash transactions with the public year the Budget of the United States Government has
from accounts of Government agencies with com- also presented data for the most recentfiscalyear and
mercial banks as well as from the Treasurer's estimates for the current and following fiscal years.
The data have also been included in the annual
accounts.
Uses and limitations.—For purposes of economic Midyear Review of the Budget, prepared by the
analysis, the series on receipts from and payments Bureau of the Budget each summer or fall. The
to the public is a more complete measure of the related series on Treasury cash deposits and withimpact of Federal financial transactions on the drawals is published in the Daily Statement of the
economy than the series on budget receipts and United States Treasury, and monthly in the Treasury
expenditures. However, it should be recognized Bulletin.
that not only cash flows, but also many other FedThe adjustments made in the figures for budget
eral financial activities have important economic receipts and expenditures to arrive at Federal cash
effects. For example, the rapid expansion in new receipts from and payments to the public are listed
appropriations immediately after the attack on Korea in detail in a release of the Bureau of the Budget
stimulated a rise in business activity long before the entitled "Federal Government Receipts From and
authorized funds were paid to the public. Likewise, Payments to the Public, Supporting Tables." This
the enactment of a tax measure may affect business release is issued in conjunction with the annual publiactivity long before the cash flows involved take cation of the Budget of the United States Government
place between the Federal Government and the and the Midyear Review. A summary reconcilation
public. Federal guaranties and insurance of private of the differences between this series and the Treasury
loans also influence the economy even though they cash deposits and withdrawals series was published
normally have little or no impact on Federal receipts in the Budget of the United States Government, for
from and payments to the public. Certain other the Fiscal Year Ending June SO, 1956, on page 1132.
70
@FedFRASER