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ÊLPHIA

AUGUST 1961

BUSINESS
REVIEW
It May Not Always Be the Other Guy: An Editorial
From Ben Hur to Yogi Berra
Some Jobs Are Always in Season

IT MAY NOT ALWAYS BE
THE OTHER GUY: AN EDITORIAL
Americans are prone to project the past into
the future. In other words, they often seem to
feel that what has been happening will go right
on happening—what hasn’t occurred, won’t oc
cur. It’s a pervasive phenomenon. It is found at
the governmental level, at the business level,
and it shapes our actions as individuals.
When the country is at peace, there is a
tendency to expect that peace will continue in
definitely. Thus we have come to major wars in
a state of unpreparedness with our armies under
manned, our weapons obsolete and inadequate.
It happened in both world wars and there are
many who now say we have failed to prepare
adequately for the cold war.
Projecting past experience is also common in
business. Indeed, it is a basic cause of the busi
ness cycle. When the economy is prosperous,
many entrepreneurs believe that good times will
continue indefinitely and they overexpand. In
slack times, the unfavorable outlook curtails
necessary and profitable investment.
When people assume their roles as individuals
rather than as governmental officials and busi
nessmen, they continue their conviction that
because something hasn’t happened it won’t
happen. Perhaps it’s a good thing. We can’t
spend our lives worrying about every unpleas
ant thing that could happen to us. We would
all be in mental institutions before long. But
people can take precautions and this is what
concerns us here—how the tendency to project
the past affects precautions or the lack of them.
Automobiles are an illustration of what we
mean. People feel that accidents happen to sta
tistical other guys. As a result, drivers speed,

drink, and take all sorts of chances. Most of the
motoring public is so sure that its good luck
will continue that it scorns the use of seat belts,
even though these devices have proved to in
crease several-fold the chances of survival in an
accident.
There are other examples of the failure to
take precautions. Polio vaccine is effective and
often given free, yet millions remain “un-shot.”
Home fire alarms could save many lives each
year but they are seldom found in today’s houses.
We even go unprepared when it comes to some
thing as inevitable as death—half the adults
today haven’t bothered to write their wills.
Civil defense is one of the classic cases of
it-won’t-happen-to-me inertia. Hydrogen war
heads are poised 15 minutes away yet how many
homes have bomb shelters? How many homes
even have caches of canned goods and water in
the basement? The Federal Government prints
the precautions one should take in case of attack,
but how many have written for the pamphlet?
Have you?
It has been said that the lack of civil defense
precaution is due, at least in part, to a feeling
of not wanting to live in the world as it would
be after an atomic war. We don’t believe it.
This is contrary to the basic instinct for human
survival and, besides, who knows what the world
would be like? We think this attitude is a blase,
sophisticated attempt to mask inertia.
Governments and businesses, as well as indi
viduals, are to blame when it comes to neglect
ing civil defense precautions. And so are banks.
We are familiar with the case of banks because
we are close to it.

business review

The Federal Reserve has distributed a set of
emergency planning instructions for banks. The
basic purpose is to maintain a functioning fi
nancial system for the many millions of Ameri
cans who are expected to survive an atomic
attack. These instructions provide for the suc
cession of bank management, for preserving vital
records, and for other important matters. The
procedures are neither complicated nor costly.
Yet action by banks has not been encouraging.
Some farsighted banks have adopted adequate
measures, of course, but many others have
ignored the procedures entirely or taken only
superficial precautions. The attitude of “it hasn’t
happened, so it won’t happen” has been strong.
But this attitude may be changing—on the
national level at least. For once we appear to
be anticipating and preparing. The President has
asked for and received authority to call up
certain reserves and to speed various prepared
ness programs as a precaution against what

might happen in Berlin.
It may be that our national inertia is diminish
ing. Possibly the desire to take things as they
come, while feeling‘ deep down that only pleasant
things will come, is changing. Perhaps the na
tion is in the mood for planning and preparation.
We hope that banks are now ready to take
further action on emergency planning. The
Secretary of the Treasury has just issued a
statement in which he says that it is “impera
tive that our banks establish an independent
means of reconstructing their assets and liabili
ties and their account relationship with cus
tomers. . . .”
We call attention to the handbook “Emergency
Circulars and Instructions” which was mailed to
Third District banks last April. It indicates the
actions banks should take. The American
Bankers Association and many state bankers
associations have also published pertinent in
structions.

FROM BEN HUR
TO YOGI BERRA
A Discussion o f that Fabulous Convalescent ,
the Spectator Sports In du stry
Going to the ball game was always an occasion.
We felt a tinge of excitement when we first
glimpsed the stadium, looming over the clustered
tenements like a medieval castle with light
towers.
We took our place at the end of the ticket
line—there were lines everywhere at the ball
park in those days. When our turn came, we

shoved our money through the opening. The
owlish figure behind the glass thrust out two
tickets.
On the other side of the turnstiles we bought
a scorecard and began to climb an Everest of
steps. At the top we found Section K and pushed
through. The aisles were never quite wide
enough.

business review

The panorama of baseball is always impressive
at first sight—the green grass, the russet fan of
the infield, the billboarded outfield fence so far
away, the embracing tiers of the grandstand. We
stood and watched for a moment.
Shortly after we were seated, the tiny figures
in the bright-billed caps completed their pre
game rituals and disappeared into the dugout.
There was just time for a soda and a hot dog
smeared with the bright yellow mustard that
seems to be found only at stadium concessions.
Then the home team jogged to their positions
on the field. The crowd came to life. “Play ball,”
bellowed the umpire, and so began two hours,
more or less, of absorbing diversion. The watcher
was transported to a world apart—-an under
standable, orderly world that ran strictly accord
ing to the rules.
There were all sorts of emotions to experi
ence—despair, disdain, delight—and there was
plenty of opportunity to vent these feelings.
Sometimes we cheered, sometimes we booed, and
both felt good to do.
This is what the wonderful world of spectator
sports was like to us. We loved it as a child and
we love it as an adult. But we haven’t been to
a game in 10 years. Like many others, we have
been bypassing the sensory and psychological
pleasures of spectator sports.
Spectator sports—baseball, football, basketball,
hockey, track, boxing, or any athletic contest
where admission is charged—were a great
American institution. They still are, for that
matter, but they fell into lean years in the early
1950’s. They had to take on all comers in a
vastly expanded leisure market. Spectator sports
have enjoyed a bit of a revival in recent years
but it has been far from robust.
Before we analyze the present trends in sports
spending and attendance, we shall place things

BLEACHERS AND BUDGETS
Spending fo r a dm issions to
consumption expenditures
RATIO SCALE
MILLIONS O F DOLLARS

spectator sp o rts

and

total

RATIO SCALE
BILLIONS OF DOLLARS

in proper perspective and delve into the musty
history of sitting and watching sports.
T W E N TY C EN TURIES IN TH E G RA N D STA N D S

Sports were important in ancient Greece but the
emphasis was on participating, not watching.
The Greeks wrestled and raced primarily to keep
fit and to train for war, not to please an audience.
In pagan Rome it was different. There, to
paraphrase Veblen, sports bore as much resem
blance to physical culture as a bull fight does to
agriculture. Athletes belonged to a low social
caste. Their job was to entertain. The average
Roman paid his denarii and sat down to watch.
Spectator sports in ancient Rome reached a de
gree of popularity that has never been equaled—
certainly not before and probably not since.
Almost 90,000 toga-clad citizens could crowd
into the Colosseum for an afternoon of gladiator
matches. On the other side of town, an estimated
250.000 could watch the chariot races at the
Circus Maximus. That is a larger crowd than
has ever witnessed a live sporting event in
modern times. The recent record is estimated at
175.000 at the Indianapolis Speedway.
Spectator sports declined and fell with the

business review

Roman Empire. They didn’t really become im
portant again until the mid-part of the 19th
century. At that time the main spectator sports
in America were shooting and rowing. A na
tional rifle tournament on Long Island once drew
100,000 spectators, and uncounted multitudes
regularly lined the Hudson River to cheer and
bet on their favorite crews.
The middle of the 19th century also saw the
beginnings of the two sports that now come as
close as any to being our national games. They
are, of course, baseball* and football.

best teams traveled all over the country taking
on what local opposition was available. Fans
everywhere discussed the exploits of Albert
Spaulding, Cap Anson, and dozens of other stars.
Baseball was well on its way to an important
place in our culture.
From ivy o rig in s

Ask any schoolboy who invented baseball. He
undoubtedly will tell you Abner Doubleday—at
Cooperstown, New York.
He didn’t do it, say baseball historians, such
as Frank Menke, Robert Smith, and others. Nor
did Doubleday himself ever claim the honor.
The best guess is that nobody invented baseball.
It just evolved, probably from the English game
of rounders.
By 1850 the game was roughly as we know
it today and was spreading rapidly on the
Eastern Seaboard. These early baseball games
had few, if any, spectators. The idea was to pro
vide diversion and exercise for the partici
pants—the Greek philosophy. But baseball was
soon to be Romanized.
Gambling attracted the first crowds to baseball.
Bookies frequented the games and more and
more people were drawn by the chance to win
a buck. It wasn’t long, however, before the
bettors developed an interest in the game itself.
Baseball flourished after the Civil War. The

The first football game was, as popularly be
lieved, between Princeton and Rutgers in 1869.
It was played under rules derived from the
English game of Rugby with 25 men on a side.
The main resemblance to the modern game was
that a small white dog ran on the field.
Only about 100 spectators saw that first game.
Crowds remained small throughout the re
mainder of the 19th century. Football was played
mostly by Eastern colleges and was witnessed by
students and a sprinkling of old grads. In those
days football was a game of sheer brawn—hard
to play and dull to watch.
About the turn of the century things began to
happen to lift football out of its ivy privacy.
The Carlisle Indians under Coach “Pop”
Warner brought new color to the game. They
introduced such crowd pleasers as the shift, the
reverse, and the hidden-ball trick.
The forward pass had a revolutionary effect
on football. The “aerial” was first exploited by
Knute Rockne and Gus Dorais while playing for
Notre Dame in 1913. The pass greatly speeded
the game. The appeal of finesse, craft, and pre
cision was added to the spectacle of men knock
ing each other down. Attendance swelled. Colleges
built huge new stadiums and soon found them
selves in the entertainment business.

* Several of our colleagues have commented that we over
emphasize baseball in th is a rticle. If true, we don't regret it.
Baseball is the bellwether of spectator sports, typical of the
industry, typical of the nation. As Jacques Barzun, the famous
philosopher and w rite r, has said, "W ho e ve r wants to know the
heart and mind of America had better learn baseball. . . "

The twenties roared in with their flasks, flappers,
and fast cars. The decade was exciting but there

Disenchanting Doubleday

The babe, the gho st, and the m auler

business review

was something unreal about it. It was a phantasy
in jazz tempo, an age that didn’t know where it
was going hut was in an awful hurry to get
there. In those glittering, frantic times, noth
ing, not even the stock market or the bootlegger,
captured the public’s imagination like the stars
of sports. Babe Ruth probably was better known
than President Harding. Red Grange, Jack
Dempsey, Bill Tilden, Bobby Jones were na
tional idols.
The figures are sketchy and incomplete but
no doubt attendance at sporting events increased
rapidly as the stars ascended. Baseball, rocked
by the Black Sox scandals of 1919, had bounced
back strong under the iron rule of Judge Landis.
College football was increasing in popularity and
pro football was beginning the journey up from
the back lots. Boxing’s Tex Rickard found that
ballyhoo and promotion could generate milliondollar gates. Golf, tennis, and even six-day
bicycle races were big attractions.
The tw in tra gedies

Watching a sporting event is a luxury—you
don’t have to do it. Like all luxuries, sports
attendance was crimped by the depression of
the 1930’s. Spending for admissions to sports
dropped 26 per cent from 1929 to its 1933
trough.
All things considered, however, this is a sur
prisingly good performance. Personal income,
industrial production, and employment dropped
considerably further. Sports spending recovered
quickly, too. It passed its previous peak in 1935
and set a new record each year for the remainder
of the decade.
Organized spectator sports continued through
World War II, thanks in large measure to
President Roosevelt’s support. Good for morale,
he said. But the best performers were in the

service and attendance slumped badly. People
had the money to go to games but they didn’t
have either the time or inclination for them.
TH E P O STW A R STO R Y IN TH R EE RO U N D S

Spectator sports have gone through three distinct
periods since World War II. In each, attendance
was subject to different influences and spending
behaved in different ways.
The f ir s t round— som ething
to come home to

Major wars seem to incubate sports booms.
Spectator sports spurted after the Civil War,
after World War I, and again after World War
II. From 1945 to 1949, spending for admissions
to sports more than doubled. Major league base
ball attendance soared to 21 million. Football
crowds set records and one of the leaders was
the University of Pennsylvania playing in
Franklin Field. Boxing had several excellent
years and so did most other sports.
Servicemen away from home are supposed to
dream of the girl next door and Mom’s apple pie.
During World War II , many soldiers and sailors
INNINGS VS. OUTINGS
Spending fo r spectator
recreation expenditures
PER C E N T

sp o rts

a percentage

all

business review

also dreamed of sports. The pageantry of the
Thanksgiving Day game, the crack of a basesloaded homer, the smoke-and-sweat smells of
basketball became symbols of home. When the
war ended and the boys returned, it was only
natural that they should want to glut themselves
with sports.
Civilians, too, splurged on sports. People had
extra leisure because working hours had de
clined sharply from wartime levels and they had
high incomes and savings with not too much to
spend them on. Reconverted industry had not
yet satisfied the great backlogs of demand and
shortages were prevalent.
Spectator sports had few reconversion prob
lems. Promoters quickly were able to offer highclass products to meet the new demand. In this
case, supply created additional demand and the
spectator sports industry enjoyed hearty pros
perity. But it was to prove short-lived.
The second round—
grandstands vs. living room s

Spectator sports ran into trouble after 1949.
People stayed away in droves. Spending dropped
sharply in 1950 and continued down for three
more years. From peak to trough, major league
baseball attendance dropped almost 35 per cent.
College football crowds were down 15 per cent.
Of all the attendance figures we could assemble,
only horse racing showed gains during the early
1950’s. Horse racing is a case in itself, however.
It has the parimutuel window to draw the
crowds.
What caused the big sports letdown? The
Korean War comes immediately to mind. The
sports slump coincides closely with the duration
of the hostilities. Korea indeed may have been
a factor but one could overestimate its effect.
The country didn’t go on a full wartime basis

and other consumer spending, including total
recreation outlays, continued to rise rapidly. No,
something special was affecting sports.
In a word, it was competition. The essence of
the appeal of spectator sports became the cause
of their difficulties. Sports, in the early 1950’s,
were forced to compete with at least two for
midable adversaries.
The first was the basic changes in the Ameri
can way of living that began after the war and
gained momentum in the fifties. Since these
changes have been well chronicled in this and
many other publications, we shall mention them
only briefly.
Americans committed much of their increased
incomes and leisure to durable goods and sub
urban living. Monthly payments bulked large
in budgets. Lawn care, do-it-yourself projects,
and outings in the car filled the clock. There was
little time for ball games and, besides, the park
was many traffic-clogged miles from suburbia.
At the same time, families were growing
larger and drawing closer and they wanted to do
more things together. Spectator sports were not
always suitable as family ventures. Mother often
wasn’t interested and daughter didn’t understand
the game. Participation sports were much better
suited. The whole family could enjoy boating,
bowling, and the like. No doubt the rise of
participation sports to a $10 billion industry
(see the July 1959 Business Review ) pulled
many people out of the grandstands.
Social mobility increased after the war and
the churning of class strata also hurt sit-andsee sports. For many years, watching sports had
been essentially a lower- and middle-class ac
tivity. The aristocracy didn’t just watch, they
participated. You know the stereotype of the
sportsman—casual, tweedy, flanked by spaniel
and shotgun. As Americans moved up the income

business review

scale, they raised their social aspirations and
became sportsmen rather than bleacherites.
Ente r the boob tube

Television was the second big competitor that
spectator sports faced in the early 1950’s. Most
people have a lazy streak in them. “Why bother
to go to the game when I can just sit back and
watch it on TV.”
TV seems to have its greatest impact on
relatively new set owners, and television spread
like a cold in a large family during the period
of the decline in spectator sports. In 1949 only
10 per cent of all wired homes had a set; by
1953, almost 70 per cent had one.
THE ARMCHAIR QUARTERBACKS
Percentage of wired homes with te le visio n sets
PER C E N T

The telecasting policies that many sports
adopted also hurt attendance in those early days
of the medium. For the most part, coverage was
unrestricted and in direct competition with the
live event.
The th ird round—
the fans stage a comeback

Spectator sports have enjoyed a mild revival
since 1953. Total spending for admissions rose
some $50 million from that year through 1960—
a rate faster than the increase in population,

though not so fast as the increase in total con
sumer outlays. The revival has been pretty much
across the board. Football, basketball, boxing,
hockey, horse racing, and major league baseball
have all participated. Only minor league baseball
has fared badly. Since 1953 the number of
leagues has been cut almost in half and attend
ance is down over 50 per cent. As Casey Stengel
summarized the minor league problem to a
Congressional Committee, “He watches his son
and is more enthusiastic about the boy than
some strangers who come to town and want to
play in a little wooden park with no facilities
to make you interested. You might rather stay
home and watch a program.”
Spectator sports in general are still meeting
■stiff competition from the new American way of
life. Also hurting is the fact that leisure time
has not increased much in the past decade. The
factory workweek has fluctuated around 40
hours and commuting time has probably in
creased. Vacations are longer and more wide
spread, to be sure, but vacations are for travel
and resorts rather than for spectator sports.
Nevertheless, a number of factors have turned
favorable for spectator sports—hence the mild
revival.
That old bugaboo, television, may actually
have been helping sports attendance in recent
years. TV is a two-edged sword. It still keeps
people at home, of course, particularly on
threatening days, but it also creates new fans.
It acquaints millions with the fundamentals and
the basic appeal of sports. Many new fans who
learned about the games at set-side, soon want
to see their heroes in person.
TV has now lost most of its novelty. The
market was pretty well saturated by the mid1950’s and the number of new set owners have
increased only slowly since then. And from what

business review

HITS AND ERRORS
Attendance at selected
change 1953—1960
-6 0

-5 0 -4 0

-3 0

- 2 0 -1 0

spectator

sp o rts,

percentage

PRO FOOTBALL (N.F.l.)
MAJOR LEAGUE BASEBALL

HORSE RACING (TROTTING)
COLLEGE FOOTBALL

HORSE RACING (THOROUGHBRED)
PRO BASKETBALL (N.B.A.)
TRACK AND FIELD*

' Estimated

we hear about the fare now available the attrac
tion of TV as a form of entertainment may have
decreased somewhat.
Sports promoters also seem to he using TV
differently. Selective telecasts of sporting events
have often replaced the unrestricted coverage of
earlier years. The pro football plan, instituted
by the late Bert Bell, is a good example. The
National Football League telecasts only away
games into a team’s territory. This doesn’t
compete with the gate, they say, and creates new
fans who turn out when the team comes home.
It seems to work, too, for N.F.L. attendance is
up almost 50 per cent since 1953.
“ N ow , s ir, if you have a m inute . .

We went out and talked to a number of authori
ties in the world of sports—reporters, business
managers, and coaches. They gave us some other
reasons for the mild recovery spectator sports
have enjoyed in the face of the continuing com
petition. We ll pass them along.

The popularity of the Little League and other
boys’ teams has stimulated interest in major
league baseball.
Income tax laws have helped. What better
way is there for a company to entertain “visiting
firemen” than to take them to the big game and
deduct the cost of the tickets as a business ex
pense. Many firms regularly buy blocks of
season tickets for entertainment purposes.
Watching sports is a good escape and there
is more to escape from now. We did not talk
to any psychiatrists—only sports men—but this
comment turned up in many conversations. It
seems that the frustrations and anxieties of
modern life can be salved by losing one’s self
in the drama of sports. One baseball executive
favorably compared his sport to the movies as
a method of escape. “The movies,” he said, “are
offering too much stark realism and not enough
diversion. There are no deep, tragic problems at
the ball park.” Obviously, he was not a Phila
delphia baseball executive.
Contests are closer and more exciting today.
Certainly this is true in pro football where the
player draft has provided a balance of talent.
Close pennant races have occurred in one, or
the other, or both major baseball leagues in
recent years, we were reminded. There is nothing
like winners to bring out the crowds. Or is there?
JO Y IN M U D V ILLE

So many experts told us that attendance depends
on team performance that we decided to do
some investigating. We attempted to gauge the
relationship between attendance figures and team
standing in major league baseball. We used a
technique called “correlation analysis” which
shows the relationship between sets of figures.
Our experiment covered the years 1947 through
1960.

business review

We found some correlation between attendance
and standing but not so much as we expected.
Only in the National League cities of Cincinnati
and St. Louis and the American League cities
of Boston, Detroit, and Philadelphia before the
Athletics moved were there close relationships.
In the other cities, standing was a factor, of
course, but it didn’t tip the scales.
Our statistical exercise leads us to several
conclusions. Big changes in standing from one
year to the next have a definite effect on attend
ance. Crowds surely are drawn to the team that
jumps from seventh place to second just as they
are bound to slight the team that nosedives. On
the other hand, small changes in standing do not
necessarily bring similar responses in attendance.
The club that improves itself one or even two
places shouldn’t expect to reap rewards at the
turnstiles.
When a team finishes in or near the same
spot for a number of years running, attendance
is likely to fluctuate, often on a downward trend.
GREEN GRASS AND BRIGHT YELLOW MUSTARD
M a jo r league baseball attendance (re g u la r season) with
in se rt showing clubs that remained in the same c itie s
M ILLIO N S

This applies to teams at or near the top as well
as the chronic tailenders.
Moving to another city is an immediate shot
in the arm for attendance. The teams that
changed towns have done better at the gate—
at first. But the stimulation doesn’t seem to last
forever. The novelty wears off after a while.
In Milwaukee, for example, attendance has been
slipping seriously for the past three years even
though the Braves have remained in contention.
In summary, league standing is only one of
many factors that bears on attendance. An im
portant one, yes, but not always a dominant one.
Also significant are the over-all trends affecting
spectator sports, the weather, physical facilities,
personalities, promotion, trades, newspaper
coverage, and even the city itself. Some towns
are good sports towns, some aren’t, and nobody
really knows why.
ILLU M IN A TIN G

S P O R TS IT IS

In a way spectator sports are like an iceberg.
The part that shows is not a measure of the
real importance. In these days of a $500 billion
gross national product, spectator sports are a
minuscule operation. In 1950, the latest available
year, there were only about 11,000 professional
athletes in the country. Less than $300 million
a year is now spent for admissions for all sports.
The sales of General Motors alone are 45 times
that amount! Gregory P. Stone, a sociologist,
sums it up when he says the production of sports
is insignificant but the consumption of sports
is awesome.
The consumption of sports includes much
more than the millions of people who go to the
parks, stadiums, and arenas. It covers the legions
of men and women who avidly follow sports
away from the scene of competition.
This everyday interest in sports is a major

business review

THE WORDS OF SPORTS
Sports have helped enrich the English language.
The following everyday expressions, and many
others, originally derived from sports terminol
ogy: He's got two strikes on him, a knockout, on
the ball, dark horse, I didn't get to firs t base,
jumped the gun, right off the bat, pinch hit, a
rookie, away out in left field, off base, punchy,
left at the post, double-header, sparred, parleyed,
southpaw, screwball, pull one's weight, throw in
the sponge.
W ith sports so much a part of our language,
doesn't it seem strange that sports occupy so small
a place in our serious literature?

American phenomenon not matched anywhere
else in the world. It doesn’t have a name so we
coined one—“sportsitis.” Sportsitis includes
thinking, talking, and reading about sports; it
doesn’t include watching or participating.
Experts say that the intensity of sportsitis is
stronger now than ever before. In other words,
more people are interested in more sports. May
be it’s the troubled times we are living through.
Maybe it is the lack of American myth and
legend. We have no Siegfried, no Arthur, so we
substitute Musial and Mays.
In 1959 the Gallup Poll attempted to measure
the sports interest of adults. It was found that
we are more interested in baseball than any
other sport. Football was next, followed by
basketball. Editor and Publisher magazine con
firmed these rankings with a poll of the opinion
of sports editors about their readers’ interests.
Just as there are many devout Mohammedans
who don’t go to Mecca, so there are many avid
sports fans who don’t go to the stadiums. Thus
the level of sportsitis is not necessarily a factor
in the ebb and flow of attendance. But sportsitis
does have a big effect on our social habits, our
culture, and our economy.

Sports probably are the topic of more male
conversations and arguments than are women,
automobiles, and politics put together.
Sportsitis comes in for plenty of criticism. A
certain class of people—self-styled intellectuals,
mostly—look down their noses. Sports are
bourgeois, they say, like Lawrence Welk, TV
westerns, and well-done steaks. Sociologists have
called sportsitis “a retreat from life, a voluntary
hallucination.” Others say it’s a waste of time—
time that could be put to better use. “The
Russians don’t spend so much time thinking
about sports.”
Sportsitis has a tremendous influence on the
young. As writer Roger Kahn puts it, the number
of boys who would rather be Mickey Mantle are
legion compared to the number who would
rather be Robert Frost.
Sportsitis has a major effect on mass com
munication media. A vast amount of air time is
devoted to sports coverage. Several national
magazines contain nothing but sports news and
commentary. Most important are the newspapers
which serve a daily sports fare hearty enough
for the hungriest fan. The sports page is one
of the largest and best-read sections of any
paper. This morning’s New York Times (Thurs
day) devoted five pages to sports and this num
ber is probably conservative. No doubt about it,
sportsitis is big business.
But sportsitis couldn’t exist unless the con
tests took place and the contests wouldn’t take
place unless people paid to see them. We, there
fore, conclude this article with an evaluation of
future attendance trends.
PRO DUC ING , PAC KAG ING , AND
PRO M O TIN G

Major league baseball has had a rough spring.
Attendance is off badly despite the close races

business review

and the record production of home runs. The
cold weather was a major factor, yet there are
some who wonder if something more basic is
wrong. The rumor is that the fans are losing
interest.
“Bunk,” says Ford Frick, Commissioner of
Baseball, “I hope baseball will always remain
as healthy as it is now.” But the Cassandras are
not stilled. So what about the future—not just
baseball’s alone but spectator sports’ in general?
Will the mild recovery under way for seven
years flower or fizzle?
Americans are chided about their physical
fitness. Soft, flabby, and chair-borne, we are
called. Could be that we may come to feel guilty
about sitting and watching. Better to be out
performing some sport, people might think, even
though one probably gets more exercise climb
ing to his stadium seat than in an afternoon of
fishing.
Fortune magazine says that in the coming
decade all spending for leisure and recreation
will be under great pressure from other, more
sober things in the consumer budget—such
things as medical costs and education. This could
inhibit spectator sports. More important, per
haps, is the competition for the consumer’s time
that we mentioned earlier. This competition is
likely to increase at least as fast as the pro
jected gains in leisure.
These and other factors should tend to offset
the rising tide of sportsitis and the alleged psy
chological benefits of watching sports. A boom
in over-all attendance doesn’t seem likely. A
continuation of the present gentle rise in admis
sion spending seems the best that can be ex
pected. Remember, of course, that we are talk
ing about all sports in general. Specific sports
could fare better—or worse.
There is much that the sports promoters can

FRO M

LO C A L

STA N D S

The offering of spectator sports is large and var
ied in the Third Federal Reserve District. On the
manicured lawns of Philadelphia's three big stadi
ums, on the sun-hardened infield at Lancaster, on
the ice at Hershey arena, on the canvas rings of
the coal-town fight clubs, there are contests to
please almost every taste.
Yet spectator sports are not particularly con
centrated here. In 1958, the Third D istrict states
of Delaware, New Jersey, and Pennsylvania had
about 8 V2 per cent of the nation's commercial
sport clubs, tracks, and promoters.* Admission re
ceipts of these enterprises came to about 9 V3 per
cent of the national total. Although both per
centages are on the rise from the 1954 and 1948
Censuses, they are still below the area's popula
tion-income potential. The three states accounted
for 10 per cent of the nation's population and
I I per cent of its income in 1958.
Philadelphia has three major league teams— the
Ph illies in baseball, the Eagles in football, and the
W a rrio rs in basketball. Here's how they drew last
season.
To ta l Hom e
Attendance
The P h illie s
The Eagles
The W a rrio rs

862,205
254,017
207,003

Average
Attendance
Per Game
1 1,197
36,288
6,088

Percentage of
To ta l League
Attendance
8.1
8.1
n.a.

* As defined by the Census Bureau, these include operators and
promoters of professional and sem i-pro baseball, fo otb all, basket
ball, hockey, and other sports, plus auto, horse, and dog racing
tracks and stables.

do, however, to improve their own outlook. In
the final analysis, spectator sports is a product
to be sold. Like any other product, from corn
flakes to Cadillacs, sports must be effectively
produced, attractively packaged, and aggressively
promoted.
The production of sports could be improved
with further rule changes to make the action
faster and more exciting. Talent could be more
evenly distributed among the teams in the vari
ous leagues to hone competition. Perhaps other

business review

sports should adopt a version of pro football’s
draft as the Phillies’ John Quinn has advocated.
The packaging problem is complex, what with
the intertwining of municipal and team interests.
The fact remains, however, the packaging of
sports could be greatly improved. Stadiums are
often antiquated, uncomfortable, and inacces
sible. Parking is a serious problem as anyone
knows who has bribed juvenile racketeers at
Connie Mack Stadium not to slash their tires.
Sports have a unique advantage when it comes
to promotion and advertising. Sports get many

millions of dollars worth of free publicity in
newspapers and magazines. But in most cases
promotion stops with the printed story. Many
other things can be done, however. Look at Tex
Rickard in boxing or Bill Veeck in baseball.
Veeck was one of the few owners that aggres
sively promoted baseball and he got definite
results at the gate.
In our opinion, spectator sports will be second
best in the race for the consumer’s time and
money unless the front offices learn to compete
as effectively as the athletes on the field.
—Lawrence C. Murdoch, Jr.

SOME JOBS
ARE ALWAYS IN SEASON
Em ploym ent in P h iladelph ia’s fa cto ries is becom ing
less seasonal , but the w eatherm an still w rites
construction schedules .
A plant goes through a slack period, a contract
ing outfit can’t work because it’s snowing, a
store lays off salespeople after the spring rush.
Immediately, people are out of work. Such
seasonal entries to the unemployment lists occur
every month. They do not happen because of
business recession or slow economic growth. The
people are unemployed simply because their
lines of work have busy and slack seasons.
We have examined the records of industrial
production and employment in the metropolitan
region of Philadelphia to see what is happening
to seasonal patterns: whether they are having
more or less effect on employment, how their
timing is changing each year. It was no surprise
to discover that seasonal patterns are shifting.

It was something of a surprise, however, to find
that the manufacturing industries of Philadelphia
were sharply reducing seasonal variations in
employment, while nonmanufacturing industries
were not. And it was interesting to find how
small a proportion of the total seasonal fluctua
tions in manufacturing activity ever result in
the actual layoff or employment of workers.
Seasonal h irin g and firin g have decreased
in m anufacturing in d u strie s

About one and one-half million people work for
wages and salaries in plants and offices in the
Philadelphia Metropolitan Area. Another third
of a million work for themselves, as domestics
or on farms, or are unemployed. Of the wage

SEASONAL INDEXES AND HOW THEY GROW
If, during a recession of business activity, retail
business improves at Easter time, this does not
necessarily presage the end of the recession, for
retail sales always improve at Easter time. Nor
does falling consumer demand in January neces
sarily mean a recession is imminent, because con
sumer demand drops sharply every year in Janu
ary. How then, if one suspects that a recession of
business activity is beginning, does he distinguish
between the large seasonal drop in retail sales
which occurs every January and a little further
decline which perhaps may be occurring? What
clearly is needed is a way of specifying how much
sales drop each January; then drops appreciably
greater or less than this amount must be attribut
able to factors other than seasonal variations.
There are many ways of estimating how much
strictly seasonal variability to expect in a given
time series in a given month. Most generally the
approach is to isolate the short-term, within-year
fluctuations— that is, the seasonal and irregular
variations— by expressing each original observa
tion— each month's sales, for example— as a per
centage of the sales one would have expected if
the time series moved very smoothly, as it would
have if there were no short-term seasonal or ir
regular disturbances in it. Then, on the reasonable
assumption that the irregular variations, being
irregular, do not repeat each year according to
any pattern, the percentages of actual sales to
the "smoothed" sales* are averaged. The aver
age January percentage then represents approxi
mately how much repetitive short-run variation
occurs in January. Th is must be the seasonal vari
ation, since irregular variations would not be re
petitive. Repeating this averaging procedure for
each of the twelve months, one ends up with what
is called a "seasonal index" fo r each month.
A seasonal index is a percentage— the per
centage that the actual magnitude of the time
series bears to the values it would have attained
in the absence of seasonal variations. Chart A
shows the seasonal indexes of total employment in
the contract construction industry in the Philadel
phia region in I960. It shows that employment in
construction rises above average in the spring and
keeps rising until by summer it is up more than
10 per cent just because summer weather is par
ticularly favorable fo r construction work. The ef
fect of winter is even more pronounced; the work
* The smoothing is achieved by computing a series of moving
averages of the actual tim e series of monthly data.

CHART A
SEASONAL VARIATIONS IN CONTRACT CON
STRUCTION EMPLOYMENT IN PHILADELPHIA,
1960
SEASO NAL INDEX (PER CENT!

SEASO NA L EFFECT O N EMPLOYM ENT (PER CENT)

force employed in the construction industry shrinks
more than 15 per cent in January and February.
Simple, isn 't it? In order to avoid the unseemly
simplicity of the scale which actually tells what the
chart shows (the one entitled "seasonal effect on
employment"), these charts are usually presented
with scales like the left-hand one, which is easier
for the fellow who computes the seasonal indexes,
because that's the way they come out of his com
puting machine. Once you are in the know, how
ever, "seasonal index" loses its mystery. Brief in
spection of the chart reveals that if one subtracts
100 from each seasonal index, he gets what it
means. For instance, 85 means employment
dropped seasonally 15 per cent below average
(represented by 100); 105 means employment rose
seasonally 5 per cent.
The furthest development so far of this kind of
involved averaging is the Census Method II, or
Shiskin method of seasonal adjustment. The philos
ophy of this method, as to how one treats a time
series to isolate seasonal factors, is as outlined
above; the method differs from its predecessors
in the number and complexity of refinements em
ployed at each step in the procedure. For exam
ple, the seasonal factors differ fo r each year's
January, February, and so on, because not only
does the method specify the average seasonal
rise or fall each month, it also estimates the aver
age change in that rise or fall. Th is allows for the
fact that a month, say, December, may be getting
seasonally more or less important as time passes.
Seasonal adjustment computations, being com
plicated and tedious, have been regarded by sta
tistical clerks as a version of medieval torture.
But our newest clerk merits no mercy and we show
her none. She is an electronic computer. W e have
kept her transistors palpitating, computing sea
sonal indexes by Method II fo r most of the avail
able data on employment in Philadelphia.

business review

and salary workers, almost two-fifths are em
ployed in manufacturing industries. Employ
ment in some of these industries swings up and
down with the seasons to a considerable extent,
as Table 1 shows. Work forces employed in the

TABLE 1
IMPORTANT
MANUFACTURING
INDUSTRIES
HAVING GREATEST SEASONAL VARIATIONS OF
EMPLOYMENT, PHILADELPHIA, 1960

In d u stry

Average
Em ploym ent
(thousands)

Ele c trica l m achinery
A p p a re l and related
products
Food
Fabricated metals
P rin tin g and p u b lish in g
Te x tile s
Tra n sp o rta tio n equipm ent
Paper

Difference Between
H ig h e st and Lowest
Seasonal Index
(percentage p oin ts)

68.6
57.9
50.9
42.0
37.9
32.6
27.0
21.8

C H A R T II

SEASONAL VARIATIONS OF TOTAL MANUFAC
TURING EMPLOYMENT IN THE PHILADELPHIA
AREA IN 1949 AND 1960

4
3
4
4
4
3
3

SEASONAL EFFECT ON EMPLOYMENT (PER CENT)

industries listed varied up and down in 1960 as
much as 4 per cent strictly for seasonal reasons.
In other important manufacturing industries,
not listed in the table, seasonal swings were very
small. Partly because of this, and partly because
the seasonal patterns of different industries to
some extent offset each other, total manufactur
ing employment varied hardly at all with the
seasons in 1960. Chart I shows how, when one
important manufacturing industry is operating

CH ART I
SEASONAL VARIATIONS OF EMPLOYMENT IN
ELECTRICAL MACHINERY AND APPAREL IN
DUSTRIES IN THE PHILADELPHIA AREA IN 1960
SEASO NA L EFFECT ON EM PLOYM ENT (PER CENT)

J______ I______ I______ I______ I______ I______ I______ I______ I______ L
J
F
M
A
M
J
J
A
S
O
N

in the beginning of the year with a seasonally
restricted work force, another’s total employ
ment is augmented because of a spring rush.
These patterns of course cancel in part and help
reduce seasonality in total manufacturing em
ployment. The total seasonal pattern of manu
facturing employment in 1960 is depicted in
Chart II.
Chart II shows a pronounced decline in the
seasonality of total manufacturing employment
in the region since 1949. This was no accident;
that is, it was not because 1949 was a nontypical

TABLE 2
HOW SEASONAL VARIATIONS OF MANUFAC
TURING EMPLOYMENT IN PHILADELPHIA AREA
HAVE DECREASED SINCE 1949
Ye a r

G re a te st Seasonal
R ise (p e r cent)

G re a te st Seasonal
Decline (per cent)

1949
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
I9 6 0

1.9
1.5
1.3
0.9
0.8
0.8
0.8
0.9
0.7
0.5
0.6
0.6

4.1
4.0
3.4
2.7
1.8
1.3
1.2
1.2
0.8
0.5
0.7
0.8

business review

year, nor was it because of just one or two im
portant industries. Table 2 shows how smoothly
and regularly both the highs and lows have de
creased since 1949. Chart III depicts, for all
the important manufacturing industries of the
Philadelphia region which are subject to more
than negligible seasonal variations, how their
seasonal swings in employment have narrowed.
In every case, the total range of seasonal indexes
was less in 1960 than in 1949. (The range is
the difference between the highest and lowest

seasonal index.) The chart includes every manu
facturing industry which had a seasonal fluctua
tion of employment in 1960 as high as 2 per
cent either up or down, provided that the indus
try employed at least 1 per cent of the region’s
wage and salary workers.
The seasonality of manufacturing employment
in the Philadelphia area has decreased in part
because employment in a number of seasonal
industries has declined. Table 3 relates the change

C H A R T III

SEASONALITY OF EMPLOYMENT RELATED TO
CHANGES IN TOTAL EMPLOYMENT, MANUFAC
TURING INDUSTRIES, PHILADELPHIA

SEASONAL PATTERNS OF EMPLOYMENT IN CHIEF
MANUFACTURING INDUSTRIES SUBJECT TO
SEASONAL EMPLOYMENT FLUCTUATIONS, PHILA
DELPHIA AREA, 1949 AND 1960
SEASONAL EFFECT ON EMPLOYMENT (PER CENT)

TABLE 3

Change in Percentage of
To ta l M anufacturing
Em ploym ent, 1950—1960

In d u strie s H a vin g Range of
Seasonal Indexes in I9 6 0 :
Above
Median Range

Below
Median Range

In d u strie s increasing
percentages of total
employment

In d u strie s decreasing
percentages of total
employment

in proportion of total manufacturing employment
to the range of seasonal variations in employ
ment for the 20 major classifications of manu
facturing industries. It is clear from the table
that since 1950 industries with wide seasonal
swings in employment have been decreasing in
importance in the Philadelphia area, while those
less subject to seasonal influences have been
growing in importance. The relationship is even
stronger than the table shows, because none of
the industries which employ the most people
appear either in the upper left or lower right
portion of it. That is to say, the most important
industries of the region either are highly
seasonal but declining in importance, or they
exhibit little seasonality but are growing in
importance. Chief in the former category are

business review

the apparel and textiles industries; in the latter
class are the machinery, food, and chemical
industries. The food industry is a special case;
it not only moved up from fourth to third rank
in employment among manufacturing industries,
it also changed from one of the most seasonal
in 1949 and the early 1950’s, with seasonal
indexes ranging between 10 and 14 percentage
points, to one of the least seasonal in recent
years, with seasonal indexes ranging around
three percentage points.
Jobs are insula ted fro m fu ll
effects o f seasonal production

Implicit in the concept of seasonal variability
is the idea of something that happens regularly,
recurring at a certain time year after year.
Regularity implies predictability. If a concern
knows it experiences a slack season, it ought
to be able to arrange its affairs so as to minimize
layoffs at that time, thereby putting itself in
better shape for the time when business picks
up again.
Something like this apparently happens. A
C

comparison of the seasonal fluctuations of
electric power consumption,* average hours
worked per week, and employment in manufac
turing industries iijiplies clearly that many ad
justments must occur in an industry before
seasonal pressures lead to the firing or hiring of
workers. As Chart IV shows, the seasonal swings
of production (as measured by power consump
tion) are much greater than the swings of
employment. Some of this difference is ac
counted for by seasonal variations in average
hours worked per week. Chart IV shows how
the range of seasonal variations in average hours
worked usually equals or exceeds the seasonal
limits of employment. Chart V presents, as an
example, how the seasonal patterns of employ
ment and average workweek are complementary
in the electrical machinery industry. Pressures
for seasonal increases or decreases in production
are partly absorbed by increasing or decreasing
* W h ile there is no index of ind u stria l production fo r Philadel
phia, data do exist concerning electric power consumption by
manufacturing industries in a region which includes most of the
Philadelphia Metropolitan Area. Fa lls and rises in electric power
consumption in manufacturing are closely related to changes in
production in most industrie s.

H A R T

HIGHEST AND LOWEST SEASONAL VARIATIONS OF ELECTRIC POWER
CONSUMPTION, AVERAGE WORKWEEK, AND EMPLOYMENT IN EIGHT
INDUSTRIES, PHILADELPHIA, 1959
Seasonal swings in workloads are much larger than in employment. For one thing, some layoffs and
hirings are avoided by shortening and lengthening the workweek.
S E A S O N A L EFFE C T (PER C EN T)
le ft: Electric power consumption
Middle: Average hours per week
Right: Employment

1
i l

ELEC TRIC AL

I
1

A PPA REL

"M A C H IN E R Y

| |

| |
1 1

N O N ELEC TRIC AL

FA BRIC A TED

M A C H IN ERY

M E TA LS

1
1

C HEM IC ALS

P R IN TIN G A N D
PU B LIS H IN G

PRIM ARY M E TA L S

rR A N S PC R TA TIO N
EC U IP M E N T

business review

C H A R T

SEASONAL PATTERNS OF AVERAGE WORKWEEK
AND TOTAL EMPLOYMENT FOR THE ELECTRICAL
MACHINERY INDUSTRY IN THE PHILADELPHIA
AREA, 1960
SEASO NAL EFFECT ON EM PLOYMENT (PER CENT)

the workweek, before they finally affect employ
ment. Note on the chart how seasonal changes
in the workweek lead the changes in employment.
Of course, adjustments of the workweek can
not serve to explain all of the wide differences
between the large seasonal swings of produc
tion and the much smaller fluctuations of em
ployment in most industries. Maintenance work,
inventory, training sessions and the like may be
undertaken when work is slack, or limited when
backlogs of orders build up. Although we have
no data series in which we can study the timing
and extent of such adjustments, they obviously
must occur.

CH ART V I
SEASONAL VARIATIONS IN TOTAL NONMANU
FACTURING EMPLOYMENT IN THE PHILADELPHIA
AREA, 1952 AND 1960
SEASONAL EFFECT ON EM PLOYMENT (PER CENT)

In a decade, the seasonality of manufacturing
employment has diminished with remarkable
uniformity. Timing of seasonal highs and lows
has not changed much, but the highs are not
so high and the lows are not so low as they
once were. This positive sort of finding always
encourages researchers; therefore we set out
with anticipation to analyze the seasonality of
employment in Philadelphia’s nonmanufacturing
industries. But here, although there turned out
to be plenty of action, the action was different.
O utside m anufacturing,
sameness conceals v a rie ty

The total seasonal pattern of employment out
side manufacturing hasn’t changed greatly in the
Philadelphia region, as Chart VI shows. The
most important seasonal peak is now in Decem
ber rather than at Easter, but the general
scheme is still the same, with winter and sum
mer lows, spring and fall highs. But this rela
tive sameness conceals differing movements and
patterns. In the first place, two industries—
transportation and public utilities, and whole
sale trade—showed very little seasonal varia
bility in employment. That leaves five major
nonmanufacturing groups. The seasonal patterns
of employment in these industries offset each
other quite well. The big summer activity of
contract construction is balanced by summer
doldrums in retail trade, government, and the
service industries (Chart V II). Secondly, the
extent of seasonal fluctuations changed in dif
ferent directions in different nonmanufacturing
industries from 1952 on (Table 4 ). This is
quite unlike what happened in manufacturing,
where the ranges of seasonal variations decreased
greatly in several important industries, and in
creased in none. The net effect was almost to
remove all seasonal pattern from total manu-

business review

CHART VII
SEASONAL PATTERNS OF EMPLOYMENT IN
INDUSTRIES IN THE PHILADELPHIA AREA, 1960
Th e sum m er push of construction and real estate a c tiv ity . . .

NONMANUFACTURING

. . . is o ffse t by lu lls in o the r in d u strie s.

SEASONAL EFFECT ON EMPLOYMENT (PER CENT)

-5

-10

- IS

-2 0

TABLE 4
RANGES OF SEASONAL INDEXES OF EMPLOY
MENT IN NONMANUFACTURING INDUSTRIES
Differences Between H ig h
and Low Seasonal Indexes
(percenta ge p oin ts)

In d u strie s decreasing range
o f seasonal v a ria tio n s:
R e ta il trade
Finance, insurance, and
real estate
In d u strie s increasing range
o f seasonal v a ria tio n s:
C ontra c t construction
Se rvic e s and m iscellaneous
G overnm ent
To ta l nonm anufacturing
em ploym ent

1952

I9 6 0

14.8

12.3

3.8

2.3

20.3
3.2
9.1

28.6
4.0
10.9

5.3

5.1

facturing employment. But nonmanufacturing
employment changes about as much now from
season to season as it formerly did. This is be
cause decreases in the seasonality of employment
in retail trade and finance and insurance were
counterbalanced by increases in construction,
services, and government.
—Bertram W. Zumeta

FOR TH E RE C ORD

Third Federal
Reserve District

United States

Per cent change

Factory*

Department Storef
Check
Payments

Employ
ment

Payrolls

Sales

Stocks

Per cent
change
June 1961
from

mo.
ago

SUM M ARY

June 1961
frc5m
mo.
ago

year
ago

1961
from
year
ago

mo.
ago

LOCAL
CHANGES

June 1961
fr Dm
year
ago

1961
from
year
ago

MANUFACTURING
Electric power consumed.........
Man-hours, total*.....................
Employment, total........................
Wage income*............................
CONSTRUCTION**
COAL PRODUCTION
TRADE***
Department store sales...............
Department store stocks.............
BANKING
(All member banks!
Deposits.......................................
Loans.............................................
Investments...................................
U.S. Govt, securities.................
Other.........................................
Check payments..........................

+
+
+
+

2
2
1

+
-

3
5
4
3

+ 13

+ 16

+
+

6
3

+
+

!
1
0
+ 1
+ 2f

4
2

3
8
5
6

3
-1 5

— 5

+
-

3
3
3

+
-

4
5

’ Production workers only.
••Value of contracts.
•“ Adjusted for seasonal variation.

0Î

year
ago

+ 2

6
+ 6
+ 8
+ 9
4" 5
+ 16f

+
+
+
+
+

6
8
4
5
2
8t

1
0
+ 1
+ 1
+ 1
+10

0
0

f20 Cities

mo.
ago

year
ago

+ 4 -j- 5

0 -f 4

+ 2

Philadelphia. . . .

3 +

4 +

1 -

3 + 2

7 +

1 + 12 +

5 +

1 +

2 +

3 + 12 -

2 -1 0

0 +24

5 +

2 +

1 -

0 +

2 + 8

2 +

1 -

4 +

7 +
0

+ 14

Reading...........

year
ago

5 + 3

Lancaster...........

mo.
ago

+ 2 — 4 + 4

4
-1 1

+
+
+
+
+
+

7
3
16
17
13
18

+
+
+
+
+
+

6
4
12
12
9
10

PRICES
Consumer.....................................

mo.
ago

— 1
+ 1

0
+ 1

^Philadelphia

Scranton ............

+ 2 -

Trenton ..............

Wilkes-Barre. . .

1 -

4 + 3

1 -

6 +

1 -

5 +

7 +

Wilmington . . . .

1 -

York.................

3 + 4 +

0 + 4

1 + 7 + 2 +

4 +

3 +
-

2 +23

4 + 3 + 4
0

+24

1 +

+45

4 + 9

•Not restricted to corporate limits of cities but covers areas of one or
more counties.
fAdjusted for seasonal variation.

Full text of Business Review (Federal Reserve Bank of Philadelphia) : August 1961

FRASER