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THE BUSINESS REVIEW "'f- FEDERAL RESERVE BANK OF PHILADELPHIA MAY 1, 1942 W ar production continues to expand and is ab sorbing an increasing proportion of plants, labor, and materials in the Third Federal Reserve Dis trict. Virtually no steel is being produced for ci vilian use, and in many textile lines output is going largely to the Government. Further general re strictions upon civilian supplies are in prospect now that the war program is getting into full stride. At the same time consumer incomes continue to ex pand, accentuating the problem of rapidly rising costs and prices. Industrial activity in this District in March was well sustained at the high levels of the preceding month and well above a year ago. Freight ship ments continue heavy, and retail and wholesale markets are still strong. Shortages of goods in the face of heavy buying by Government, industry, and consumers are pushing prices up in many lines. earnings of factory workers are still rising substan tially. Preliminary reports indicate that employ ment and wage disbursements were well sustained in April. Retail trade increased somewhat less than sea sonally from February to March, after having been unusually heavy in preceding months. Anticipatory buying is still in evidence. Retailers report that increased income tax payments have as yet had lit tle effect upon trade. Neither has the attempt to absorb buying power through the sale of pavings bonds been sufficiently effective. Bank credit continues to expand, chiefly as a re sult of sustained purchases of Government securi ties. Demand for commercial loans has slackened somewhat, although credit is actively being ex tended to war industries. Prices in the securities markets have been somewhat weak in recent weeks and trading has continued light. Stock prices have reached new nine-year lows; the prospect for heavier taxes and uncertainty as to further anti-inflationary measures are beclouding the out look. Manufacturing activity increased about season ally in March, the principal gains being at textile mills. Little change was shown in the output of heavy goods, currently about half again as great as in the spring of 1941; production in nondurable I lines is about the same as last year at this time. Manufacturing. The demand for factory prod Production of coal in March was unusually well ucts in this District has improved further, reflect sustained, and output of crude oil and electric ing principally continued heavy war purchases. power showed small seasonal changes. New commitments for iron and steel products are Construction activity has advanced, particularly largely restricted to high priority orders, and in in the case of residential building which is stim many textile lines supplies for civilians are very ulated by heavy demands for housing facilities in limited. Manufacturers’ sales of products generally war production centers. for nonessential uses are declining, as raw mate Nonagricultural employment continues to in rials and productive facilities are increasingly crease, and payrolls have advanced in nearly all diverted to war needs. Shipments have continued lines of trade and industry. Hourly and weekly to expand and are well above 1941 levels. Prices Page One PRODUCTION AND DISTRIBUTION EMPLOYMENT AND PAYROLLS IN PENNSYLVANIA PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT 12 B RANCHES or TRADE AND PERCENT NDU3TRY I932AVG. =100 250 W * PAYROLLS ELECTRIC POWER ' PRODUCTION -OUTPUT OF MANUFACTURES f* JX 200 r' i 150 - - - - - - - rL f~ lv . V. LOADINGS OF MERCHANDISE AND MISCELLANEOUS FREIGHT V/ i Lv 100 /* jr------ EMPL0YMEN 50 1937 1938 1939 1940 1941 1942 1936 1937 1938 1939 1940 1941 1942 of factory products not subject to ceilings have ad In Delaware factories, employment showed vir vanced further since the middle of last month. tually no change from February to March, while Activity in essential industries is still expanding, wage payments rose 3 per cent. Manufacturing as new facilities come into operation and plant con plants in southern New Jersey reported similar version progresses. The volume of unfilled orders changes. has reached new peaks in a number of lines, and The output of manufactured goods in this Dis backlogs generally are sharply larger than at this trict was well sustained from February to March. time last year. Stocks of finished goods have de On a seasonally adjusted basis, the production of clined to levels substantially below those prevail durable goods declined slightly, but was 45 per ing in the Spring of 1941. cent above 1941. The output of lighter products, Factory employment in Pennsylvania increased although somewhat increased in the month, was 1 per cent further in March to a new high approxi about the same as a year earlier. In the first three mating 1,165,000 workers, and wage disburse months of 1942 productive activity generally aver ments expanded 2 per cent to a record volume of aged 25 per cent above the rate prevailing last year. $39,000,000 a week. The number of wage earn Production of electric power slackened season ers exceeded a year ago by 12 per cent; wage ally in March but was 11 per cent greater than a payments were 35 per cent larger. Activity in April was well sustained, according to preliminary year ago. Total sales and sales to industries de creased somewhat more than usual from February reports. but remained well above the 1941 level. At plants making durable goods, employment in March was 23 per cent and wage payments 46 per Coal and other fuels. The demand for fuels cent larger than a year ago, reflecting an excep generally is well sustained. Government agencies tionally high rate of activity in the metal trades. continue to advise consumers to build up inven In the case of lighter products, the number em tories of coal to lighten the load on transporta ployed continued at about the 1941 level, while tion facilities next fall. Home owners on the At payrolls were 12 per cent greater. lantic seaboard are being advised to change back from oil to coal, wherever feasible, owing to the Hourly earnings of factory workers in Pennsyl shortage of petroleum products. Maximum prices vania rose to a new peak in March, averaging 87 were placed on Pennsylvania anthracite early in cents, or nearly 12 cents an hour more than a year March; later the requirement for seasonal discounts earlier. This reflected higher wage rates, increased on sales at mines was eliminated. overtime, and greater employment of highly paid skilled employees. Working time continued at the The production of anthracite declined less than February average of 42^/2 hours a week; but aver was to be expected in March and was the largest age weekly income increased further to $36.63, the for the month with one exception since 1928. Dur highest in records back to 1923, and $6.27 more ing the first quarter, production aggregated 14, than in March 1941. 400,000 tons, the highest in six years. Page Two TEXTILES AND LEATHER HOURLY EARNINGS AND WORKING TIME PENNSYLVANIA EMPLOYEE - HOURS IN PENNSYLVANIA FACTORIES CENTS HOURS PERCENT TEXTILES AND I CLOTHING AVERAGE HOURLY EARNINGS N HOURS WORKED LEATHER PRODUCTS 1937 1939 1940 1942 Stocks of bituminous coal in the hands of indus try and retail yards have declined from the high level reached in December. Colliery output in March expanded to the largest volume since last July, although there is usually a decline at this time of year. Production in Pennsylvania in the first quarter totaled 34,300,000 tons, the greatest for the period since 1929. 1937 1939 1940 194 I 1942 Contracts placed in the first quarter of 1942 were 30 per cent above a year earlier and the larg est for the period since 1930. The greatest gains were in public works and utilities, apartments and hotels, and factories. Expanded domestic and foreign de mand and reduced imports, necessitating a record production of many foods in 1942, are resulting Operations at by-product coke ovens continued in pronounced shifts in the acreage planted to a at peak levels in February but declined somewhat number of leading field crops throughout the coun in March, according to preliminary reports. try. Shortages of imported vegetable oils are stim ulating the production of substitutes. Demands for Building. Construction activity in this District in livestock are increasing, necessitating heavier plant creased in March to levels well above a year ago. ings of forage crops. Supplies of wheat continue New awards for residential construction rose large. sharply. Publicly financed projects account for an Planting intentions of farmers in this District in increasing proportion of total building. dicate an exceptionally large increase this year in To conserve materials, labor, and machinery, the acreage allotted to soy beans and somewhat the War Production Board has ordered that no smaller gains in the case of spring wheat, corn, substantial construction projects may be undertaken and barley. Plantings of hay and oats are expected without the specific approval of the Board. Heavy to be about the same as in 1941, but small declines war requirements for homes and plants indicate are in prospect for white potatoes and tobacco. that building activity this year will be greater than Growing conditions generally are satisfactory, and reserve supplies of feed grains are above average in 1941 in spite of these restrictions. for this time of the year. Awards of new contracts expanded 15 per cent in March to $30,783,000, the largest for the month Expanding activity in other essential industries in thirteen years. Substantial increases were re continues to reduce the supply of farm labor, and ported in the case of houses and apartments and acute shortages are expected in the vicinity of the hotels, contracts for the latter being seven times as larger manufacturing centers later this year. Wage great as in February. Awards for public works rates for agricultural workers have advanced rap and utilities accounted for over one-third of the idly in recent months to levels well above those aggregate contracts let in March. The only de prevailing in the spring of 1941. Wholesale prices creases were in awards for factory buildings, which of farm products have risen steeply, and farm in had been exceptionally large earlier and in mis come has expanded. In Pennsylvania, New Jer sey, and Delaware, cash income, including rental cellaneous structures. Agriculture. Page Three BUILDING CONTRACTS DEPARTMENT STORE SALES AND STOCKS PHILADELPHIA FEDERAL RESERVE DISTRICT PHILADELPHIA FEDERAL RESERVE DISTRICT MILLIONS PERCENT FACTORY AND COMMERCIAL SALES RESIDENTIAL STOCKS ADJUSTtD rqR SEASONAL VARIATION 1937 1938 1939 1940 1941 1942 Source: FW.Dodfe Corp. and benefit payments, amounted to nearly $76, 000,000 in the first two months of 1942 as against less than $60,000,000 in the same period last year. 1937 193 8 1939 r 9 41 1942 in March to a volume 2^ times that of a year ago. Wholesale trade sales were sustained in March at the high levels of the month before and about 40 per cent above a year ago. There were large increases in the month in the sale of shoes, paper, and hardware and smaller gains in the case of dry goods and jewelry. Sales of groceries and elec trical supplies declined and drugs were virtually unchanged in the month. Stocks of goods at whole sale establishments in the aggregate increased some what further in March to a level 16 per cent above March 1941. Trade. Retail sales increased less than usual in March after having been exceptionally active in January and February, when anticipatory buying was heavy. Gains over a year ago continued sub stantial but in April narrowed considerably, owing in part to the earlier date of Easter this year. Wholesale markets continue strong, as retailers are still placing large orders for delivery later in the year and are replenishing stocks of seasonal mer Rail freight shipments in this section expanded chandise. Rail freight traffic continued heavy in seasonally from February to March and were 3 per March, although the increase over a year ago was cent greater than a year ago. Loadings of grain less pronounced than in earlier months; shipments and livestock products showed exceptionally large of coal were expanded sharply in March 1941 in anticipation of the strike which began in bitumi gains in the month, and the movement of coal was much heavier than usual. Shipments of merchan nous mine fields on April 1. dise and miscellaneous commodities, which include Sales by men’s apparel stores advanced sharply manufactured products, did not measure up to sea in March to a level about 60 per cent above a year sonal expectations. In the Philadelphia area, load ago. Business increased about seasonally at furni ings consisting principally of industrial products ture stores, but gains in other lines were smaller decreased somewhat in early April and were below than usual. At all types of reporting stores sales the level of a year ago. were well above March 1941, owing in part to price increases. Banking conditions. The expanding war pro Retail inventories increased sharply in March at department and credit stores but showed somewhat smaller than seasonal gains at women’s apparel and shoe stores. The volume of stocks at the end of the month was substantially larger than a year earlier in all reporting lines, the most pronounced increases being 66 per cent at furniture and other credit stores and 44 per cent at department stores. Outstanding orders for merchandise as reported by representative department stores expanded further Page Four gram is being reflected to an increasing extent in the field of banking and credit. The volume of credit outstanding at reporting banks has been raised to a new peak by allotments of new Treasury securities and purchases of outstanding issues in the open market. The demand for loans to finance war production continues active,'but the total of com mercial loans has declined somewhat over the past month. To assure the greatest possible production of war COMMERCIAL LOANS DEPOSITS AT MEMBER BANKS PHILA. FED RES. DISTRICT REPORTING MEMBER BANKS PHILAOELPHIA FEDERAL RESERVE DISTRICT MILLIONS MILLIONS 2000 1942 PHILADELPHIA BANKS N 1941 1940 COUNTRY BANKS 1200 1939 1938 1939 1940 1942 materials, the President has authorized the Federal Reserve Banks, operating under regulations of the Board of Governors, to act as agents for the War Department, the Navy Department, and the Mari time Commission, to guarantee loans made by finan cial institutions to concerns engaged in war produc tion, or to act as agents to make loans, advances or commitments to such concerns. Guarantees are to be made only under certain circumstances, where lack of funds hinders war production and credit is not available from other sources. Growing scarcities of consumers’ durable goods and the restrictions upon instalment terms have re sulted in a declining volume of consumer credit ex tended by banks. Reports from a group of banks in this District show a decrease of 17 per cent in consumer instalment credit outstanding during the first quarter. The shrinkage was greatest in auto motive paper, but the decline also was of con siderable proportions in other retail credits, in re pair and modernization loans, and in personal in stalment cash loans. JAN. FEB. MAR. APRIL MAY JUNE JULY AUGi SEPT OCT. NOV. DEC Sales of War Savings bonds in the first three weeks of April were somewhat smaller than in the cor responding period of March and substantially less than in January, when some bought their entire year’s quota. Member bank borrowings continue very light, but industrial advances by the Reserve Bank were increased $1 million to over $5 million in the five weeks ended April 22. System purchases of gov ernments in the open market were reflected in an increase of $4 million to $181.5 million in the par ticipation of this Bank in the System Open Market Account. Earning assets of the reporting banks reached a new high of $1,436 million. Since March 18 hold ings of Treasury securities have been increased $28 million through the acquisition of $16 million of certificates of indebtedness, $6 million of bills, and $8 million of bonds, with a small decline in Treas ury notes. The investment in corporate and munic ipal securities was reduced $9 million and loans by a slightly greater amount. There were moderate declines in commercial loans, now 16 per cent larger than a year ago, in open market paper, and in the unclassified group which includes direct per sonal and instalment advances to individuals. The reserves of member banks in this District in the five weeks ended April 22 increased $55 mil lion to $678 million, or about one and one-half times legal requirements. This was due princi Deposits at the weekly reporting banks increased pally to large gains in interdistrict transactions. A $62 million to $1,974 million in the five-week pe considerable amount was absorbed by Treasury riod. A sharp gain was shown in balances of States operations, reflecting heavy income tax collections and local governments, similar to that a year ago, in the latter part of March and withdrawals from and a smaller expansion in demand deposits of in depositaries and sales of securities in April. Cur dividuals and business concerns. Time deposits rency demand continued to expand. declined further to a level one-third smaller than Subscriptions to Treasury certificates of indebt a year ago; funds were withdrawn by the Treasury edness totaled $111 million in this District and al from Government balances; and correspondent lotments were $56 million, paid largely in cash. banks also reduced their deposits somewhat. Page Five BUSINESS STATISTICS Production Employment and Income Philadelphia Federal Reserve District in Pennsylvania Adjusted for seasonal variation Not adjusted Industry, Trade and Service Per cent change Indexes: 1923-5 = 100 Mar Feb. Mar 1942 1942 1941 Mo. ago INDUSTRIAL PRODUCTION 123p MANUFACTURING................ 124p Durable goods........................... 176p Consumers* goods.................. 89p Metal products.......................... 153 Textile products........................ 74p 1 ransportation equipment.. . 350 bood products........................... 92p Tobacco and products............ 125 Building materials.................... 57p Chemicals and products......... 133p leather and products............. 124p Paper and printing.................. 93 Individual lines Pig Iron....................................... 90 Steel.............................................. 123 Silk manufactures.................... 82 Woolens and worsteds... 61p Cotton products..................... 51 Carpets and rugs.................... 58p Hosiery........................................ 82 Underwear.................................. 143 Cement........................................ 88p Brick........................................ 72 Lumber and products............. 31 Slaughtering, meat packing . . Sugar refining............................ Canning and preserving......... Cigars.......................................... Paper and wood pulp............. Printing and publishing......... Shoes............................................ Leather, goat and kid............. Paints and varnishes............... Petroleum products................. Coke, by-product...................... COAL MINING.......................... Anthracite................................... Bituminous................................. CRUDE OIL................................. ELEC. POWER—OUTPUT... Sales, total.................................. Sales to industries.................... BUILDING CONTRACTS TOTAL AWARDSt................... Residential!............................... Nonresidentialf........................ Public works and utilities!... 123 124 177 88 152r 70 354 89 138 62 146 122 93 1942 from Mar Feb. Mar. 1942 1942 1941 3 Year mos. ago 1941 102 0 + 21 102 0 + 22 121 - ] + 45 89 + 2 + 1 126 + i + 22 82 + 5 - 1C 164 - 1 +113 82 + S + 12 106 - 1C + 18 55 - 7 + 4 135 - £ - 2 119 + 2 + 4 88 0 + 6 108 S2 124 106 75 82 r 58 73 51 51 60 124 84 92 137 136 104 91 73r 64 31 29 r Employment Mar. 1942 from + 23 + 25 + 50 + 3 + 25 - 8 +11C + 10 + 2£ + 16 + 8 + 10 + 6 104 51 97p 125 90 94 137 112p 94 151p 135p 74p 71p 94 451 345 354 278 94 25 97 138 90 94 132 112 100 165 148 71 69 86 455 344 360 286 99 61 75 105 79 90 141 98 91 158 143 67 64 92 382 312 313 236 - 17 + 0 + 18 - 1 + 16 + 17 + 9 0 - 2 + 4 - 17 - 10 + 1 0 + 1 - 3 - 53 - 47 - 3 - 12 - 7 + 4 + 5 + 6 - 16 - 3 + 24 - 1 + 12 + 10 + i + 6 + 10 i* + 8* + n + 5 + 2 +105 - 16 - 47 - 1 + 29 + 36 - 10 + 19 + 29 0 + 13 + 15 0 + 4 + 4 + 3 - 3 - 3 0 + 15 + 29 - 6 + 3 + 10 - 9 - 4 + 7 - 9 - 6 + 2 + 4 + 10 + 3 + 3 +11 + 3 + 10 + 2 + 4 - 1 + 18 + 15 0 + 11 + 13 - 2 + 13 + 14 - 3 + is + 22 117 73 108 246 107 50 157 156 90 66 111 94 + + + 10 46 31 57 + 30 + 11 - 3 +162 124p 123 125p 124 103 103 155 77p 367 90p 115 51p 133p 127p 95 128 r 85 r 173 81 98 49 136 123 90 Indexes: 1932 = 100 GENERAL INDEX............ 133 Manufacturing...................... 175 Anthracite mining................ 64 Bituminous coal mining . . . 106 Building and construction. . 50 Quar. and nonmet. mining. 118 Crude petroleum prod......... 137 Public utilities....................... 104 Retail trade............................ 116 Wholesale trade.................... 130 Hotels...................................... 95 Laundries................................ 113 Dyeing and cleaning........... 102 103 111 94 131 130 r 114 84 80 84 59p 60 71 54 54 54 59 p 61 123 85 87 96 155 149 148 67p 73 70 71 70 r 63 30 30 28 95 32 90 116 90 94 139 121 98 163 156 78 76 94 455 365 389 283 95 93 67 r 97 81 92 150 97 93 157 149 69 66 94 390 318 310 224 106 36 158 188 79 50 111 86 +1 + 9 +12 - 4 - 4 +16 +12 - 1 + 4 + 8 + 4 - 5 + 5 + 1 +i -1 0 +4 +8 -2 -1 +8 +5 -2 0 +i 256 362 88 328 91 317 184 128 150 152 131 162 138 +2 +2 +3 +1 +6 +3 -4 0 +i +4 0 +1 +8 +32 +35 +21 +36 +37 +44 +18 +12 +18 +14 + 7 +18 +18 Manufacturing Employment* Payrolls* Per cent Per cent Mar. change from Mar. change from 1942 1942 index Feb. Mar. index Feb. Mar. 1942 1941 1942 1941 Indexes: 1923-5 =100 100 78 88p 115 91 96 145 lllp 96 150p 141p 76p 73p 96 460 352 350 264 + 43 102 - 15 56 + 49 108 +150 224 * Unadjusted for seasonal variation. t 3-month moving daily average centered at 3rd month. 154r 75 352 86 116 52 145 129 93 Payrolls Per cent Per cent Mar. change from Mar. change from 1942 1942 index Feb. Mar. index Feb. Mar. 1942 1941 1942 1941 TOTAL..................................... Iron, steel and products. . . Nonferrous metal products Transportation equipment Textiles and clothing.......... Textiles............................... Clothing................................ Foods products..................... Stone, clay and glass........... Lumber products.................. Chemicals and products. . , Leather and products......... Paper and printing.............. Printing................................. Others: Cigars and tobacco............ Rubber tires, goods........... Musical instruments......... 113 121 186 105 93 84 128 111 97 60 116 99 106 94 +i 0 +2 +1 +1 +1 0 -1 -3 +i +i 0 +i +12 +20 + 18 +35 - 4 - 5 +1 + 5 + 9 - 2 +16 + 3 + 6 + 4 148 208 304 156 107 97 154 133 118 67 158 124 130 112 + + + + + + + + 2 2 3 3 2 2 3 1 2 2 1 3 2 3 +35 +41 +40 +75 + 9 + 7 +14 +17 +22 +15 +35 +20 +17 +10 74 92 67 +i +3 -2 +16 + 1 - 8 74 138 83 + 2 +ii 0 +31 +29 - 6 +1 — + + + + * Figures from 2,861 plants. p—Preliminary, r—Revised. Hours and Wages Factory workers Averages March 1942 and per cent change from year ago Local Business Conditions* Percentage change— March 1942 from month and year ago Allentown. . . . Altoona........... Harrisburg.... Johnstown.... Lancaster........ Philadelphia... Beading........... Scranton .......... I ren ton........... Wilkes-Barre.. W illiamsport. . Wilmington.. . York................. Employment Payrolls Building permits value Feb. 1942 Mar. 1941 Feb. 1942 Mar. 1941 Feb. 1942 Mar. 1941 +2 +1 +1 0 0 +1 0 +2 0 +4 0 0 -3 +ii -19 -11 -11 - 9 -20 - 4 h 9 2 +24 + 11 +19 + 10 +2 +3 +3 -3 +2 +3 -1 +3 +1 +4 +4 +3 +3 +33 +44 +36 +26 +29 +52 +20 +22 +20 +68 +42 +50 +37 +572 - 82 + 10 + 95 +556 + 42 +119 +245 +168 +887 + 68 + ii - 22 +327 + 99 - 83 - 52 + 65 + 31 - 57 + 23 - 52 + 185 - 13 - 73 +129 Retail sales Feb. 1942 Mar. 1941 Feb. 1942 Mar. 1941 +39 +21 +16 +47 +21 + 16 +41 +19 +44 +36 +24 +27 +22 +36 +34 +25 +29 +25 +36 +n +17 +16 +25 +n +13 +25 + 13 +29 + 17 + 18 + 10 -14 +14 +15 +59 +21 +12 + 8 +20 +20 +23 + 10 + 3 +18 +12 +14 +21 +20 +33 * Area not restricted to the corporate limits of cities given here. Page Six Debits TOTAL............................ Iron, steel and prod.. . Nonfer. metal prod.... Transportation equip.. Textiles and clothing.. Textiles......................... Clothing........................ Food products.............. Stone, clay and glass. . Lumber products......... Chemicals and prod.. . Leather and prod......... Paper and printing.. . . Printing........................ Others: Cigars and tobacco.. . Rubber tires, goods.. . Musical instruments Weekly working time* Hourly earnings* Weekly earnings! Aver age Ch’ge Aver Ch’ge Aver Ch’ge age hours age 42.4 + 5 $.870 - MS $36.63 43.5 + 4 .953 - 1-14 41.41 42.2 + 4 .802 -bl7 33.80 47.4 +12 1.010 - 1-22 47.83 38.2 + 2 .610 -M3 23.22 .627 - bl4 24.18 38.6 + 3 37.2 .567 0 b 9 21.23 .682 40.6 + 3 -11 28.04 38.2 + 4 .793 b 8 30.18 39.9 + 4 .606 b 3 23.95 39.5 + 2 .925 bl3 36.20 40.0 + 1 .630 M2 25.14 41.3 + 4 .777 - - 6 32.99 38.7 + 5 .907 - 3 36.76 +21 +18 +22 +36 +14 +18 + 7 +12 +12 + 8 + 16 +14 + 9 + 1 38.2 41.2 42.7 +11 +21 + 2 * Figures from 2,647 plants. + 6 +10 - 3 .477 .807 .755 H- 4 H -10 H- 6 18.24 33.26 32.21 f Figures from 2,861 plants Distribution and Prices Per cent change Wholesale trade Unadjusted for seasonal variation Mar. 1942 from Month Year ago ago Sales Total of all lines................... Boots and shoes.................. Drugs..................................... Dry goods............................. Electrical supplies.............. Groceries............................... Hardware............................. Jewelry.................................. Paper..................................... Inventories 0 +15 0 + 2 - 4 - 5 + 7 + 1 + 8 -39 -30 -21 -78 0 +29 +49 +33 +87 + 3 ' 0 +13 - 2 + 3 - 1 - 5 0 +16 + 5 +27 - 5 +28 +15 -15 +22 1942 from 3 mos. 1941 | Per cent change | Mo. ago Year ago Not adjusted 1942 from Mar. Feb. Mar. 1942 1942 1941 3 mos. 1941 Mar. 1942 fro m Mar. Feb. Mar. 1942 1942 1941 Indexes: 1935—1939 = 100 +39 +44 +15 +73 + 4 +28 +50 +20 +99 Adjusted for seasonal variation RETAIL TRADE Philadelphia................. Credit.................................................................... Inventories 149p 148 127 178 135p 153p 157 155 135 161 r 177 152 118r 116r 107 r 112 100 118r - 5 - 5 - 6 +ii -23 +1 +26 +28 +20 +59 + 35 +30 148p 144 136 I21p 193p 136 130 137 124 177 103r 98 r 99 102 116r + 9 + 11 - 1 - 2 + 9 +44 +47 +38 +19 +66 149 145 103 141 243 180 111 130 115 149 151 109 126 262 175 106 110 97 144 138 105 144 257 176 103 123 111 0 - 4 - 5 + 12 - 7 + 3 + 4 +18 +18 + + + + + + 3 5 2 2 6 2 8 5 4 75 107 94 -30 -20 139p 138 138 166 146p 135p 116 116 97 127 r 118 117 106 103 r 108 97 r 101 102 153p 149 149 126p 207p 134 128 134 115 179 106 101 108 106 124 + 8 +10 + 5 + 2 - 7 + 6 + 9 +13 + 2 137 140 104 137 78 191 109 122 99 135 138 107 137 63 192 105 115 93 133 133 106 139 82 187 102 116 95 +30 84 123 104 111 r 117 116 83 131 +35 +36 +27 +55 +46 +27 Source: U. S. Department of Commerce. Prices Basic commodities (Aug. 1939=100). . Wholesale (1926-100)............. Food.......................... Other......................... Living costs (1935-1939 = 100) United States.......... Philadelphia............. Clothing................. Housefurnishings.. Other....................... Per cent change from Mar. 1942 Month Year Aug. 1939 ago ago FREIGHT-CAR LOADINGS Ore......................................................................... 166 +i +28 +66 98 103 96 95 +i +i +2 0 +20 +44 +28 +12 +30 +69 +43 +19 114 113 116 123 106 103 121 109 +1 +1 +1 +6 0 0 +2 +1 +13 + 13 +22 +22 + 3 + 4 +18 + 8 +16 +15 +24 +24 + 4 + 7 +20 + 9 Forest products.................................................. Grain and products........................................... Livestock.............................................................. MISCELLANEOUS Life insurance sales............................................. Hotels—(1934 = 100) Business liquidations Check payments................................................ 147 * Computed from unadjusted data. Source: U. S. Bureau of Labor Statistics. 146 133 + 5* - 3* +11* + 9* + 8* + 9* 122 128 117 132 +52* -10* -57* +10 -31* -64* +17 104 36 144 69 23 147 +55* 1i + 1 p—Preliminary. r—Revised. BANKING STATISTICS MEMBER BANK RESERVES AND RELATED FACTORS Reporting member banks (000,000’s omitted) April 22, 1942 Assets Commercial loans................. $ 304 38 Open market paper............. 27 Loans to brokers, etc........... 32 Other loans to carry secur.. 48 Loans on real estate............ Other loans............................. 105 Changes in— Five weeks -$ 3 - 3 + 1 One year - 1 +$ 42 + 1 + 2 + 4 2 - 4 + 2 Sources of funds: Reserve bank credit extended in district........... Commercial transfers (chiefly interdistrict) . . . Treasury operations................................................ Total.......................................................................... Uses of funds: Currency demand.................................................... Member bank reserve deposits............................ “Other deposits” at reserve bank........................ Other Federal Reserve accounts.......................... Total loans........................... $ 554 -$10 +$ 49 Government securities........ $ 533 Obligations fully guar’teed. 92 257 Other securities..................... +$28 +$121 + 4 - 19 Total.......................................................................... 9 Total investments.............. $ 882 +$19 +$106 Member bank reserves (Daily averages; dollar figures in millions) Total loans & investments $1436 Reserve with F. R. Bank.. . Cash in vault........................ Balances with other banks. Other assets—net................. - +$ 9 +$155 + 53 - 1 i - 119 + 2 - 24 - 11 Liabilities Demand deposits, adjusted $1346 172 Time deposits........................ 34 U. S. Government deposits . 422 Interbank deposits............... +$93 - 14 - 6 - 11 +$124 - 88 + 21 - 52 Other liabilities..................... Capital account.................... + + 484 25 190 70 13 218 + 1 i 3 i Held Re quired Ex cess Mar. 25 Apr. 1 Apr. 8 Apr. 15 Apr. 22 Changes in five weeks + 4.9 +18.3 -28.7 - 6.9 +20.0 - 9.3 +16.2 +30.0 + 7.3 - 0.9 +14.0 - 8.2 -5.9 +8.6 +0.7 + 7.4 +90.9 -38.2 - 5.5 + 3.8 +53.5 + 4.9 +3.4 +60.1 + + + - 6.9 1.2 4.2 0.1 + 0.5 +52.7 + 0.3 + 0.0 + + + 0.2 5.4 0.8 0.1 +3.3 +0.2 -0.1 -0.0 + 9.7 +55.4 - 5.0 - 0.0 + 3.8 +53.5 + 4.9 +3.4 +60.1 Changes in weeks ending— Philadelphia Federal Reserve District (Millions of dollars) - 5.5 Ratio of excess to re quired Phila. banks 1941: Apr. 1-15.. $573.3 $250.1 $323.2 129% 1942: Mar 1-15.. 422.6 297.6 125.0 42 ” Mar. 16-31.. 415.8 295.1 120.7 41 ” Apr. 1-15. . 455.4 Country banks 1941: Apr. 1-15.. $195.0 $105.1 $ 89.9 1942: Mar. 1-15.. 211.5 145.3 66.2 Mar. 16-31. . 206.6 143.8 62.8 Apr. 1-15. . 211.3 1.2 4.1 0.2 0.0 86% 45 ” 44 ” Federal Reserve Bank of Phila. (Dollar figures in millions) Changes in— April 22, 1942 Five weeks One year Bills discounted........ $ 0.6 Bills bought............... 0 Industrial advances. 5.1 U. S. securities.......... 181.5 -$ 0.0 0 + 1.0 + 3.9 +$ 0.5 0 + 2.7 + 8.4 Total.......................... Note circulation.... Member bk. deposits U. S. general account Foreign deposits. . . . 0 ther deposits........... Total reserves........... Reserve ratio............. +$ 4.9 + 9.4 + 55.4 + 19.3 - 2.2 - 5.0 + 65.8 - 0.1% +$11.6 +184.1 -103.6 - 34.1 - 9.9 - 16.2 + 10.0 - 0.6% $187.2 615.0 677.8 19.4 68.1 8.0 1225.8 88.3% Page Seven National Summary of Business Conditions INDUSTRIAL PRODUCTION Industrial activity continued at a high rate in March and the first half of April. Distribution of commodities to consumers was maintained in large volume and com modity prices advanced further. Production Federal Reserve monthly index of physical volume of production, adjusted for seasonal variation, 1935-39 average = 100. Latest figures shown are for March 1942. DEPARTMENT STORE SALES AND STOCKS Federal Reserve monthly indexes of value of sales and stocks, adjusted for seasonal varia tion, 1923-25 average = 100. Latest figures shown are for March 1942. MEMBER BANKS IN 101 LEADING CITIES Volume of industrial production increased seasonally in March and the Board’s adjusted index remained at 172 per cent of the 1935-39 average. Output of durable manufactured products, now mostly war materials, continued to advance, reflecting mainly increased activity in the iron and steel, machinery, aviation, and shipbuilding industries. Production of lumber and cement, which had been maintained at unusually high levels during the winter months, increased less than seasonally in March. In most industries manufacturing nondurable goods activity was sustained at earlier high levels. In some, however, notably wool textiles and petroleum refining, there were declines owing to restrictions on production for civilian use and, in the case of pe troleum products, to transportation difficulties. Mineral production declined in March and the first half of April, reflecting sharp curtailment in output of crude petroleum. Coal production, which usually declines at this season, was maintained in large volume. The Great Lakes shipping season opened in the latter part of March and the first boat load of iron ore reached lower Lake ports 12 days earlier than the record set last year. Shipments during the coming season are expected to exceed considerably the total of 80 million gross tons brought down the Lakes last year. Value of construction contract awards continued to increase in March, according to figures of the F. W. Dodge Corporation, and the level of the first quarter of 1942 was the highest in recent years, being some 30 per cent above that of the corresponding period last year. Awards for public work amounted to close to 80 per cent of the total and in the residential field accounted for 52 per cent of the value of all projects. Publicly financed contracts for factory construction showed a sharp increase, partly offset in the total by a decline in private factory construction. On April 9 the War Production Board issued an order which required explicit permission of the Government for initiation of all new private construction involving expenditures in excess of specified small amounts and not covered by specific priority ratings. Distribution Value of retail trade in March continued at the high level of other recent months, making allowance for customary seasonal changes. Sales at department and variety stores increased by somewhat less than the usual seasonal amount while sales by mail order houses rose more than seasonally. On the railroads total loadings of revenue freight were maintained in large volume in March and the first half of April. Shipments of coal and coke declined less than seasonally and ore loadings increased sharply, while grain shipments declined further from the peak reached in January. Loadings of miscellaneous merchandise, which had been unusually large in the preceding three months, increased less than seasonally. Commodity Prices Wednesday figures. Commercial loans, which include industrial and agricultural loans, rep resent prior to May 19, 1937, so-called “Other loans1* as then reported. Latest figures shown are for April 8, 1942. MEMBER BANK RESERVES The general level of wholesale commodity prices advanced IY2 per cent further from the middle of March to the middle of April. Among manufactured products, fin ished consumers’ goods, such as foods, clothing, and shoes, continued to show the largest price increases. Prices of most raw materials were unchanged or showed in creases, which in a number of cases reflected the raising of Federal maximum price levels. There were declines in prices of wheat and of a few other commodities, including gasoline at Gulf ports and turpentine. In retail markets maximum prices were fixed in this period for a number of elec trical products, most of which will no longer be produced for civilian use after May 31. Prices of many other commodities and services advanced further. Bank Credit During the four weeks ending April 15 holdings of Government securities at banks in leading cities increased by nearly 700 million dollars, while commercial loans de clined somewhat, following a rise in previous weeks. Changes in member bank reserves and deposits reflected principally the temporary effects of Treasury operations in con nection with income tax collection and the sale of certificates of indebtedness. Money in circulation continued to increase. United States Government Security Prices Wednesday figures. Required and excess re serves, but not the total, are partly estimated. Latest figures shown are for April 8, 1942. Page Eight Following an advance from the mid-February low, prices of U. S. Government bonds remained relatively steady in the first half of April.
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