Full text of Economic Report of the President : 1973
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ECONOMIC
TRANSMITTED
TO THE CONGRESS
JANUARY 1373
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^
Economic Report
of the President
Transmitted to the Congress
January 1973
TOGETHER WITH
THE ANNUAL REPORT
OF THE
COUNCIL OF ECONOMIC ADVISERS
UNITED STATES GOVERNMENT PRINTING OFFICE
WASHINGTON
:
1973
For sale by the Superintendent of Documents, U.S. Government Printing Office,
Washington, D.C. 20402. Price $2.35 domestic postpaid or $2 GPO Bookstore
Stock Number 4000-00287
CONTENTS
Page
ECONOMIC REPORT OF THE PRESIDENT
1
ANNUAL REPORT OF THE COUNCIL OF ECONOMIC
ADVISERS*
9
CHAPTER 1. T H E 1972
RECORD
17
CHAPTER 2. INFLATION CONTROL UNDER THE ECONOMIC STABILIZATION ACT
51
CHAPTER 3. OUTLOOK AND POLICY
71
CHAPTER 4. T H E ECONOMIC ROLE OF WOMEN
89
CHAPTER 5. T H E INTERNATIONAL ECONOMIC SYSTEM IN TRANSITION
113
APPENDIX A. SUPPLEMENTS TO CHAPTERS IN THE ANNUAL REPORT
OF THE COUNCIL OF ECONOMIC ADVISERS
141
APPENDIX B. REPORT TO THE PRESIDENT ON THE ACTIVITIES OF
THE COUNCIL OF ECONOMIC ADVISERS DURING 1972
APPENDED C. STATISTICAL TABLES RELATING TO INCOME, EMPLOYMENT, AND PRODUCTION
*For a detailed table of contents of the Council's Report, see page 18.
in
175
187
ECONOMIC REPORT
OF THE PRESIDENT
ECONOMIC REPORT OF THE PRESIDENT
To the Congress of the United States:
As predicted, 1972 was a very good year for the American economy.
From the end of 1971 to the end of 1972, total output rose by about
ll/2 percent. This is one of the largest 1-year increases in the past 25 years.
This growth took place in a largely peacetime economy; it was not
achieved by a war-fed, inflationary boom. In fact, real defense spending declined 5 percent during the year. More important is the fact that the
big increase of production in the year just ended was accompanied by a
reduced rate of inflation. Consumer prices increased a little more than
3 percent from 1971 to 1972—a far cry from the runaway inflation
rate of 6 percent that confronted us in 1969.
A year ago, looking ahead to 1972, I said that the great problem was
to get the unemployment rate down from the 6-percent level where it
was in 1971. During 1972 the rate was reduced to a little over 5 percent.
We should get this down further, and expect to do so, but what was
accomplished was gratifying. It is especially significant that the total number of people at work rose by 2.3 million from 1971 to 1972, the largest
1-year increase in 25 years.
Everything was not ideal in 1972—in the economy any more than in
other aspects of our national life. Rising food prices were a major concern. The U.S. balance of trade with other countries did not improve as
we had hoped. But all-in-all it was a very good year.
The economic performance of 1972 owed much to sound and forceful Government policy. The history of this policy goes back before 1972,
and back before the dramatic moves taken on August 15, 1971. It goes
back to the decision made in 1969 to bring to an end the dangerous
inflation that had started in the mid-sixties. The decision was carried out
by slowing down the rise of Federal spending and continuing the temporary tax increase that had been enacted in 1968 and by tightening
monetary conditions. As a result, much of the cause of the inflation was
removed and the rise in the cost of living was moderated. Without these
steps, the subsequent success of price and wage controls would have been
impossible.
Curbing inflation and cutting back on defense production necessarily
involved a downturn in the economy and a rise of unemployment. To
keep this from going too far, fiscal and monetary policy shifted in an
expansive direction in 1970. And to speed up both the decline of inflation and the recovery of the economy, I announced the New Economic
Policy on August 15, 1971. Temporary controls were imposed on prices,
rents, and wages. Taxes were reduced. A little later we moved to stimulate
the economy further by boosting Government expenditures in thefirsthalf
of 1972, mainly by bringing forward expenditures that would have been
made later.
The policies that began in 1969 contributed to the economic progress
so visible in 1972. But Government policies alone did not do the job.
Credit goes largely to a strong private economy and to the private citizens
who cooperated in raising productivity, maintaining industrial peace, and
conforming to the standards of the control system. The Government
helped to create conditions in which private people could adapt to a
growing economy that was far less defense-oriented and much less inflationary. But it was the individual American who made the adaptations.
The immediate economic goals for the domestic economy in 1973
are clear. Output and incomes should expand. Both the unemployment
rate and the rate of inflation should be reduced further, and realistic
confidence must be created that neither need rise again.
The prospects for achieving these goals in 1973 are bright—if we
behave with reasonable prudence and foresight. By all signs a vigorous
economic expansion is underway and will continue during the year.
This will raise output and employment and reduce unemployment. The
problem, as far as can now be foreseen, will be to prevent this expansion
from becoming an inflationary boom.
That is why I put restraining Federal expenditures at the top of the
list of economic policies for 1973. Nothing is easier or more pleasant,
at least for a bureaucracy, than to spend money. But beyond some point,
which our budget plans already reach, everything that the Government
gives out with one hand it must take back with the other, in higher
taxes or more inflation or both. Spending proposals roust be looked at
in this way, by asking whether they are worth either of these costs. Much
Government spending fails this test.
I am proposing a budget with expenditures of $250 billion in the currentfiscalyear—an increase of $18 billion from last year. I am proposing
a $19 billion increase for next year, to $269 billion. Although those
are large totals and large increases, they reflect a sense of responsibility
and discipline. I urgently seek the cooperation of the country and the Congress in staying within my budget proposals.
Only by holding the line on Federal spending will we be able to reduce
the inflation rate further in 1973. Productivity should still be rising
strongly. Inflationary expectations have been subdued. Workers have
been experiencing large gains in their real incomes and so the pressure
to catch up will be less than it was earlier. Anti-inflationary forces are
at work, but it will be necessary to keep our healthy expansion from
becoming an overheated boom.
The system of wage and price controls in effect during 1972 helped
bring about a combination of less inflation and more production. But it
is not the best system for 1973. After intensive consultation with all parts
of the American society we have concluded that controls should be substantially modified. There are several problem areas—food, construction,
and medical care costs—where special efforts at restraint are needed, in
some cases more intense than last year.
In the economy at large there is need to establish more firmly a pattern
of behavior consistent with reasonable price stability. At the same time
our own experience and the experience of other countries demonstrate
that as controls continue, unless they are suitably modified, red tape
multiplies, inequities increase, interferences with production and productivity become more severe, and the possibility is enhanced that prices
will explode when controls are lifted. Therefore, we are modifying the
control system in several ways.
We are setting forth standards of reasonable price and wage behavior
to which we ask business and labor to conform. Private economic units
will be able to determine by themselves whether price or wage increases
are within the standards or not. They will not require advance approval
from the Government. However, the Government will maintain the legal
authority, the practical capacity, and the will to intervene where necessary to stop action that is unreasonably inconsistent with the standards.
I am asking Congress to extend the Economic Stabilization Act for 1 year,
to April 30, 1974, to continue the authority. There should be no doubt
about the fact that the authority will be used where needed.
An essential part of our anti-inflation program must be an increase of
food supplies to restrain increases of food prices and bring about reductions where possible. The combination of natural occurrences holding
down food production in the United States and abroad with rising
consumers' incomes at home caused a sharp increase in food prices last
year. These same forces will be at work in the early part of this year. But
we have taken steps to increase food supplies. Quotas which previously
limited the import of meat have been suspended. Restrictions on the
acreage planted to major field crops have been relaxed. An increased
amount of dried milk is being allowed into the country. Subsidies on
agricultural exports have been eliminated. Grazing of cattle is being permitted on acreage diverted from crop production. We have established
new machinery in the Federal Government to assure that high priority
is given to holding down food prices.
Restraint in budget policy, the new system of cooperative price and
wage controls and special efforts to increase food supplies, coupled with
the productivity and vigor of the private economy, should make 1973
another year in which inflation and unemployment decline and output
rises. But what is at stake in the policies of 1973 is more than economic
performance in 1973. What is at stake is whether we can make 1973 the
prelude to a sustained period of growth and stability in a free economy.
Since 1968 the Government and the economy have been largely absorbed
in the negative task of correcting the destabilizing consequences of the
financing of the Vietnam war. That period is almost over. Now we can
stop putting out fires and turn to building a better economic order.
We must develop more reliable and responsible attitudes and methods
for dealing with the Federal budget, so that it is not perpetually on the
margin of an inflationary explosion. We must prepare for the end of wage
and price controls, and be willing to show the same courage in taking
them off as was shown in imposing them. We must weed out the restrictive
effects of the large number of other economic controls exercised by the
Federal Government, most of them having their origins decades ago, and
many of them interfering with productivity and production. And we must
strengthen the forces of competition in a vigorous free-enterprise economy.
Nowhere is the need to make 1973 a year of economic reform more
apparent than in our international relations. Our actions of August 15,
1971, put the world on the path of negotiation for improvement of the
international economy. Last year we made proposals for the reform of
the international financial system, and these proposals are now the subject of discussion by high-level officials of the member countries of the
International Monetary Fund. This year we expect to enter negotiations
on the subject of trade.
We want the American people to be able to buy those foreign goods
and services that are better, cheaper, or more interesting than our own.
That raises the American standard of living. We want our people
to be able to invest abroad when that is the most profitable thing to do.
But we also want the American people to be able to pay for these purchases and investments in the way that is best for us. That means, first,
that we must be able to pay by selling abroad the things that we produce best, and selling them on the best terms that we can freely obtain.
Second, it means that we must be able to pay in a way that is sustainable
so that we are not confronted with the need for sudden and possibly
painful adjustments.
Existing arrangements are not favorable to us in either respect. We
have been buying from abroad in rapidly increasing amounts, and that
has helped the American people. But our exports, with which we seek
to pay for these imports, have been subject to high barriers, particularly
in the case of our agricultural products. We have not been able to sell
enough to pay for our overseas expenditures, and so we have had to pay
by incurring more and more short-term debts abroad. This is not a situation that can go on indefinitely; its sudden ending could be disruptive.
Therefore we want to bring about those reforms that will permit us to
earn our way.
Our proposals have been, and will be, put forth in the U.S. national
interest. But this is not contrary to the interest of other countries. International competition is shifting from the military and political arenas
to the economic. This is a great advantage, because in economic competition every participant can win—there need be no losers. The effort of
each nation to produce and sell what it can do most efficiently will benefit
others. This is the fundamental belief underlying our proposals for reform
and the fundamental reason for thinking that a satisfactory agreement
will be reached.
*
*
*
*
*
The general prediction is that 1973 will be another very good year for
the American economy. I believe that it can be a great year. It can be a
year in which we reduce unemployment and inflation further and enter
into a sustained period of strong growth, full employment, and price
stability. But 1973 will be a great year only if we manage our fiscal
affairs prudently and do not exceed the increases in Federal expenditures
that I have proposed. This is the practical lesson of the experience from
1965 to 1968, when loose fiscal policy turned a healthy expansion into
a feverish boom followed by a recession. I am determined to live by this
lesson. And I urgently appeal to the Congress to join me in doing so.
January 31, 1973.
THE ANNUAL REPORT
OF THE
COUNCIL OF ECONOMIC ADVISERS
LETTER OF TRANSMITTAL
COUNCIL OF ECONOMIC ADVISERS,
Washington, D.C., January 25, 1973.
T H E PRESIDENT:
SIR: The Council of Economic Advisers herewith submits its Annual
Report, January 1973, in accordance with Section 4(c) (2) of the Employment Act of 1946.
Respectfully,
S
HERBERT STEIN,
Chairman.
EZRA SOLOMON.
MARINA V.N. WHITMAN.
11
CONTENTS
Page
17
CHAPTER 1. T H E 1972 RECORD
Demand and Output
Business Fixed Investment
Housing
Consumer Spending
The Labor Market
The Labor Force
Employment Gains in 1972
Unemployment
Prices and Costs
Compensation, Productivity, and Costs
Nonfinancial Corporations
Farm Prices and Rural Incomes
Fiscal Policy in 1972
Federal Expenditures
Federal Receipts
The Request for a Spending Ceiling
State and Local Governments
Financial Policy and Financial Markets
Monetary Policy
Interest Rates
Fourth Quarter Developments
CHAPTER 2. INFLATION CONTROL UNDER THE ECONOMIC STABILIZATION ACT
The Situation in August 1971
The Nature of the Program
Prices and Wages During the Controls Period
The Costs of Controls
Where We Stand
CHAPTER 3. OUTLOOK AND POLICY
13
51
51
54
56
66
68
71
Guides to Overall Economic Policy
Fiscal and Monetary Policy
Price and Wage Restraints in Phase III
The Outlook for 1973
490-000 O - 73 - 2
19
19
22
23
24
24
25
28
30
31
35
39
40
41
42
44
44
45
45
47
50
71
74
78
82
Page
CHAPTER 4. T H E ECONOMIC ROLE OF WOMEN
Advisory Committee on the Economic Role of Women
Participation in the Labor Force
The Historical Pattern
The Working Woman Today
Unemployment
The Widening in the Reported Male-Female Unemployment Differential
Education and the Occupational Distribution
Earnings
Direct Discrimination Versus Role Differentiation
Special Problems
The Female-Headed Household
The Income Tax
Child Care
Government Action
89
90
91
92
95
96
99
100
103
106
107
107
108
109
110
CHAPTER 5. T H E INTERNATIONAL ECONOMIC SYSTEM IN TRANSITION . .
113
The U.S. Balance of Payments in 1972
The Goods-and-Services Account in 1972
The Capital Account in 1972
Foreign Exchange Market Developments in 1972
Reforming the International Economic System
The International Monetary System
The International Trading System
Other Aspects of International Economic Cooperation...
114
115
116
116
119
120
131
135
APPENDIXES:
A. Supplements to Chapters in the Annual Report of the Council
of Economic Advisers
B. Report to the President on the Activities of the Council of
Economic Advisers During 1972
C. Statistical Tables Relating to Income, Employment, and
Production
List of Tables and Charts
Tables
1. Changes in Gross National Product in Current and Constant
Dollars, 1968 to 1972
2. Annual Vacancy Rates for Rental and Homeowner Housing,
1956-72
3. Personal Outlays, Taxes, and Saving as Percent of Personal
Income, 1960-72
4. Changes in the Working-Age Population, Armed Forces, and
Labor Force, 1962 to 1972
5. Change in the Number of Employees on Nonfarm Payrolls,
1969 IV to 1972 IV
14
141
175
187
20
23
24
25
27
Page
6. Selected Unemployment Rates, 1970 IV-1972 IV
7. Changes in Gross National Product Price Deflators, 1968 II
to 1972 IV
8. Changes in Hourly Compensation, Private Nonfarm Sector,
1967-72
9. Changes in Unit Labor Costs, Productivity, and Compensation
Per Man-Hour in Recessions and Expansions, Private Nonfarm Economy
10. Changes in Prices, Costs, and Profits Per Unit of Output for
Nonfinancial Corporations, 1967 III to 1972 III
11.. Changes in Gross Product and Profits Before Taxes of Nonfinancial Corporations 7 Quarters After Trough and Ratio
of Changes
12. Distribution of Gross Product Originating in Nonfinancial
Corporations, 1947-72
13. Profits Before Adjustment, Adjusted Profits, and Interest as
Shares of Gross Product of Nonfinancial Corporations,
1950-72
14. Federal Government Receipts and Expenditures, National
Income Accounts Basis, Calendar Years, 1971-72
15. Changes in Price Measures, 1968 to 1972
16. Changes in Wage Measures, 1969 to 1972
17. First-Year Wage Rate Changes in Collective Bargaining Agreements Covering 1,000 Workers or More, 1968 and 1970-72. .
18. Changes in Consumer Prices in the United States and OECD
Countries, Selected Periods, 1958 to 1972
19. The Economic Preludes to Two Major Collective Bargaining
Rounds, 1970 and 1973
20. Government Expenditures as a Percent of Full-Employment
GNP, Selected Calendar Years, 1955-71
21. Women in the Labor Force, Selected Years, 1900-72
22. Labor Force Participation Rates of Women by Marital Status
and Age, 1950, 1960, and 1972
23. Unemployment Rates by Sex and Age, Selected Years, 1956-72.
24. Distribution of Unemployment of Adult Men and Women by
Reason for Unemployment, 1969 and 1972
25. Unemployment of Adult Men and Women by Duration and
Reason, 1972
26. Women as a Percent of Persons in Several Professional and
Managerial Occupations, 1910-70
27. Occupational Distribution of Employed Persons by Education
and Sex, 1970
28. Ratio of Total Money Earnings of Civilian Women Workers
to Earnings of Civilian Men Workers, Selected Years,
1956-71
15
29
31
33
34
35
36
37
38
42
57
60
62
63
69
77
91
92
97
97
98
101
102
104
Page
29. U.S. Balance-of-Payments Transactions, 1971-72
30. Percent Deviations of Major Foreign Currencies from Central
Rates, December 1971-December 1972
31. Changes in Official Reserves for Selected Countries and Changes
in U.S. Liabilities to Foreign Official Reserve Holders,
1972
32. Classification of Firms and Workers in Economic Stabilization
Program
33. Women in Experienced Civilian Labor Force, 1950, 1960, and
1970
Charts
1. Changes in GNP, Real GNP, and Price Deflator
2. Recovery Comparisons of Real GNP and Civilian Employment.
3. Civilian Labor Force Participation Rates
4. Changes in Compensation, Productivity, Labor Costs, and
Prices (Private Nonfarm Sector)
5. Shares of Profits and Interest in Gross Product of Nonfinancial
Corporations
6. Interest Rates
7. Changes in Prices
8. Changes in Compensation in the Private Nonfarm Economy. .
9. Labor Force Participation Over a Working Life of Cohorts of
Women Born in Selected Time Intervals, 1886-1955
10. Annual Income by Age, for Male and Female High School and
College Graduates
11. Movement of European Community Exchange Rates
12. Organization of the Economic Stabilization Program in 1972. .
13. Illustration for Individual Country of Reserve Indicator
System
16
114
118
118
152
155
18
21
26
32
39
48
58
59
94
105
117
145
168
CHAPTER 1
The 1972 Record
1 Q H 0 WITNESSED the first full-year results of the innovative set of
X.ZJ I £* economic programs initiated in August 1971 to speed the recovery of the economy, to reduce the rate of inflation, and to reverse the
deteriorating trend in the Nation's external position. There was a rapid acceleration in the rate of growth in real output and a slowdown in the rate of
inflation (Chart 1). Civilian employment rose sharply and the number of
persons unemployed declined. Both real wages and corporate profits increased. Some progress was made on the international front, but it was
greatly overshadowed by developments in the domestic economy.
Last year's economic performance brought with it significant changes in
public attitudes about inflation and in expectations about the course of the
economy. Although hopes were high in early 1972 that the shift in policy
would bring favorable results, uncertainties persisted regarding both the
strength of the economic expansion and the effectiveness of price and wage
controls. These doubts began to abate gradually as evidence grew that
rates of wage and price inflation were indeed declining compared to the
period prior to August 1971. Workers' cooperation in the wage control system was fostered by the realization that real wages were increasing. Strike
activity fell and relative to total time worked was at its lowest point in
almost 10 years. Although increases in food prices were troublesome during
most of 1972, consumers could see a slower rise in the overall cost of living.
Finally, although selling prices were constrained, so were costs, and business
was able to enjoy some rise in profit margins in a setting of rapidly rising
volume. These developments were all parts of a process that was one of the
major objectives of the price-wage control system—the unwinding of inflationary expectations.
Nor was the change in attitudes confined to inflation alone. The rise in
production and employment that became particularly evident by midyear
created a growing mood of confidence among businessmen and consumers,
and this in turn helped to bolster private investment and personal consumption expenditures.
The fact that considerable progress was made during 1972 did not mean
that final goals had been reached. The unemployment rate in December
1972, although down by nearly 1 percentage point from a year earlier, was
still higher than desirable. At the same time, the rate of inflation at the end
17
Chart 1
Changes in GNP, Real GNP, and Price Deflator
PERCENT CHANGE FROM PRECEDING YEAR
REAL GNP
1968
1969
1970
SOURCE: DEPARTMENT OF COMMERCE.
18
1971
1972
of 1972, although lower than it had been before the controls, was still
higher than the ambitious target set by the Administration. The balance of
payments still showed a considerable deficit, and although work on international monetary reform was underway it had only begun. Nonetheless
by the end of 1972 there was a strong sense of optimism about the progress
that had been achieved and the ability to find answers to some of the problems that remained.
DEMAND AND OUTPUT
Last year's expansion in demand and its division between real output and
prices exceeded most expectations held at the start of 1972. The $102 billion
increase in gross national product (GNP) from 1971 to 1972 was close to
the figure projected by the Council, but the 6.5-percent rise in real GNP
was higher than projected, while the 3.0-percent rise in prices was a little
lower. Real growth was the largest and the price rise as measured by the
GNP deflator the smallest since 1966.
All major sectors of demand, except for net exports, contributed to the
rise in overall GNP (Table 1). The very large increase in gross private
domestic investment, the step-up in Federal purchases in the first half of the
year, and the large increase in consumer spending were the principal stimulating forces in the economy. The continued buoyancy of housing demand and
the strength of consumption in the face of overwithholding of personal income taxes were noteworthy developments in 1972.
The policy measures initiated in August 1971 changed both the character
and the pace of the recovery that began at the end of 1970. In its first full
year it was weaker than in comparable periods of past cyclical upswings.
Indeed, that was one of the main reasons for the shift in policy. After the
pronounced acceleration that occurred during 1972 the current expansion
compares very favorably with previous upswings, when changes are taken
from the preceding peak to the eighth quarter after the trough (Chart 2).
BUSINESS FIXED INVESTMENT
Business fixed investment showed considerable strength in 1972—much
more than the Council of Economic Advisers and most forecasters had
anticipated at the start of the year. The comprehensive measure included in
the national income accounts (NIA)—nonresidential fixed investment—
rose 14 percent. The real increase of 10 percent was confined to equipment,
since on this basis nonresidential construction was unchanged. Investment
was bolstered by the general incentives provided by the liberalized depreciation regulations, the job development credit, and the excise tax cuts on
motor vehicles. The strong upsurge in the economy in 1972, the rise in profits
and cash flow, and the ready availability of funds at lower interest rates
than in 1971 also benefited investment. However, last year's buoyant economy and favorable financial setting had their main impact on decisions and
19
T A B L E 1.—Changes in gross national product in current and constant dollars, 1968 to
Component
1968
to
1969
1969
to
1970
1970
to
1971
1972
1971
to
19721
CURRENT DOLLARS
Percent change:
Total GNP...
10.3
10.3
10.9
8.5
5.0
6.4
-.3
-1.3
.8
2.5
-4.3
5.2
.0
10.3
-'.6
Personal consumption expenditures.
Durable goods
7.6
8.1
8.0
Gross private domestic investment...
Fixed investment
Business fixed investment..
Residential structures
Government purchases
Federal purchases
State and local purchases.
7.6
9.7
7.8
14.4
8.5
12.4
10.9
12.2
4.8
36.4
18.6
17.5
13.8
26.5
4.3
-2.3
10.2
6.3
1.3
10.2
9.5
8.3
10.3
-2.9
1.7
-1.3
-2.9
2.2
-4.8
2.7
3.9
10.8
4.4
6.0
-1.0
30.5
Change in billions of dollars:
Inventory accumulation
Net exports of goods and services..
CONSTANT (1958) DOLLARS
Percent change:
Total GNP
2.7
6.5
Personal consumption expenditures.
Durable goods
3.6
5.3
Gross private domestic investment...
Fixed investment
Business fixed investment...
Residential structures
5.0
5.1
6.0
2.2
-.5
1.7
-2.9
-5.9
-3.8
-3.1
-5.9
-1.2
-5.9
4.0
-4.7
-12.0
2.6
-1.0
-6.0
3.4
3.9
1.3
5.9
.3
-.8
-2.6
2.0
-1.5
-2.1
1.9
-1.9
Government purchases
Federal purchases
State and local purchases.
5.9
11.9
14.0
12.7
9.8
20.3
Change in billions of dollars:
Inventory accumulation
Net exports of goods and services..
1
Preliminary.
Source: Department of Commerce, Bureau of Economic Analysis.
commitments to invest. Because of the lag between the investment decision
and actual investment, a large portion of this impact will manifest itself in
rising outlays in 1973.
At the start of the year the main reason for expecting that the rise in
investment in 1972 would be moderate was the relatively low rate of capacity
utilization, especially in manufacturing. In this sector, investment did not
increase very much. After a 6-percent drop in the preceding year, dollar
outlays were up only 4 percent in 1972, or about as much as the rise in
capital goods prices. The recent behavior of manufacturing investment has
been more or less typical of past business cycles. In the early 1960's, for
example, manufacturing investment did not strengthen to any significant
degree until 1964, the third year of the recovery.
Most of the increase in investment outlays in 1972 was concentrated in
the nonmanufacturing sector, where increases by electric and gas utilities,
communications firms, and the airlines were especially large. In many of
the nonmanufacturing industries investment tends to be rather independent
20
Chart 2
Recovery Comparisons of Real GNP
and Civilian Employment
PERCENT OF PRECEDING PEAK
114
REAL GNP
1954-56
1958-60
96
TROUGH
IUO
CIVILIAN EMPLOYMENT
—
106
1954-56
104 102
_
1970-72
^ x
100
98
^ ^ 0 ^ ^ ^ .
\
1961-63
_^t£^'^
1958-60
-
1
TROUGH
QUARTERS AFTER TROUGH
NOTE: PEAK AND TROUGH QUARTERS, AS DESIGNATED BY THE NATIONAL BUREAU OF ECONOMIC
RESEARCH, ARE: PEAKS, 1948 IV, 1953 I I , 1957 I I I , 1960 I I , AND 1969 IV; TROUGHS, 1949 IV 1954 III
1958 I I , 1961 I, AND 1970 1V.
SOURCES: DEPARTMENT OF COMMERCE AND DEPARTMENT OF LABOR (EXCEPT AS NOTED).
21
of the short-run cyclical behavior of the economy. Also, investment by
farmers was up very sharply as a result of rising farm income, and business purchases of items affected by the excise tax cut—such as trucks—rose
substantially.
Investment plans and forward commitments were much stronger than
actual investment spending during 1972. This showed up in many ways.
In November, new orders received by producers of capital goods were 23
percent above the year-earlier figure, and construction contracts for commercial and industrial buildings were up by 20 percent. In manufacturing,
the 19-percent rise in new appropriations for future spending and the 23percent rise in the total value of new investment projects started in the first
3 quarters of 1972 were far greater than the small increase in actual outlays
from 1971 to 1972.
HOUSING
Almost 2.4 million private housing units were started last year, a rise of
approximately one-sixth over the 1971 total. Shipments of mobile homes
also rose considerably. The 1972 housing performance exceeded the Council's
projection of 2.2 million units, which itself was at the high end of the range of
housing forecasts for 1972. Total outlays for residential construction rose by
more than one-fourth to nearly $54 billion.
The rise in starts reflected exceptionally strong demand for housing and
favorable conditions for an increase in mortgage credit. In the single-family
housing market, sales were at a peak, vacancy rates were low, and pressures
on home prices were strong. The demand for apartment units was also high,
although vacancy rates in rental units edged up for the second year in a row.
Last year's rise in housing starts occurred in spite of a decrease in starts
under federally assisted home programs. Some 318,000 private housing units
were started in 1972 under federally subsidized programs, or 13^4 percent
of the total. This compares with 408,000 units, or 20 percent, of total starts in
1971 and 400,000 units, or 28 percent, of total starts in 1970.
Conditions in mortgage markets were extremely favorable for home construction and purchasing in 1972, but the primary driving force was a strong
underlying demand for shelter. Part of this strength was a legacy of
earlier years. The level of new housing construction was relatively
low in the 1960's, particularly in the second half of the decade, when credit
conditions were generally unfavorable for housing. Once credit conditions
began to improve, as they did in 1970, much of the unsatisfied backlog of
demand reasserted itself. At the same time the pace of new household formation has been rising rapidly. New household formation totaled about
1.9 million in 1971 and 1.5 million in 1970 as compared to an average of
1.1 million in the preceding 5 years. Despite the fact that starts rose to new
records in the last 2 years, housing vacancies are still low in relation to those
of the past 15 years (Table 2).
22
TABLE 2.—Annual vacancy rates for rental and homeowner housing, 1956-72
Vacancy rate (percent)1
Year
Total
1956
1957
Homeowner
Rental
2.7
2.4
2.9
3.0
5.5
5.1
5.9
6.4
0.9
.9
1.1
1.1
1960
I96L.
1962.,
1963
1964
3.4
3.6
3.5
3.5
3.5
7.4
7.9
7.4
7.5
7.5
1.2
1.3
1.3
1.4
1.4
1965
1966
1967
1968
1969
3.5
3.3
2.9
2.5
2.3
7.5
7.0
6.2
5.4
5.0
1.4
1.3
1.2
1.0
.9
2.3
2.4
2.4
4.9
5.1
5.2
1.0
.9
.9
1959
. .
.
. .
1970.
1971
1972 *
i Excludes dilapidated units.
> Estimates by Council of Economic Advisers.
Source: Department of Commerce, Bureau-of the Census (except as noted).
CONSUMER SPENDING
Consumer spending increased by over $56 billion- in 1972. The nominal
increase of 8J4 percent and the real increase of 6 percent were among the
largest recorded in the past 20 years. The general improvement in the economy, rising employment and income, and the slowdown in both inflation
and inflationary expectations all affected the consumer's ability and willingness to spend. Consumers made extensive use of credit to finance their
purchases, particularly of durable goods.
The boom in residential housing brought with it the largest gains in spending on furniture and appliances since 1964. The lower level of automobile
prices in 1972, as a result of the 1971 excise tax cut, was partly responsible
for dealers' sales of 10.9 million new cars. Almost all of the 7-percent rise
over 1971 was accounted for by domestic-type cars.
Underlying last year's buoyant consumer demand was a rise in personal
income of 8.6 percent, well above average for the preceding decade. In 1970
and 1971, when the economy was sluggish, rising transfer payments accounted for a significant share of the income increase. In contrast, most of
the 1972 rise in income reflected larger earned income. But the outstanding
feature of consumer behavior in 1972 was the strength in consumer spending, despite the overwithholding of personal income taxes that began at the
start of the year. Because of overwithholding, the 6.8 percent rise in disposable (after-tax) income was roughly 1 percentage point less than the rise
otherwise associated with an 81/2 -percent rise in personal incomes. Apparently in 1972 consumers largely ignored the temporary effects of overwithholding. In any case, most of the rise in the proportion of personal income
23
going to higher taxes was compensated for by a reduction in the proportion
of income devoted to saving. As Table 3 shows, the ratio of personal outlays
to income was little changed from 1971. The table also shows that the share
of income devoted to personal outlays last year continued relatively low
compared to the 1960's.
TABLE 3.—Personal outlays•, taxes, and saving as percent of personal income, 1960-72
[Percent]
Year
1960-72 average
1960
1961
1962.
1963
1964
.
Personal
income
.
.
1965
1966
1967
1968
1969
1970
1971
19721
.
.
.
Personal
outlays
Personal
taxes
Personal
saving
100.0
80.7
13.6
5.7
100.0
100.0
100.0
100.0
100.0
83.1
82.4
82.2
82.6
82.8
12.7
12.6
13.0
13.1
11.9
4.2
5.1
4.9
4.3
5.3
100.0
100.0
100.0
100.0
100.0
82.5
81.6
80.4
80.0
79.4
12.2
12.8
13.2
14.2
15.5
5.3
5.5
6.4
5.8
5.1
100.0
100.0
100.0
78.7
79.3
79.1
14.5
13.6
15.0
6.8
7.1
5.9
i Preliminary.
Note.—Detail may not add to totals because of rounding.
Source: Department of Commerce, Bureau of Economic Analysis.
THE LABOR MARKET
Two forces dominated the labor market in 1972. First, there was
a large expansion in opportunities for civilian employment. According to
the household survey, civilian employment increased by more than half a
million jobs in each quarter of the year, and for 1972 as a whole there
were 2.3 million more people at work than in 1971. This was the largest
year-to-year percentage change since 1955. At the same time, the civilian
labor force expanded sharply, and not until the middle of the year were
the large employment gains accompanied by noticeable reductions in
unemployment.
THE LABOR FORCE
The year 1972 witnessed a large influx into the civilian labor force, which
expanded by 2.1 million relative to 1971 (Table 4). One factor contributing to this increase was a reduction in the size of the Armed Forces,
which fell by about 400,000 and enlarged the pool of persons available for
civilian work. Returning veterans have a very high propensity to join the
civilian labor force—participation rates for recent veterans averaged more
than 90 percent over the past few years—so that a shift in the size of the
Armed Forces by itself will change the overall civilian participation rate.
However, in 1971, when the size of the Armed Forces also fell by 400,000,
the civilian participation rate dipped. The difference between the 2 years
lies in the increased labor force participation of other groups, notably
women and teenagers.
24
TABLE 4.—Changes in the working-age population, Armed Forces, and labor Jorce, 1962 to 1972
Change (millions of persons, 16 years and over)
Group
1962
to
1965
average
1965
to
1968
average
1968
to
1970
average
1970
to
1971
1971
to
1972 1
Noninstitutional population
2.1
2.1
2.3
2.4
Total labor force
1.2
1.7
1.8
1.0
1.7
.3
1.4
-.2
2.0
-.4
1.4
-.4
2.1
.2
.1
.2
.1
.3
.4
.1
.3
.3
.3
.1
.3
.6
.1
.2
.5
.2
-.1
.2
.3
.1
.5
.4
.6
-.1
Armed Forces
Civilian labor force
Both sexes 16-19 years
Men 20-24 years
Men 25-54 years
Men 55 years and over
Women 20-24 years
Women 25-54 years...
Women 55 years and over..
.3
.2
i
.3
.2
2.4
!6
0
i Data for 1972 have been adjusted for comparability with data for 1971.
»Decrease of less than 50,000.
Increase of less than 50,000.
3
Note.—Detail may not add to totals because of rounding.
Source: Department of Labor, Bureau of Labor Statistics.
Chart 3 shows trends in the participation rates of the major age and sex
groups in the civilian labor force. For a number of groups, participation
rates, which had leveled off or declined in 1971, rose in 1972 as the recovery
strengthened. The tendency for women in the 20-24-year age bracket
to enter the labor force had grown steadily throughout the 1960's and into
1970 as more young wives chose either to delay the start of a family in favor
of working or to continue working even after starting a family; the participation rate for this group leveled off in 1971 but resumed its longer-run
growth in 1972. A similar pattern was evident for women in the 25-54-year
age bracket. Participation rates of teenagers, which had risen sharply in
the last half of the 1960's and 1970, dipped in 1971 but rose again in 1972.
The participation rates for young men in the 20-24-year age group have
been particularly affected by changes in the size of the Armed Forces.
Civilian labor force participation for this group had been declining since
the mid-1960's as more and more young men were absorbed into the Armed
Forces and others continued their schooling through the college level. The
participation rates declined through 1968 and, after remaining about level
through 1971, rose in 1972.
Finally, participation rates of men in the prime working-age group (2554) and of all persons 55 or older fell again in 1972. The spread of private
pension plans, the liberalization of both private and public pension plans,
and the improvement in disability benefits are important reasons for the
decreasing trend in participation rates of these groups.
EMPLOYMENT GAINS IN 1972
From the fourth quarter of 1971 to the fourth quarter of 1972, real
output rose 7.7 percent, creating exceptionally strong demands for labor.
25
Chart 3
Civilian Labor Force Participation Rates
RATE (PERCENT)!/
100
M E N 2 5 - 5 4 YEARS
90
80
ALL CIVILIANS
60
50
40
•
/
'
^
3 0 1/M
•
-
\
/
\
WOMEN 25-54 YEARS
I 1 i
1950
I
I
I I I
1955
BOTH SEXES 55 YEARS AND OVER
I
1 1 i
I960
l
i
I
1 l i
1965
1 / CIVILIAN LABOR FORCE AS PERCENT OF CIVILIAN NONINSTITUTIONAL POPULATION
IN GROUP SPECIFIED.
SOURCE: DEPARTMENT OF LABOR.
26
I
i
I I I N
1970
Employment expanded sharply according to both of the major employment measures, the household survey and the payroll survey. According to
the latter survey, 2.7 million more persons were at work in nonagricultural
establishments in the fourth quarter of 1972 than in the corresponding
quarter a year earlier (Table 5).
The goods-producing sector, whose employment declined in the first
year of the recovery, made a strong advance in 1972. The sharpest turnaround was in durable goods manufacturing, where employment expanded
in each of the past 5 quarters, following 2 years of contraction. These
strong gains notwithstanding, manufacturing employment in the fourth
quarter of 1972 was still 4 percent below its level at the business cycle peak
in the fourth quarter of 1969, largely because of the reduced level of defenserelated manufacturing. In the private sector, manufacturing and mining
were the only industry divisions for which employment was below levels prevailing in the fourth quarter of 1969.
Employment in the service-producing industries, which had continued
to rise during the recession and in 1971 but at less than the trend rate of
increase, moved up strongly in 1972. State and local governments added
almost 500,000 employees to their payrolls. Although the major part of this
gain is attributable to the increased demand for local government services,
the 1972 rise was augmented by employment financed by the Federal Public
Employment Program. The only service category for which employment
fell over the 4-quarter period was the Federal Government; here, the
decline that began in 1969 continued.
TABLE
5.—Change in the number of employees on nonf arm payrolls, 1969IV to 1972IV
[Seasonally adjusted]
Change (thousands of persons)
Industry group
Total
Goods producing industries...
Mining
Construction
Manufacturing
Durable goods
Nondurable goods...
Service producing industries..
Transportation and public
utilities
Wholesale and retail trade.
Finance, insurance, and
real estate
Services
Federal Government
State and local government....
1971 IV
to
1972 IV
-771
983
2,698
684
743
428
843
-1,612
-53
865
185
260
70
350
-98
-1,514
-73
123
-103
55
27
783
62
23
100
-11
16
255
-1
2
69
5
-14
359
-1,258
-256
-37
-66
633
150
70
30
193
62
87
-18
283
76
841
1,036
1,833
499
483
358
493
-4
103
- 362
54
133
601
46
154
27
177
-4
123
64
147
94
297
-69
129
280
131
502
-28
29
110
37
142
-12
27
131
-37
38
119
16
419
316
493
155
110
119
109
o
1
Preliminary.
Note.—Changes are based on quarterly averages.
Detail may not add to totals because of rounding.
Source: Department of Labor, Bureau of Labor Statistics.
27
1971 IV
to
1972 1
1972 1
to
1972 II
1972 II
to
1972 III
1972 III
to
1972 IV i
1970 IV
to
1971 IV
1969 IV
to
1970 IV
The underlying strength in the labor market is confirmed by recent trends
in the labor turnover data. In manufacturing, the rate of new hires (the
number of new workers hired per 100 employees) had drifted down from
3.8 in the first quarter of 1969 to 2.4 in the first quarter of 1971. Since that
low point the pace of new hires has increased steadily, reaching an average
of 3.7 in October and November of 1972. The quit rate in manufacturing has
also increased recently, indicating that many workers are finding better job
prospects. Correspondingly, layoffs have decreased sharply—from an average of 1.8 per 100 workers in 1970 to half that rate in October and November, the lowest rates since the Korean war. A further indication of the
expansion of employment opportunities is the recent upturn in job vacancies
in manufacturing. The number of unfilled jobs in manufacturing, while still
low in relation to 1969, has increased by nearly 70 percent since the end
of 1971.
The increases in payroll employment were accompanied by gains in hours
worked. Average weekly hours of production workers in manufacturing rose
from 40.1 in the fourth quarter of 1971 to 40.9 in the fourth quarter of 1972,
the highest level since late 1968. For the entire nonfarm sector, where the
average workweek has followed a pronounced downward long-term trend,
average weekly hours lengthened slightly in 1972.
UNEMPLOYMENT
Although unemployment responded relatively slowly to the large output
and employment gains of 1972, there were unmistakable signs of progress.
In the fourth quarter, the number of unemployed adjusted for seasonality
averaged 4.6 million persons, down from the 5.0-million average of 1971
and the first half of 1972. The overall unemployment rate, which had hovered around 6 percent throughout 1971, began moving down in 1972 and
by December had reached 5.1 percent.
Partly because of the upsurge in durable goods output, the improvement
in the unemployment picture over the past 4 quarters was more marked for
adult males than for adult females (Table 6). The unemployment rate for
married men fell to 2.6 percent in the fourth quarter and to 2.4 percent by
December. Although the latter was above the very low rates of the late
1960's, it was less than in any other period since early 1957. The unemployment rate for household heads also declined in 1972, but not so markedly as
the rate for married men. Unemployment among teenagers reached an alltime high in the first quarter of 1972 but has since receded somewhat.
The unemployment rate for nonwhite workers declined over 1972, but
not so rapidly as did the rate for whites. However, the changes in the overall
rates by race obscure widely divergent changes in unemployment for the
different age and sex groups. There were sizable employment gains for
nonwhite adult males, whose unemployment rate declined from 7.9 percent
in the fourth quarter of 1971 to 6.1 percent a year later. This decline
was much larger, both absolutely and relatively, than the decrease from
3.9 percent to 3.3 percent experienced by white adult males. The widening
28
in the gap between white and nonwhite unemployment rates on an
overall basis was apparently attributable to differences in the behavior of
unemployment among teenagers.
TABLE 6.—Selected unemployment rates, 1970 IV-1972 IV
[Percent; seasonally adjusted1]
1972
Selected groups of workers
1970 IV
1971 IV
II
1
All workers?
5.8
Sex and age:
Both sexes 16-19 yearsa
Men 20 years and over2
.
20-24 years
25 years and over
Women 20 years and over2
20-24 years
25 years and over -
17.2
4.2
10.5
3.4
5.5
8.7
Race:
White
Negro and other races
Occupation:
White-collar workers
Blue-collar workers
Service workers
Reason for unemployment*:
Lost last job
Left last job
Reentered labor force
Never worked before
5.8
17.0
17.8
10.3
10.0
4.4
3.5
5.7
9.4
4.1
5.6
5.7
15.8
3.2
5.4
9.1
4.1
9.5
3.3
5.6
9.6
16.1
3.9
8.9
3.0
5.5
9.7
5.3
15.6
3.6
8.6
2.8
5.2
9.1
4.8
4.9
4.5
4.7
4.6
4.4
5.4
9.2
5.4
10.1
5.3
10.6
5.3
9.9
5.0
9.9
4.7
9.8
3.4
3.5
3.5
3.4
3.4
3.3
6.0
6.4
6.2
6.0
6.7
6.3
3.5
3.2
3.6
3.2
3.4
2.9
3.5
2.9
3.3
2.7
3.1
2.6
8.4
4.3
8.4
4.2
8.7
3.5
8.5
3.6
8.5
3.5
8.5
3.2
2.8
.7
1.6
2.7
.7
1.7
.8
2.5
.7
1.8
.9
2.5
.7
1.6
.9
2.5
.7
1.7
.7
2.2
.8
1.6
7.5
Other categories:
Household heads
Married men .
Full-time workers . .
Part-time workers
State insured workers 3
5.9
IV
III
5.4
. .
7.4
5.6
7.0
5.4
6.6
5.3
6.3
5.1
5.8
4.8
1
Unemployment as percent of civilian labor force in group specified unless otherwise indicated.
Reflects revisions for 1971-72. See Note, Appendix Tables C-24-26.
3 Insured unemployment under State programs as percent of average covered employment.
* Unemployment as percent of total civilian labor force.
2
Source: Department of Labor, Bureau of Labor Statistics.
Last year witnessed a decisive improvement in the labor market status
of recent veterans. The unemployment rate for Vietnam-era veterans
in the 20-29-year-old age group, which had averaged 8.8 percent in 1971,
declined to 6.1 percent in the final quarter of the year. Moreover, the unemployment rate decline for veterans was faster than for nonveterans in the
20-29 age group, so that by yearend the veteran unemployment rate was
actually below the nonveteran rate, after remaining persistently above it
for the past several years. A number of forces explain these developments.
They reflect the general improvement in economic conditions as well as
specific Government policies directed toward aiding the labor market adjustments of veterans. The stabilization of the size of the Armed Forces
during the course of the year also helped, since it reduced the flow of discharged veterans from 100,000 per month at the start of the year to about
50,000 toward yearend. Moreover, the average age of the Vietnam-era veteran has been rising, and there is a strong inverse relationship between age
and unemployment for veterans and nonveterans alike.
http://fraser.stlouisfed.org/
490-000 O - 73 - 3
Federal Reserve Bank of St. Louis
29
There was also considerable improvement in the distribution of unemployment along geographic lines. This is most readily apparent in the Labor
Department's monthly classification of the unemployment situation in 150
labor market areas. From the end of 1971 to the end of 1972, the number
of areas with "low" unemployment (less than 3.0 percent) almost trebled—
from 6 to 17 areas. Areas with "moderate" unemployment (from 3.0 to 5.9
percent) increased from 84 to 88. On the other hand, there was a sharp
reduction—from 60 to 45—in the number of areas classified in the "substantial" unemployment categories, i.e., 6.0 percent or more.
PRICES AND COSTS
In the period since the August 1971 policies were instituted there has
been a dramatic deceleration in the rate of inflation. This is discussed in
detail in Chapter 2; here we focus mainly on price measures applicable to
the GNP. For example, the implicit price deflator for GNP, which measures the change in prices of all goods and services included in the gross
national product, rose at a rate of 5.2 percent per year in the 3 years ending
in the second quarter of 1971, the last full quarter before the policy shift. Over
the next 6 quarters, the annual rate of increase was down to 2.7 percent.
The GNP deflator is the only measure of price that is consistent with
real GNP; the product of the two equals GNP in current dollars. However,
changes in the deflator reflect shifts in the composition of real GNP as well as
changes in individual prices. Changes in the composition of GNP in 1972
had a downward effect on the rate of inflation as measured by the general
GNP deflator. This compositional effect is eliminated by the Commerce
Department through the construction of an index of GNP prices with fixed
base period weights—the general type of construction used for the consumer
price index (CPI) and wholesale price index (WPI).
On the basis of a GNP price index that uses fixed 1967 weights, the rate of
price increase experienced over the past 6 quarters is 3.6 percent rather than
2.7 percent. Even so, this represents a marked improvement relative to the
period prior to August 1971 (Table 7). For some analytical purposes it is
useful to focus on the private sector, which excludes Government workers
and their pay raises. For the private sector of the economy, the fixed-weight
deflator shows an inflation rate of just over 3 percent since the second quarter of 1971, as against an average increase of 4.7 percent over the 3 preceding years.
Although the rate of inflation slowed last year in most broad sectors of
the economy, farm prices were one important exception. The sharp
rise in farm prices had a significant effect on the overall rate of inflation. If attention is confined to private nonfarm business, as shown in the
last column of Table 7, the deceleration of the price rise is clearly more pronounced than it is for the GNP deflator as a whole or even the private
deflator. In the private nonfarm sector inflation declined from a rate of
30
4.6 percent in the 1968-71 period to 1.7 percent over the past year and a
half.
TABLE 7.—Changes in gross national product price deflators, 1968 II to 1972 IV
[Percent change; seasonally adjusted annual rates]
GNP
Private
nonfarm
business
GNP
Private GNP
Period
Implicit
deflator
1968
1969
1970
1971
II
II
II
II
1971
1971
1971
1972
1972
1972
II to 1971 III
III to 1971 IV
IV to 1972 1
1 to 1972 II
II to 1972 III
III to 1972 IV 1
1
to
to
to
to
1969
1970
1971
1972
II
II
II
IV i
1967
weights
Implicit
deflator
1967
weights
Implicit
deflator
4.7
5.6
5.2
2.7
4.7
5.8
5.2
3.6
4.4
4.8
4.8
2.4
4.5
5.1
4.7
3.1
4.2
4.9
4.7
1.7
2.9
1.5
5.1
1.8
2.4
2.7
3.5
2.5
6.1
3.0
3.1
3.4
2.8
1.0
4.2
1.7
2.2
2.7
3.5
1.7
4.5
2.5
2.9
3.3
2.4
.0
3.6
1.2
1.2
2.1
Preliminary.
Stiurce: Department of Commerce, Bureau of Economic Analysis.
COMPENSATION, PRODUCTIVITY, AND COSTS
The slowing of price inflation in the private nonfarm economy reflects a
marked deceleration in the rise in unit costs. For labor costs, this was a
result of two factors: a slower rise in hourly compensation and an acceleration of the rise in output per man-hour (Chart 4).
Compensation
Although fiscal and monetary policies moved the economy away from
the conditions of excess demand that persisted into 1969, hourly compensation continued to rise at rates of 7j^ percent or more per annum in early 1971
(Table 8). These large increases occurred not only in the face of generally
slack labor market conditions, but in spite of two associated factors that tend
to reduce the rise in average hourly compensation during such periods.
During an economic slowdown, increases in average hourly compensation
(which includes premium payments for overtime hours) are normally dampened because the proportion of overtime hours usually falls. A second factor is
the changed composition of employment. Some of the relatively highly paid
industries, like durable goods manufacturing, are those most affected by an
economic slowdown, and this restrains the average increase in hourly compensation for the economy as a whole.
Since the second quarter of 1971, just before the start of the stabilization
program, the rise in hourly compensation for all persons in the private nonfarm sector has slowed to an annual rate of about 6 percent. In terms of
quarter-to-quarter changes, the 90-day wage-price freeze restrained the
increase in the fourth quarter of 1971. The sharp step-up in the first quarter
31
Chart 4
Changes in Compensation,
Productivity, Labor Costs, and Prices
Private Nonfarm Sector
PERCENT CHANGE FROM PRECEDING YEAR
COMPENSATION PER MAN-HOUR
8
6
OUTPUT PER MAN-HOUR
4
2
V////1
0
-2
1965
1966
1967
1968
NOTE: DATA RELATE TO ALL PERSONS.
SOURCE: DEPARTMENT OF LABOR.
32
1969
1970
1971
1972
of 1972, when hourly compensation rose at about a 9-percent rate, reflected the bulge after the end of the freeze and the increase in social security
taxes. This was followed by a very small increase of 4.6 percent during the
second quarter. The apparent step-up during the final 2 quarters of 1972
may be more a reflection of the timing of wage increases—which has undoubtedly been affected by the controls program—than of an underlying
acceleration of wage inflation. Over the last 3 quarters of 1972, hourly compensation rose at an average annual rate of 6 percent, which would seem
to be a fair representation of post-bulge experience.
TABLE 8.—Changes in hourly compensation, private nonfarm sector, 1967-72
[Seasonally adjusted annual rates]
Period
Percent
change from
previous
quarter
Period
Percent
change from
previous
quarter
1967: 1
II . .
Ill
IV
4.3
6.3
6.3
5.4
1970: 1
II .
III
IV
6.5
7.2
9.0
4.6
1968: 1
9.9
62
7.4
8.8
1971- 1
11
III
IV . .
9.1
7.5
5.2
4.9
5.7
6.9
6.5
8.8
1972- 1
II
III
IV i .
9.1
4.6
6.1
7.4
III
IV . .
1969: 1
III . .
IV . . .
» Preliminary.
Note.—Data relate to all persons.
Source: Department of Labor, Bureau of Labor Statistics.
Productivity
Changes in productivity (which is usually measured in terms of real output per hour of work) show cyclical movements around an upward trend.
Longer-term growth in productivity reflects such basic developments as the
rising educational attainment and skill levels of the work force as well as
changes in the quantity and quality of the tools, equipment, and organization with which they work. The short-run variability in productivity is
highly influenced by changes in the industry mix of output and in production
rates. Some of the work force in each unit, such as skilled maintenance personnel, represent relatively fixed overhead inputs, in the sense that they
must be kept on even when the level of production declines. Also, if the
period of slack production is expected to be brief, employers may refrain
from laying off workers. While these adjustments hold down increases in
output per man-hour of paid labor during periods of slack, they also help
to explain why increased output can be had with a substantially less than
proportionate rise in labor inputs during the subsequent recovery phase.
The behavior of productivity during the recovery from the t970 recession
falls neatly into two separate phases, each of which is different from earlier
experiences at comparable stages of expansion. The basis for this disparity
33
appears to be related to the different pattern of ouput growth in this expansion as compared to earlier ones.
Reflecting the slow growth in real output, the rise in productivity during
the first 3 quarters of 1971 was clearly below the experience in previous
recoveries (Table 9 ) . Indeed, the rise was even weaker than the measures in Table 9 show. This is so because productivity in the final
quarter of 1970 was depressed by the lengthy strike at General Motors.
Ifj as seems reasonable, a more representative value of output per man-hour
during the trough quarter was the average of the final quarter of 1970
and the first quarter of 1971—when there was a very substantial amount
of makeup production from the strike—then the growth of productivity
over the first 3 quarters of 1971 was closer to 3 percent than to the 4.4
percent shown in the table. The lower figure is about half the average
growth rate of productivity in the preceding four recoveries.
With the acceleration in the rise of real output since late 1971, productivity has grown very strongly. Starting in late 1971 and throughout 1972,
productivity growth has been much more pronounced than that experienced
during corresponding phases of previous recoveries.
Unit Labor Costs
Because compensation per man-hour and output per man-hour during
the recent slowdown and current recovery have behaved differently from
past cyclical experience, unit labor costs have also traced an unusual pattern
of change (Table 9). In past recoveries, labor costs per unit of output began
T A B L E 9.—Changes in unit labor costs, productivity, and compensation per man-hour in recessions
and expansions, private nonfarm economy
[Seasonally adjusted annual rates]
Peak and trough quarters *
Peak to
trough
Trough
to third
quarter
after trough
Third to
eighth
quarter
after trough
Compensation per man-hour:
1948
1953
1957
1960
1969
IV, 1949 IV
I I , 1954 III
111,1958 11
I I , 1961 1
IV, 1970 IV
0.4
3.3
3.3
1.7
6.8
8.3
3.4
5.1
5.0
7.2
8.6
5.7
4.2
3.7
2 6.4
3.1
2.4
1.7
.0
1.6
9.2
5.1
4.7
7.0
4.4
2.2
-.6
1.4
3.4
2 5.2
-2.6
.8
1.6
1.7
5.2
-.8
1.6
.3
-1.9
2.7
6.3
6.4
2.8
.3
21.2
Productivity a :
1948
1953
1957
1960
1969
IV, 1949 IV
11,1954 111
I I I , 1958 II
I I , 1961 1
IV, 1970 IV
Unit labor costs:
1948 IV, 1949 IV
1953 I I , 1954 III
1957 111,1958 II
196011,1961 1
1969 IV, 1970 IV
* Peak and trough quarters are those designated as cyclical turning points by the National Bureau of Economic Research.
2
Preliminary.
3 Output per man-hour.
Note.—Data relate to all persons.
Source: Department of Labor, Bureau of Labor Statistics (except as noted).
34
to decline around the trough quarter. In contrast, during the early stages
of the recovery from the 1970 recession, the rise in unit labor costs, although
down from earlier rates, remained high. However, because of the acceleration in productivity growth since the third quarter of 1971, and the slowdown in compensation increases, unit labor costs have increased little. During the comparable phase of previous expansions, unit labor costs have
usually risen substantially relative to their behavior during the early recovery phase.
NONFINANCIAL CORPORATIONS
A comprehensive set of figures on output, prices, and costs is available for
the important nonfinancial corporate sector. These data provide a convenient accounting framework for a detailed discussion of prices, costs, and
profits.
In general the behavior of costs and prices in the corporate sector is not
very different from that of the broader private nonfarm sector just reviewed.
From the third quarter of 1971 to the third quarter of 1972, the rate of inflation for nonfinancial corporations slowed to 1.3 percent from the rate of
approximately 4 percent experienced in the 2 preceding years (Table 10).
Over the same period, the rise in unit labor costs, which had already started
to abate the year before, fell to an annual rate of less than 1 percent—a joint
reflection of both a stepping up in the rise in productivity to 5.0 percent per
10.—Changes in prices, costs, and profits per unit of output for nonfinancial corporations,
1967 III to 1972 III
TABLE
1967 III
to
1968 III
1968 III
to
1969 III
1969 III
to
1970 III
1970 III
to
1971 III
_
0.029
0.030
0.044
0.048
0.016
Employee compensation.
Other costs
.020
.008
.038
.016
.045
.022
.022
.017
.008
.001
.001
.005
.002
.007
.004
.005
.008
.008
.006
.010
.006
.001
.003
-.001
-.001
.002
-.024
-.022
.007
.008
2.6
2.6
3.8
4.0
1.3
2.8
5.2
5.9
2.7
1.0
7.3
4.4
7.2
1.8
7.9
2.0
6.8
4.0
5.8
5.0
3.4
6.7
8.6
6.1
.3
Item
1971 I
to
1972 I
Dollar change per unit of output:
Price
Capital consumption allowances.
Indirect business taxes 1
Net interest
Profits 2
Percent change per unit of output:
Price
Employee compensation...
Compensation per man-hour.
Output per man-hour
_.
Other costs.
Capital consumption allowances.
Indirect business taxes i
Net interest
.9
5.0
8.7
6.4
3.8
20.0
6.9
7.3
20.0
8.1
5.1
2.8
2.2
-.8
-2.7
Profits 2
1.2
-14.4
-15.4
5.8
6.3
Percent change in output.
7.0
4.4
-1.4
1.8
9.2
1
Also includes business transfer payments less subsidies.
Before taxes and including inventory valuation adjustment.
Note.—Detail may not add to totals because of rounding.
Sources: Department of Commerce, Bureau of Economic Analysis, and Department of Labor, Bureau of Labor Statistics.
2
35
annum and a slowdown in the rise of hourly compensation to 5.8 percent
per annum. The rise in hourly compensation in 1972 was the smallest yearto-year rise experienced since 1967 and the rise in productivity the highest
since 1965.
All other unit costs combined, which include capital consumption charges,
indirect taxes, and interest, were essentially unchanged from the third quarter of 1971 to the corresponding quarter of 1972. Lower interest costs and
indirect business taxes per unit of output offset an increase in capital consumption costs per unit. Since the percentage increases in aggregate dollar
costs of each of these categories over the past year were about the same
as in the preceding year, the improved behavior in costs per unit was essentially a reflection of the acceleration of the rise in output. Had the liberalized
depreciation regulations not been in effect, capital consumption costs per
unit would have been virtually unchanged during the year instead of rising
2 percent. Profits before taxes would have been correspondingly higher.
It is also interesting to note that the recent decline in interest costs per unit
of output followed a modest increase in the preceding year and dramatic
increases in 1969 and 1970, when interest rates were at their peaks.
Profits per unit of output rose 6.3 percent (before tax and including the
inventory valuation adjustment) over the past year. The most recent rise
followed a 5.8-percent increase the year before and a net decrease of nearly
30 percent over the preceding 2 years. The peak for profits per unit of
output was reached in the fourth quarter of 1965; almost 7 years later
they were still some 25 percent lower.
Rising profit margins and increased physical volume raised total beforetax profits of nonfinancial corporations by 14 percent from 1971 to 1972.
Even so, the rise in corporate profits in the most recent expansion has not
been large compared to experience in previous recoveries. As Table 11
shows, the rise in profits relative to the rise in corporate output (for the
nonfinancial corporate sector) has been smaller over the first 7 quarters
TABLE 11.—Changes in gross product and profits before taxes of nonfinancial corporations 7
quarters after trough and ratio of changes
Change 7 quarters after trough
(billions of dollars)
Trough *
Gross
product
1949 1V „
1954 III
..
____
.
1958 II
19611
19701V
.
.
.
.
13.4
38.7
7.0
18.1
47.7
13.5
28.3
42.3
11.4
27.0
94.7
19.1
20.2
Source: Department of Commerce, Bureau of Economic Analysis (except as noted).
36
29.5
45.5
1 Quarters designated as trough by the National Bureau of Economic Research.
2 Before taxes and including inventory valuation adjustment.
Profits»
Change in
profits as
percent of
change In
gross product
of the present recovery than during corresponding periods of earlier recoveries in all but one instance. Furthermore, the rise in profits in the present
expansion is itself biased upward because profits in the fourth quarter of
1970 (the trough from which the expansion is measured) were depressed
by the General Motors strike.
Profit Shares
Because profits rose more and employee compensation rose a bit less than
the 10-percent overall rise in the gross product of nonfinancial corporations,
the share of profits rose from 10.2 percent in 1971 to 10.6 percent in 1972,
while the share of employee compensation fell from 66.4 to 66.2 percent
(Table 12). A similar shift, which is typical during cyclical upturns, occurred between 1970 and 1971. However, in 1970 the profit share of
TABLE 12.—Distribution of gross product originating in nonfinancial corporations, 1947—72
[Percent1]
All other costs
Period
1947.
1948 .
1949
...
....
Total
Compensation of
employees
Total
Capital
consumption
allowances
Indirect
business
taxes 2
Profits a
Net
interest
100.0
100.0
100.0
65.9
63.9
63.8
14.8
14.5
16.1
4.8
5.0
5.9
9.3
8.8
9.5
0.7
.7
.8
19.4
21.6
20.1
1950
1951
1952
1953
1954
100.0
100 0
100.0
100.0
100.0
62.4
63 1
64.8
65.9
65.9
15.5
15 1
16.1
16.6
17.6
5.7
58
6.2
6.6
7.7
9.2
87
9.2
9.3
9.1
.6
6
.7
.7
.8
22.1
21 7
19.1
17.4
16.6
1955
1956
1957
1958
1959
100.0
100.0
100.0
100.0
100.0
63.9
65.3
65.6
65.9
64.7
17.5
17.7
18.6
19.9
19.1
7.9
8.0
8.4
9.1
8.7
8.9
9.0
9.3
9.7
9.3
.7
.7
.9
1.1
1.0
18.6
16.9
15.8
14.2
16.2
100.0
100.0
100.0
100.0
100.0
65.5
65.1
64.3
63.9
63.3
19.7
20.4
20.8
20.9
20.8
8.9
9.2
9.7
9.7
9.5
9.7
9.9
9.8
9.8
9.8
1.1
1.3
1.4
1.4
1.5
14.8
14.5
14.9
15.2
16.0
100 0
100.0
100.0
100 0
100.0
62 6
63.2
64.0
64 2
65.7
20 4
20.0
20.9
21 2
21.8
94
9.3
9.7
97
9.9
95
8.9
9.1
93
9.3
16
1.8
2.1
2.2
2.5
17 0
16.8
15.1
14.7
12.5
1970
1971
1972*
100.0
100.0
100.0
67.2
66.4
66.2
23.0
23.4
23.2
10.3
10.6
10.7
9.7
9.9
9.6
2.9
2.9
2.9
9.8
10.2
10.6
1971:1
II
III..
IV
.
100.0
100 0
100.0
100.0
66.5
66 4
66.3
66.4
23.2
23 1
23.5
23.7
10.3
10 4
10.6
10.8
9.9
98
9.9
10.0
2.9
29
3.0
3.0
10.3
10.5
10.2
9.9
1972-1
II .
III - -
100.0
100 0
100.0
66.4
66 2
66.1
23.2
23 3
23.2
10.7
10 9
10.7
9.7
96
9.6
2.9
2.9
2.9
10.3
10.5
10.7
. .
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
. .
1
2
3
Quarterly percents based on seasonally adjusted data.
Also includes business transfer payments less subsidies.
Before taxes and including inventory valuation adjustment.
* Preliminary.
Note.—Detail may not add to totals because of rounding.
Source: Department of Commerce, Bureau of Economic Analysis.
37
corporate output was at its postwar low and the compensation share at its
postwar high. The relative shift that has occurred over the past 2 years in
favor of profits still leaves the profit share lower and the employee compensation share higher than in any postwar year before 1970.
Long-range comparisons of the profits share, including those just
cited, suffer from the fact that over the years depreciation laws and
regulations have undergone many changes that affect the calculation of
profits. This shortcoming can be overcome through the use of uniform
methods of calculating depreciation over time, so that the resultant estimates of profits are not affected by changes in depreciation practices.
The Commerce Department has made such calculations, and the results
are shown in the second column of Table 13. The adjustment raises the
profits share for most of the periods (it is lowered for the 1950-54 period),
but in terms of changes over long periods the picture shown by the unadjusted
numbers (column 1 of Table 13) is not altered in any significant way. Comparisons should properly be made only between periods in comparable stages
of the business cycle; but even if one focuses on a year like 1968, when
economic activity was high and unemployment was very low, it is clear that
the profits share has declined in comparison with earlier periods (Chart 5).
A final adjustment should take account of interest, which is part of the
total return on capital and which has grown in importance over the postWorld War II period, as corporations have placed greater reliance on debt
as opposed to equity financing and as interest rates have risen more rapidly
than the price of corporate output. The share of interest plus adjusted
profits in gross corporate output has also declined over the long run, but that
decline has been milder than for adjusted profits alone.
TABLE 13.—Profits before adjustment, adjusted profits, and interest as shares of gross product of
nonfinancial corporations, 1950—72
[Percent]
Period
Profits before
adjustment
Adjusted
profits i
Interest
Adjusted
profits plus
interest
1950-54 average..
1955-59 average..
1960-64 average..
1965-69 average..
19.4
16.3
15.1
15.2
18.4
16.6
15.6
15.5
0.7
.9
1.3
2.0
19.1
17.5
16.9
17.5
1968...
1969...
1970...
1971...
1972 2..
14.7
12.5
9.8
10.2
10.6
14.9
12.8
10.0
10.5
Ml.O
2.2
2.5
2.9
2.9
2.9
17.1
15.3
12.9
13.4
13.9
1 Based on uniform method of calculating depreciation: historical cost valuation of assets, double declining balance*
and service lives equal to 85 percent of those shown in Treasury Bulletin F.
2 Preliminary.
3 Estimate by Council of Economic Advisers.
Note.—All profits are before taxes and include inventory valuation adjustment.
Profits in this table exclude those on residential properties owned by nonfinancial corporations and therefore differ
from those shown in Table 12.
Source: Department of Commerce, Bureau of Economic Analysis (except as noted).
38
Chart 5
Shares of Profits and Interest in Gross Product
of Nonfinancial Corporations
PERCENT OF GROSS PRODUCT
24
22
—
ADJUSTED PROFITS
PROFITS BEFORE ADJUSTMENT
1 Z \
20
18
" X A.
\\ /f\\
1
\
- - • •
^v
16
\
/
-
12
-
10
-
X^v
—
••--X
\
' /
\V/\v
14
Q
PLUS INTEREST
-<y\
ADJUSTED PROFITS-!/
S
l
i
•K
-
i
1950
i
i
1955
1960
i i
i
1965
I i i T
1970
J / S E E TABLE 13 FOR DEFINITION.
NOTE: A L L PROFITS ARE BEFORE TAXES AND INCLUDE INVENTORY VALUATION ADJUSTMENT.
SOURCE: DEPARTMENT OF COMMERCE.
FARM PRICES AND RURAL INCOMES
Rising domestic and export demand and reduced supplies as a result of
lower net farm production brought sharply higher prices and incomes to
rural families in 1972. Prices received by farmers rose 18 percent from
December 1971 to December 1972.
International events had a significant effect on prices. Reduced food
production in three major countries—Russia, China, and India—expanded
the demand for food grains from U.S. farms. The expansion in demand
brought a quick response in prices of farm commodities, as is typical of
products with a relatively inelastic demand and a very inelastic short-run
production. Because the United States was the only major food-exporting nation with large carryover supplies of wheat and other grains, this country
was in a very favorable position to expand its exports of farm commodities
in 1972. The volume of farm exports increased nearly 14 percent, and
exports of food commodities advanced 17.5 percent.
Changes in domestic economic conditions also improved farm incomes
last year. As nonfarm employment and income rose, demand for income
39
elastic food items strengthened, causing a strain on the available supply
of beef, pork, and certain dairy products. The result was rising farm and
retail prices. Even the removal of restraints on meat imports and the resulting increase in imports of lean meat left domestic meat prices at alltime record levels. Only in the autumn did red meat prices show some
moderation, mainly because of expanded marketings of beef animals and
diversion of purchases to other meats for the holiday periods.
While demand was expanding in 1972, overall net farm output including
food and nonfood commodities remained quite static. Indeed domestic production of food commodities actually dropped 2.2 percent below the previous year, according to preliminary estimates. Unseasonable weather and
storms hit several parts of the country at critical times and cut back fruit
and vegetable production sharply. Pork output reached a low phase in the
production cycle, and beef production rose less than anticipated, partly
because favorable prices caused more stock to be retained for expansion
of herds.
While family income in the nonfarm sector was also rising substantially,
the agricultural gains were so large that farm families improved their relative
position. Net farm income reached $19 billion for the year, up $3 billion, or
18 percent, from 1971 and well above the previous all-time high of $17.1
billion earned in 1947. With only half as many families on farms today as
there were 25 years ago, income per family is much higher.
Along with the sharp improvement in farm income in 1972, rural families
also benefited from the expansion of the general economy. For a large proportion of farm families, the increase in employment and the rise in nonfarm
wages were more important than the change in farm prices, since over half
of all farm families earn the greater part of their income from nonfarm
sources. Most of these farm operations are small, grossing less than $5,000
a year from farm sales. In fact, over 85 percent of the annual income among
this group is earned off the farm, and income improvements from farm
prices or Government farm programs thus directly affect only about 15
percent of their income. This situation is not limited, however, to only the
smallest farms. Even the operators of the largest farms, those classified as
having sales over $40,000, earn about one-fifth of their total income from
off-farm sources.
FISCAL POLICY IN 1972
Fiscal policy was deliberately expansionary in 1972. The stimulus came
from rising expenditures and from the effect of tax reductions instituted in
1971 and 1972. On a national income accounts basis, full-employment
revenues in calendar 1971 exceeded full-employment expenditures by
$1 billion. The corresponding figure for calendar 1972 was a full-employment deficit of $4 billion—a swing of some $5 billion. These estimates understate the size of the swing and of the stimulus provided by fiscal
policy, because 1972 receipts include about $9 billion in overwithheld per
40
sonal income taxes. As discussed below, consumer behavior is probably less
sensitive to the temporary cash effects of overwithholding than it is to a
more permanent change in income. If Federal receipts from overwithholding are entirely excluded, the estimated full-employment deficit in 1972
is $13 billion—a swing of $14 billion from the position in 1971. On net
balance, the stimulus from budget policy in 1972 was somewhere between
$5 billion and $14 billion and probably closer to the higher end of this range.
The policy shift set forth in August 1971 assigned little importance to increased Government spending as such. On the contrary, the program envisaged some cutbacks in Federal employment and a postponement of a Government pay raise. It sought instead to stimulate private spending through
tax incentives for investment, repeal of the excise tax on motor vehicles, and
an acceleration of the scheduled date for personal income tax reductions.
As originally proposed in its two-tier form, the job development tax credit
was expected to have a large and immediate impact on capital goods demand
and output. The excise tax cut was expected to stimulate demand for and
production of motor vehicles. These tax measures, along with the anticipated
change in public sentiment resulting from the policy shift, strengthened the
sluggish recovery that was underway. Industrial production rose after August and the rate of growth in real GNP accelerated in the fourth quarter.
However, the unemployment rate, which had risen to 6 percent around
the beginning of 1971, stayed at that level with only minor variation until the
end of the year. Consequently, in presenting its plans for fiscal 1973 the
Administration indicated that it would take additional steps to stimulate
the economy by raising the level of expenditures during the remaining half
of fiscal 1972. At the same time, the Administration emphasized its intention to restrain the growth in expenditures starting in fiscal 1973. The
Administration's position was that the total stimulus provided would be
sufficient to accelerate the recovery, but that further stimulus might threaten
the anti-inflation program.
FEDERAL EXPENDITURES
According to the budget data presented in January 1972, total expenditures (NIA basis) were projected to rise by $29 billion or 13 percent from
calendar 1971 to calendar 1972, a sharp advance by historical standards.
Actual expenditures rose by 12 percent (Table 14).
Included in this projected rise was an increase of $9 billion in Federal
purchases, which embraced a scheduled $5.2 billion pay increase for military
and civilian personnel and a step-up in real purchases. The latter was an
extension of a turnaround that had begun in the second half of 1971, following the prolonged and steep decline in defense purchases associated with the
process of disengagement in Vietnam. Actual 1972 purchases fell a bit short,
basically in the second half.
In addition to the planned increase in purchases, the budget called for a
rise of one-sixth in other types of outlays. This rise included $5.2 billion for
revenue sharing, and provision for a 5-percent increase and some liberaliza
41
tion of social security benefits at an estimated annual cost of $3^4 billion
starting in the third quarter of 1972. Because revenue sharing legislation was
delayed, the actual transfer of 1972 grant funds was later scheduled to take
place in two instalments payable in December 1972 and in January 1973.
In addition Congress altered the Administration's social security proposal
by providing a 20-percent increase starting in the fourth quarter of 1972 at
an estimated annual cost of $8 billion.
TABLE 14.—Federal Government receipts and expenditures, national income accounts basis, calendar
years, 1971-72
(Billions of dollars]
1972
Receipts and expenditures categories
1971
January 1972
budget
projection i
Federal Government receipts.
Personal tax and nontax payments
Corporate profits tax accruals
Indirect business tax and nontax accruals.
Contributions for social insurance
Federal Government expenditures..
Purchases of goods and services.
Defense
Other
Transfer payments
_
Grants-in-aid to State and local governments
_.
Net interest paid..
Subsidies less current surplus of government enterprises.
199.1
215.6
228.3
89.6
33.1
20.5
55.9
94.1
36.1
20.5
65.1
108.8
36.0
20.1
63.3
220.8
249.5
246.8
97.8
71.4
26.3
107.1
75.9
31.1
105.9
76.2
29.7
75.0
29.3
13.6
5.2
82.8
39.8
13.3
7.0
83.5
37.7
13.6
6.1
-21.7
Surplus or deficit (—) on income and product accounts
Actual *
-33.9
-18.5
1
January 1972 projected percent changes applied to revised 1971 actual data.
Preliminary.
Note.—Detail may not add to totals because of rounding.
Sources: Department of Commerce, Bureau of Economic Analysis, and Office of Management and Budget.
2
FEDERAL RECEIPTS
Budget changes on the revenue side in last January's budget presentation
reflected the tax proposals of August 1971, as extended and modified by the
Congress, as well as proposals made before August 1971. In addition, the
Administration proposed that the social security taxable earnings base be
raised from $9,000 to $10,200, to take effect at the start of 1972. This increase
was subsequently amended and deferred to 1973 by congressional action
taken in October.
Planned tax reductions affecting revenues in 1972 included some features
already mentioned: the job development tax credit, the repeal of the excise
tax on motor vehicles, and an advance in the effective date of the rise (to
$750) in personal exemptions. Other revenue reductions included a retroactive rise in personal exemptions from $650 to $675, applicable to 1971
incomes, an increase in the minimum standard deduction to $1,300 per
return, and a 1-year speedup in the effective date of a scheduled rise in the
standard deduction from 14 to 15 percent. Revenue-increasing features
42
included a rise from earlier legislation in the taxable social security wage
base from $7,800 to $9,000, the proposed further rise to $10,200, and the
elimination of certain features of the revised depreciation regulations.
The estimated net effect of the proposed tax changes, in themselves, was
to reduce calendar year 1972 revenues by about $4 billion relative to 1971
in NIA terms. Although on this basis tax increases and tax reductions for
individuals appeared to be approximately offsetting, on balance these proposed changes provided some net fiscal stimulus in calendar 1972. Under
the NIA procedures that are used to seasonally adjust contributions for
social insurance, increases in receipts from a rise in the taxable earnings
base begin at the full annual rate in the first quarter, even though the required additional taxes are ordinarily not paid until the second half of the
year.
With these proposed tax changes providing a partial offset to the rise in
revenues expected from the rise in economic activity and incomes,
Federal receipts were expected to show a fairly steady increase during
calendar 1972 and to total $215/ 2 billion. In fact, receipts turned out to be
some $12/ 2 billion higher than anticipated. Part of this difference reflected
a faster rise in tax accruals than had been foreseen for 1972, but the
greater portion derived from the fact that personal income tax receipts
were considerably in excess of projections because of the overwithholding
that began early in 1972.
The origin of overwithholding goes back to 1971, when families with
more than one source of wage and salary income had withholdings that
fell short of their liabilities. The withholding tax table for 1972 was particularly designed to correct the 1971 experience for such families and was
generally meant to allow all taxpayers to bring their withheld taxes closer to
their liabilities. However, under these schedules single individuals and families with only one source of wage or salary income had to claim additional
exemptions if they were to avoid overwithholding. For the most part, singleincome families did not take advantage of the option to adjust their withheld taxes downward. Withholdings have consequently been running considerably in excess of liabilities and will result in substantial refunds in 1973.
How the effect of overwithholding should be treated for purposes of
analysis depends on a prior view of how it affects consumer spending.
According to one view, known as the permanent-income hypothesis, consumer spending is governed largely by consumers' views of their permanent or
longer-run incomes; temporary aberrations in income do not alter spending
significantly. Consequently, overwithholding and the subsequent associated
refunds should not have a large effect on the pattern of consumer spending.
In this view, which has some support on the basis of consumer behavior in
1972, most of the effect of overwithholding and of the subsequent refunds
should be excluded—from the calculation of the full-employment surplus or
deficit, for example—for purposes of analysis. According to another view
43
most consumers govern their spending according to the income immediately
available to them, regardless of whether the income is permanent or temporary. Clearly, a definitive answer must await an examination of how
consumers behave in 1973 after they receive refunds on last year's overwithholding.
THE REQUEST FOR A SPENDING CEILING
The increase in outlays in 1972, especially in the first half of the year,
served the purpose of stimulating the economy: by midyear the expansion,
as expected, had developed a strong momentum of its own. For the period
after mid-1972, the emphasis of budget policy has been on restraining the
growth in expenditures. In June, the Administration requested Congress
to impose a statutory ceiling of $246 billion on unified budget outlays for
fiscal 1973—an amount equal to the original spending total proposed last
January.
The shift of 1972 revenue sharing payments to late calendar year 1972 and
early 1973, and the large increase in social security benefits late in 1972, had a
relatively small effect on the level of spending budgeted for calendar 1972.
However, both changes raised the level of expenditures for fiscal 1973 significantly above the amount originally proposed.
Anticipation of these developments heightened concern about not only
the level and growth of Federal spending but the potential danger to the
anti-inflationary program and the orderliness of the economic expansion.
In September, the Administration repeated its request for a statutory
ceiling on fiscal 1973 outlays, this time at the $250 billion level. Although
both the House and Senate voted favorably on the ceiling—in bills of different form—final congressional approval was not obtained.
STATE AND LOCAL GOVERNMENTS
State and local government purchases rose by 10 percent from 1971 to
1972, a rise somewhat below that projected by the Council at the start of the
year. The shortfall was partly due to the delay in revenue sharing; but this
factor should not be overstressed, because the relation between Federal grants
and State and local spending is neither direct nor immediate. Initially, at
least, increased Federal grants appear as increases in State and local
surpluses.
The $5.2 billion revenue sharing bill, originally scheduled for the first
quarter of 1972, was passed in October. The first payment for 1972 was
made retroactively in December, when a half-year's instalment of $2.62
billion (recorded in the national income accounts at an annual rate of $10.5
billion in the fourth quarter) was mailed out to States and localities.
The remaining half-year instalment was mailed in January 1973. In April
1973 the payments are scheduled to revert to an annual rate of $6.0 billion payable quarterly.
The beginning of revenue sharing in the fourth quarter has increased the
level of Federal grants and the likelihood that State and local governments
44
will continue to run large surpluses for a time in NIA terms. With the level
of Federal grants now increased by the advent of revenue sharing and with
the growing importance of State and local government spending, the behavior of the revenues and expenditures of State and local governments
assumes much greater importance in the assessment of the effects of Federal
fiscal policy.
FINANCIAL POLICY AND FINANCIAL MARKETS
Although the financial requirements of last year's expansion were considerable, they were generally accommodated in a satisfactory fashion. The
large demand for funds was accompanied by remarkably mild increases in
short-term interest rates. Long-term rates on balance actually declined. The
money supply expanded by 8.2 percent over the year (December to December) , clearly less than the expansion of 10.9 percent in nominal GNP. Housing and mortgage markets enjoyed a record year with a reduced need for
Federal assistance.
MONETARY POLICY
Federal Reserve goals in 1972 were "sustainable real economic growth
and increased employment, abatement of inflationary pressures, and attainment of reasonable equilibrium in the country's balance of payments."
Throughout the year Federal Reserve efforts were directed toward establishing financial market conditions conducive to these goals.
Monetary expansion in the fourth quarter of 1971 had been unusually
slow: the seasonally adjusted annual rate of growth (measured from the
final month of the third quarter to the final month of the fourth quarter)
was 1.1 percent. The rate was low historically and below the Federal Reserve's target rate. As a result of this shortfall and the requirements of the ongoing economic expansion, the Federal Reserve moved to increase the rate
of monetary growth in the first quarter of 1972. To help achieve this objective the System acted to ease credit market conditions. At the same time,
in the execution of policy it gave increased emphasis to the growth in bank
reserves by means of a new reserve concept: reserves available to support
private nonbank deposits (RPD's). The adoption of this additional target
for daily operations was taken partly because of the difficulty the System
had experienced in 1971 in controlling the monetary growth rate by influencing the Federal funds rate. While the monetary growth rate remained
the intermediate target for policy, day-to-day operations were carried out
in terms of an RPD guide range as well as money market conditions.
In the first quarter of 1972 the rate of growth in the narrowly defined
money stock rose to 9.6 percent per annum. Since this was a somewhat faster
rate than the Federal Reserve had expected, operating policy sought to
restrain monetary growth and to allow market interest rates to rise.
This posture was maintained through the summer and early autumn; the
490-000 O - 73 - 4
45
target for the rise in RPD's was gradually reduced from a range of 9 to 13 percent for March-April to a 3- to 7-percent range for July-August.
In the third quarter, the continuation of strong economic expansion increased the quantity of money demanded and pressed the cost of credit
upward. Since excessive monetary accommodation would have had serious
implications for future inflation, the Federal Reserve sought only "moderate" growth in the monetary aggregates. For the third quarter, RPD's rose
at a 10.3-percent rate, while the monetary growth rate increased to 8.7 percent from 5.4 percent in the second. Short-term market interest rates rose
gradually, as indicated by the increase in the Federal funds rate from an
average of 4.46 percent in June to 4.87 percent in September.
Late in the third quarter and early in the fourth, a policy of somewhat
more restraint was adopted, but the conduct of monetary policy was complicated in the fourth quarter by changes in Federal Reserve Regulations
D and J. These changes restructured reserve requirements according to bank
size and speeded the payment of checks. Both shifts radically altered the
volume of reserves which banks desired and accumulated, and monetary
policy necessarily proceeded cautiously to allow the banking system to adjust to the new regulations without influencing monetary aggregates or
financial markets. Short rates rose further during the quarter, with the rate
for Federal funds increasing to 5.33 percent in December. Nevertheless the
rate of monetary growth accelerated.
One of the advantages of the shift in policy emphasis to an RPD target is
that this procedure improves control over the monetary growth rate and
protects the economy against fluctuations that might take place if only an
interest rate target is used. Although other considerations also affected the
formulation of policy in 1972, the adoption of the new procedures appears
to have had a stabilizing effect on monetary growth. While the money stock
grew by 8.2 percent from December 1971 to December 1972—up from 6.2
percent in 1971 and 5.4 percent in 1970—its behavior was smoother during
1972 than in the 2 preceding years. For example, the quarterly growth rate
ranged from 5.4 to 9.6 percent in 1972 as compared to a range of 1.1 to 11.0
percent in 1971.
Although the monetary growth rate over the course of 1972 was lower
than the corresponding rise in real GNP, it was still the second highest of
the post-World War II period. As is usually the case, assets which are close
substitutes for money grew even faster than the money stock during 1972.
Regular time deposits at banks rose by 13 percent during the year, while
accounts of nonbank thrift institutions increased by 17 percent. Large
negotiable bank certificates of deposits rose by 31 percent for the year. As
in 1971, the rates paid by thrift institutions on deposits were higher relative
to open market rates than was the case in 1969 and 1970, and this was a
factor contributing to heavy deposit inflows.
46
INTEREST RATES
A notable financial development in 1972 was the relatively stable behavior
of interest rates. Long-term interest rates followed a generally downward
course for the year and short-term rates rose moderately, even though many
observers had anticipated that both rates would increase sharply in response
to the credit requirements of a strong economic expansion (Chart 6). The
unusually wide spread between short- and long-term rates that prevailed at
the beginning of 1972 narrowed in the course of the year but remained
historically large at yearend.
Short-term market interest rates declined in January and February and
followed a generally upward path for the remainder of the year, the rise
being interrupted by temporary declines in May and August. Commercial
banks' prime rates, which are generally closely related to market rates, also
rose over the year. The upward pressure on short-term rates reflected the
underlying growth of the economy as a whole and the increasing demands
made on credit markets to support the expansion. The increase in shortterm rates was considerably milder, however, than increases experienced at
the same stage of past economic upturns.
Long-term market rates declined on balance over 1972. They rose through
April but thereafter fluctuated below April peaks on a generally downward
trend. The declining trend of long-term rates at the same time that shortterm rates rose was an interesting feature of 1972. While short and long
rates can move in opposite directions (if, for example, there is a sharp
change in expectations about levels of future interest rates) historically short
and long rates have tended to move in the same direction. Several forces
produced this divergence in 1972.
First, at least two factors probably led investors to be less desirous of holding funds in highly liquid forms: increasing certainty about the strength of
the economic expansion in 1972, and less uncertainty about the effects of
controls on wages and prices.
Second, foreign central banks slowed the pace at which they bought shortterm Treasury securities with the dollars accumulated through their balanceof-payments surpluses. This reduction resulted from both a slowing of the
dollar outflow from the United States and a shift in preferences of foreign
official institutions toward obligations with longer maturities, especially
after it became clear that the flow of dollars back into the United States
following the Smithsonian Agreement in December 1971 was smaller than
had been expected earlier.
Third, the downward revision of expectations of future inflation seems
to have extended to longer horizons in 1972, causing estimates of long rates
to be lowered. (See Chapter 2.) In addition, the levels of real interest rates
expected in the future may have been reduced as it became evident that the
rise in actual rates in 1972 was much milder than had been widely
anticipated.
47
Chart 6
Interest Rates
PERCENT PER ANNUM
12
SHORT-TERM
FEDERAL FUNDS
10
PRIME BANK RATE
3-MONTH TREASURY BILLS
(New Issues)
\
0 11 ii 11111111111111 i 11111111111 I n 1111111111 ii 11 il 1111111111 il 1111 1111111
1967
1968
1969
1970
1971
1972
12
LONG-TERM
10
NEW HOME MORTGAGES
(FHLBB)
CORPORATE Aaa BONDS
HIGH-GRADE MUNICIPAL BONDS
U.S. GOVERNMENT BONDS
0 I i 111 11 i i l l 11 11 1 1 i l 1 1 11 11 i l i i 11 i i i I 1 1 1 1 I i l 11 I I 11 I I n 1111 I I I i l l I I I I 11 1 1 1 1
1967
1968
1969
1970
1971
1972
SOURCES: TREASURY DEPARTMENT, BOARD OF GOVERNORS OF THE FEDERAL
RESERVE SYSTEM, FEDERAL HOME LOAN BANK BOARD, MOODY'S INVESTORS
SERVICE, AND STANDARD & POOR'S CORPORATION.
48
Mortgage Interest Rates
Mortgage interest rates, which had followed a downward trend in late
1971, continued to decline in early 1972. They reached their lows for the
year in April and moved up slightly thereafter, even though other long rates
continued to edge down. The increases in mortgage rates have been small:
from April to November, the contract rate on conventional mortgages for
new homes rose from 7.38 to 7.50 percent, still below the 7.68-percent level
of October 1971 and well below the rates that prevailed for all of 1970.
Assistance to Mortgage Markets
The mortgage and housing markets in 1972 enjoyed a prosperous year
with considerably less support from Federal agencies than in previous years.
There was less upward pressure on all interest rates than in past years.
Partly as a consequence of this, there was a strong inflow of funds to financial
intermediaries, particularly savings and loan associations and mutual savings
banks. As in 1971, these institutions, which lend the bulk of their funds on
residential mortgages, added to their mortgage holdings on a larger scale
than in previous years.
The program of the Government National Mortgage Association
(GNMA) for reducing discounts on federally insured mortgage loans—the
"tandem plan"—was largely dormant during the year because the decline in market rates lowered those discounts to support levels. However, GNMA continued to develop and expand its 3-year-old mortgage-backed securities program, which is designed to attract new funds for
housing finance by increasing the ability of residential borrowers to compete
in the general capital market. The issuance of GNMA securities increased
to $3.6 billion in 1972, as compared to $3.0 billion in 1971.
The Federal National Mortgage Association (FNMA) was also a steady
purchaser of FHA- and VA-insured mortgages over the year, although on
a smaller scale than in 1970 and 1971. For 1972, FNMA's net acquisition of
mortgages was $2.0 billion, compared with $4.4 and $2.4 billion in 1970 and
1971, respectively. The Federal Home Loan Mortgage Corporation purchased $1.3 billion in conventional and insured mortgages as against $0.8
billion in 1971.
The Federal Home Loan Bank Board also took a number of steps toward
strengthening the ability of savings and loan associations to compete for
funds as a means of increasing the flow of funds into the mortgage market.
These steps included: (1) An increase from $30,000 to $36,000 in the
maximum loan limit on 95-percent conventional loans of Federal associations, (2) an increase from 5 to 10 percent in the fraction of total loans
that Federal associations can hold in the form of mobile home loans, and
(3) approval of the issuance of subordinated debt instruments of 7 years
or longer maturity by savings and loan associations as a new source of funds.
It also proposed regulations for variable rate mortgages for federally chartered associations.
49
FOURTH QUARTER DEVELOPMENTS
The year 1972 ended with considerable forward momentum in economic
activity. According to preliminary fourth quarter data, GNP rose by $32
billion, or at a seasonally adjusted annual rate of 11J/2 percent. The rise in
real terms was 85/2 percent, and the price rise as measured by the GNP
deflator 2% percent. Judging from monthly indicators such as industrial
production, the course of output was strongly upward through the quarter.
All major components, except for Federal purchases of goods and services, contributed to the large fourth-quarter rise in demand. Consumer
spending was exceptionally strong, rising by $17^2 billion. Underlying the
strength of consumer demand was a sharp rise in payrolls, which reflected
rising employment and a longer workweek, notably in the manufacturing
sector. In addition, the increase in earned income was supplemented by
the enlarged payments of social security benefits that had begun in October.
Total retail sales in December were 115/2 percent above the level of
December 1971. Fixed investment also rose substantially in the final quarter,
and it appeared that businessmen were stepping up their rate of inventory
accumulation in order to accommodate the increased volume of sales.
Civilian employment rose by 525,000 during the quarter to a total of 82.8
million in December, about 3 percent above the level of a year earlier. The
unemployment rate declined to 5.1 percent in December, compared to a rate
of 6.0 percent in December 1971. All major age and sex groups were affected
by the decline in unemployment, but the reduction was especially marked for
adult males in the prime working-age bracket.
Price performance was mixed. From September to December the CPI
rose at a seasonally adjusted annual rate of 3.2 percent, or 2.5 percent excluding food. The WPI showed an extraordinary increase (9.6 percent
annual rate) because of sharp rises in farm and food prices; in contrast,
the rise in wholesale industrial prices was only 2 percent. The pronounced
increases in farm and food prices, which posed a serious threat to the entire
stabilization program, led to new policy initiatives at the start of 1973.
50
CHAPTER 2
Inflation Control Under the Economic
Stabilization Act
Public Law 92-210, the Economic Stabilization Act Amendments
of 1971, requires that the Economic Report of the President include a
section "describing the actions taken under this title during the preceding
year and giving his assessment of the progress attained in achieving the
purposes of this title." This chapter and the supplement included in
Appendix A of this Report are intended to fulfill that requirement.
There is, however, no intent to represent the description of the control
regulations contained herein as legally binding interpretations.
T
HE UNITED STATES has had general price and wage controls
before, during both World War II and the Korean war. But 1972
marked the first full year in American history that comprehensive wage
and price controls were in effect when the economy was not dominated by
war or its immediate aftermath. Judged by any expectations one could
derive from history, either in the United States or abroad, the system was
successful. Nevertheless, by the end of the year it was plain that although
continuing controls could make a further contribution to economic stabilization, the system would have to be modified. As the year ended the Administration was developing a revision of the system that would make its operation
more effective and at the same time lay the groundwork for its termination.
THE SITUATION IN AUGUST 1971
To understand what is meant by the "success" of the controls one must
go back to the conditions which existed in the summer of 1971. By then
the rate of inflation had declined from its 1969 peak, and output and
employment were expanding. Neither the decline in the inflation rate
nor the expansion of the economy had been as marked as people had hoped
for or as the Administration had forecast. A more rapid expansion and a
further slowdown of inflation in the months ahead were high on the list
of the Nation's goals.
51
The true probabilities for the future behavior of the economy—as distinguished from what people thought might happen—were not known. However there were several reasons why the rate of inflation might still continue
to decline after August 1971. First, prices and wages would be responding,
with a lag, to the slowdown in the economy that had occurred earlier. Second, the prospective recovery of the economy, even according to an optimistic view of its pace, would still leave the economy in a situation of excess
capacity rather than excess demand throughout 1972. Third, more rapid
recovery would accelerate the rise of productivity and hold down the rise
of unit costs.
On the other hand, there were reasons why the inflation rate, which had
been declining since 1969, might not only stop falling but might accelerate.
For one thing, the decline might already have ended. The Economic Report
of 1972 summarized the evidence of the price indexes at mid-1971:
(1) Most of the indexes show a peak rate of increase at some time
in 1969; (2) most of the indexes show a trough at some time in 1970;
(3) in the second quarter of 1971, the last full quarter before the freeze,
we find that the rate of increase is above the trough in all instances
but below the peak in all but one instance—wholesale industrial prices.
That, of course, is a serious exception. Although it does not negate
the improvement shown in the other indexes, the exception was important enough and the other improvements small enough to leave uncertainty about the future decline of inflation.*
By August 1971 the recovery of the economy was in its ninth month.
At that point in earlier recoveries the rate of inflation had begun to accelerate, rather than continue to decelerate. This might have happened again
after August 1971: inflationary expectations and the effort of some workers
to catch up with the cost of living and with the wage increases of other
workers had not been eliminated during the period of economic slowdown.
Such price-raising forces might have been suppressed only to break out
again when the pressure of deficient demand was relaxed. Indeed, as workers
and businessmen became more aware of the continued expansion, especially
expansion produced by Government action, their belief that rapid inflation
was inevitable would be reinforced and might even tend to generate the
feared result.
Although the feared acceleration of inflation was associated with the
prospect of economic expansion, it should be clear that the price rises
then envisaged for the period ahead would not be the direct result of excess
demand. The price and wage increases would not be equilibrating in the
sense that they would be necessary to raise output into balance with demand
and attract workers. Firms would have been willing to produce more at
existing prices, and workers would have been willing to supply their labor
at existing wages, if they could not raise them. But both groups preferred
"^Revision of seasonal factors since the above was written has slightly altered the
wholesale industrial price pattern so that it is now consistent with the other indexes.
52
raising wages and prices, because others had been doing so and because, with
expansion underway, they anticipated that their production costs or living
costs would be rising and that the market would absorb their products or
labor at higher prices or wages. How probable this more pessimistic scenario
was could not be known, but it was not a negligible possibility.
Moreover, even if the more pessimistic outcome was actually unlikely,
there was widespread fear of it, and this fact was itself important. Anxiety
about inflation among consumers was believed to be holding back a revival
of consumer spending. Long-term interest rates had been rising in the spring
and summer of 1971; this may have been a sign of renewed inflationary
expectations. An opinion common in the financial community was that stimulative actions by the Government would intensify the fear of inflation, cause
a more rapid increase of interest rates, and finally hurt rather than help the
economic expansion. Also, the idea that the American inflation was endless
and uncontrollable was undermining confidence in the U.S. dollar and
aggravating the balance-of-payments problem. These fears inhibited the
Government from taking steps to expand the economy.
In this situation then, the purposes of the controls were threefold:
1. To reduce the risk that the rate of inflation would rise again and to
increase the probability of further decline;
2. To reduce the fear that the rate of inflation would rise or not decline
further; and thus,
3. To strengthen forces for expansion in the private economy and free
the Government to follow a more expansive policy.
The controls were to be used to help achieve these goals subject to the
conditions that they:
1. Should not interfere with the expansion of the economy. For example,
they should not discourage private investment.
2. Should not impair the rise of productivity by reducing incentives to
hold down costs or by precipitating strikes.
3. Should be fair in the sense that they should not adversely affect some
groups or individuals and favor others.
4. Should not impose heavy administrative costs either on the Government or on private citizens.
5. Should not create or perpetuate a situation in which termination of
the controls would be highly disruptive.
The controls were part of a larger program, which had the twin objectives of economic expansion and inflation reduction. The broader program
included a fiscal and monetary policy which would initially be strongly
expansive but would become less so as the economy reached higher levels
and as the danger of excess demand became greater. One of the major
concerns of the Administration when it instituted controls was that the
country would come to rely on the controls and feel relieved of the necessity
to exercise restraint in Federal spending when restraint became appropriate.
This concern was related to the belief that controls would not in fact be
53
able to hold down prices and wages when there was a strong excess of demand, and that the effort to do so would result in shortages and distortion
of production.
Another program element, which became more significant as the year
progressed, was the attempt to use the policies of Government to hold prices
down in situations of shortage by promoting expansion of supply. The food
sector provided the leading instance of this approach.
The controls program was intended to be temporary. This was true not
only of the freeze, but also of Phase II and its modifications as they developed
during 1972. Some believe that the United States faces a permanent problem of serious inflation beyond the capacity of prudent fiscal and monetary
policy to control. In contrast, the Administration expected that if the total
package of policies were well managed it would be possible to enter a period
of reasonable price stability without controls. In any case the control system of 1972 was not designed to last forever. If a means of dealing with a
more prolonged problem were needed, it would have to be created especially
for that purpose.
In the following pages of this chapter, after a very brief description of
the program, we review how far its objectives were achieved by the end
of 1972 and, what is much more difficult, to what extent they were in fact
achieved by the program itself.
THE NATURE OF THE PROGRAM
The supplement to this chapter, included in Appendix A, contains a
description of the controls program. Further details may be found in the
Quarterly Reports of the Cost of Living Council and in the regulations
issued by the Council, the Pay Board, and the Price Commission. Here we
summarize only the most salient points.
1. Goals. The goal of policy was to get the rate of inflation, as measured
by the consumer price index (CPI), down to 2-3 percent by the end of
1972. The upper end of the range was considered to be not far below what
might have been optimistically expected without controls; but at the same
time it would represent significant progress from the earlier rate of inflation.
The goal was set in the expectation that food prices would not rise significantly more than other prices.
2. Pay standard. To achieve this goal the Pay Board (initially consisting
of five members each from labor, management, and the general public) set a
basic standard of 5^2 percent for permissible pay increases. This figure was
related to the inflation goal through a "normal" or trend productivity increase of 3 percent, which would yield a 2 l/i -percent increase in unit labor
costs. A number of exceptions, some formulated by the Board and some
imposed by Congress in the Economic Stabilization Act Amendments of 1971,
permitted increases beyond 5 / 2 percent. But the standards only set maximum
limits; they did not set a floor.
54
3. Price standard. The Price Commission specified that prices could
increase above their August 1971 level no more than would be proportional
to the increase of costs over the same period, subject to the further proviso
that, if prices were raised, a firm's profit margin in relation to sales could not
exceed the average rate of the best 2 of the 3 fiscal years preceding August
1971. Again a number of exceptions were made, generally further limiting
permissible price increases.
4. Term limit pricing (TLP). Agreements were worked out individually by the Price Commission with many of the largest companies,
specifying the maximum amount by which they could raise their average
prices during the coming year. Thus the companies were relieved of the
necessity to obtain advance approval for individual price increases and
the Price Commission was relieved of a considerable administrative burden.
The agreement usually specified a maximum amount by which any individual price could be raised. For example, the agreement might provide
that a company's average price could not rise more than 1.8 percent and
that no single price could rise more than 8 percent. The TLP did not relax
the profit-margin limit for the firm.
5. Firm-by-firm control. Price and wage control was exercised on a firmby-firm basis, and on the basis of collective bargaining units. The control
agency did not set ceiling prices at which specified commodities could be
sold by any seller. It did not set ceiling wage rates for particular individuals
or occupations. Instead it laid down rules by which the individual company
could determine its ceiling prices, and these might differ from the ceiling
price at which a different company sold the same commodities. Similarly the
rules limited the average wage increase for the workers covered by a single
company or bargaining unit, and these increases might permit different
pay for the same occupation in different firms. Such a system kept the administrative burden on the Government small and was probably the only
feasible way to make a rapid transition from the freeze to the
more flexible controls of Phase II. On the other hand, the firm-by-firm
approach may have raised the costs of compliance for the private sector.
The variations that the system allowed in different firms' prices for the
same product might have been a source of inefficiency and inequity in a
situation of excess demand, but, under the conditions prevailing in most
industries during 1972, competition tended to bring about uniform prices
despite differences in ceilings.
6. Exemptions. The most important exemption from the controls system
applied to farm products, defined to include timber and unprocessed fishery
products also. The reason for the exemption was that pricing of these
products took place in extremely competitive markets and adjusted quickly
to changing market conditions; repressing price increases by controls would
therefore cause shortages and require rationing. Interest rates were not subject to mandatory controls for the same reason, although voluntary restraint
was sought in raising administered interest rates (mortgage rates, con
55
sumers' credit rates, and the banks' prime lending rate). Imports
and exports were also exempt. The Economic Stabilization Act
exempted wages of low-income workers from control, and the subsequent
definition of this class excluded about 40 percent of all private nonfarm
workers. After the Phase II system had been in operation for some months,
firms, collective bargaining units, and landlords, below certain size limits,
were exempted from control. This removed from control the largest proportion of all economic units in the country, permitting administrative resources to be concentrated on the remaining units, which still accounted for
most of the economic activity and which, by their competition, restrained
price increases in the uncontrolled sector.
7. Administration and reporting. For checking compliance with the price
standards, firms were divided by size into three tiers. The largest, Tier I
firms, were required to notify the Price Commission and obtain approval in
advance of price increases, unless they had a prior term limit pricing agreement. Tier II firms submitted quarterly reports, as did the Tier I firms; but
the Tier II firms were not required to submit advance notification of increases. Tier III firms were not required to submit reports but were expected
to maintain records which would permit auditing of compliance. Somewhat comparable procedures were established for monitoring pay increases.
PRICES AND WAGES DURING THE CONTROLS PERIOD
According to the indexes which provide comprehensive measures of the
movement of prices in the United States, the rate of inflation has declined
significantly during the controls period (Table 15 and Chart 7). Price behavior has been dominated by two facts: The rate of increase of prices other
than farm prices declined markedly compared with the precontrol period;
and the rate of increase of farm prices increased markedly compared with
the precontrol period. The decline in the rate of inflation obviously is therefore smaller in indexes which accord a heavy weight to farm and food prices
than it is in more comprehensive indexes like the consumer price index, the
gross national product (GNP) deflator, the private output deflator, and the
personal consumption expenditure deflator. Only the wholesale price index
(WPI) fails to show this slowdown in the rate of inflation. However, the
WPI reflects the prices of only about half the output produced or purchased
in the United States, and it gives considerably more weight to farm products
than is present in family budgets or in the national economy.
The broad price indexes clearly show the sharp decline of the inflation
rate during the freeze, the rise during the bulge after the freeze, and a decline thereafter to a rate below that of early 1971. The sole exception is
farm products.
56
TABLE 15.—Changes in price measures, 1968 to 1972
[Percent; seasonally adjusted annual rates]
Pre-freeze
Freeze
Bulge
Post-bulge
Price measure
Dec. 1968
to
Dec. 1969
Dec. 1969
to
Dec. 1970
Dec. 1970
to
Aug. 1971
Aug. 1971
to
Nov. 1971
Nov. 1971
to
Feb. 1972
Feb.1972
to
Dec. 1972
6.1
5.5
3.8
1.9
4.8
3.0
7.2
5.7
2.2
6.5
5.0
3.4
1.7
2.3
9.7
2.9
3.6
3.0
4.5
7.4
4.8
8.2
2.9
4.5
.0
3.1
2.4
4.7
2.5
3.3
4.8
2.2
5.2
-.2
6.9
6.5
6.5
4.7
1.1
-.5
Consumer price index:
All items
Food
All items less food
Commodities less food
Services^
Wholesale price index:
All commodities
Farm products and processed
foods and feeds
Industrial commodities . . .
7.5
3.9
1968 IV
to
1969 IV
-1.4
3.6
1969 IV
to
1970 IV
1970 IV
to
1971 II
1971 II
to
1971 IV
14.7
4.0
1971 IV
to
19721
14.7
3.4
1972 1
to
1972 IV «
Fixed weight GNP price deflators:
Total GNP...
Gross private product
Personal consumption expenditures..
5.4
5.1
5.1
4.5
5.9
5.0
3.0
2.6
6.1
4.5
5.0
4.3
4.5
2.4
3.6
5.3
5 3
5.1
2.2
3.2
2.9
2.8
Implicit GNP price deflators:
Total GNP...
Total U.S. purchases *
Private business GNP:
Nonfarm
Farm
5.3
5.5
4.7
10.4
5.1
-7.3
5.0
4.3
12.1
2.3
1.2
16.3
35.1
35.3
3.6
20.1
2.3
2.6
1.5
21.5
1 Based on unadjusted indexes as these prices have little seasonal movement.
2 Preliminary.
3 Increase in pay of Federal Government employees accounted for about \\i percentage points of the total increase.
* Total GNP less net exports of goods and services.
Sources: Department of Commerce, Bureau of Economic Analysis, and Department of Labor, Bureau of Labor Statistics.
Since most nonfarm prices were subject to controls and farm prices were
not, it is theoretically possible that the controls generated pressures which
increased farm prices. This possibility is significant because food prices are an
important part of consumer budgets. However, there is no evidence to indicate that the increase of farm prices was stimulated by the control of
prices in other sectors.
There is, on the contrary, considerable evidence which points to domestic
supply conditions and an increase in foreign demand as the main contributors to the rise in farm prices, and these two factors would have had much
the same effect even in the absence of a controls system. The supply of food
for domestic consumption not only failed to rise but actually declined on a
per capita basis, for two reasons. First, domestic food production declined
because of unfavorable natural conditions, including the earlier corn blight
and bad weather in 1972; hence, despite a rise in imports and a reduction
in carryover stocks, the supply available for domestic use and exports fell.
Second, food exports increased significantly because of bad growing weather
57
Chart 7
Changes in Prices
PERCENT CHANGE FROM 2 QUARTERS EARLIERJ/
7
GNP PRICE DEFLATOR^/
-
CONSUMER PRICE
INDEX
\
5 —-
4 -
V /Y
A**->^'**A¥
/
/.••-•.
A
40nm<?
#
-V
•• • •
•
*
i
i
#
%
\
• ••
\ ^4.
^/ ^
rA
\
PRIVATE GNP
%
PRICE DEFLATOR^/
\
// \ y
/
V
2 -
•
%«-—^
WHOLESALE PRICE
INDEX
_
1 -
I
I
1
I
i
i
1968
i
1
i
1969
7
1
1
1
/
AJ
1
1
1971
A
\
/
CONSUMER PRICE
INDEX LESS FOOD
6
1
1970
^"""""^k.
1
1
1972
PRIVATE NONFARM BUSINESS
GNP PRICE DEFLATOR
^
~~
/
5
"
4
3
-%,••••••
\
\
2
1
—
0
t
y
/
V
i
1968
V
/
/
i
I
i
,
~
\
/
\
V
/
%
, 1
i
1970
SEASONALLY ADJUSTED ANNUAL RATES.
SOURCES: DEPARTMENT OF COMMERCE AND DEPARTMENT OF LABOR.
58
-
"•
2 / CHANGES BASED ON FIXED WEIGHT INDEXES.
\A
WHOLESALE INDUSTRIAL
PRICE INDEX
1969
-
i
\
\ 7 *
\
^
i
1971
V"
V*
i
i
i
i
1972
abroad. These exports were facilitated by U.S. arrangements to permit the
financing of grain exports to the U.S.S.R.
An additional factor which retarded the decline of some of the indexes
was the behavior of import prices. Because of the devaluation of the U.S.
dollar and rapid inflation abroad, the dollar prices of imports rose more
rapidly than U.S. prices. As a result, indexes which reflect prices of U.S.
purchases, such as the CPI and the personal consumption expenditure deflator, rose more rapidly than indexes which reflect the prices of U.S. output,
such as the GNP deflator and the private output deflator. This difference in
behavior is reflected in the comparison, near the bottom of Table 15, of
the price deflator for GNP and the price deflator for total U.S. purchases
(GNP plus imports minus exports).
Statistics on wage increases also showed a marked deceleration during the
controls period. Here too there is an initial sharp decline associated with the
freeze, followed by a brief upsurge in the months after the freeze, and then
a settling back to a rate below the level prior to the freeze. Several measures
of wage change are shown in Table 16 and Chart 8.
Chart 8
Changes in Compensation in the
Private Nonfarm Economy
PERCENT CHANGE FROM 2 QUARTERS EARLIER-!/
9
COMPENSATION PER MAN-HOUR, ALL EMPLOYEES
AVERAGE HOURLY EARNINGS,
PRODUCTION WORKERS.?/
>1
1
I
1968
I
I
I
I
1969
1
1 I
I
1970
I
I
I
I
1971
I
1 1
I
I
1972
1/ SEASONALLY ADJUSTED ANNUAL RATES.
2/ ADJUSTED FOR OVERTIME (IN MANUFACTURING ONLY) AND FOR INTERINDUSTRY EMPLOYMENT SHIFTS.
SOURCE: DEPARTMENT OF LABOR.
59
T
TABLE 16.—Changes in wage measures, 1969 to 1972
[Percent; seasonally adjusted annual rates]
Pre-freeze
Freeze
Bulge
Post-bulge
Aug. 1971
to
Nov. 1971
Nov. 1971
to
Feb. 1972
Feb.1972
to
Dec.19721
Wage measure
Aug. 1969
to
Aug. 1970
Average hourly earnings, private nonfarm economy 2
_.
_
6.9
1969 II
to
1970 II
Aug. 1970
to
Aug. 1971
3.1
6.9
1970 II
to
1971 II
1971 II
to
1971 IV
9.5
1971 IV
to
1972 1
5.6
1972 1
to
1972 IV1
Average hourly compensation, all employees:
Total private economy
Nonfarm
Average hourly earnings, private nonfarm economy 2
1
2
7.2
7.6
5.2
8.9
5.7
7.1
7.6
5.1
8.9
5.9
6.5
7.4
5.7
8.0
6.0
Preliminary.
Adjusted for overtime (in manufacturing only) and interindustry employment shifts.
Source: Department of Labor, Bureau of Labor Statistics.
Additional evidence of the decline of the inflation rate is provided by the
substantial reduction in the size of negotiated increases in collective bargaining agreements covering 1,000 or more workers; the typical wage increase negotiated for the first year of a contract had been 11.8 percent for
the first 9 months of 1971 and 11.9 percent during all of 1970. In contrast,
this first-year increase declined to 7.6 percent for all of Phase II and to an
even more moderate 6.6 percent during the last 3 quarters of 1972. For
manufacturing alone, the first-year increase was 8.1 percent in 1970, 11
percent during the first 9 months of 1971, and 6.9 percent during Phase II.
Construction first-year wage increases, which had averaged 18.1 percent in
the 4 quarters prior to the establishment of the Construction Industry
Stabilization Committee in early 1971, slowed to 12.5 percent during the
first year of the CISC's operation and to 5.8 percent during the last 3
quarters of 1972.
Did Controls Reduce the Inflation Rate?
The fact that the rate of increase of both prices and wages declined during
the controls period does not prove that the controls themselves reduced the
rate of inflation. There are, naturally, two views on this subject: one is that
they were effective and the other is that they were not.
Those who say the controls were not effective rely primarily on the observation that the rate of inflation was declining before the controls began
and that no sharp discontinuity in the decline of the rate of inflation can be
dated from the beginning of the controls. Although a sharp cut in the inflation rate accompanied the freeze, and a bulge followed the relaxation
of the freeze, these can be regarded as only briefly displacing in time the
trend of prices that would otherwise have occurred.
60
The difficulty with this argument lies in the absence of any assurance
that the decline in the inflation rate which had occurred before the freeze
would have continued without it. The controls were imposed largely because there was no such assurance. Some of the reasons for the fear that the
inflation rate would not continue to decline have been given earlier in this
chapter.
The facts are that some price and wage increases were below the permitted amounts and that there have been few if any cases of shortages at
ceiling prices. But the first of these points is not inconsistent with the
controls having held down the average rate of inflation by holding down a
significant number of price and wage increases. And the second point is
consistent with the underlying rationale of the controls, which is that the
price and wage increases to be restrained were not increases necessary to
avert shortages.
The case for the effectiveness of controls rests in part on econometric
study of the relation between the rate of inflation and other variables,
such as unemployment, prior inflation rates, and growth of demand.
The relations derived from past experience are used to project what
the inflation rate would have been in the absence of controls. Since, as has
turned out in several studies, the projected inflation rate was larger than the
rate actually experienced in 1972, the conclusion is that the controls reduced
the inflation rate, and by the amount of the difference. Although these
studies ask the right question—What would the inflation rate have been
without the controls?—the poor record of this technique in predicting the
rate of inflation prior to controls does not inspire confidence in their answer,
and evidence from this source must be regarded as inconclusive.
One interesting set of facts bearing on the effectiveness of the controls system is the distribution by size of wage adjustments in collective bargaining
agreements. The data are shown in Table 17. The reduction from 1970 and
1971 to 1972 in the percentage of workers receiving increases of 10 percent
or more is striking, and it may reflect the curtailment of big increases
by the controls. In 1968, when there were no controls and the average increases were about the same as in 1972, the percentage of very large increases was also much less than in 1970 and 1971. Still, the 1972 distribution
is more compressed than that of 1968, at least in manufacturing: the proportion of very large adjustments was below the 1968 level. The group of
industries negotiating increases in 1972 was different from that in 1968,
however, and this may help explain the difference in the distribution.
We believe it is probable that the controls did reduce the rate of inflation,
but the magnitude of the reduction is uncertain. There are a number of
individual cases in which the controls seem to have restrained price and
wage increases, and it is hard to find cases in which the controls have stimulated increases. The slowdown of wage increases and of the private GNP
deflator is more pronounced during the controls period than before it. But
490-000 O - 73 - 5
61
TABLE 17.—First-year wage rate changes in collective bargaining agreements covering 1,000
workers or more, 1968 and 1970-72
Percent of workers affected
Type of wage-rate action i
All industries
1968
All wage actions.
100
1970
100
1971
100
Manufacturing
19722
100
No wage increase..
Increase in wages..
1968
100
1970
100
1971
100
1972
100
99
100
Under 1 percent
1 and under 2 percent...
2 and under 3 percent...
3 and under 4 percent—
4 and under 5 percent...
5 and under 6 percent...
6 and under 7 percent...
7 arid under 8 percent...
8 and under 9 percent...
9 and under 10 percent..
10 percent and over
Not specified
8
2
2
6
23
24
19
16
2
4
4,589
4,675
3,978
2,092
2,277
2,184
1,913
792
Mean adjustment (percent)
7.4
11.9
11.6
7.0
7.0
8.1
10.9
6.6
Median adjustment (percent)
7.2
10.0
12.5
6.3
6.9
7.5
10.1
6.2
Number of workers (thousands).
1 Percent of estimated average hourly earnings excluding overtime.
2
Preliminary.
3 Less than 0.5 percent.
Note.—Detail may not add to totals because of rounding.
Source: Department of Labor, Bureau of Labor Statistics.
one cannot be sure that the controls had an effect on the rate of inflation.
Still less can the size of the effect be gauged.
However, this uncertainty does not imply an equal uncertainty about the
value of the controls. As we said at the outset, the controls were intended to
deal with the risk that inflation would again accelerate. To reduce that
risk substantially, as we believe the controls did, was a very significant contribution, but one that would not necessarily show up in a reduction of the
inflation rate below what would most probably have occurred without the
controls.
Reducing Inflationary
Expectations
The goal of policy in 1971 and 1972, as we have pointed out, was not only
to reduce the probable rate of inflation but also to reduce the general fear of
continued or rising inflation and thus to increase confidence in the achievement of price stability. A change in the perception of the U.S. inflation
prdblem has taken place. The controls have made a substantial contribution to this.
There are no completely satisfactory measurements of people's expectations and fears about inflation. But everyone who has examined his
own thinking and the thinking of other people in 1970, 1971, and 1972 can
see that a change has occurred since the controls were imposed, and these
changes are reflected in available public attitude surveys. For example, the
62
proportion of people surveyed in a poll who said they thought there was a
current danger of inflation declined from about 85 percent just before the
freeze to about 60 percent in December 1972. The proportion who said
they feared inflation at that time more than a year earlier fell from 70 percent to about 35 percent. Any other outcome would be strange. For a great
many people the idea that inflation could be reduced by fiscal and monetary
restraint is unreal and abstract. Disbelief on this score was reinforced by the
disappointing contrast between the many forecasts that inflation would
decline markedly in 1970 and 1971 and the actuality. On the other hand,
nothing seems more obvious than that the imposition of controls should curb
inflation. Moreover, the controls had a symbolic value as evidence of the
Government's determination to take whatever steps might be necessary
to check inflation.
Concern about inflation did not, of course, disappear. From time to time
in 1972 it was even fairly acute. Nevertheless, one has only to recall the tone
in which the problem was usually discussed in the summer of 1971 to see
how far we have come.
One of the most striking changes has been in the attitude of the international economic community toward the American inflation; before August
1971 it was the major concern of foreign observers and investors. By the
end of 1972 the American anti-inflation policy had become the marvel of
the rest of the world (Table 18). Largely because of this change the rest
of the world is willing to hold increasing amounts of dollars.
TABLE 18.—Changes in consumer prices in the United States and OECD countries, selected
periods, 1958 to 1972
[Seasonally adjusted annual rates]
Percent change
Country
United States
1958-59
average
to
1968-69
average
From previous year
1970
1971
From previous half-year
1971
first
half
1971
second
half
1972
first
half
1972,
second
to
third
quarter
2.1
5.9
4.3
4.2
3.5
3.1
3.6
2.3
5.1
3.9
2.4
3.5
3.3
3.8
3.3
7.8
5.5
3.8
5.0
6.4
5.3
2.9
6.1
5.6
5.2
4.9
9.4
7.4
2.5
6.6
5.1
5.4
4.8
10.3
7.2
4.9
5.9
6.4
6.1
4.9
9.1
8.8
4.3
3.0
4.9
4.7
4.9
5.1
6.6
7.4
6.1
9.0
8.7
8.7
10.5
8.2
Other OECD countries:
Canada
Japan
France
Germany
Italy....
United Kingdom
All other OECD countries L .
1
1970 private consumption weights and exchange rates used. Includes Austria, Belgium, Denmark, Finland, Greece,
Iceland, Ireland, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, Turkey, and Yugoslavia.
Sources: Department of Labor, Bureau of Labor Statistics, and Organization for Economic Cooperation and Development
One objective indicator of inflationary expectations is the behavior of
interest rates, particularly those on long-term obligations. When increased
inflation is generally expected in the economy, lenders demand higher
63
interest rates to compensate them for the depreciation of the real values
of their loans. Borrowers are willing to pay higher rates because their
resources are expected to appreciate in nominal terms. Interest rates,
therefore, tend to rise and. fall in direct relation to changes in inflationary
expectations. The expected rate of inflation is, however, by no means the
only factor determining the behavior of interest rates, nor is it easy to
distinguish its effect from the effects of other factors operating at the
same time.
The behavior of interest rates after August 15, 1971 strongly suggests that
inflationary expectations receded abruptly as a result of the imposition of
the Economic Stabilization Program. On August 16 the yield on seasoned
3-5 year Treasury securities fell 40 basis points from August 13 levels,
and the Moody's Aaa long-term bond yield fell 20 basis points. By the end
of August these yields had fallen 75 and 26 basis points, respectively, from
the levels on August 13.
The declines in these yields were very sudden. Because they took place
so quickly, they cannot be explained by any fundamental force except
expectations. Hence a strong presumption exists that people believed the
effects of the freeze would not be completely reversed and that they expected the inflation rate to follow a lower course after August 15 than before.
While long-term interest rates rose early in 1972, they generally followed
a downward path after April, although scattered increases occurred, particularly in September. The declines took place in a period in which the
economy was expanding rapidly, at a pace seldom equaled, and short-term
rates were rising. Both of these forces are normally associated with increases in long-term rates as credit demands increase and expectations of
future short-term rates are revised upward; only twice in the past 26 years
had long-term rates declined over such a long period in such circumstances.
The fact that long-term interest rates declined on balance during 1972
even in the face of strong economic expansion suggests that long-term inflationary expectations which influence such rates were also revised. While
short-term expectations appear to have been quickly revised in 1971 after
the imposition of controls, investors in long-term securities took longer
to become convinced that inflation would remain on a lower path for a
considerable period to come.
The Fairness of Controls
In the development and management of the controls system, a great effort
has been devoted to achieving fairness, both in justice to those directly
affected and because belief that the system is fair is necessary to ensure the
voluntary support without which the system could not function. According to the concept of fairness underlying the controls, the system itself should
not substantially alter the distribution of income that would have occurred
in an expanding, noninflationary economy without controls.
Fairness in the controls system can be understood in small or large terms:
through the impact that controls exert on particular individuals and busi
64
nesses or the effect on such large classes, as wage earners and stockholders.
In particular instances there was undoubtedly some arbitrariness. The regulations were inevitably broad and general; case-by-case handling of inequities was slow. As the year passed, feeling grew that individual treatment
by the system had not always been equitable.
Public discussion and complaint about the fairness of the system have
related chiefly to the larger aggregates, however, especially to the relation
between wages and profits. In these terms it is hard to see that the controls
system has changed the distribution of income. If there has been any change
compared to what would have happened in a strong expansion without controls, it seems to have been favorable to wages. Employees' compensation
rose from 75.1 percent of the national income in the second quarter of 1971
to 75.3 percent in the third quarter of 1972, despite the normal tendency
of the labor share to decline when output expands rapidly. Related to
gross national product, the employee compensation percentages are 61.3
and 61.0, respectively. As is shown in Table 12, Chapter 1, employees' share
of the gross product of nonfinancial corporations declined insignificantly
(from 66.4 percent to 66.1 percent) over the same period. Also shown in
Chapter 1 (Table 11), the rise in profits relative to the rise in GNP has
been much smaller in the current recovery than in earlier business recoveries; a related fact is the modest increase in corporate dividends, which
have risen much less than employee compensation.
It seems quite clear that the share of labor in the national income has
not suffered at the expense of profits during the controls period. Yet it
is also true that real hourly labor compensation (compensation adjusted
for the cost of living) in the private nonfarm sector has not risen as fast
as output per hour in the private nonfarm sector. It is a well-known proposition of economics that if real compensation per hour does not rise as
fast as productivity, labor's share declines. However, this proposition holds
only if the prices used to deflate hourly money compensation and convert
it into real compensation are the prices of the workers' products. In the
present case, prices in the private nonfarm sector rose much less than the
consumer price index because of the large influence of farm prices and
import prices on the latter index. Therefore, real hourly compensation in
terms of the things workers produced rose much more than real compensation in terms of the CPI market basket (and it is the former which is relevant for the proposition about shares). From the second quarter of 1971 to
the fourth quarter of 1972 the purchasing power of the compensation for
an hour of work in the private nonfarm sector rose at an annual rate of 2.8
percent in terms of the items included in the CPI, but at 4.2 percent in
terms of the goods produced in the private nonfarm sector.
In a larger sense, workers gained much more from the controls program
than can be shown by calculations of their proportionate share in the national income. The confidence engendered by the program was an important
ingredient in the economic expansion which greatly increased employment,
65
hours of work, and productivity, and thus the real incomes of workers.
Real weekly earnings of private, nonfarm production workers (adjusted for
the CPI) rose at an annual rate of 3-4 percent from August 1971 to December 1972 compared to 3.0 percent in 1971 prior to the freeze and to an
average of 0.4 percent per year from 1965 to 1970. Total employment, including the Armed Forces (which declined), rose by 3.2 million from the
second quarter of 1971 through the fourth quarter of 1972, and the total
real compensation of employees rose at an annual rate of 5.7 percent.
THE COSTS OF CONTROLS
The actual or potential benefits of price and wage controls in reducing
both the inflation rate and the fear of inflation must be balanced against
their actual and potential costs. Several kinds of costs may be involved;
almost all are difficult or impossible to measure. An impressionistic review
suggests that these costs were probably not large in 1972, relative to the role
that the system played in the national economy, but that they were growing
as the year progressed.
1. Administrative costs. The controls program was designed to be carried
out with a staff of less than 4,000 people. The annual rate of expenditure
of the Cost of Living Council, the Pay Board, the Price Commission, and
related agencies was about $80 million. The cost of administering the program, however, even within the Federal Government, amounted to more
than this. The program was a demand on the time of the President and
of the heads of many Government departments and agencies. This cost
is to be measured in diversion from attention to other problems.
The administrative costs outside the Government were undoubtedly much
larger than those borne by the Government. Many more man-hours were
required to prepare applications and reports than to review them, and to
maintain records than to check them. There is no calculation of what this
cost amounted to in dollars, but it was probably substantial.
By the end of 1972 it appeared that the administrative costs would increase substantially if the program continued without modification. In a
continuing program, companies and workers would insist on more equitable
procedures that they did not demand when the system was considered to be
short-lived, and they would have more recourse to the courts to get their
full rights.
2. Industrial disputes. Previous experience, both in the United States and
elsewhere, suggested the danger that wage and price controls might lead to
exceptionally bitter industrial disputes and loss of time due to strikes. The
disinflationary process would in any case require a slowdown in the rate of
wage increases and thus carried with it the possibility of long strikes. This
possibility might be aggravated if the Government entered the picture by setting standards for maximum pay increases. In such a situation, wage disputes
could become tests of policy and power between Government and labor,
66
each party being unwilling to compromise and local cases threatening to
explode into nationwide stoppages.
Despite the danger, 1972 turned out to be a year of unusual industrial
peace. Time lost through strikes as a proportion of time worked was at its
lowest level in nearly 10 years. This outcome was a consequence of the
public's strong support for the program and the cooperative attitude among
workers and the leaders of organized labor.
3. Effects on productivity. Price control systems tend in greater or less
degree to be cost-plus systems which reduce the incentive to hold down costs
and may even create an incentive in the other direction. The basic price
standard in the 1971-72 controls program had this feature. Prices were generally permitted to be raised in proportion to costs, so that an increase of
costs also permitted an increase of profits. This effect was at least limited
by the requirement, adopted in May, that firms use an historical, industrywide productivity factor in calculating costs, rather than their own actual or
estimated productivity. However, firms would again be in the cost-plus situation if they reached their profit-margin limit, because an increase of costs
would then permit an increase in profits.
Productivity rose sharply in 1972. The cyclical conditions for such a rise
were highly favorable. Any adverse effect that the controls system may have
had on productivity is not visible in the statistics, although this does not
mean such effect was absent or negligible. Nevertheless, even anecdotal evidence of antiproductivity effects is rare. There were probably several reasons for this. Relatively few firms were up to their profit-margin standard
in 1972. Even those which were at the profit^margin limit felt restraint on
cost-raising tendencies because of competition from firms that were not.
Moreover, the expected short life of the controls made businesses especially
wary of falling into managerial practices that would be harmful when controls ended. All of these reasons suggested dangers as the controls continued,
particularly in an economy operating closer to its potential.
4. Effects on investment. The price control system posed certain threats
to the vigorous expansion of business investment. Profits were restrained by
the cost pass-through rules as well as by the profit-margin standard. Furthermore, in the calculation of costs to justify price increases no allowance was
made for the cost of nonborrowed capital. As a consequence, an increase in
equity capital per unit of output would reduce the rate of return on equity,
even though it permitted saving of other costs.
Despite these inhibiting factors, business investment rose substantially in
1972, and reports of business intentions suggest another substantial increase
in 1973. Since investment is undertaken in expectation of a future stream
of profits, the heavy investment of 1972-73 suggests that business viewed
controls as likely to be of relatively brief duration. The restraint on dividend
payments, which increased the internal funds of corporations, may also have
helped to sustain investment growth.
67
5. Distortions and interferences with production and distribution. There
are a number of classic ways in which long-maintained and rigid price controls in the face of excess demand distort the pattern of production and distribution. Low-margin goods disappear from the shelves, black markets and
informal rationing appear, the quality of goods and services is degraded, and
innovations are discouraged. Very little of this distorting effect showed up
during 1972. There were stories, whose significance was difficult to measure,
of a shift toward high-profit lines in the lumber industry, of favoritism in
the allocation of lumber to dealers, and even of lumber production held back
to await the end of controls. Relative prices under the controls induced
production of more gasoline and less fuel oil than would have occurred in
free markets. The ceilings on service fees charged by hospitals may have led
to the provision of an unnecessarily large amount of services.
However, these cases were exceptional. They were kept from becoming
more common by the flexibility of the controls system and by an even more
important factor, the prevalence of unused production capacity during 1972.
WHERE WE STAND
By the end of 1972 the rate of inflation had been clearly reduced
from its level when the freeze took effect. Moreover, what had happened
was not merely a suppression of price increases that would burst out if controls were removed. Although some such increases might occur, a more
durable change had taken place in the conditions underlying wage and price
increases. Expectations of rapid inflation had diminished, and not only because of controls. Confidence in the Administration's determination to pursue a noninflationary fiscal and monetary policy had been strengthened.
An economic background for wage decisions had been established which
was much more conducive to moderation than had prevailed earlier. Although workers had, on the average, been getting large wage increases
in money terms in 1970 and 1971, they felt very little real improvement because of the rapid inflation. Consequently there was a strong push, recognized by employers as well as workers, for even larger wage increases. In
contrast, at the end of 1972 workers had been receiving the same or smaller
hourly wage increases, but the increase in their buying power during the
year had been much larger. This contrast is shown in Table 19, which compares the conditions of 1972 with the conditions of 1969, that is, 1 year before
many of the collective bargaining agreements to be negotiated in 1973 were
last negotiated.
Developments during the controls period have thus improved the position of workers in the aggregate; they should also have particular relevance for employees in those sectors where bargaining activity in 1973 will
be concentrated. In recent years, before the introduction of controls, wages
in the major industries affected by collective bargaining agreements showed
a persistent tendency to fall behind the rest of the economy during the term
68
TABLE 19.—The economic preludes to two major collective bargaining rounds, 1970 and 1973
[Percent change; seasonally adjusted annual rates]
Backdrop to the
Backdrop to the
1970 negotiations: 1973 negotiations:
1972 2
19691
Series
Consumer price index
6.1
3.2
6.5
6.2
4.9
6.3
6.7
7.3
.4
.1
-1.1
3.1
3.4
4.1
Earnings in current dollars:3
Hourly*
Gross weekly
Spendable weekly6..
Earnings in constant dollars:3
Hourly*
Gross weekly
Spendable weekly 6 .
i December 1968 to December 1969.
3 August 1971 to December 1972.
3 For production or nonsupervisory workers on private nonfarm payrolls.
* Adjusted for overtime (in manufacturing only) and interindustry employment shifts.
6
Gross weekly earnings, after taxes ,for a worker with three dependents. In annualizing the rates of change, the effect
of the change in tax rates at the beginning of 1972 is taken into account separately.
Source: Department of Labor, Bureau of Labor Statistics.
of a multiyear agreement and then to catch up through larger increases
when new agreements were negotiated. As the accelerating and high inflation rate has receded, however, a fundamental change has occurred in the
manner in which inflation and long-term contracts have affected the relative
position of unionized workers in the wage structure. Workers covered by
many important contracts expiring in the near future appear either to have
maintained or to have improved their relative position in the wage structure.
Thus the economic performance of 1971 and 1972 gave rise to several
factors favorable to price stability in 1973. At the same time, this performance
did not achieve a final liquidation of the extraordinary inflation problem left
behind by the 1965-68 demand surge. The rise of prices, as measured by the
consumer price index, was above the interim target rate set by the Administration and above the rate that would be considered permanently satisfactory.
Apprehension about the future inflation rate, although much diminished,
remained. Sensitivity to the vestiges of recent inflationary experience
was heightened by the prospect and need for continued expansion and by
the large number of workers who would be involved in new wage settlements in 1973.
A case could therefore be made for continuing the anti-inflationary influence of controls in 1973. But the experience of 1972 also suggested a number of dangers to be avoided. Although the costs of controls in retarding
and distorting economic activity had apparently thus far not been great,
these costs seemed to be rising. They could be much more significant in 1973
as the program aged and as the economy came closer to its potential. The
number of instances of excess demand would multiply, and the relative
price ceilings established by the system would become more potent sources
of distortions. More and more companies would hit their profit-margin
69
ceilings, with adverse consequences for cost control and for investment incentives. More insistence on formal and equitable procedures would arise, litigation would multiply, and administrative costs, public and private, would
increase greatly. Less tolerance of the inevitable delays and red tape of the
system would be forthcoming.
These dangers and difficulties did not mean that continuation of controls
was impossible or undesirable. They did mean that even temporary continuation would require modification of the program. They reinforced the idea
that controls should not be a permanent part of the American economic
system. And they emphasized the need for maintaining general noninflationary economic conditions which would permit the controls to continue for a
while and then to disappear. These considerations were all prominent in the
development of the policy for 1973 which is discussed in Chapter 3.
70
CHAPTER 3
Outlook and Policy
PRINCIPAL QUESTION on the economic outlook for 1973 is
-*• not whether, but how fast, output and employment will expand. For
policy, there are two issues. The first is to find and implement the set of policy
actions which will maximize the likelihood that the economy will move to
its full potential level of output and employment. The second is to do so in
ways that will serve both to eliminate the vestiges of the post-1965 inflation
and to place the economy squarely on a sustainable path of subsequent noninflationary growth.
This is an ambitious set of policy goals, but there is a good prospect of
achieving them, or at least approaching them closely. The year ahead is the
first in a long time in which there is reasonable hope of closing in on full
prosperity without serious inflation and without war.
For this to become a reality rather than just a hope will require full
cooperation from business and labor. It will also require coordinated policy
actions by the Administration, the Congress, and the Federal Reserve System. The economy will be approaching the zone of its potential by the
end of the year. Such an economy requires a disciplined balancing of conflicting short-run interests in order to ensure that the common prosperity, which
benefits all interests, can be sustained without interruption.
The central need is to balance the speed of expansion against its durability, but in the context of 1973 this problem has many other dimensions:
The allocation of output between uses dictated by the Government and
those dictated by the private sector; the balancing of the need for allowing
free operation of market mechanisms for determining individual prices and
wages against the continuing need for restraint on the average level of prices;
the division of emphasis between minimizing unemployment in the short run
and minimizing it more permanently.
GUIDES T O OVERALL ECONOMIC POLICY
The basic mandate for policy set forth in the Employment Act is to
achieve "maximum employment, production, and purchasing power." The
question of the precise meaning of those goals was left unresolved when the
Act was passed in 1946 and has remained open ever since.
In the early 1960's a judgment was put forward that maximum employ-
71
ment for that time would be achieved when 96 percent of the labor force was
employed, which meant 4 percent unemployed. Paralleling this estimate was a
calculation of "maximum output/ 5 usually called potential GNP, which was
conceptually the output that would be realized if the economy were operating
at full employment. Estimates of potential GNP, at constant prices, were
actually derived by assuming that the potential level of output was equal to
the level of actual output in mid-1955, and that it would increase at a trend
rate based on underlying changes in population, the proportion of the population that would be in the labor force, hours of work, and productivity. The
trend rate was adjusted from time to time to reflect changes in the underlying
variables. The benchmark period, mid-1955, was selected because it appeared
to reflect most of the characteristics associated with noninflationary full
employment, including an unemployment rate close to 4 percent (the actual
rate of unemployment for the second and third quarters of 1955 was 4*4
percent).
These estimates of maximum employment and potential output were not
considered to be either immediate or permanent guides to policy. In fact,
policy in the early 1960's recognized that too fast a push to maximum employment or potential output could be dangerous. At the same time the
96 percent employment rate, or 4 percent unemployment rate, was considered
to be an "interim" goal, which might be changed later as a result of improvements in labor markets or other developments.
These judgments applied to conditions expected in the early 1960's. In
retrospect, the standard they suggested seems to have been in the correct
zone: Steady noninflationary expansion did raise the rate of employment
to 95/ 2 percent and the ratio of actual to potential output to 99 percent by
mid-1965, and both rates might have risen somewhat further or could have
at least been sustained without generating inflation, had the normal course
of events not been disrupted by the subsequent rapid rise in defense spending
and the associated budget deficits.
The standards are a less reliable guide to policy for the 1970's than they
were for the 1960's. Large and unpredicted changes have taken place in the
nature, composition and behavior of the labor force, employment and
unemployment, as well as in the length of the workweek. Also the economy
itself has been through the worst and most prolonged period of price and
wage inflation since World War II. These changes have important implications for the guidance of policy.
Given that our knowledge of the interrelation between the levels of output, employment, and prices at "maximum employment" is incomplete, it
would be preferable to think of each objective, not in terms of a single value
but as a range of values. Furthermore, the behavior of the economy in the
near future will be determined not only by whether it is operating below or
above some numerical potential output or below or above some target rate
of employment, but also by the speed and manner with which it approaches
the range of its potential levels. Against the background of recent inflation-
72
ary history it is necessary to give the economy reasonable assurance that
policy will not repeat the fiscal errors which ignited the inflation in the first
place. Too fast a dash for a numerical target of potential would rekindle
inflationary expectations and behavior that might make the potential itself
unattainable, and would make it unsustainable if attained, whereas a more
gradual approach which allows for the sensitivity of wages and prices to
expectations would make the potential not only attainable but sustainable.
The Government can neither precisely predict what maximum employment or maximum production will be nor can it precisely control the level
of actual employment or production. What the outcomes should be and will
be depends upon private behavior—upon the amount of work and production
that people want to do on realistically achievable terms—as well as upon
public policy. The contribution of public policy is to create conditions in
which people can reach their desired employment and production goals
through feasible behavior in the market. One aspect of this contribution is
that the total demand for output in money terms should be sufficient so that
people who want to work can find work without an unrealistically large departure from accustomed and expected patterns of wage behavior.
Specifically, in the current situation we believe these guides mean that the
money value of output should rise at a rate which, with reasonably expectable
price and wage behavior, would reduce the rate of unemployment to the
neighborhood of 4 / 2 percent by the end of 1973. The rise of money gross
national product (GNP) would be about 9 percent from the end of 1972
to the end of 1973. This does not imply that in present circumstances 4*/2
percent is necessarily the floor to the unemployment rate. It does imply a
belief that a more rapid expansion of the economy within 1973 would endanger the further reduction of the inflation rate that is desirable, and would
do so despite the continuing price and wage controls program. However, if,
as a result of cooperation with the controls system or for other reasons, prices
and wages rise less rapidly than is assumed here, the increase in money GNP
suggested for the year would permit output and employment to rise more
and unemployment to fall further.
Policy beyond 1973 will have to be adaptable to developments during
the year. However, in the absence of evidence to the contrary, a sustained
period of uninterrupted expansion would provide the optimal background
for maximizing both employment and price stability. To this end, the
appropriate policy goal in the ensuing period would seem to be a steady
increase of money demand (money GNP) at a rate consonant with the potential growth rate of the economy and reasonable price stability. Again, this
would not imply that the unemployment rate of 4 / 2 percent assumed to
have been reached by the end of 1973 will not decline further. If, with
4J/2 percent unemployment, there is the pressure of an excess supply of
73
labor the average rate of wage and price increase would be lower and the
rise in employment relative to the labor force would be higher, leading to
a further reduction of the unemployment rate.
A further reduction of the unemployment rate in 1974 and beyond to even
lower levels would be assisted by labor market policies, including manpower
programs, which effectively reduce the relatively high level of frictional and
structural unemployment that has typically been experienced in the United
States.
It is worth repeating that the policy goal is a condition in which persons
who want work and seek it realistically on reasonable terms can find employment. The Government must make two kinds of contribution to the achievement of this goal. First, it must maintain reasonable stability in the overall
rate of economic growth so that the efforts of individuals to find work are
not frustrated by erratic changes in the conditions on which work is available. Second, it must seek to eliminate obstacles that prevent willing workers
and willing employers from getting together, insofar as these obstacles can
be overcome without excessive cost. When the condition that persons who
want work can find it through serious search is met, the rate of unemployment as we measure it will not be zero. What it would be we do not know.
Undoubtedly the number would change from time to time. But it is the
condition which is important, not the statistic.
FISCAL AND MONETARY POLICY
The path of the economy suggested above calls for slowing down the rise
of money GNP, which was about 11 percent during 1972, to about 9 percent
during 1973 and to a steady rate less than that thereafter. This desired shift
to a slower rate of increase of money GNP would be assisted by a shift of the
budget—from a position in which the unified budget would be in deficit at
full employment to a position in which it would be in balance at full employment. In fact, the strength of the private demand forces in the economy,
described below, argues that this shift in the budget position is essential to
avoid an inflationary pace of expansion. The desired subsequent steadiness
of the rate of increase of money GNP would be assisted by keeping the
budget in a position of balance at full employment, unless there later appears
clear and strong evidence that developments in the private sector call for
greater fiscal stimulus or restraint. Constancy in the relation between fullemployment receipts and expenditures provides approximate constancy in
the Federal contribution to economic expansion. The constancy of the contribution is only approximate because the impact of the budget on the economy depends on its composition and total size as well as on the size of the deficit or surplus. However, constancy of the balance at full employment is the
best single guide to a budget policy that neither pushes the economy above its
desired growth rate nor holds the economy below it. In any case, the rule
74
that expenditures should not exceed the revenues that would be collected at
full employment is essential to bring home the requirement that Government should not spend money for things it is unwilling to ask citizens to pay
for. The circumstances of 1973 are appropriate for getting on to that track.
A gradual slowing down of the expansion of money GNP to a steady rate
consistent with the long-run potential growth rate of the economy and
reasonable price stability is also an appropriate goal for monetary policy.
This is likely to require a slower increase of the supply of money and credit
than was proper when the main objective was to encourage a quickened economic expansion in an environment of substantial unused resources.
There is, as far as we are aware, little explicit disagreement with the
proposition that the budget should be brought into a position of full-employment balance for fiscal year 1974. The threat to the achievement of fullemployment balance is not that the country or the Congress will decide
against it but that congressional procedures will be incapable of carrying
out a policy to do it. Congress, under present practice, makes hundreds of
separate decisions affecting expenditures but does not decide at any point
in the process what total expenditures should be. Lacking the discipline that
would be imposed by recognition of a limit to total spending, Congress tends
regularly to authorize and appropriate too much money, constantly straining the ability of the Executive to keep spending under control.
If the budget is not to be a perpetual menace to economic stability, better
congressional procedures will have to be created for making a deliberate
decision about total spending. That is why the President has urged the
Congress to establish a rigid ceiling on fiscal year 1974 expenditures before it
passes any other spending legislation this year. The President has also urged
the Congress to act on its own initiative to reform its expenditure-deciding
process. In fact the problem is now more recognized in Congress than it has
been for many years and there have been encouraging moves there to deal
with it.
We also need to consider whether the future conduct of fiscal policy could
be improved if Congress were to develop expeditious procedures for
temporary, limited changes in the level of particular taxes. Such changes
could take the form of a temporary, 1-year, positive or negative surcharge
rate on personal and corporate income taxes, or additionally a temporary,
1-year shift in the rate of the investment tax credit. Both suggestions have
been advanced with some regularity over the past two decades, and while
they raise many difficult questions it is also generally agreed that we cannot
be complacent about our existing instruments for the conduct of fiscal policy.
Basic changes in the structure and level of tax rates do and should require extended discussion. At the same time, experience has shown that the
proper conduct of macroeconomic policy may sometimes call for a prompt
and effective shift in the overall balance between the flow of Federal receipts
and expenditures. Temporary and prompt changes in tax rates, which do not
75
alter the basic structure of taxes, may provide an efficient way of accomplishing such required shifts.
Government Expenditures
The shift to full-employment budget balance by 1974 can be accomplished
either by raising tax rates or by restraining the rate at which expenditures
rise. The Administration has a clear preference for the latter.
The conceptual basis for arriving at public expenditure decisions is fairly
straightforward. In general, public expenditure is justified when both of
two conditions are met: If a desired result can be achieved at less cost by
public rather than private spending and if the expenditure yields benefits
which (adjusted for their timing) are greater than their costs, measured by
the value and timing of the alternatives that have to be foregone in order
to finance the outlays required.
In practice, there are formidable difficulties in arriving at sound public
spending decisions. For many expenditures, reliable estimates of benefits and
costs are not available. Many decisions have spending consequences that
stretch years beyond the point at which the decision itself is made; over this
period, circumstances, priorities, costs, and benefits may and do change.
The proper management of public spending therefore requires the continuous reevaluation of prior decisions from which current spending flows as
well as the careful evaluation of new decisions. Furthermore it is instructive
to gain perspective by referring to a rough guide such as the fraction of
total output which flows through the government sector.
The United States has now been through a period of substantial growth
of government expenditures, both absolutely and relative to the size of the
economy. In making a comparison with the size of the economy it is useful
to abstract from fluctuations in the level of actual output around its path
of potential growth. To this end, the data shown in Table 20 relate the
level of government spending and its major components to the level of
potential GNP. Separate figures are shown for the Federal Government
(including grants to the State and local level), the State and local sector
(excluding Federal grants) and for all levels of government combined.
Excluding defense spending, the ratio of government expenditures—
Federal and State and local—to potential GNP rose from 14 percent in
1955 to 23 percent in 1971. Defense spending fluctuated relative to
GNP but was much lower at the end than at the beginning of the period.
During these years, potential GNP, measured in nominal dollars, nearly
tripled.
The share of the Federal portion in total government civilian spending also
rose rapidly between 1955 and 1971. In 1955 Federal civilian spending was
6.6 percent of potential GNP compared to 7.4 percent for State and local
spending. Over the 16-year period the Federal share rose twice as fast
as the State and local share. By 1971 Federal civilian spending was 12.4
percent of potential GNP as against 10.5 percent for the State and local
sector.
76
TABLE 20.—Government expenditures as a percent of full-employment GNP, selected calendar
yeats, 1955-71
[Percent]
Type of expenditure
1955
1960
1965
1968
1971
Total government
Total
.
Defense relatedl
Civilian
Education, health, and welfare2
. .
Natural resources3
Commerce, transportation .and housing.
General government and net interest
24.5
25.3
27.1
31.6
30.2
10.4
14.0
9.0
16.2
8.7
18.4
10.3
21.3
7.3
22.9
8.5
1.2
1.8
2.5
10.1
1.2
2.1
2.8
11.7
1.3
2.3
3.0
14.1
1.4
2.5
3.4
15.9
1.1
2.4
3.5
17.1
17.3
17.9
21.2
19.7
7.3
12.4
Federal Government *
Total
Defense related
Civilian
. . .
Education, health, and welfare
Old-age and disability
Other
....
Other civilian
2
. .
10.4
6.6
9.0
8.2
8.7
9.2
10.3
10.9
3.7
2.1
1.6
4.7
2.9
1.8
5.4
3.4
1.9
6.9
4.3
2.6
8.3
4.8
3.5
4.0
4.1
2.9
3.5
3.8
7.4
8.0
9.2
10.4
10.5
4.8
2.6
5.4
2.6
6.4
2.8
7.2
3.2
7.7
2.8
State and local government *
Total civilian 5
Education, health, and welfare2
Other civilian
.
» Consists of national defense, space research and technology, and international affairs and finance. Negligible amounts
of State and local expenditures for these functions are included in Federal expenditures.
2 Consists of education, health, labor and welfare, and veterans benefits and services.
3 Consists of agriculture and agricultural resources and natural resources.
* Federal expenditures include and State and local expenditures exclude Federal grants.
* See footnote 1.
Note.—Expenditures are on a national income accounts basis.
Detail may not add to totals because of rounding.
Source: Department of Commerce.
For all levels of government, the largest increases were recorded in
spending for education, health, and welfare purposes. Total spending for
such purposes rose from 8.5 percent of potential GNP to 15.9 percent, and
Federal spending rose from 3.7 percent of potential GNP in 1955 (about
$15 billion) to 8.3 percent in 1971 (about $93 billion). A large part of
the rise was in spending connected with social security programs for the
aged and disabled, although other forms of spending for education, health,
and welfare functions also rose rapidly.
The rise in the share of Federal civilian spending in the United States
has accelerated since the mid-1960's along with the large increase in the
number and scope of social programs. Many of these were introduced
without any firm estimate of how effective they would be in solving the
problems to which they were addressed or how much they would cost in
the long run. At the same time there has emerged the need for new social
programs, especially in the field of pollution abatement.
The continued existence of large social problems alongside a greatly
expanded volume of government expenditures designed to correct these
problems is not a strong argument for devoting a still-larger share of the
490-000 O - 73 - 6
77
national output to similar government programs. On the contrary, it is an
argument for close scrutiny of these programs to discover whether they can
be justified by their results. Such a scrutiny, carried out by the Administration, has led to decisions to cut back many programs, even though total
Federal spending, after the cuts, will still be rising by about $20 billion a
year. Making these cutbacks in less effective programs will provide budget
room for consideration of more effective programs later as the growth
of the economy expands the Federal revenue.
PRICE AND WAGE RESTRAINTS IN PHASE III
The purpose of budget and monetary policy is to help the economy achieve
sustainable expansion along the growth path of potential output. One necessary condition for achieving this objective is the avoidance of policy errors
which risk the re-emergence of generalized demand-pull inflation. A second
condition is that the risk of inflation related to cost-push and expectational
factors should also be minimized. Inflationary expectations and behavior
left over from the country's experience since 1966, even though reduced
in 1972 from previous heights, have not been completely eliminated. The selfinterest of both business and labor calls for restraint and hence can be expected to lead to an even more durable winding-down of inflationary patterns
than the economy has already achieved. However, the reciprocal abatement
of the rate of wage and price increases is a delicate and complex process that
can be upset through unrestrained behavior by particular sectors of the pricewage spectrum. To avoid the risk of such disruption, it is necessary to maintain a system of direct wage and price restraints in 1973.
Although temporary continuation of controls in 1973 is necessary, the
condition of the economy and of the controls system have pointed to the
need for substantial changes in the program. Two things are critical. One is
to restrain and, if possible, reverse the rapid rise of food prices. The
second is to moderate the degree of detailed supervision and mandatory enforcement in the system in order to preserve the self-restraint which has been
the essence of the progam.
In 1972 food prices rose much more rapidly than other prices. The reasons for this, and the steps taken to curb the food price increase, are described
in Chapter 2 and its supplement. By the end of 1972 adverse weather conditions had further reduced the food supply in prospect for 1973. Moreover,
it began to appear that these uncontrollable adversities were superimposed on
an agricultural policy which, although less restrictive than it had been, still
leaned too far in the direction of limiting output and stocks relative to the
rising domestic and foreign demand. This was especially true for meat,
where the programs adopted in the early 1960's had made a major change
in the way farmers could use their cropland. Whereas previous programs
had placed limits on actual acres of crops produced, and allowed other
areas of land to be used for livestock grazing or production of minor crops,
78
the new programs utilized a new concept. They restricted the production of
major crops by paying farmers to idle a portion of the acres previously used
in crop production. In return for the payment, the idle acres had to be
planted to soil-conserving crops and could no longer be used for livestock
grazing or other crop production during the most productive part of the
year. This change had the effect of slowing the rate of growth of meat
production after 1965. With strong growth in demand for meat in 1972,
prices rose rapidly.
Arresting the rapid rise in food prices is a key element in the 1973 stabilization program, both because of the direct importance of food in family
budgets and because of the possible link between food prices and moderation of wage increases. Accordingly, the revision of the Phase II program
included major steps to restrain food price increases in addition to what had
been done in 1972.
During January 1973 the Administration took a number of strong measures which will have an important impact on food supplies and food prices,
although with some lag. These include:
1. Suspension for 1973 of mandatory acreage set-aside requirements under
the wheat program.
2. Disposal of Government-owned stocks of grains, except for minimum
reserves, to be completed promptly.
3. Termination of Government loans, effective May 31, 1973, on farmerowned stocks of grains from crops of 1971 or earlier years.
4. Suspension of all remaining export subsidies for foods, applying to
chickens, flour, and lard.
5. Permission for acreage diverted from crop production under Government programs to be used for grazing animals under arrangements to be
agreed upon with the Department of Agriculture.
To help assure that the agricultural policies of Government are consistent with the anti-inflation objective, administrative actions of the Department of Agriculture affecting food supplies and prices will hereafter
be subject to review by the Cost of Living Council (CLC). The CLC
Committee on Food has been set up to discharge this function as well as
to review or initiate other policies and proposals that may affect food prices.
This can lead to a progressive reorientation of agricultural policy to the
needs of the 1970's.
As in Phase II, mandatory controls will be continued on food processing
and distribution. Large food processors will be required to comply with previous regulations, including prenotification and approval of cost-justified
price increases. The limitations on retailers' margins established under the
Phase II system will remain in force, except for mii.or administrative changes.
Pay units in the food processing and retailing industries will remain under
mandatory pay control.
79
Concern with the food price problem in 1972 led the Cost of Living
Council to ask the National Commission on Productivity to undertake a study
on ways to improve productivity and reduce costs in food production and
distribution. The study, which has now been transmitted to the CLC for its
consideration, contains numerous suggestions for both Government and private action. A Food Industry Advisory Committee, drawn from the private
economy, has been established to advise the CLC on matters relating to food
costs and prices. One of its main functions will be to assist in carrying out
recommendations for raising productivity arising from the recently completed study.
Three other sectors of the economy, in addition to food, will receive special attention under Phase III.
(a) Medical care. Mandatory control of prices and wages remains in
force in the health industry. The Cost of Living Council Committee on
Health will review Government activities significantly influencing healthcare expenses. A Health Industry Advisory Committee composed of private
citizens will advise the CLC in this area.
(b) Construction costs. The Construction Industry Stabilization Committee will continue to operate as under Phase II to restrain wage increases
in that industry. Construction prices are subject to reduction if scheduled wage increases are reduced.
(c) Interest and dividends. The Committee on Interest and Dividends
will continue its efforts to obtain voluntary cooperation in holding down
dividend payments and interest rates.
Outside of these particular areas, the main effort of Phase III is to bring
about private action on wages and prices consistent with the goal of
slowing down the inflation rate without imposing unnecessary burdens on
the economy. These burdens, described in Chapter 2 as they related to Phase
II, included administrative costs for the Government and the private sector,
interferences with productivity and production, obstructions to the normal
conduct of business and collective bargaining, weakening of incentives to
investment, and a feeling of inequity on the part of some. Although surprisingly small during 1972, these burdens were becoming more serious and
there was every reason to believe that they would become still more serious
as the control system continued and as the economy moved closer to its
potential.
These costs or burdens of the system were not essential for its basic objective. The objective was not to force prices and wages to conform in every
particular case to precisely defined standards laid down by the Government,
nor to obtain advance approval for every private action. The objective was
a certain average degree of restraint. But prior to August 1971 private decisions had been made for a long time in a highly inflationary atmosphere.
With that background, spontaneous wage and price decisions in 1972 could
have come out a long way from the requirements of price stability, even
80
given a general desire to cooperate in the fight against inflation. Thus the
ability of the Government to monitor private behavior and enforce reasonable compliance with the requirement of price stability had to be developed
and demonstrated. Therefore, the situation of Phase II required prenotification, precise standards, and omnipresent enforcement. The conditions at the
opening of 1973 permitted and—if the system was to survive and succeed—
required a relaxation of these forms of the system. This is the basic philosophy
of Phase III.
The President has established a goal of getting the rate of inflation down
to 2^4 percent or less by the end of 1973. The Cost of Living Council has set
forth standards of price and wage behavior which are consistent with
the achievement of this goal. These standards are essentially the standards
of Phase II, with some modifications on the price side which are noted
below. The CLC has authority to change these standards. In considering
modification of the pay standards the CLC will have the advice of a LaborManagement Advisory Committee composed of leading private citizens.
Compliance with these standards is expected to be initially and generally
voluntary. The program will be self-administering, in the sense that private
parties can calculate the application of the standards in their own cases. The
experience under Phase II, and the regulations and definitions developed
under it, were invaluable in making this possible. Businesses and collective
bargaining units will not be required to notify the Government in advance
of price or wage increases. The largest economic units will be required to
submit quarterly reports to the Cost of Living Council, which will permit
the CLC to assess their behavior relative to the requirements of the antiinflation goal. Moderate-sized economic units will be required to maintain
records for the same purpose. The parts of the economy not required to submit reports or maintain records will be surveyed from statistical and other
information and are expected to follow the same standards.
When the Cost of Living Council believes that there have been, or are
about to be, price or wage increases that are not reasonably consistent with
the objectives of the program it can take action to stop them. Among other
things, it can, if it considers it appropriate, issue an order under the authority of the Economic Stabilization Act setting a ceiling on specific prices or
wages. This order might be temporary, pending a hearing. While the order
is in effect, transgressing it will be a violation of the Act and subject to its
penalties. In determining whether price or wage increases are not reasonably
consistent with the objectives of the program the CLC will be guided by the
standards it has issued.
The Price Commission and the Pay Board will no longer operate in Phase
III, but many of their functions will be performed by Price and Pay Divisions
of the Cost of Living Council. Rent control, which had already been cut down
to cover about 30 percent of rental units, is terminated in Phase III, because
it leads to costly evasions, enforcement is difficult, and housing market condi-
81
tions have significantly improved. The total number of personnel assigned to
the program will be reduced from about 43000 to about 2,000. Relieved of the
necessity to process a large flow of advance notifications, and to administer
rent control, this staff will be adequate to maintain an effective option for the
Government to intervene to assure achievement of the anti-inflation goal.
The President has asked for a 1-year extension of the Economic Stabilization
Act, which would otherwise expire on April 30,1973.
One significant change ha<s been made in the standard for prices. As in
Phase II, prices may be increased only to reflect cost increases. These costbased price increases are then subject to one of two further limits. First, the
average increase in a firm's prices may not exceed 1.5 percent in a year; if
this standard is observed the firm's profit margin will not be limited. Second,
if a firm's average price increase exceeds 1.5 percent that firm may not
exceed its base period profit margin. Thus, a firm is given the opportunity
to exceed its base period profit margin if it does so by increasing productivity,
without raising prices by more than 1.5 percent. The base period for calculation of the allowable profit margin is slightly altered by permitting the inclusion of fiscal years ending after August 15, 1971.
The essence of Phase III is that the Government retains the enforcement
ability and authority necessary to the Nation's anti-inflation objective while
leaving the private sector the maximum possible freedom to pursue productivity, efficiency, and collective bargaining.
THE OUTLOOK FOR 1973
The U.S. economy will expand substantially in 1973. All major components of demand will rise strongly except for residential construction and
Federal purchases. Aggregate demand for goods and services will rise by about
10 percent, from an estimated 1972 level of $1,152 billion to about $1,267
billion in 1973.* The real increase is projected at 6% percent with an implied
increase in the GNP price deflator of 3 percent. This projection of GNP
prices is compatible with the objective that the rate of inflation, as measured
by the consumer price index, be reduced to 2^2 percent or less by the end of
1973. Civilian employment is expected to rise more rapidly than the civilian
labor force, reducing the unemployment rate to the neighborhood of 4 / 2
percent by the end of the year.
The course of the U.S. economy, at least through the first half of 1973,
will be dominated by expansive forces already in place at yearend 1972.
Business investment has developed a strong forward momentum, stimulated
by both the fact and the expectation of expanding orders, sales, and profits.
The ability and willingness of consumers to increase their purchases has been
augmented by the large increase in social security benefits in the fourth
*Given the path of money GNP in 1972, an increase of 10 percent between the
average level in 1972 and the average level in 1973 is consistent with an increase
of 9 percent from the end of 1972 to the end of 1973.
82
quarter of 1972 and their incomes will be augmented again early in 1973 by
Federal pay increases. The financial position of the State and local government sector, stronger than it has been in many years, will be strengthened
further by both current revenue sharing payments and retroactive payments
for 1972.
Given these expansive forces the probability is that the economy will
maintain a very high rate of real growth over the first half of 1973. After
midyear, the economy will be significantly closer to the zone of full potential
output, and it is both probable and desirable that the rate of expansion will
and should abate toward its sustainable long-run path.
The outlook for the major components of expenditure on GNP in 1973
is discussed in the following sections.
Business Fixed Investment
The Council expects the rise in business fixed investment to continue on
its strong upward course and to increase by 14 percent from 1972 to 1973,
about the same as the rise from 1971 to 1972. The last time two successive
annual increases of this magnitude occurred was in the mid-1960's. A substantial part of the earlier increase took place before the rapid buildup of the
war in Vietnam. The foundation for the large increase expected in 1973
has already been laid. The rapid expansion in 1972 has generated increased
requirements for capacity expansion and has also provided business with a
substantial part of the funds required for capital goods purchases: In addition to rising profits, the actual and potential availability of funds has been
augmented by liberalized depreciation provisions, the investment tax credit,
and the restraint on dividend increases, as well as by favorable financial conditions in the markets for debt and equity capital. This year's strong economy
will sustain investment plans that have already been made and, indeed, will
probably lead to their upward revision.
Several indications of forward investment commitments were noted in
Chapter 1. Additional evidence can be found in the strong buildup in unfilled order backlogs held by producers of capital goods, which were 14
percent larger in November 1972 than a year earlier. Recent months have
also seen a pronounced step-up in construction contract awards for factory
building, which had been lagging for several years.
According to the most recent Commerce Department survey, taken in
November and December and published in January, businessmen were
projecting a rise of 13 percent in their plant and equipment expenditures
from 1972 to 1973. The survey also projected a rise of 13/ 2 percent for
manufacturing companies. These results correspond fairly closely with a
similar survey conducted by McGraw-Hill in late October. The manufacturing increases extended to almost all major industries and were especially
large in the durable goods sector. Investment by nonmanufacturing business is expected to continue its steady upward trend for a projected rise of
12% percent, with larger than average increases in spending by public
utilities and mining.
83
The Council's forecast for an overall rise of 14 percent is basically consistent with the rise projected in the anticipations survey for 1973. One reason
for a slightly higher forecast is that investment demand is expected to be
strong in certain sectors not covered by the plant and equipment survey,
notably investment in agriculture, and among professional businesses. A
second reason is that over the postwar period anticipations have tended to
underestimate actual results during periods of strong expansion.
It is interesting to note that experience in 1972 was an exception to the
general rule: Business spent less on new plant and equipment in 1972 than
was projected early in the year by both the Commerce and McGraw-Hill
surveys. It is highly unlikely that the shortfall was due to disappointments in
demand; indeed, capital appropriations, new orders, and contract awards all
increased as 1972 progressed. A possible explanation for the shortfall which
occurred is that construction and equipment costs did not rise as fast as
originally expected, especially for older projects that had been planned
several years previously and had been reactivated after postponement during
the recession.
Inventory Investment
The change in business inventories is expected to total $12^2 billion in
1973, an increase of about $7 billion over last year's level of inventory
accumulation. Considering the strength of the rise in output and sales in
1972, inventory accumulation was relatively low. However, stocks relative
to sales at the beginning of 1972 were still a little high by historical experience. In addition, most sectors experienced few problems with delivery
delays, and under such conditions a major shift in inventory policy was not
likely. The combination of last year's strong upsurge in sales and the moderate rise in stocks has reduced the ratio of stocks to sales for manufacturing
and trade firms combined to its lowest level since 1966. One structural element that will help add to inventory investment this year is the increased
demand—stemming from some of the capital-intensive manufacturing industries—for heavy equipment with long production lead times.
Residential Construction
Residential construction expenditures are expected to rise only slightly
from 1972 to 1973 and to decline somewhat in real terms. Housing starts are
expected to edge down gradually throughout 1973, averaging 2.2 million
units as compared to 2.4 million in 1972. In general the decrease in new
starts will reflect cutbacks in some areas where overbuilding has occurred,
some reduction in the backlog of demand as this is satisfied by the very large
volume of completions expected in 1973, and somewhat less favorable conditions in mortgage markets than prevailed last year. The number of new
nonfarm housing units—public as well as private—to be started under HUD-
84
subsidized programs is expected to exceed the 1972 level somewhat, even
though new commitments under these programs are being discontinued.
The reduction in total starts is not expected to be severe because the underlying demand for housing—buttressed by strong formation of new households and replacement demand—continues to be very high. Furthermore,
while some rise in interest rates may occur as a result of the strong upsurge
in business activity, there is little possibility of the stringent financial conditions that led to shortages of mortgage funds in 1966 and 1969.
Government Purchases
Government purchases are expected to show mixed trends. State and local
purchases are projected to rise by 12 percent, or by somewhat more than
last year's 10 percent rise, due in part to the effects of revenue sharing. Many
States and localities have indicated that spending increases related to revenue sharing receipts will take the form of capital projects, in which case the
full impact of the new program on the economy will be deferred by the longer
lags involved in planning and executing such expenditures. There will also be
tax cuts from existing levels or the avoidance of tax increases that might
otherwise have taken place in the absence of revenue sharing, and also some
debt reduction. All of this may stimulate the economy but not in the form
of higher government purchases.
Federal purchases of goods and services are scheduled to show little change
from 1972 to 1973, which means a decrease in real terms. The year begins
with a Federal pay raise for both military and civilian workers that is
expected to add $2.2 billion a year to Federal payrolls, although part of this
rise is expected to be offset by subsequent reductions in personnel.
Net Exports
Imports of goods and services are likely to exceed exports again in 1973
but the difference is expected to be narrower by about $2j/s> billion than was
the case in 1972. The improving trend in the balance of trade that began in
mid-197 2 should continue through the coming year. Because the growth of
U.S. output from yearend 1972 to yearend 1973 will be slower than it was
in the preceding 4-quarter period, the demand for imports should rise less
rapidly than during 1972. At the same time, economic growth in major
industrial countries abroad is expected to be more rapid during 1973 than
during 1972, and on this account the growth rate of demand for U.S. exports
should show an improvement. Furthermore the slower rise in U.S. costs and
prices relative to those experienced by our trading partners should increase
the relative demand for U.S. products both at home and abroad. Finally, the
positive long-run effect of the December 1971 currency realignment, which
was offset by its perverse short-run effects on the nominal dollar value of our
trade balance last year, can be expected to show up more clearly in 1973.
However, the positive effects outlined above will be reduced by a continuing rise in net fuel imports.
85
Consumer Spending
Consumer spending is expected to rise approximately 9^4 percent in 1973,
exceeding last year's large rise of 8^2 percent. However, the course of consumer demand within 1973 is not likely to be as rapid as it was within 1972.
This difference between year-to-year and within-the-year movements reflects the fact that unlike 1972, the year 1973 starts off from a high base.
For example, retail sales in December after seasonal adjustment were 4J/2
percent above the monthly average for all of 1972; the corresponding figure
a year ago was 2 J/2 percent above the 1971 average.
Personal income is expected to show another large gain from 1972 to
1973, with an expected rise close to that of last year. A large rise in employment and payrolls will be supplemented by the increase in social security
benefits that became effective in the final quarter of 1972 as well as by new
benefits that become effective in 1973.
Personal income is computed after subtracting personal contributions
for social insurance. This year, increased social security tax rates and a
higher taxable earnings base will reduce personal income by about $5 billion. Although the national income accounts record the entire amount of
the tax rise beginning in the first quarter, it is important to note that the
portion due to an increase in the wage base ($1.6 billion at an annual rate)
does not, in actual practice, become effective until later in the calendar year.
Disposable income is expected to show an extremely large rise of 10 percent this year, exceeding the rise in personal income mainly because of the
refunds of the overwithholding of 1972 personal income taxes. These
refunds are expected to give a strong boost to cash income in the
first half of the year, followed by a corresponding slowdown in the growth
of spendable income after midyear. Some impact on consumption is expected from these refunds, but the greater part is assumed to affect personal
saving, as seems to have been the case in 1972. Because of the heavy infusions of income in the first half of 1973, the saving rate in that period is likely
to be very high but it should decrease as the year progresses.
Labor force and unemployment
The unemployment rate is expected to decline to the neighborhood of 4 / 2
percent by the end of 1973. This projection is essentially based on the forecast
that real GNP in 1973 will be about 6% percent higher than it averaged in
1972. The principal uncertainty involved in translating the projection of
output into a projection of the unemployment rate is the growth of the total
labor force (which includes the Armed Forces) over the course of the year.
In the mid-sixties it was widely assumed that the trend rate of growth of
the labor force would rise to about 1 ^4 percent per annum and remain there
through 1980. In fact the growth of the total labor force turned out to be
much higher; over the last half of the 1960's it was close to 2*4 percent per
annum. As a result, the total labor force is now far larger than the level
86
projected in 1965. The extraordinary expansion in participation rates ended
in 1970.
In 1972, in spite of a strong expansion in employment opportunities, the
growth of the total labor force was close to its long-term rate of 1 % percent.
The uncertainty for 1973, and beyond, is whether labor force growth will
remain at this level. There are reasons to believe that it will, and that the
extraordinary increases between 1965 and 1970 represent a one-time phenomenon, caused principally by the following factors:
1. The strong demand for labor due to the Vietnam mobilization and
buildup increased labor force participation rates. In particular it drew large
numbers of women and teenagers into the labor force because so many men
were either in the Armed Forces or remained in college.
2. The fertility rate fell rapidly, causing fewer women to be out of the
labor force looking after young families.
3. Because women generally have a lower median age at marriage than
men there was a temporary excess of women when the first cohorts of the postwar baby boom reached marriageable age in the mid-1960's. Like the fall
in the fertility rate, the "marriage squeeze" induced an abnormal increase
in the labor force.
4. The introduction of 7-day and late night openings by many sectors of
retail trade led to large increases in the availability of part-time work.
These factors do not seem to be still operating on balance to accelerate
participation rates further, and it is therefore likely that labor force growth
will now remain at its long-run trend rate of 1 % percent. If it does, and the
size of the Armed Forces remains close to present levels, the 4J4 percent
unemployment level forecast should be achieved.
*
#
*
*
*
#
*
As always there are uncertainties. The projection of a 10 percent rise in
money GNP between 1972 and 1973 is within the high side of the fairly
narrow range being forecast by the majority of economic models and economists. The probability that GNP in 1973 will differ from its forecast
value by more than 1 percent is extremely small.
The apparent consensus on money GNP for 1973 is due in part to the
fact that many of the common foreshadowing data used are themselves
stated in terms of expected dollar flows. There is less agreement about how
the nominal increase will be divided between real growth and changes in
the price level—because we have fewer insights on either of these components than we have for the total itself. The Council's projection of a
3 percent change in GNP prices is at the low end of the range now expected
by private forecasters. It is based on three assumptions about the future:
That the limit on federal expenditures proposed by the President for fiscal
1973 and fiscal 1974 will be met; that the rate of rise in food prices will
be less than in 1972; that there will be a high degree of compliance with
87
Phase III standards, enforced as necessary by the Economic Stabilization
Program. None of these is certain but the probability is high that all will be
realized.
Notwithstanding the uncertainties, the economy in 1973 appears to be
moving along a general path which gives it a better chance of reaching
sustainable full employment than it has had in all but one or two years of
the postwar period.
88
CHAPTER 4
The Economic Role of Women
O
NE OF THE MOST important changes in the American economy in
this century has been the increase in the proportion of women who
work outside the home. This increase is the most striking aspect of the expansion of the role of women in the economy.
The addition of millions of women to the labor force has contributed
substantially to the increase of total output. This is most obvious if we focus
attention on the output that is measured and included in the gross national
product (GNP). But even if we subtract from the contribution of working
women to the GNP the value of the work they would have done at home,
there has been an addition to total output. Most of the benefits of this additional output accrue to the women who produce it, and to their families.
There are, however, also direct benefits to the society at large, including the
taxes paid on the women's earnings.
Concern is sometimes expressed that the increase in women in the labor
force will reduce the employment opportunities for men and raise their
unemployment. There is no reason to think that would happen and there
is no sign that it has happened. The work to be done is not a fixed total.
As more women enter employment and earn incomes they or their families
buy more goods and services which men and women are employed to
produce. A sudden surge of entrants into the labor force might cause difficulties of adjustment and, consequently, unemployment, but the entry of
women into the labor force has not been of that character.
Women work outside the home for the same reasons as men. The basic
reason is to get the income that can be earned by working. Whether—for
either men or women—work is done out of necessity or by choice is a
question of definition. If working out of necessity means working in order
to sustain biologically necessary conditions of life, probably a small proportion of all the hours of work done in the United States, by men or
women, is necessary. If working out of necessity means working in order
to obtain a standard of living which is felt by the worker to be desirable,
probably almost all of the work done by both men and women is necessary.
The Employment Act of 1946 sets forth a goal of "maximum employment." We understand that to mean employment of those who want to
work, without regard to whether their employment is, by some definition,
89
necessary. This goal applies equally to men and to women. The Act also
sets forth a goal of "maximum production." We understand the meaning
of that goal which is relevant to the present context to be that people
should be able to work in the employments in which they will be most
productive. That also applies equally to men and women.
Although the goals apply equally to men and women, some of the obstacles to their achievement apply especially to women. Women have gained
much more access to market employment than they used to have, but they
have not gained full equality within the market in the choice of jobs, opportunities for advancement, and other matters related to employment and
compensation. To some extent the cause of this discrepancy is direct discrimination. But it is also the result of more subtle and complex factors
originating in cultural patterns that have grown up in most societies through
the centuries. In either case, because the possibilities open to women are
restricted, they are not always free to contribute a full measure of earnings
to their families, to develop their talents fully, or to help achieve the national
goal of "maximum production."
ADVISORY COMMITTEE ON THE ECONOMIC ROLE OF
WOMEN
Recognizing the urgency of these problems and the importance of leadership to change the attitudes which underlie them, the President announced
in September the formation of the Advisory Committee on the Economic
Role of Women. The committee will meet periodically with the Chairman
of the Council of Economic Advisers, providing a forum for the interchange
of information, ideas, and points of view. This interchange will increase the
Council's own expertise on the economics of women. Because the function
of the Council of Economic Advisers is to advise the President on a wide
variety of economic issues, its association with the committee will ensure
that the interests of women will be represented in economic policy decisions.
With these goals in mind, in January 1973 the Chairman of the Council
of Economic Advisers asked 21 men and women representing diverse areas
of expertise to serve on the committee. They include officials from the Federal Government agencies whose activities are important to the progress of
women, representatives from business, finance, education, and other private
institutions, and specialists on the economic problems of women from
sociology, psychology, economics, and the law. Among the topics that the
committee will explore are job training and counseling in the schools,
special problems of minority women, problems related to child care,
women's performance at work, the extent of job discrimination, women's
access to credit, and legislative action on taxes and social security that
may have a different effect on women than on men.
Another, more fundamental, issue affecting women in the economy underlies many of the others. The roles played by women and men have been
90
sharply differentiated. It is obvious that only women are capable of childbearing. But along with this biologically determined role, women have by
tradition come to assume primary responsibility for child care and home
management, while men have primary responsibility for the family's financial support. Until very recently this division of labor within the family
has had such general acceptance as to impose limitations on women's
work outside the home. The way in which the economic role of women
evolves thus hinges on the most fundamental societal patterns, and the
extent to which social action can and should influence further change in
these patterns will be one of the most difficult and important questions the
committee must consider.
By way of an introduction to the problem, this chapter looks at jobrelated aspects of the economic role of women. The committee will, of
course, deal with a much broader range of topics.
PARTICIPATION IN THE LABOR FORCE
In 1900 about 20 percent of all women were in the work force (Table 21).
In the succeeding decades this percentage hardly increased, reaching
about 25 percent by 1940. With World War II, however, the movement
rapidly accelerated, and by 1972 the percentage of women 16 years and
older in the work force had risen to 43.8. Single women and women
widowed, divorced, or separated, have always had higher labor force participation rates than married women living with their husbands. By 1950,
the participation of women in the two former groups had already reached
levels close to those of today. Thus, the upward trend in labor force
participation since World War II has been due almost entirely to the
TABLE 21.—Women in the labor force, selected years, 7900-72
Women in
labor force
(thousands)
Year
Women in labor force as
percent of
Total labor
force
All women of
working age
1900
1910
1920
1930
1940
5,114
7,889
8,430
10,679
12,845
18.1
20.9
20.4
22.0
24.3
20.4
25.2
23.3
24.3
25.4
1945
1950
1955
1960 .
1965
1970
19,270
18 412
20, 584
23,272
26,232
31,560
29.6
28.8
30.2
32.3
34.0
36.7
35.7
33.9
35.7
37.8
39.3
43.4
1972
33, 320
37.4
43.8
Note.—Data for 1900 to 1940 are from decennial censuses and refer to a single date; beginning 1945 data are
annual averages.
For 1900 to 1945 data include women 14 years of age and over; beginning 1950 data include women 16 years of age
and over.
Labor force data for 1900 to 1930 refer to gainfully employed workers.
Data for 1972 reflect adjustments to 1970 Census benchmarks.
Sources: Department of Commerce, Bureau of the Census, and Department of Labor, Bureau of Labor Statistics.
91
changed behavior of married women (Table 22). The first to respond
were the more mature married women beyond the usual childbearing
years. More recently there has also been a sharp upturn in the labor force
participation of younger married women.
The record for men has tended to run in the opposite direction. A secular reduction in time spent in paid work over most men's lifetimes has
taken place: A man spends more years at school and enters the labor
force later than formerly; he retires earlier, works fewer hours a week, and
has longer vacations. Of course these changes have also affected women,
but for them the increase in years worked has far outweighed the other
work-reducing factors.
In one very important respect, however, the working life patterns of men
and women have not merged. The typical man can expect to be in the
labor force continuously, for an unbroken block of some 40 years between
leaving school and retirement. Of men in the 25-54 year age group, 95.2
percent were in the labor force in 1972. For most women, this continuity
in participation is the exception rather than the rule.
TABLE
22.—Labor force participation rates of women by marital status and age, 1950, 7960
and 1972
[Percent i]
Age
Marital status and year
Total
Under
20 years
20-24
years
25-34
years
35-44
years
45-64
years
65 years
and over
Single:
1950
1960
1972
50.5
44.1
54.9
26.3
25.3
41.9
74.9
73.4
69.9
84.6
79.9
84.7
83.6
79.7
71.5
70.6
75.1
71.0
23.8
21.6
19.0
23.8
30.5
41.5
24.0
25.3
39.0
28.5
30.0
48.5
23.8
27.7
41.3
28.5
36.2
48.6
21.8
34.2
44.2
6.4
5.9
7.3
37.8
40.0
40.1
37 3
44.6
45.5
54.6
57.6
62.3
55.5
62.1
65.4
67.4
71.7
50.2
58.3
61.1
11.0
Married, husband present:
1950
1960
1972
Widowed, divorced, or separated:
1950
1960
1972
8.8
9.8
i Labor force as percent of noninstitutional population in group specified,
s Not available.
Note.—Data relate to March of each year.
Data for 1950 and 1960 are for women 14 years of age and over; data for 1972 are for women 16 years of age and over.
Source: Department of Labor, Bureau of Labor Statistics.
THE HISTORICAL PATTERN
What are the causal factors that induced women to enter the labor force?
One might have expected that the strong increases in husbands' real incomes which occurred during the period would have provided an incentive to women not to enter the labor force. This seeming puzzle is resolved,
however, when one considers that by entering the labor force women did
not leave a life of leisure for work, but rather changed from one kind of
92
work, work at .home, to another kind of work, work in the market. The
incentive for women to make this dramatic occupational change came from
several developments which made paid work outside the home the increasingly more profitable alternative.
Rapidly rising earnings and expanded job opportunities for women
gave a strong impetus to the change. The expansion of job opportunities for women was undoubtedly influenced by the expansion of the
service sector of the economy, where employment increased by 77 percent
from 1950 to 1970, compared to the increase of 26 percent in the goodsproducing industrial sector over the same period. Women have always been
more heavily represented in services than in industry, since the service
sector offers more white-collar employment and provides more opportunities
for part-time work, an especially important feature for women with small
children. On the other hand, the increasing supply of women workers
perhaps itself contributed to the rapid expansion in the service sector.
The increase in women's educational attainments has also helped to raise
the amount they can earn by working. Education may make women more
productive in the home, that is, more efficient housekeepers, consumers, and
mothers, but education appears to increase still more their productivity in
work outside the home. Women with more education earn more, and they
are more likely than less educated women to seek work in the market.
Because life expectancy has increased considerably over the century (and
more for women than for men), and because most women complete their
childbearing at a younger age, women can look forward with more certainty to a longer uninterrupted span of years in the labor force. This lengthening of a woman's expected working life is significant because it increases
her return on her investment in training and education: the greater the
number of years in which to collect the return the greater is the return.
These increases in the income a woman could potentially earn meant
essentially that time spent producing goods and services at home was coming
at a higher and higher cost in terms of the income foregone by not working
in the market. It made sense then to buy available capital equipment (such
as washing machines) which would substitute for some of the housewife's
time and free her to go to work. And changes in technology which lowered
the cost and increased the array of time-saving devices facilitated the
substitution.
The most difficult home responsibility to find a good substitute for is
child care; and, although the labor force participation of women with
children under 6 years has increased from 12 percent in 1950 to 30 percent
in 1971, child-rearing is probably the major factor causing some women to
interrupt and others to curtail their careers.
The long-term decline in the average number of children in the family
has undoubtedly had a strong influence on the proportion of women entering the labor force. Advances in birth control techniques permit parents
not only to reduce the number of births but also to control their timing to
490-000 O - 73 - 7
93
suit a mother's working career. Declines in infant and child mortality may
also have encouraged a reduction in births by increasing the parents' expectation that all their children would survive to adulthood. On the other
hand, reductions in family size may themselves be influenced by the desire
of women to work.
Childbearing has a very noticeable effect on the patterns of women's
labor force participation by age. Based on census data, Chart 9 traces the
lifetime changes in labor force participation by groups of women born at
different times, the earliest group consisting of women born between 1886
and 1895. The chart therefore simulates the actual work history of particular cohorts of women followed longitudinally. According to this chart,
the various forces in the economy that have induced women to work have
generally had a more powerful effect on women beyond the childbearing ages
Chart 9
Labor Force Participation Over a Working
Life of Cohorts of Women Born in Selected
Time Intervals, 1886-1955
PARTICIPATION RATE (PERCENT)*
60 -
—
BORN 1916-25
BORN 1946-55
BORN 1926-35
50
40
/
BORN
BORN 1906-15
_
1936-45
• s^T
V
/
BORN
1896-1905
—
30
20
-
-
10 A.
1
1
16-24
25-34
1
35-44
YEARS OF AGE
1
45 "54
,N
55 "64
• T O T A L LABOR FORCE AS PERCENT OF TOTAL NONINSTITUTIONAL POPULATION IN GROUP SPECIFIED.
NOTE: FOR WOMEN BORN BETWEEN 1886 AND 1915, THE FIRST AGE PLOTTED IS 14-24 YEARS. COHORTS
REACH EACH AGE INTERVAL ACCORDING TO THE MIDPOINT OF THEIR BIRTH YEARS. THUS, THE
COHORT BORN 1886-95 REACHED AGES 25-34 IN 1920 AND AGES 55-64 IN 1950; THE COHORT BORN 1916-25
REACHED AGES 25-34 IN 1950 AND AGES 45-54 IN 1970.
SOURCE: DEPARTMENT OF COMMERCE.
94
than on younger groups. Those increases in labor force participation that
have occurred for groups of women reaching the childbearing ages of 20-34
years have been closely associated with declining fertility rates. Thus labor
force participation for the group reaching 25-34 years increased substantially from 1930 to 1940, and again between 1960 and 1970, while there
was a decline between 1940 and 1950 in the participation of those reaching
this age group—the baby boom mothers. Whether the young women now
in their twenties have simply postponed having children and will later drop
out of the labor force or whether many will continue to work, choosing to
have small families or remain childless is, of course, a question of great
interest.
THE WORKING WOMAN TODAY
Although the decisions of individual women to work outside the home
are undoubtedly based on many different factors, there are some economic
factors which seem to be of overriding importance. The necessity to support
oneself or others is one obvious reason and, not surprisingly, adult single
women and women who have been separated from husbands or widowed
are highly likely to work.
The increase in earnings opportunities, which proved to be such a powerful factor influencing the secular growth of women's participation in the
labor force, is a similarly powerful factor influencing the pattern of
women's participation at any given time. Thus, education and other
training which affect the amount a woman can earn are strongly related
to women's work patterns. The importance of education is such that, whether
a woman is single, married or separated, the more education she has, the more
likely she is to work. One striking exception to this pattern is that, among
mothers of children under 6 years old, there is scarcely any relation between
education and labor force participation. Thus, the rearing of children of
preschool age causes all women, regardless of education, to curtail their work
outside the home. However, the drop in participation during this childrearing period is most pronounced for highly educated women who in other
circumstances have much higher participation rates.
Although for most women the childbearing period has been reduced, childbearing still means an interruption of outside work. A longitudinal survey of
the lifelong work experience of women indicates that among all women who
were 30-44 years old in 1967, only 7 percent had worked at least 6 months
out of every year since leaving school. Among married women with children
the proportion was still lower, dropping to 3 percent. By contrast, 30 percent
of childless married women in the same group had worked at least 6 months
out of every year. Information on job tenure collected by the Bureau of
Labor Statistics illustrates much the same phenomenon. As of January 1968,
continuous employment in their current job came to 2.4 years (the median)
for women and 4.8 years for men. Job tenure increases with age for both
men and women. At ages 45 and over the median was 12.7 years for
95
men and 6.6 years for women. Since women tend to change jobs less
frequently than men, their shorter time spent on any given job is the result
of a higher propensity to leave the labor force at least temporarily. In 1964
a survey of women who had dropped out of the labor force in 1962 or 1963
and had not yet reentered was undertaken by the Labor Department in an
effort to find out why they had left. Pregnancy was most frequently cited as
the primary reason—by 74 percent of the 18- to 24-year-olds and 56 percent
of the 25- to 34-year-olds.
Among married women, husband's income does not have a very pronounced effect on work patterns. The median annual income of husbands
with working wives was $8,070 in 1971 compared to $8,330 for husbands
of wives not in the labor force. Only when husbands' incomes reach the
$10,000 and over category does wives' participation decline to any noticeable
extent. However, many other things vary with husbands' incomes, such as
wives' education and age as well as family size. These other factors are sufficiently important to obscure the simple relation between husband's income
and a wife's tendency to work. It should be noted, however, that during a time
of hardship, such as when a husband experiences a prolonged spell of unemployment, wives who usually do not work may be compelled to work.
Thus, the labor force participation of women with unemployed husbands
is generally above that of women with employed husbands.
Although the probability that a black woman will work seems to vary with
education and presence of children in much the same way as it does for all
women, there is one very striking difference: the labor force participation
of black women is higher. Particularly pronounced differences are observed
when the comparison of labor force participation is confined to married
women living with their husbands. In March 1971, about 53 percent
of black wives were in the labor force compared to 40 percent of
white wives. One important reason why this difference prevails may be
that the earnings of black wives are closer to their husbands' than is
the case among white married couples. In 1971 black married women who
worked year-round, full-time earned 73 percent as much as black married
men who worked year-round, full-time. Among whites the percentage was
only 51 percent. Behind these relationships is the fact that black men earn
considerably less than white men, while black women's earnings are much
closer to white women's earnings.
UNEMPLOYMENT
Women have generally experienced more unemployment than men and
this differential has been more pronounced in recent years (Table 23).
However, the source of women's unemployment differs from that of men's,
and this makes a comparison of unemployment differences more complex
than might appear.
96
T A B L E 23.—Unemployment rates by sex and age, selected years,
1956-72
[Percent »1
Sex and age
1956
1961
1965
1969
1972
All workers.
4.1
6.7
4.5
3.5
5.6
Men....
3.8
6.4
4.0
2.8
4.9
11.1
6.9
3.0
3.5
17.1
10.8
5.1
5.7
14.1
6.4
2.7
3.3
11.4
5.1
1.6
1.9
15.9
9.2
3.1
3.3
4.7
6.6
13.3
6.3
3.5
2.2
16.7
9.3
4.9
3.4
16-19 years
20-24 years
25-54 years
55 years and over..
Women..
16-19 years
20-24 years
25-54 years
55 years and over..
4.9
7.2
5.5
11.2
6.3
4.1
3.3
16.3
9.8
6.2
4.4
15.7
7.3
4.3
2.8
* Unemployment as percent of civilian labor force in group specified.
Source: Department of Labor, Bureau of Labor Statistics.
Some of the difference arises from the way people are classified in our
unemployment statistics. A person with a job is not classified as unemployed
even though he or she may be searching for another job. However, work at
home is not counted as a job. Thus, a woman who may in a real sense be
clearly employed in the home while she searches for a job, will be counted
as unemployed, unlike the man who searches while on his job.
Most adult men are continuously in the labor force and therefore become
unemployed because they have either quit or lost their jobs (Table 24). For
women, the picture is different: labor force participation is frequently interrupted, sometimes for several years, but sometimes just for several weeks
during the year. Thus, although 59.8 percent of the women 24-54 years
old were in the labor force at one time or another during 1971, only 38.2
percent were in the labor force for 50-52 weeks during the year. This high
rate of labor force turnover generates unemployment, and it is not surprising to find that in both the tight labor market of 1969 and the looser
labor market of 1972 a considerable portion of unemployed women were
T A B L E 24.—Distribution of unemployment of adult men and women by reason for
1969 and 1972
unemployment,
[Percent]
Women 20 years and over
Men 20 years and over
Reason for unemployment
1972
1969
Total unemployment
Separated from a j o b . .
Job losers.
Job leavers
Labor force entrants,.
.
.
.
Reentrants
New entrants
Unemployment rate
^
Note.—Detail may not add to totals because of rounding.
Source: Department of Labor, Bureau of Labor Statistics.
97
1972
1969
100.0
100.0
100.0
100.0
74.8
75.3
49.9
55.7
57.8
17.0
62.6
12.7
33.0
16.8
39.4
16.3
25.2
24.6
50.2
44.3
22.4
2.8
21.6
3.1
44.8
5.5
39.4
4.9
2.1
4.0
3.7
5.4
labor force entrants (Table 24). People entering or reentering the labor
force tend, however, to be unemployed for relatively short periods, and
this is one of the reasons why the duration of unemployment is in general
shorter for women than for men (Table 25).
Table 25.—Unemployment of adult men and women by duration and reason,
1972
Percent of total unemployment
Sex, age, and reason
Total
unemployment
(thousands)
Men 20 years and over
Unemployment of
less than
5 weeks
Unemployment of
15 weeks
and over
1,928
37.0
31.6
1,207
245
416
59
33.6
44.9
41.7
39,0
35.3
24.9
25.4
28.8
Women 20 years and over
1,610
48.4
22.8
Lost last job
Left last job
Reentered labor force
Never worked before
635
262
635
79
35.6
50.0
59.8
55.7
33.4
19.2
14.4
16.5
Lost last job
Left last job
Reentered labor force .
Never worked before.
Note.—Detail may not add to totals because of rounding.
Source: Department of Labor, Bureau of Labor Statistics.
In order to know what significance to attach to the observation that the
greater unemployment of women appears to be related to their greater
labor force turnover, it is of course necessary to know more about the causes
of the turnover. Some have stressed that excessive labor force turnover
indicates a poor job market. According to this view, women drop out of the
labor market because lack of opportunities has discouraged them from
continuing the search. Evidence for this point of view is cited from Labor
Department surveys, which indicate that some of those women out of the
labor force are there because they do not believe they could find work. In
1972, 525,000 women or 1.2 percent of those out of the labor force were
reported in this category.
Another school of thought, however, stresses that the labor force turnover of women and the unemployment it generates is largely induced by
factors external to the current labor market, such as the uneven pressures of home responsibilities. Several kinds of evidence support this point
of view. Unemployment among women appears to be related to the nature
of home responsibilities. For example, in 1971 the unemployment rate for
married women with children under 3 years was 11.7 percent, compared
to the rate of 4.5 percent for married women with no children under 18
years. Moreover, on numerous surveys women cite pregnancy, home responsibilities, or husband's relocation as primary reasons for leaving the job
or the labor force.
98
It would of course be interesting to know more about the unemployment
experience of women who do remain continuously in the labor force. Some
evidence from the Labor Department's longitudinal survey indicates that
women who were in the labor force in both 1967 and 1969 had considerably
lower unemployment in 1969 than those who were in the labor force in
1969 but not in 1967. The unemployment rate in 1969 for the group who
were also in the labor force 2 years previously was 2.9 percent, compared
to the rate of 6.9 percent for the women who were in the labor force only
in 1969. However, this was still above the rate of 2.1 percent for men 20
years old and over in 1969, as measured by the household survey.
Although movement in and out of the labor force is probably the most
important factor leading to higher unemployment for women compared to
men, two other factors seem to be important. Women with less time on a
job and in whom the employer had made negligible training investments
are more vulnerable to layoffs. Finally, one additional factor which doubtless contributes to unemployment of married women is the difficulty in
maximizing employment opportunities for both the husband and the wife.
A wife seldom is free to migrate to wherever her own prospects are best.
It is important to emphasize, because the point is often misunderstood,
that to explain the unemployment of women is not to excuse it or belittle
it or to place blame on the women who are unemployed. The unemployment of women who seek work is costly, to themselves, their families, and
the Nation. Our goal should be to reduce this unemployment wherever
that can be done by means which are not themselves more costly. Some
unemployment entails more loss for the workers involved and to the economy as a whole than other; some is more amenable to correction by the
persons directly affected than other unemployment. But these distinctions
do not run along sex lines.
THE WIDENING IN THE REPORTED MALE-FEMALE
UNEMPLOYMENT DIFFERENTIAL
During the 1960's the differential in reported unemployment between
women and men widened. Two factors may help to explain the change.
The first has to do with changes in the unemployment survey questionnaire
introduced in 1967.
Persons are classified as unemployed if they have not worked during the
survey week, were available to work during the survey week, and had made
specific efforts to find a job such as looking in the "want-ads" section of
the newspaper or going to an employment agency. Prior to 1967 the period
of jobseeking efforts was not specified, and it is believed that many respondents interpreted the question narrowly to mean that one had to have looked
for a job in the week just prior to the survey. In 1967 the unemployment
question was changed by specifying 4 weeks preceding the survey as the
point of reference. Data from samples taken on both the old and new
99
basis are available for 1966. In that year the unemployment rate for
women aged 20 years or older was 0.4 percentage points higher on the new
basis than on the old. This increase in the rate for women as a result of
the change in the questionnaire has been interpreted as reflecting the
likelihood that the jobseeking activities of women are more intermittent.
As a result of lengthening the reference period to 4 weeks, persons
who had briefly looked for work but who were not actively seeking work by
the time of the survey week would be added to the unemployed under the
new definition.
Although the reported unemployment of some men may also have been
increased as a result of the effective lengthening of the unemployment reference period, other changes in the questionnaire in 1967, which were evidently
unimportant for women, seemed to reduce the reported unemployment of
men. Indeed these changes were of sufficient importance that the net effect
was to lower the unemployment rate for men 20 years old and over by 0.3
percentage points. The unemployment rate for men was evidently lowered
for two reasons: By a reclassification from unemployed to employed of
persons absent from work because of a vacation or a labor dispute but at
the same time looking for work; and by the fact that persons stating that
they had given up the search for work were no longer counted as
unemployed.
The 1966 samples indicate that as a result of the changes in the unemployment questionnaire, which increased the rate for women and lowered
the rate for men, the reported male-female unemployment differential,
comparing men and women 20 years old and over, increased from 1.3 percentage points to 2.0 percentage points. We cannot, of course, be sure that
effects of the same precise magnitude have persisted ever since the new
definitions were substituted in 1967. However, the definitional change has
undoubtedly contributed to a wider unemployment differential since the
late 19605s.
Another factor contributing to the widening of the unemployment differential may be the rapid increase in the labor force participation of women
during the 1960's, since its effect was to increase the proportion of women
entering or reentering the labor force, with an accompanying increase in
unemployment.
EDUCATION AND THE OCCUPATIONAL DISTRIBUTION
Some of the hesitancy of women to enter or to stay in the labor force is
undoubtedly the result of societally determined factors that restrict the
possibilities open to them. The low representation of women in positions of
responsibility is striking. Despite gradual gains, progress has not been sufficient to alter the picture significantly (Table 26). Exactly how much of this
situation has been imposed on women because of prejudice and how much of
it derives from a voluntary adjustment to a life divided between home responsibilities and work remains obscure. The existence of discriminatory
100
TABLE 26.—Women as a percent of persons in several professional and managerial occupations,
1910-70
[Percent]
Occupational group
Clergymen
College presidents, professors, and
instructors *
Dentists . .
. .
Editors and reporters
Engineers
Lawyers and judges
Managers, manufacturing industries .
Physicians
1910
1920
1930
1940
1950
1960
1970
0.6
1.4
2.2
2.4
4.0
2.3
2.9
18.9
30.2
31.9
26.5
23.2
24.2
28.2
12.2
(2)
16.8
(2)
24.0
(2)
25.0
.4
32.0
1.2
2.5
3.5
36.6
.8
40.6
1.6
1.7
6.0
3.1
5.0
3.2
4.4
4.3
4.7
6.4
6.1
7.1
6.9
6.3
9.3
3.1
.5
3.3
1.4
1.9
2.1
1.5
2.7
2.3
3.5
3.5
4.9
i Data for 1920 and 1930 probably include some teachers in schools below collegiate rank. The Office of Education estimates the 1930 figure closer to 28 percent.
> Less than one tenth of 1 percent.
Note.—Data are from the decennial censuses. Data for 1910 and 1920 include persons 10 years of age and over; data for
1930 to 1970 include persons 14 years of age and over.
Source: Department of Commerce, Bureau of the Census.
barriers may discourage women from seeking the training or adopting the
life style it would take to achieve a responsible and highly demanding job.
On the other hand, women who expect to marry and have children and who
also put their role at home first are subject to considerable uncertainty about
their future attachment to the labor force. In the latter case, incentives to
train extensively for a career would be few; and, once such women started
working, the restrictions imposed by home responsibilities could limit their
ability to take a job requiring long hours or the intensive commitment that
most high-status positions demand. At the same time, changes in the accepted social roles of men and women would alter current patterns if they
changed women's expectations about their future in the labor force.
For whatever reasons, from school onward the career orientation of
women differs strikingly from that of men. Most women do not have as
strong a vocational emphasis in their schooling; and for those who do, the
preparation is usually for a stereotyped "female" occupation.
Although the probability of graduating from high school has been somewhat greater for women than for men, it is less probable that a woman will
complete college, and still less that she will enter graduate school. The representation of women consequently declines as they move upward through
the stages of education beyond high school. In 1971, 50 percent of all high
school graduates were women and 45 percent of first-year college students
were women. During 1971 women earned 44 percent of the bachelor's
degrees granted, 40 percent of the master's degrees, and 14 percent of the
doctorates.
Even more striking are the differences in the courses taken. At both the
undergraduate and advanced levels, women are heavily represented in English, languages, and fine arts—the more general cultural fields. They are
poorly represented in disciplines having a strong vocational emphasis and
promising a high pecuniary return. In 1970, 9.3 percent of the baccalaureates in business and 3.9 percent of the master's in business went to women.
101
In the biological sciences, women had a larger share, taking about 30 percent of the bachelor's and master's degrees and 16 percent of the doctorates.
But only 8.5 percent of the M.D.'s and 5.6 percent of the law degrees went
to women. Most of these percentages, low as they are, represent large gains
from the preceding year.
The situation is quite different in the so-called women's occupations. In
1971 women received 74 percent of the B.A.'s and 56 percent of the M.A.'s
given in education. In library science, which is even more firmly dominated
by women, they received 82 percent of all degrees in 1971. And in nursing,
98 percent of all the degrees went to women.
It is not surprising, then, to find that women do not have anything like the
same occupational distribution as men. Even within an educational level,
significant differences remain in the distribution across broad occupational categories (Table 27). Although 77 percent of women college graduates in 1970 were in the professions, mostly as teachers, only 4.8 percent,
compared to 20 percent for men, were classified as managers. At high school
levels, the proportion of women working as skilled craftsmen is minuscule, although a substantial proportion of women are blue-collar workers in
the lower paying operative categories.
The supplement to this chapter, appearing in Appendix A, summarizes in
detail women's representation in occupations more narrowly defined. Although women are found in all occupations, the extent of occupational segregation by sex is large. In broad outline, this situation does not appear to
have undergone any dramatic change between 1950 and 1970, although
there are several examples of large increases in the proportion of women
in less typically "female" occupations (for example busdrivers, bartenders,
and compositors and typesetters).
TABLE 27.—Occupational distribution of employed persons by education and sex, 1970
[Percent!
College graduates
High school
Occupational groups
Men
Total employed
Professional .technical, and kindred workers.
Managers and proprietors
_ .
Salesworkers
Clerical and kindred workers
Craftsmen
Operatives
Nonfarm laborers
Farm laborers and foremen
Farmers and farm managers
Service workers excluding private household.
Private household service workers
Women
100.0
2.8
6.9
56
6.8
25.6
27.3
9.9
1.9
2.2
10.8
.2
» Less than one tenth of 1 percent.
Note.—Detail may not add to totals because of rounding.
Source: Department of Commerce, Bureau of the Census.
4 years
1-3 years
102
100.0
3.6
2.9
10 2
25.3
2.4
22.5
1.6
.6
.2
25.4
5.2
Men
Men
Women
Women
100.0
100.0
100.0
100.0
7.6
11.4
7.5
10.0
26.4
20.6
5.3
.9
2.9
7.5
7.1
3.8
81
50.4
1.8
11.4
.8
.3
.2
14.5
1.7
58.9
20.1
86
4.9
3.3
1.4
.5
.2
.8
1.4
77.4
4.8
2.3
12.1
.4
.6
.1
.1
.1
1.9
.3
0)
(0
Casual observation of individual occupations cannot, of course, provide
a comprehensive indication of whether the occupational distributions of
men and women, involving numerous occupations, have moved closer together or further apart. To help answer this question, an index was constructed and calculated for 1960 and 1970 which reflects the difference (for
197 occupations) between the occupational distributions of men and women.
The index displays a small move toward occupational similarity between
1960 and 1970. (See the supplement to this chapter, included in Appendix
A, for a more detailed description of the index.)
Another question of interest is whether the changes in the occupational
distributions of men and women were in the direction of higher economic
status and, if so, how far they went. Some insight into this question is
obtained by calculating an index which reflects what earnings would have
been in 1950, 1960, and 1970, if earnings were the same in all 3 years and
only the occupational distributions changed. Median earnings for yearround, full-time workers in each of 11 broad occupational categories were
used as the constant weights to calculate such an index. The results indicated that the occupational distributions of both men and women shifted
in the direction of higher-earnings occupations from 1950 to 1960 and from
1960 to 1970. However, in the earlier period men moved ahead in this respect
faster than women while in the second period the changes were similar for
both.
EARNINGS
In 1971 annual median earnings for women 14 years old and over were
$2,986, or 40 percent of the median earnings of men. But women work
fewer hours per week and fewer weeks per year. If the comparison is restricted to year-round, full-time workers, women's earnings are 60 percent
of men's, that is, $5,593 compared to $9,399. An additional adjustment for
differences in the average full-time workweek—full-time hours for men were
about 10 percent higher than for women—brings the female-male ratio
to 66 percent in 1971.
Differentials of this order of magnitude appear to have persisted since
1956 (Table 28). Indeed, a slight increase in the differential seems to have
occurred from 1956 to 1969. Part of the source of the increasing differential
was the relatively low rate of growth in the earnings of female clerical workers and female operatives, who in 1970 accounted for 32 percent and 14 percent, respectively, of all women workers. On the other hand, the rate of
growth of earnings of women in the professions was high (a 5.1-percent
annual compound rate between 1955 and 1968) relative to all workers;
more recently it was even high relative to male professionals.
103
TABLE 28.—Ratio of total money earnings of civilian women workers to earnings of civilian men
workers, selected years, 1956-71
1\ctual ratios
Occupational group
1956
Total*
Professional
workers
and technical
1965
1969
1971
1969
1971
63.3
60.7
59.9
58.9
59.5
65.9
66.1
62.4
61.3
65.2
62.2
66.4
67.9
72.4
75.6
79.9
72.4
82.0
59.1
71.7
41.8
52.9
67.6
40.9
53.2
67.2
40.5
56.7
56.6
53.1
65.0
40.2
56.7
58.7
53.0
62.4
42.1
56.4
60.5
57.2
70.0
45.7
60.8
65.4
56.8
66.9
47.4
60.2
66.6
55.4
57.2
55.4
57.4
58.5
62.5
63.2
Teachers, primary and
secondary schools
Managers, officials, and proprietors
Clerical workers
Sales workers..
Craftsmen and foreman
Operatives
Service workers excluding private household workers
1960
Adjusted ratios i
1
Adjusted for differences in average full-time hours worked since full-time hours for women are typically less than
full-time
hours for men.
2
Total includes occupational groups not shown separately.
3 Not available.
* Base too small to be statistically significant.
Note.—Data relate to civilian workers who are employed full-time, year-round. Data for 1956 include salaried workers
only, while data for later years include both salaried and self-employed workers.
Sources: Department of Commerce, Bureau of the Census, Department of Labor, Bureau of Labor Statistics, and
Council of Economic Advisers.
A large differential is also evident when the comparison is restricted to
men and women of the same age and education. As Chart 10 indicates, the
incomes of women do not increase with age in anything like the same way
men's do. Thus the differential widens with age through much of the working life.
One important factor influencing the differential is experience. The lack
of continuity in women's attachment to the labor force means that they will
not have accumulated as much experience as men at a given age. The relatively steeper rise of men's income with age has been attributed to their
greater accumulation of experience, of "human capital" acquired on the job.
Since very few women have participated in the labor force to the same
degree as men, it is difficult to set up direct comparisons between the earnings of men and women with the same lifetime pattern of work. Using data
from the Labor Department's longitudinal study of women, referred to
above, one study was able to compare the earnings of women working different amounts of time throughout their lives with the earnings of men, most
of whom are presumed to work continuously after leaving school. The figures
for men were taken from census data. The women's lifetime work experience
was measured as the percentage of years each had worked since leaving
school. However, a work year was crudely defined as one in which the
women had worked at least 6 months. Thus no adjustment could be made
for whether the years worked had been truly full-time commitments with respect to both hours worked per week and weeks worked per year.
104
Chart 10
Annual Income by Age, for Male and Female
High School and College Graduates
DOLLARS y (RATIO SCALE)
MEN, COLLEGE, 4 YEARS AND OVER
20,000
10,000
9,000
WOMEN, COLLEGE, 4 YEARS AND OVER
8,000
7,000
6,000
\
WOMEN, HIGH SCHOOL, 4 YEARS
5,000
4,000
_L
18-24
_L
25-34
35-44
45-54
55-64
65 AND OVER
YEARS OF AGE
J / M E D I A N INCOME OF FULL-TIME, YEAR-ROUND WORKERS, 1971.
SOURCE: DEPARTMENT OF COMMERCE.
Among the women 30-44 years old in the survey, the gain from continuous
work was apparently very large. If we look only at those women who had
worked year-round, full-time in 1966, the median wage and salary income
for the group who had worked each year since leaving school was $5,618;
for those who had worked less than 50 percent of the years since leaving
school (almost half the group) the median income was $3,655. The median
wage and salary income of men in the same age group who had worked
full-time, year-round in 1966 was $7,529. The men are presumed to have
worked continuously since leaving school. Thus the women who had worked
less than half of the years since leaving school earned only 49 percent as
much as men, while the small group of women who had worked each year
earned 75 percent as much as men. Interestingly, single women who had
worked each year since leaving school earned slightly more than single men.
More sophisticated comparisons, adjusting for additional differences in
105
training, continuity at work, and education, can be made. One recent study
found that the earnings differential was reduced to below 20 percent after
taking account of such differences.
The importance of lifetime accumulated experience in influencing women's earnings suggests one possible explanation for the small decline in the
ratio of women's to men's earnings between 1956 and 1969. Since the labor
force participation of women has been rising rapidly, an increasing proportion of new entrants and of those with few accumulated years in the labor
force could have resulted in a decline in the average experience level of
all women. This drop would in turn temporarily push down the average
level of earnings for all women. Unfortunately the data are not available to
compare the ratio over a period of time between the earnings of women
having a given number of years' experience and the earnings of men.
DIRECT DISCRIMINATION VERSUS ROLE
DIFFERENTIATION
A differential, perhaps on the order of 20 percent, between the earnings
of men and women remains after adjusting for factors such as education,
work experience during the year, and even lifelong work experience. How
much of this differential is due to differences in experience or in performance on the job which could not be measured adequately, and how much to
discrimination? The question is difficult to answer, in part because there are
differences of opinion about what should be classified as discrimination.
Some studies have succeeded in narrowing the male-female differential
well below 20 percent. Indeed, Department of Labor surveys have found that
the differential almost disappears when men's and women's earnings are
compared within detailed job classifications and within the same establishment. In the very narrow sense of equal pay for the same job in the
same plant there may be little difference between women and men. However, in this way the focus of the problem is shifted but not eliminated,
for then we must explain why women have such a different job structure
from men and why they are employed in different types of establishments.
There is clearly prejudice against women engaging in particular activities. Some patients reject women doctors, some clients reject women lawyers, some customers reject automobile saleswomen, and some workers
reject women bosses. Employers also may have formulated discriminatory
attitudes about women, exaggerating the risk of job instability or client
acceptance and therefore excluding women from on-the-job training which
would advance their careers.
In fact, even if employers do estimate correctly the average job turnover
of women, women who are strongly committed to their jobs may suffer from
"statistical discrimination" by being treated as though their own behavior
resembled the average. The extent to which this type of discrimination
occurs depends on how costly it is for employers to distinguish women who
106
will have a strong job commitment from those who will not. Finally, because
some occupations restrict the number of newcomers they take in and because
women move in and out of the labor force more often, more women than
men tend to fall into the newcomer category and to be thus excluded. For
example, restrictive entry policies may have kept women out of the skilled
crafts.
On the other hand, as discussed above, some component of the earnings
differential and of the occupational differential stems from differences in
role orientation which start with differences in education and continue
through marriage, where women generally are expected to assume primary
responsibility for the home and subordinate their own outside work to their
household responsibilities.
It is not now possible to distinguish in a quantitative way between the
discrimination which bars women from jobs solely because of their sex,
and the role differentiation whereby women, either through choice or
necessity, restrict their careers because of the demands of their homes. Some
may label the latter as a pervasive societal discrimination which starts in the
cradle; nonetheless, it is useful to draw the distinction.
One other missing link in our chain of understanding of these problems
is the value of the work done at home by women. One study has found
that women college graduates tend to reduce their outside work when their
children are small more than less educated women, and that they also devote more time to the training of their children. Of course this pattern is
undoubtedly facilitated by the higher income of their husbands. However,
this pattern also results in a considerable sacrifice of earnings, and one may
infer that these women have therefore placed a very high value on the
personal attention they can give their children. Without more information,
it is difficult to evaluate the full extent to which women's capabilities have
actually been underutilized by society.
SPECIAL PROBLEMS
THE FEMALE-HEADED HOUSEHOLD
In 1971, some 6 million families, about 11.5 percent of all families, were
headed by women. These women are widowed, divorced, separated, or
single, and many have responsibilities for the support of children in fatherless families or of other relatives. Close to two-thirds of all female-headed
families include children; the average number of children under 18 years
of age in a female-headed family with children was about 2.3 in 1971, about
the same as in male-headed families with children.
As a result of the division of labor within families, the average woman
who has been married has not had the same labor market experience or
vocationally oriented training as her husband. Unless she has a substantial
alimony or pension, she is likely to face financial difficulties. The median income of female-headed families was $5,116 in 1971, less than half the in
107
come of male-headed families ($10,930). When women who head families
were full-time, year-round workers, the family's median income was
$7,916; but only 32 percent of women heading families were able to be
full-time, year-round workers. And the woman who heads a family and
works has additional expenses of child care and other home care expenses.
The problems faced by the woman who heads a household are particuarly acute if the woman is black, and 27 percent of women heading households are black. For this group, median family income was only $3,645 in
1971. Although, at higher education levels, black women now earn
amounts comparable to white women, those black women who head families are at a disadvantage compared to white women. The median personal
income of white women heading households and working year-round, fulltime was $6,527 in 1971, compared to $5,227 for black women in the same
position.
As a result of the combination of a large number of dependents and the
difficulty of maintaining the dual responsibility of monetary support and
home care, many female-headed families fall below the low-income level.
In 1971, 34 percent of female-headed families were below the low-income
level, compared to 7 percent for male-headed families. Among black households with a female head, 54 percent were below the low-income level. A
large proportion receive public assistance. In 1971, 30 percent of the women
heading households received public assistance payments.
It has been suggested, though not proved, that widespread availability
of public assistance has encouraged husbands to desert their wives or wives
to leave their husbands in families where the husband earns little more
than the amount of welfare benefits his family would be entitled to in his
absence. Remarriage may also be discouraged because the low-income
mother would then lose her entire public stipend, including the child support portion, and without some outside child support a man might be reluctant to marry a woman with several children.
Among the women who are now welfare recipients many are handicapped
by lack of education and training and are not in a position to earn an income that would lift them and their families above poverty levels. A program
established in 1967, the Work Incentive Program, now gives many mothers
currently on welfare, training and placement assistance so that they can
improve their ability to support themselves and their dependents.
THE INCOME TAX
Devising a tax system which is equitable and efficient has always posed
formidable problems, and often the best solution is one involving compromise with one or more of the objectives. The tax treatment of working
wives is one of the more difficult problems. The income tax law as such
treats men and women equally and, indeed, its effects on single men and
single women are the same. However, some of the features of the tax structure, which have been considered desirable for other purposes, have, as a
108
by-product, unequal effects on the second earner of a married couple, who
is usually the wife.
Only income arising from market transactions is taxed. Indeed, there is
no practical way to assign a market value to the unpaid work performed at
home and then subject it to the tax. As a result, the tax system imposes a
general bias in the economy favoring unpaid work at home compared to
paid work in the market. However, the bias and the resulting disincentive
toward market work are particularly relevant for the married woman who
traditionally has done more work at home.
An equity problem also arises from this situation. To use a hypothetical
example, a husband and wife each earning $8,000 would pay the same
income tax as a couple where the husband alone works and earns $16,000,
although the couple with two earners will have the additional expenses
of buying the services which would be produced at home and untaxed if
the wife did not work.
There is the further problem that a married couple may pay more or less
income tax than two single persons whose combined income equals the
couple's, depending upon how the income is divided between the two individuals. This problem reflects a basic ambivalence about whether the appropriate unit of taxation is the individual or the family.
Remedies for the situation are not easy to find. One suggestion has been
to allow working wives to deduct a given percentage of their earnings from
their income for tax purposes. However, this would be unfair to single
persons, who also incur expenses of going to work. A general earned income
credit has also been suggested, but this creates a bias against investments
in capital and in favor of wage income.
As discussed below, the Revenue Act of 1971 has given expanded tax
relief to working wives with children by allowing more liberalized child
care deductions to couples within a given income range. This provision,
however, does not affect couples without children or couples with combined incomes outside the allowable income range.
CHILD CARE
Provision for child care is a cost to working mothers and a major obstacle to the employment of many other mothers who would work outside
the home if they could find satisfactory arrangements for taking care of
their children. As more mothers have taken jobs outside the home, and
more weigh the possibility of doing so, several major questions about child
care have become intense national issues.
One question is whether the Government should pay for part or all of
the cost of child care. This question is usually raised about the Federal
Government, but it could be equally asked about State or local governments.
According to one view of the matter parents have chosen to have children,
which implies a certain allocation of their resources, therefore they have no
reason to burden other taxpayers to look after the children. Another view of
O - 73 - 8
Digitized490-000
for FRASER
the matter is that Government subsidies can be justified and different groups
have cited different reasons. The point has been made that the pressures of
custom result in a bias against the wife going to work while the husband
stays home with the children. A child-care subsidy for working mothers
would help remove any harmful effects of this cultural bias. Another
reason given is that there is a national interest in the proper care of children, who are, of course, the future nation, and that this case justifies Government subsidies. The analogy commonly given is to public education.
Government has given subsidies to families with children but there has
been no consistent philosophy behind them. At the extreme, with respect to
children in very poor families, we have long recognized the need for public
assistance in the form of the program of Aid to Families with Dependent
Children. This program is not specifically addressed to children with working mothers. In fact, until recently it was tilted against helping working
mothers. The Federal Government also provides a form of assistance for
child care through the income tax. With the Revenue Act of 1971, a much
more liberal deduction than had ever been provided was instituted specifically for child-care expenses incurred by working wives. Below a combined
husband-wife income of $18,000, a working wife can now deduct up to
$400 a month for child care expenses. The deduction is scaled downwards
to zero as combined income goes from $18,000 to $27,600. The two groups
not covered are women whose family income is too low to benefit from a
tax deduction and women at the other end of the income scale.
Public discussion of Government support for child care has not clearly
distinguished among several possible objectives:
(a) To reward and assist the care of all small children;
(b) To assist the care of small children whose parents might not
be otherwise able to care for them;
(c) To assist the care of the small children of working mothers;
(d) To assist in the care of small children in a particular way—
through day-care institutions, or at home, etc.
Both the amount of Government support that is desirable, and the form it
should take if it is to be provided, depend on the choice made among these
objectives.
Recently, publicly supported institutional group care, or day care, has
received considerable attention as one approach to helping the working
mother. Some have also stressed day care as a developmental program. It
may be noted that a very small proportion of working women have depended on group day care in an institutional center. A Government-sponsored survey of 1965 found that, among employed mothers of children
under 6, only 6.4 percent depended on school or group care centers. About
47 percent of the women arranged to have their children cared for at home,
often by a relative. The rest mainly arranged for care in someone else's home
(31 percent) or looked after the child while working (15 percent).
110
Some have attributed the low use of day care to a failure of the market
to provide a service that would be utilized if financing were available.
Others have interpreted it as an indication that the true demand for institutional day care is low. Even among more affluent and knowledgeable working mothers who presumably could afford it, dependence on institutional
group care is low. A survey of college graduates found that in 1964, among
those who worked and who had children under 6 years, 9 percent used
group care, which included nursery schools, kindergartens, and day-care
centers. Most (73 percent) arranged for care in their own home.
Whether institutional day care provides the best use of dollars spent on
child care has yet to be established. While this issue has not been resolved,
it is clear that the problems of mothers who want and need to work require
serious attention and a continuing search for new solutions.
GOVERNMENT ACTION
Government has been profoundly concerned with promoting full equality
of opportunity for women within both the public and the private sectors.
Two approaches have been followed. The first involves the use of law
and regulations where they are both applicable and compatible with other
goals of a democratic society.
A number of laws have been passed and Executive Orders issued which
deal with discrimination by employers. Included are the Equal Pay Act
of 1963, requiring employers to compensate men and women in the same
establishment equally for work of equivalent skill and responsibility, and
Title VII of the Civil Rights Act of 1964, which prohibits discrimination in
hiring, discharging, compensation, and other aspects of employment. Title
VII is administered by the Equal Employment Opportunity Commission
(EEOC). The Equal Employment Opportunity Act, signed by the President in 1972, gave the EEOC enforcement power through the courts in sexdiscrimination cases. In December 1971, Order No. 4, under Executive
Order 11246, was extended to women. This Order requires Federal contractors employing more than 50 workers and holding contracts of $50,000
or more to formulate written affirmative action plans, with goals and timetables, to ensure equal opportunities. Title IX of the Education Amendments of 1972 prohibits discrimination in educational programs or activities
on the basis of sex.
The Equal Rights Amendment to the Constitution, which was strongly
supported by the President, passed the Senate on March 22, 1972, and has
now been ratified by 22 States. The proposed amendment would provide
that "equality of rights under the law shall not be denied or abridged by
the United States or by any State on account of sex," and would authorize
the Congress and the States to enforce the amendment by appropriate legislation. The purpose of the proposed amendment would be to provide constitutional protection against laws and official practices that treat men and
women differently.
Ill
The other approach of Government to providing equality to women has
been through leadership. The Women's Bureau in the Department of Labor
has for 50 years been concerned with the problems of women at work. Recently, several new groups, each concerned with different areas affecting
women, have been formed. The formation of the Advisory Committee on
the Economic Role of Women is one such effort. The Citizen's Advisory Council on the Status of Women is another. The latter is a council
of private citizens appointed by the President, which surveys the social and
political issues of particular interest to women and makes recommendations
for legislation or other suitable social action. In an effort to recruit women
to top-level jobs in the Government, the President in 1971 appointed to the
White House staff a special assistant for this purpose. As a result many
women have been placed in key policy making positions, positions never
before held by women.
It is only in the past few years that the problems women face as a group
have been given the widespread recognition they deserve. There is much to
be learned before we can even ask all the appropriate questions. Many of
the problems involve profound issues of family and social organization. By
listening to diverse groups and to the discussion of the public it is hoped
that Government will be able to find its appropriate role. We believe that
the newly formed Advisory Committee on the Economic Role of Women
will contribute to that process.
112
CHAPTER 5
The International Economic System
in Transition
T
HE INTERNATIONAL ECONOMIC POLICY of the United
States had two major objectives in 1972. One was to improve the
U.S. balance of payments, which had reached a record deficit of nearly
$30 billion in 1971. The other was to make progress on reform of the international economic system, affecting monetary, trade, and investment relationships. The existing system has been unable to cope with shifting patterns
of trade and imbalances in international payments which have resulted in
repeated international economic and political tensions.
The groundwork for progress on both fronts had been laid in December
of 1971 when the world's major industrialized countries met at the Smithsonian Institution. For the short term, the participants agreed on a realignment of exchange rates among the major currencies to relieve the existing
disequilibrium in international payments. For the long term, they agreed
to enter into multilateral negotiations on reform of the international economic system.
The overall balance-of-payments position of the United States, while still
far from equilibrium, began to improve in 1972. The improvement, which
was all in the capital account, was largely the result of a sharp reduction
over 1971 in speculative outflows of capital. Domestic economic policies
which curtailed the rate of inflation, the realignment of exchange rates, and
renewed confidence in international monetary relationships all contributed
to this improvement. The trade and current account deficits of the United
States, however, were considerably larger in 1972 than in 1971, although
they levelled off during the year. The year-over-year deterioration in these
accounts stemmed primarily from the rapid growth of the U.S. economy
and a lag in the economic recovery of some of the other major countries.
Progress was also made during 1972 on the longer-term reform objective.
Agreement was reached on a format for international monetary negotiations. Discussions on the characteristics of a revised international monetary
system are now underway, and the United States has set forth a number of
proposals. The major industrialized countries have also agreed to initiate
multilateral trade negotiations in the fall of 1973. Finally, these same
countries have agreed to explore new forms of cooperation on internal
policies which affect trade and investment among nations.
113
THE U.S. BALANCE OF PAYMENTS IN 1972
As this Report goes to press, official data for the U.S. balance of payments
are available only for the first 3 quarters of 1972. These figures, shown in
Table 29, indicate tKat, at annual rates, Americans imported $76.2 billion
in goods and services during the first 9 months of 1972, while foreigners
purchased $71.2 billion in U.S. goods and services. On balance, therefore,
Americans obtained $4.9 billion more goods and services abroad than they
provided to the rest of the world. In addition, U.S. Government grants and
other types of unilateral transfers to foreigners exceeded similar transfers to
the United States by $3.7 billion, and U.S. investments in long-term assets
abroad exceeded foreign investments in U.S. long-term assets by $1.6 billion.
Moreover, recorded short-term capital movements, nonrecorded transactions,
and allocations of Special Drawing Rights (SDR's) together resulted in a net
outflow of $1.4 billion. Overall, therefore, American balance-of-payments
expenditures exceeded receipts by $11.6 billion. Virtually the whole deficit in
the U.S. balance of payments on the official reserve transactions basis was
financed by increased dollar holdings of foreign central banks.
TABLE 29.—U.S. balance.of.payments transactions, 1971-72
[Billions of dollars]
Receipts
2
1972 first 3 quarters 1
1971
Type of transaction
Payments
Balance
Receipts
Payments
Balance
Goods
42.8
45.5
-2.7
47.4
54.4
-7.0
Services
.
Military transactions3
Investment income . .
Other
23.4
1.9
12.9
8.5
19.9
4.8
4.9
10.2
3.4
-2.9
8.0
-1.7
23.8
1.2
13.1
9.6
21.8
4.7
5.7
11.3
2.1
-3.6
7.4
-1.8
GOODS AND SERVICES
66.1
65.4
.7
71.2
76.2
-4.9
3.6
-3.6
3.7
-3.7
66.1
69.0
-2.8
71.2
79.9
-8.7
1.8
_'.l
2.3
8.2
1.9
4.8
1.6
-6.5
-2.4
-4.8
.8
5.1
.3
.3
4.4
6.7
1.3
3.3
2.1
-1.6
-1.0
-3.0
2.4
67.9
77.2
-9.3
76.3
86.6
-10.2
2.4
-2.4
.1
.7
-.6
1.1
7.8
2.9
1.4
1.5
11.0
-11.0
3.0
-3.0
91.7
7-11.6
Unilateral transfers, net 4
CURRENT ACCOUNT
Long-term capital
US Government6
Direct investment
Other private
...
CURRENT ACCOUNT AND LONGTERM CAPITAL
Short-term nonliquid capital
Short-term liquid capital .
-6.7
Errors and unrecorded transactions net
Allocations of SDR's
TOTAL
.7
.7
.7
61.9
7-29.8
80.0
91.7
.7
12 Seasonally adjusted annual rates.
Excludes transfers under military grants.
s Includes direct investment fees and royalties.
* Excludes military grants of goods and services.
* Excludes official reserve transactions and includes transactions in some short-term U.S. Government assets.
«7 Less than $0.05 billion.
Equals official reserve transactions balance.
Note.—Detail may not add to totals because of rounding.
Source: Department of Commerce.
114
THE GOODS-AND-SERVICES ACCOUNT IN 1972
For the goods-and-services account, preliminary estimates are available for
the full year 1972. These figures differ slightly from those in Table 29, which
are annual rates based on data for the first 3 quarters. These preliminary estimates indicate that the United States imported about $4j/s> billion more goods
and services than it exported. U.S. imports of goods exceeded exports by
about $7 billion in 1972, while exports of services exceeded imports by
about $25/2 billion. These figures represent a substantial deterioration in
the goods-and-services account from the full year 1971.
On a quarterly basis, net imports increased from $1.2 billion in the first
quarter of 1972 to $1.6 billion in the second quarter and then declined to $900
million in the third quarter and remained at about the same level in the
fourth. When exports and imports are calculated in volume terms by adjusting for price changes, the quarterly decline in net imports begins somewhat
sooner (in the first quarter rather than the second) and is more marked over
the course of the year.
The figures just cited give early indications that the dollar devaluation,
reinforced by a lower rate of inflation in the United States than in other
major industrialized countries in 1972, is beginning to affect U.S.
exports and imports. The fact remains, however, that the U.S. trade deficit
was much larger in 1972 than had been expected after the realignment of
exchange rates. Cyclical developments in the United States and abroad were
a major reason for this disappointment. Nominal gross national product
(GNP) in the United States grew by nearly 10 percent in 1972, compared to 7*4 percent in 1971 and 5 percent in 1970. Thus while changes in
relative prices reduced the attractiveness of foreign goods compared to
domestic goods, the level of imports continued to increase with the rapid
rise in the overall demand for goods in the U.S. economy. At the same time,
a number of major industrial countries experienced lower than normal rates
of growth in 1972, which tended to hold down the increase in their demand
for U.S. goods.
Apart from the effects of these cyclical developments, the response to
any devaluation is generally delayed. First, it takes some time before a
devaluation is reflected in the relative prices obtained by exporters and
paid by importers. In the short run, to protect their market shares, foreign
exporters frequently do not increase their list price in the U.S. market by
the full amount of devaluation. Conversely, foreign importers frequently do
not reduce their list price of U.S. goods in the foreign market by the full
amount of the devaluation.
Second, when the change in relative prices does occur, its initial impact
is likely to be perverse because a devaluation raises the dollar prices of imported goods and services before the volume of exports and imports responds
to the changes in relative prices. In time, the effect of devaluation on real
trade flows is expected to outweigh the change in prices. It is because of this
sequence of events that one expects the trade balance of a devaluing
115
country to improve in real or volume terms before it improves in value
terms, which is what happened in 1972.
In the case of the United States, the trade deficit in 1972 was also affected
by long-run changes in the demand for basic materials. In particular, domestic production of fuels has not kept pace with the growth of the U.S.
economy, and consequently net imports of fuels increased from $1.7 billion
in the first 10 months of 1971 to $2.6 billion in the first 10 months of 1972.
Although U.S. exports of agricultural products have also expanded rapidly,
they have not fully offset this increased demand for fuels. On balance,
long-term changes in trade patterns have tended to make the elimination
of the U.S. balance-of-payments deficit more difficult.
THE CAPITAL ACCOUNT IN 1972
Returning to the balance-of-payments figures in Table 29, the net outflow
of capital from the United States fell from $27.7 billion in 1971 to an annual
rate of $3.7 billion in the first 3 quarters of 1972. This sharp reduction was
due to several factors.
First, the realignment of exchange rates, and the preservation of international monetary cooperation among the major countries, reestablished
confidence in international monetary relationships. Investors had less incentive to hedge against the risk of a change in exchange rates or the imposition
of new restraints on capital transfers, and some investors were induced to
bring back funds transferred abroad in 1971 for hedging purposes.
Second, a tightening of credit conditions in the United States relative
to some major European countries led to a reversal in the flow of interestsensitive funds. In line with this trend, foreign banks placed liquid funds
in the U.S. money market.
Third, the rapid expansion of the U.S. economy created improved investment opportunities in the United States, and sluggish rates of growth
in a number of major foreign countries reduced incentives for U.S. investment in these countries. In particular, the improved economic prospects
in the United States made purchases of U.S. stocks more attractive to
foreigners.
These factors affected both short-term capital movements, which recorded
a net inflow of $0.9 billion at an annual rate in the first 3 quarters of 1972
compared to a net outflow of $10.2 billion in 1971, and long-term capital
flows, which recorded net outflows of $1.6 billion at an annual rate in the
first 3 quarters of 1972 compared to $6.5 billion in 1971.
FOREIGN EXCHANGE MARKET DEVELOPMENTS IN 1972
When the supply of a currency exceeds the demand its value tends to drop
in foreign exchange markets, and when the demand exceeds the supply its
value rises. In order to hold currency values in the foreign exchange market within certain limits, governments other than the United States
116
have followed the practice of entering the market as buyers or sellers of
their own currency whenever its value in terms of U.S. dollars falls or
rises beyond a certain range. On the basis of the Smithsonian Agreement
that range was established as a maximum deviation of plus or minus 2%
percent from the announced parity or central rate of that currency vis-a-vis
the dollar; a total of 4 ^ percent.
Movements in the exchange rate between the dollar and the major
foreign currencies can be seen in Table 30. Chart 11 shows the movements
of the currencies of the European Community (EC). The EC countries have
agreed to keep their currencies within a maximum range of 2^4 percent of
each other, which is half the maximum spread allowed between any two
currencies other than the dollar by the Smithsonian Agreement. This narrowed intra-European band of fluctuation is generally known as the "EC
snake in the Smithsonian tunnel."
Chart 11
Movement of European
Community Exchange Rates
PERCENT DEVIATION
FROM SMITHSONIAN RATES
4.00
STRONGEST EC CURRENCY
2.25
-2.25
-4.00
I I I I I 1 I 1 I I I I 1 1 1 I 1 I 1 1 1 I M i l I I 1 1 1 I 1 ll 1 I I I II II II I 1 I I 1
JAN FEB MAR APR MAY JUNE JULY AUG SEPT OCT NOV DEC
1972
•STERLING CRISIS.
NOTE: DATA RELATE TO FRIDAY RATES IN THE EXCHANGE MARKETS OF COUNTRIES
BELONGING TO THE EUROPEAN ECONOMIC COMMUNITY (EC).
SOURCE: TREASURY DEPARTMENT.
117
T A B L E 30.—Percent deviations of major foreign currencies from central rates, December 1971—
December 1972
[Currency units per U.S. dollar1!
Deviation of currency at end of period from central rate
Currency
Central
rate
1972
December
1971
February
British pound
Belgian franc
Swiss franc...
West German mark
French franc
Italian lira...
Netherlands guilder
Canadian dollar 2_
Japanese yen
-2.1
.4
-2.0
-1.5
-2.1
-2.1
2.60571
44.8159
3.84
3.2225
5.1157
581.5
3.2447
April
0.0
2.2
-.8
1.1
.9
-.9
2.1
-.2
1.2
308.0
0.2
1.5
-.6
1.3
1.6
-.4
.8
.9
1.0
August
June
October
December
-10.5
1.6
1.1
.6
1.6
-.6
.5
1.8
2.2
-10.0
1.7
1.9
.7
-6.0
2.0
1.6
1.0
2.2
.1
.5
1.8
2.2
-6.2
2.2
2.5
2.0
2.2
.2
2.2
1.7
2.2
-.1
.6
1.1
1
British pound and Canadian dollar are expressed in U.S. dollars per unit of currency. Percent deviations are based on
mid-day selling rates in London.
2 Measured by deviation from 1-to-l relationship between U.S. dollar and Canadian dollar.
3 Less than 0.05.
Source: Treasury Department.
Changes in reserves of the major countries, as well as changes in U.S.
liabilities to all foreign central banks, are shown in Table 31. Changes in
reserve holdings of foreign central banks reflect primarily their intervention
in the foreign exchange market to keep the value of their currencies within
the agreed margins. Changes in U.S. liabilities to foreign central banks show
the extent to which foreign central banks have acquired claims against the
United States as a result of intervention in the foreign exchange market.
T A B L E 31.—Changes in official reserves for selected countries and changes in U.S. liabilities
foreign official reserve holders, 1972
to
1972 change (billions of dollars) I
Country
First
quarters
Total 2
Total official reserve for countries below
Belgium
Canada
..
Fra nee
Italy
Japan
Netherlands..
Sweden
Switzerland
United Kingdom
West Germany
. . .
.
U.S. liabilities to foreign official reserve holders
1
Third
quarter
8.5
4.1
0.4
3.9
.6
.2
.2
.2
.5
1.8
-.4
1.1
1.1
.3
.4
. ... ... .
Second
quarter ^
.2
.2
1.3
.6
-.2
.3
.9
-.2
-.8
.3
.6
.6
.5
(0
.4
-2.7
5.8
.4
1.4
3.2
2.9
1.5
9.4
3.2
.8
5.4
Quarterly changes are based on data for end of quarters.
Total change for first 3 quarters.
3 Total official reserves in the first quarter include 1972 SDR allocations of $1.2 billion.
4 Second quarter data have been adjusted to reflect sterling outflows which were not recorded until the third quarter.
« Less than $0.05 billion.
2
Note.—Detail may not add to totals because of rounding.
Source: International Monetary Fund.
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The dollar was under downward pressure and, conversely, most other
currencies were under upward pressure, at the beginning of the year, before
the Smithsonian rates had become fully established, and during the summer,
when a loss of confidence in the established value of the pound sterling
raised questions about the whole Smithsonian structure of exchange rates.
During the spring and the latter part of the year, the dollar strengthened
relative to most other currencies. These movements in the value of the dollar
reflected primarily changes in the degree of confidence in existing exchange
rates. Changes in credit market conditions in the United States relative to
those abroad also played a role.
Two major currencies did not follow the general pattern described above,
the British pound and the Japanese yen. The pound sterling came under
considerable downward pressure toward the end of June, when a number
of factors created considerable doubt regarding the long-term viability of
the British exchange rate established at the Smithsonian. After losing a considerable amount of foreign exchange in preventing the pound from dropping
below the Smithsonian floor, the British authorities allowed the pound to
float downward in response to market pressures. Over the next 6 months
the pound dropped 10 percent below the rate set at the Smithsonian.
The Japanese yen has been under upward pressure since the end of June,
reflecting the sizable surplus in the Japanese balance of payments. Throughout the second half of the year, the Japanese authorities were required to
purchase large amounts of dollars in the foreign exchange market to keep
the value of the yen from rising above the Smithsonian ceiling. During this
period, forward yen rates remained substantially above the Smithsonian ceiling, reflecting market uncertainty over the existing yen parity.
The renewed confidence in existing exchange rates in the latter part of
1972, with the two exceptions just described, had several causes. One was that
the determination of governments to support the Smithsonian rates was reaffirmed in July by a number of major governments. U.S. intervention in
the exchange markets on a limited basis, and the stated willingness of the
United States to take such action when it was desirable as a means of dealing
with speculative pressures, were important symbols of cooperative support
for the Smithsonian Agreement. The fact that the U.S. price performance
in 1972 was better than that of any of its major partner countries, despite
our ra«pid expansion, also contributed to the improvement in confidence
during the second half of the year.
REFORMING THE INTERNATIONAL ECONOMIC SYSTEM
Changes are required in monetary arrangements, in trading arrangements
and in procedures for dealing with policies usually considered to be "domestic" but having a significant impact on international transactions. The United
States has strongly emphasized not only that reform is needed in all three of
these areas but also that the reforms in all three must be considered as part
119
of a single package, since policies adopted in one field may complement or
conflict with policies in the others. However, thinking is now farthest advanced with respect to monetary reform and we devote most of this chapter
to it.
The President has also taken steps to improve the handling of international economic issues within the U.S. Government, to take better account
of the close interconnections of all aspects of international economic policy
with each other and with domestic policy. The recently created Council
on Economic Policy will provide a framework for the unified consideration
of domestic and international economic issues. The Council on International
Economic Policy (CIEP) continues to have responsibilities for foreign economic policy within the framework of the Council on Economic Policy,
and the director of CIEP is a member of the latter group. Other steps to
improve the handling of the economic aspects of foreign relations include
the appointment of a higher ranking official to be responsible for economic
policy in the State Department and the development of more effective
procedures for the National Advisory Council on International Monetary
and Financial Policies, the body which coordinates the foreign lending
policies and activities of the U.S. Government.
THE INTERNATIONAL MONETARY SYSTEM
The suspension of the convertibility of the dollar into gold on August 15,
1971, gave public recognition to the fact that the postwar international
monetary arrangements, known as the Bretton Woods system, had become
untenable. Interim arrangements, including the negotiation of a multilateral
realignment of exchange rates at the Smithsonian Institution in December
1971, have been developed, but they do not provide a long-term solution
to the problems which made changes in the rules of the Bretton Woods
system inevitable. The arrangements have greatly facilitated the maintenance of normal international commercial and investment relationships,
but they do not constitute an adequate system of rules for the international
monetary system in the long run.
A stable international monetary system must meet several major requirements if it is to serve as the basis for the continued expansion of world trade
and investment. First, it should be market-oriented. For the sake of both efficiency and equity, the mechanism for balancing each country's total foreign exchange receipts and payments over the long run should function in
such a way as to minimize interference with individual market transactions.
Second, the settlement of payments balances among countries should be
multilateral, so that every country can offset its deficits with some countries
by means of surpluses with others. To fulfill this condition, the system must
provide for the ultimate settlement of claims in terms of commonly accepted
reserve assets. Such a generalized payments system makes possible a far
higher level of international trade and investment transactions than would
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be feasible if each country had to balance its payments bilaterally with every
other country in a network of barter relationships. Third, the system should
be stable. International commerce frequently entails long-run commitments
and hence requires stable expectations about conditions affecting the future
profitability of international transactions.
In order to meet these requirements the international monetary system
must fulfill certain specific functions. It must provide an effective and
equitable mechanism for adjustment of payments imbalances among countries, so that external payments imbalances are not allowed to persist and
accumulate. It must also provide international monetary reserves in adequate amounts and in forms acceptable to the participants in the system, i.e.,
international liquidity has to be adequate. If the system permits the creation
of too much international money, international inflationary pressures will
be created; if too little international money is created, deflationary pressure
or pressures for restrictions on international transactions will result. Finally,
the system must operate in such a way as to create and maintain confidence
in its continued viability and in the value of the international reserve assets
associated with it.
Characteristics of the Brett on Woods System
The Articles of Agreement which established the International Monetary
Fund (IMF) in the immediate postwar period reflected a heavy emphasis on
the need for stability and confidence in the international monetary system.
The rules embodied in the Articles dealt primarily with such questions as the
conditions under which governments could change their exchange rates, or
borrow from the Fund to cover deficits, or impose exchange restrictions. The
primary objective was to prevent arbitrary actions by governments in these
areas, and in meeting this objective the Articles were highly successful.
Under the Articles of Agreement, governments were obligated to support
their exchange rates at agreed parity levels in either of two ways—by buying
or selling their own currency in the foreign exchange market whenever the
rate rose 1 percent above or fell 1 percent below parity, or by making their
currency convertible into gold or other reserve assets at the request of a
foreign official institution. In practice, all countries but the United States
have supported their currencies by buying or selling them for dollars, while
the United States has maintained the convertibility of dollars into gold or
other reserve assets tied to gold.
The rules permitted changes in a country's parity when its balance of payments was in fundamental disequilibrium. In practice the parities were
changed only infrequently, generally after a prolonged period of disequilibrium in external payments. There was also a widespread belief that, because
of the importance of the United States in world trade and the central role of
the dollar in the international monetary system, the United States could not
change its exchange rate. In any case, since most other countries were pegging
their rates to the dollar in the foreign exchange market, the United States
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could not be certain that a change in the price of gold would actually result
in a change in the value of the dollar in terms of foreign currencies.
The Articles of Agreement did not address themselves explicitly to the
question of liquidity. The expectation was that, as in the past, newly mined
gold would provide the major source of new official reserves. It was also
implicitly assumed that countries would hold certain currencies as additional reserves. There were no arrangements, however, for reviewing or
influencing the growth of liquidity. The growth of reserves was thus dependent on the vagaries of gold markets and on deficits in the balance of payments of reserve currency countries. In practice, the U.S. deficits provided the
bulk of new reserves for the rest of the world.
The inadequacies of the system with respect to the process of liquidity
creation led to an important step forward with the recent creation of Special Drawing Rights (SDR's), an internationally created obligation of
the International Monetary Fund. With the establishment of SDR's, the
system no longer had to rely on a persistent deficit in the U.S. balance of
payments for the creation of new reserves. The creation of SDR's could
not in itself restore equilibrium to international payments, however, since
provisions for the adjustment of payments imbalances remained inadequate.
The Articles of Agreement were not very explicit about the circumstances
under which countries should take action to remove balance-of-payments
deficits or surpluses. The assumption was that deficit countries would sooner
or later run out of reserves or borrowing facilities and therefore would have
to adjust. However, surplus countries could postpone adjustment as long as
they were willing to accumulate reserves. Since the major deficit country,
the United States, could not adjust its exchange rate without endangering
the operation of the system, and since most of the surplus countries were
persistently reluctant to change their own rates, the disequilibrium in world
payments increased through the latter half of the 1960's until it reached a
breaking point in mid-1971. At that time, the disequilibrium became so large
that speculative pressures caused billions of dollars to be exchanged for foreign currencies within a few days. These currency movements greatly increased U.S. liabilities to foreign official institutions and further reduced
the stock of U.S. reserve assets. This brought to a head a problem which
had been developing for some time: how to maintain convertibility as the
stock of dollars held by foreign official institutions grew and the United
States' own stock of reserve assets, mainly gold, shrank.
On August 15, the President announced a suspension of the convertibility
of the dollar into gold or SDR's. This action withdrew U.S. support from
the old exchange rates between the dollar and other foreign currencies, and
in effect put the dollar on a floating basis. Subsequently, a new set of exchange rates was agreed upon at the Smithsonian Institution, and as part
of that realignment the United States agreed to increase the U.S. official
price of gold from $35 to $38 an ounce. This 8.5-percent increase in the price
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of gold was signed into law on March 31, 1972. The United States has not
resumed the convertibility of the dollar, but has said that it will undertake
appropriate convertibility obligations in the context of a suitably reformed
international monetary system, provided that the U.S. balance-of-payments
and reserve positions improve sufficiently to make such an undertaking
viable.
Preparations for International Monetary Reform
Some of the major problems to be dealt with in a reform of the international monetary system, as well as a number of approaches to their solution, were examined in a report submitted by the Executive Directors of
the International Monetary Fund to the Board of Governors in August 1972.
At about the same time, the member countries of the International Monetary
Fund agreed to create a committee to conduct negotiations on reform. This
committee, the Committee of Twenty, is patterned after the representational
system used in the Executive Board of the International Monetary Fund,
where the membership is broken down into twenty constituencies, each with
a single spokesman to act on behalf of all the countries in the constituency.
Although some of the constituencies are formed by single large countries,
as is true with the United States, most comprise several smaller countries.
The first meeting of this new group was held at the annual session of the
International Monetary Fund in September 1972; this was followed by
several meetings of deputies, who expect to prepare a draft outline of the
main reform proposals in time for the 1973 annual meeting of the International Monetary Fund.
U.S. Ideas on International Monetary Reform
In order to help get the negotiation process underway, the United States
has advanced some general proposals on reform. The U.S. approach is
evolutionary, seeking to build on existing principles and practices where
they have proved useful and have met with international approval. At
the same time, it proposes certain important changes to ensure the viability
of the new system. The primary emphasis is on the creation of an effective
and evenhanded mechanism for the adjustment of payments imbalances
that would place all countries, surplus and deficit alike, under agreed and
broadly symmetrical rules and responsibilities for taking action to restore
equilibrium. In the U.S. view, the most promising approach is a system in
which disproportionate changes in a nation's reserves in either direction
indicate the need for measures to eliminate the payments imbalance. Within
such a system of symmetrical adjustment discipline, the U.S. approach would
allow considerable diversity in the choice of instruments for bringing about
adjustment. One way to widen the choice of adjustment tools would be to
allow increased flexibility of exchange rates.
With respect to international liquidity, the U.S. proposal envisages an
increase in the importance of the SDR and the elimination of various
123
encumbrances which reduce its usefulness as a reserve asset. At the same
time, the U.S. proposal contemplates a gradual diminution of the role played
by gold in the international monetary system. Holdings of foreign currency reserves would be neither banned nor encouraged, but it is expected
that they would become a smaller proportion of total international reserve
assets than they are today.
The Adjustment Process
In developing its proposals the United States has taken into account a
number of realities about the international adjustment process. First, every
government seeks to retain a large degree of discretion in managing its
economy, in order to meet the specific social and economic concerns of
its citizens. Second, the policies of every government are necessarily affected
and constrained by the interaction of its economy with the outside world,
since international trade and investment are increasingly important factors
in the economic prosperity of all countries. The U.S. proposal seeks to
achieve a proper balance between these two conditions by retaining considerable national discretion with respect to the method and timing of adjustment, but by imposing a stronger international discipline to ensure the
achievement of adjustment objectives.
Reserves as objective indicators for adjustment. The U.S. proposal, that
disproportionate changes in reserves in either direction be used as the
primary indicator of the need for balance-of-payments adjustment, is described in detail in Appendix A. In summary, the proposal is that certain
points should be established above and below each country's "base," or
"normal" level of reserves, and that movements in reserves beyond these
points would signal the need for balance-of-payments adjustment.
The U.S. proposal is based on the recognition that countries experiencing
a persistent deterioration in their reserve positions have always had to
devalue their currencies or to take other adjustment measures. The U.S.
proposal would make this discipline symmetrical for both deficit and surplus countries by providing that a disproportionate gain in reserves would
indicate the need for adjustment actions by surplus countries to the same
extent that disproportionate reserve losses now impose pressure on deficit
countries to adjust.
Symmetry in the adjustment process, as provided for in the U.S. proposal,
is desirable for several reasons. Active implementation of adjustment policies,
as opposed to passive acceptance of the domestic consequences of adjustment
by others, frequently entails political costs (as in the case of an exchange
rate change, which governments have commonly considered to be a confession of weakness). And it may sometimes involve economic costs of adjustment as well (when, for example, a deficit country tolerates an increase in unemployment in order to improve the payments balance through demand
restraint). Thus, a balanced distribution of the responsibility for initiating
adjustment is in part a question of equity.
124
Such symmetry also makes the process of international adjustment more
efficient. If countries on both the deficit and the surplus sides of a payments imbalance follow active policies for the restoration of equilibrium the
process is likely to be easier than if the deficit countries try to bring about
adjustment by themselves. Deficit countries would in any case be unable to
restore equilibrium unless surplus countries at least followed policies consistent with a reduction of the net surplus in their payments positions. Such
problems can best be avoided by clarifying the responsibilities of both groups
of countries in bringing about payments adjustment.
The use of reserve criteria also focuses on the close relationship between
the speed of adjustment and the need for liquidity. The less efficient and
prompt the adjustment process, the larger is the global need for reserves;
the smaller and less elastic the total stock of reserves, the more stringent the
demands will be on the adjustment process. In a system where the adjustment process is tied to reserves, the total volume of reserves created can be
related to the sum of countries' individual reserve targets as reflected in the
internationally agreed indicators. If the two are not made consistent, sustained balance-of-payments equilibrium cannot be obtained. Failure to provide the system with adequate reserves puts deflationary pressure on deficit
countries and induces a disruptive competition for scarce reserves. In contrast,
the creation of too large a volume of reserves places the major share of
adjustment pressures on surplus countries and exacerbates tendencies toward
world inflation.
A link between adjustment measures and reserve changes is essential if a
generalized system of convertibility of national currencies into international
reserve assets is to be sustainable. In the long run, convertibility can be maintained only if the adjustment mechanism prevents the development of large
and persistent imbalances which would inevitably prevent a deficit country
from providing conversion of its own currency into primary reserve assets.
Reserve indicators have several other advantages as compared to other
conceivable adjustment guides. They are comprehensive, quickly available,
and relatively unambiguous. Furthermore, they do not discriminate between
one set of transactions and another. They leave the relation between specific
types of transactions to market forces, focusing only on the overall level of
the balance of payments. In a system based on the market principle, it would
be inappropriate to base judgments about the need for adjustment solely on
trade, or the current account, or the capital account.
Adoption of reserve criteria as a primary indicator of the need for adjustment does not imply automaticity. The system would operate in the context of a multilateral review procedure. While excessive reserve changes may
create an increasingly strong presumption that effective adjustment measures are called for, a country could still convince the international community that the signals were wrong and adjustment was not appropriate.
In such a case the reserve indicator could be overriden. Moreover, the use
of reserve indicators would not preclude such supplementary guides as
might be available.
http://fraser.stlouisfed.org/
490-000 O - 73 - !
Federal Reserve Bank of St. Louis
125
Short-term capital movements may present a problem in managing any
system of adjustment, including one based on reserve indicators. Large movements of such funds in response to differences in interest rates, or the expectation of future changes in exchange rates, could bring about large changes
in reserves. This could signal the need for adjustment actions even though
they might not otherwise be thought appropriate. It should be possible,
however, to identify such cases in the multilateral review and to override the
signal by international agreement. Moreover, the wider margins within
which exchange rates can fluctuate have already provided a useful cushion
against short-term capital movements initiated by interest rate differentials,
and these margins should become more effective in a system where the maintenance of inappropriate parities is avoided.
Greater flexibility in the exchange rate. An important feature of the
U.S. proposals is that they would make exchange rate changes a more useful
internationally acceptable instrument of adjustment. The U.S. suggestions regarding the exchange rate mechanism assume that most countries
will generally choose to continue their practice of maintaining established
values for their currencies. At the same time, the United States recognizes
that the difficulties caused by prolonged maintenance of inappropriate exchange rates can be avoided only if countries adjust their parities more
promptly than was usual in the past.
The U.S. proposal recognizes the current evolution of more flexible
techniques of exchange rate management. For example, despite the fact
that floating a currency—suspending the maintenance of its value by exchange market intervention—is technically a violation of the Bretton
Woods Agreement, a number of important countries have done so. Such
floats may be either transitional, as a way of utilizing market signals in
determining a new rate, or indefinite in their duration. The Canadians have
floated during long intervals for more than two decades, the Germans have
floated twice in recent years, and the British have been floating since mid1972. The U.S. proposal would permit either transitional or indefinite periods of floating, but it would impose standards on countries adopting
floating regimes to guard against their use as instruments for competitive
devaluation.
The United States also proposes that countries which maintain parity
exchange rates adopt wider margins within which the market exchange rate
is allowed to fluctuate. The Smithsonian Agreement temporarily increased
the permissible margins from 1 percent on either side of dollar parity to 2*4
percent above or below dollar parity, implying a maximum spread of 4J4
percent between any two nondollar currencies. A number of countries have
adopted these wider margins. The United States favors the permanent adoption of margins for all currencies,- including the dollar, that are in the same
range as those permitted for nondollar currencies under the Smithsonian
Agreement. Since the dollar currently serves as the chief intervention currency it can never deviate from its parity with any other currency by more
126
than the width of the margin, or 2J4 percent. For any two nondollar currencies, however, the maximum spread is twice the margin, because one
currency could be at the floor while the other currency was at the ceiling.
To do away with this particular asymmetry will require innovations in the
techniques of exchange market intervention, a question which will have to
be addressed in the context of the general reform effort.
A larger zone within which fluctuation can take place without government
intervention implies more opportunity for the operation of market forces
and can facilitate small changes in parities. Wider margins can also lessen
the incentives for short-term capital flows in response to interest rate differentials by increasing the scope for forward premiums or discounts in the
exchange markets, thus neutralizing such differentials.
The desire for symmetry between the margins for the dollar and for other
currencies reflects the view that, whereas the dollar had unique functions and
responsibilities in the old system, its role in the new system should be closer to
that of other important currencies. Under the Bretton Woods system, other
countries maintained or changed the values of their currencies in relation to
the dollar, and the United States was passive. The proposed change would
give the United States more freedom to exercise control ov6r its own exchange rate, not only in influencing the rate within the margins around
parity, but also in changing the parity itself. Of course, under any system this
freedom will be limited by the fact that the United States is so important in
world trade that any change in the value of the dollar would strongly affect
other countries. In addition, the dollar will undoubtedly continue to be an
international medium of exchange, even when no Americans are involved,
and substantial amounts of dollars will still be held abroad in private and
official hands. Therefore, reasonable stability in the value of the dollar will
be desirable. Nonetheless, in a reformed system the dollar should have considerably more flexibility than it did before.
Other techniques of adjustment. Under the U.S. proposal a variety of
mechanisms for restoring payments balance would be available, among them
changes in monetary and fiscal policy. Furthermore, in keeping with the
goal of the international monetary system to encourage a freer flow of resources, surplus countries would be encouraged to remove barriers to imports and capital outflows, while deficit countries would be encouraged to
remove barriers to exports and capital inflows.
Such a choice among adjustment measures is essential, not only to preserve national sovereignty, but also because the nature of the imbalance
may itself suggest a particular form of policy response. Furthermore, the
existence of uncertainty about whether or not adjustment will take the form
of a change in the exchange rate can itself be a stabilizing influence by
holding down speculation in response to reserve changes.
The U.S. proposal would in extreme circumstances permit the imposition
of direct restraints for balance-of-payments purposes. Their use, however,
would be appropriately circumscribed to ensure that controls remained tem
127
porary and caused the least possible distortion in the pattern of trade and
investment. Controls or surcharges on some transactions and not on others
distort economic relationships, and for that reason broad adjustment measures are generally preferable. And where selective measures are used, pricebased barriers such as taxes or surcharges are generally preferable to quantitative barriers such as quotas. Taxes on some transactions and not on others
change relative prices, but they do not insulate such transactions from market
pressures, as quotas do. This view contrasts with the present rules of the General Agreement on Tariffs and Trade (GATT), which specifically authorize
quantitative restrictions but not surcharges for balance-of-payments purposes.
The U.S. proposal furthermore reflects the view that controls on capital
transactions for balance-of-payments purposes should not be encouraged and
certainly should not be required in lieu of other measures of adjustment,
nor should they become the means of maintaining an undervalued or overvalued exchange rate. This position is based on a belief that restrictions have
a distorting influence whether they are focused on trade in commodities, in
services, or in assets (the capital account), and that this parallelism should
be recognized in the rules governing the reformed international monetary
system. In contrast, the provisions of the earlier system made a sharp distinction between controls on trade and other current transactions and controls
on capital transactions.
The U.S. proposal assumes that countries would take their responsibilities
seriously and would usually take steps toward adjustment before such steps
became necessary on the basis of the indicators. In the few cases where countries might persist in avoiding adjustment, however, certain international
sanctions would become operative. On the deficit side, for example, failure
to adjust might lead to refusal to provide credit, as under the old system, or
to loss of scheduled SDR allocations. On the surplus side, the international
inducements for adjustment might include the risk of losing scheduled SDR
allocations or a tax on the country's excess reserve holdings. In some situations, other countries might be authorized to impose a surcharge on imports
from the chronic surplus country until effetive measures were taken
to correct the situation. The Bretton Woods Agreement incorporated a provision similar to this last one, the so-called scarce currency clause. However,
because this provision was never invoked, there was no effective form of
international pressure on surplus countries to adjust.
International
Liquidity
The magnitude, composition, and distribution of world liquidity have
undergone substantial changes in recent years. From the end of 1969 to the
end of October 1972, gross international official reserves increased from
$78 billion to $152 billion, or almost 100 percent in 3 years. Part of this
increase was in newly created Special Drawing Rights, but most of it was
in dollars. Gold and reserve positions in the International Monetary Fund
remained at approximately the same level as in 1969. As a result, a significant
128
change occurred in the proportional composition of international reserves.
Gold dropped from 50 percent to 26 percent, reserve positions in the IMF
dropped from 9 percent to 4 percent, foreign exchange rose from 41 percent
to 64 percent, and SDR's, which did not exist in 1969, provided 6 percent
of world reserves.
For the future, the United States supports movement toward increasing reliance on the SDR as the primary source of world reserve growth
and toward progressive reduction in the role of gold as a reserve asset. The
U.S. proposal also assumes that currencies will play a much smaller role in
reserve holdings in the future than they do today. In that connection, proposals for exchanging a portion of reserve currency holdings into a special
issue of SDR's deserve careful study as part of the transition to a new system.
SDR's as the primary international reserve asset. As part of its proposals
for reform, the United States has supported increased importance for
SDR's; they should become the formal unit of account of the system,
to serve as the common reference point for currency rates and as a common measure of the value of reserve assets. Such an arrangement would
offer important advantages, in that it would eliminate several potential
sources of instability—private and official—which have been particularly
troubling for the international monetary system in the past.
First, the system would not be subjected to strains arising from private
demands for the primary reserve asset. The SDR has no commodity uses
and there are no plans, at least at the present time, for allowing the SDR
to be held as a financial asset in private hands. The value of the SDR in
terms of currencies would be determined purely on the basis of considerations
related to the monetary system itself, and not by occurrences in often volatile
commodity markets.
Second, the system would not have to depend on increasing the value of
the SDR for increases in official liquidity. Instead, the SDR was designed to
expand (or contract) international liquidity through changes in the volume
of SDR units outstanding, thus avoiding speculative problems caused by
changes in the value of the basic reserve asset relative to other types of
money.
Third, SDR's would not be subject to the problem of confidence created
by primary reliance on reserve currencies. Under the Bretton Woods system,
the demand for reserve assets was increasingly met by the reserve currencies.
The larger the amount of a currency held by foreign official institutions,
however, the greater the risk that confidence may be undermined by the
accompanying deficit in the balance of payments of the issuing country.
Furthermore, the commitment of the reserve currency country to maintain
convertibility into reserve assets becomes less and less credible as the stock of
its outstanding liquid liabilities increases. The SDR is not subject to these
particular problems of confidence, since the liability is spread among all
participating countries and it is not convertible into other reserve assets. Con-
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fidence in the SDR is primarily a function of the commitment and willingness
of governments to accept it in settlement of debts.
Certain changes in the nature and the use of the SDR would make it a
more attractive and useful asset. To the extent possible, for instance, SDR's
should be freed from the encumbrances of reconstitution obligations, designation procedures, and holding limits. These special features of the SDR
mechanism were probably necessary when that instrument was a new and
untested asset. In the absence of an effective adjustment mechanism, it was
considered desirable to place limitations on the magnitude of payments
imbalances to be financed through SDR transfers. The need for such special
features would be reduced or eliminated in a reformed system. Moreover,
the elimination of these special provisions would enhance the SDR's practical utility. The rules of the International Monetary Fund should also be
changed to permit SDR's to be used in all IMF transactions now permitting
or requiring gold. SDR's would thus truly become the basic international
money.
The role of reserve currencies. The United States has also proposed that in
a reformed system official holdings of foreign exchange should be neither
banned nor encouraged. Such holdings of national currencies may provide
a useful margin in reserve management, and fluctuations in such holdings
could add some elasticity to the system as a whole in meeting sudden flows
of volatile capital. A system which prohibited nations from holding foreign
exchange other than working balances would be a much more rigid system.
It would provide no short-term flexibility to allow for reserve expansion
over and above SDR allocations when the demand for reserves is abnormally high for brief periods and there are no other immediately available
means for responding to sudden and reversible speculative pressures. In
practice, there would be a much greater danger that such a rigid system
would break down under the normal pressures which can develop in a
liberal world trading and payments order where the level of international
transactions is large in comparison with the level of world reserves. Inability
of the international reserve mechanism to adapt flexibly in periods of strain
could seriously undermine the effort to move toward a more liberal trade and
payments system. At the same time, since countries would commit themselves
to convert foreign official currency holdings into common reserve assets, a
country should be able to place limits on the amount of its currency which
other countries may hold as reserves.
Gold as reserves. The United States believes that the role of gold in the
international monetary system should continue to diminish, and would
support orderly procedures to facilitate that process. A declining role for
gold is fully consistent with the long-term trend of monetary history. Governments long ago recognized the inadequacy of gold as a basis for national
monetary systems, and in recent decades the dependence of the international economy on that metal has diminished sharply. With the physical
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supply of gold limited; with its commodity uses competing inevitably and
increasingly with its monetary uses; and with residual noncommercial availability in no way related to the liquidity needs of a prosperous and expanding international economy, the world has naturally developed supplements
and substitutes.
The current situation—where speculative pressures on a thin and volatile commodity market have led to a price much higher than the official gold
price—is evidence of the instabilities and tensions inherent in a system
based on gold or other commodities. In 1972 alone, the commodity price
of gold varied between $44 and $70—a difference of 60 percent of the
lower figure. Whatever the established monetary price of gold, it is certain to get out of line with the price tendencies prevailing on the private
market. Care must be taken to avoid exposing the reformed monetary system to that source of instability.
THE INTERNATIONAL TRADING SYSTEM
A new round of multilateral trade negotiations within the framework of
the GATT is scheduled to begin in the fall of 1973. The purpose of these
negotiations will be both to expand the scope for international trade and to
improve the institutional process for resolving international trade disputes.
The world as a whole, including the United States, has benefited substantially from the expansion of trade made possible by previous multilateral reductions of trade barriers. At the same time, conflicts over trade
issues have intensified in recent years. In the approaching trade negotiations,
new ways will have to be found to resolve such conflicts in ways conducive to
the growth of trade.
World trade expanded more than fivefold in the last 20 years, and this
expansion has been accompanied by an equivalent expansion of world
output. The average annual growth in the value of both world trade and
economic output during this period was about 8 percent. While the expansion of trade was only one reason for these output gains, it was undoubtedly
an important source of growth. Trade not only allows each country to produce what is best suited to its capabilities, it also provides competition which
stimulates everyone to produce goods more cheaply and to improve their
quality.
Although the United States is less dependent on trade than most other
nations, the role of trade in the economy has grown. Over the last two
decades, GNP in the United States has increased about three and one-half
times, while trade has increased more than four times. Exports have become
a more significant source of employment and income for those sectors in
which the United States has a comparative advantage, particularly agriculture and high technology manufactures, while imports are becoming more
important as the source both of the raw materials and fuels used by U.S.
industry and of consumer goods whose production requires much use of
relatively unskilled labor.
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Over the last 5 years, imports of goods by Americans have increased
much faster than foreign purchases of goods made in the United States.
This imbalance has caused difficulties for the United States as well as for
the world economy, and its correction is therefore in the interest of both. It
can be accomplished in part through equilibrating changes in exchange rates
and relatively more effective anti-inflationary measures in the United States,
both of which change relative prices and thus improve the competitiveness
of U.S. goods and services. Much progress has been made on this front in
the past 18 months. Reductions in foreign trade barriers can also contribute
to correction of the payments imbalance. A number of countries, particularly
Japan, took some liberalizing actions in 1972 aimed at alleviating the disequilibrium situation. It is hoped that further actions during 1973 will contribute to this adjustment process.
Aims of Trade Negotiations
The trade negotiations scheduled to begin in the fall of 1973 look to the
longer term. Their goal is to remove the sources of difficulties that have
arisen under present trading arrangements and to provide for the expansion of trade on the basis of mutual advantage and mutual commitment
with reciprocity. However, results from the negotiations in the form of
concrete changes affecting the world trading system are likely to be gradual
and will not begin to take effect for several years.
In approaching these negotiations the United States seeks, as it has since
the end of World War II, a more open and equitable world trading system.
A freer movement of goods, services, and capital throughout the world in
response to market forces is in the U.S. interest for several reasons. To the
extent that trade is undistorted by artificial barriers, our producers can sell
what they make best and our consumers will reap the benefits of efficient
production and competition on a worldwide basis. These benefits to the
United States will not conflict with the interests of other countries. All
countries can expect gains from expanded world trade on a nondiscriminatory basis.
A world trading system that minimizes trade distortions is also one of the
important prerequisites for a smoothly functioning international monetary
system. The more barriers that countries erect to the flow of goods, services,
and capital, the more the adjustment of payments imbalances is focused on
the narrower range of economic activity which remains free to respond to
market forces. The result is to place heavy and uneven burdens of adjustment on particular sectors, often forcing countries to choose between accepting severe economic dislocations and postponing overall adjustment.
Comprehensive trade negotiations are made even more urgent by the accelerated liberalization of trade within the enlarged European Community
and countries associated with it. This development will stimulate growth and
increased trade among countries within Europe, and will make possible ex-
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pansion of trade with the outside world as well. At the same time, when a
group of countries eliminates trade barriers among themselves while maintaining them against the outside world, the immediate effect is to divert trade
from outside suppliers to suppliers in member countries.
In the process of harmonizing their tariffs with the EC's common external
tariff, the new members of the EC will be increasing some tariffs and reducing
others. Under the rules of the GATT, compensatory tariff reductions must be
offered for any increase in tariffs fixed in previous agreements. In the course
of this year, the United States and others will negotiate with the EC over the
amount of compensation considered adequate. But, such compensation will
not be able to take full account of the new situation that has been created by
the changes in European trading arrangements. Only a negotiated reduction
in the general level of tariffs and nontariff barriers (NTB's) can effectively
reduce the discrimination that results from the removal of trade barriers
within Europe.
The expansion of the EC has also been accompanied by the negotiation
of preferential trade agreements between the members of the European
Community and a large number of other countries in Europe and Africa.
Most of these agreements provide for preferential access for exports of both
parties in each other's markets, thus inherently discriminating against exports
of outsiders. This proliferation of preferential trade agreements threatens to
erode the most-favored-nation (MFN) principle, which provides that all
trade concessions agreed on between two or more countries be extended to
all countries that adhere to the General Agreement on Tariffs and Trade.
While the GATT permits formation of free trade areas or customs unions
that involve the elimination of barriers on substantially all internal trade, it
does not permit more limited selective preferential arrangements.
The MFN principle has been the cornerstone of the postwar liberalization
of multilateral trade. By ensuring nondiscrimination in the application of
trade barriers, it minimizes the inefficiency and distortions caused by such
barriers. It also avoids trade diversion and thus injury to third parties
from selective reduction of trade barriers. And finally, it makes possible a
greater trade liberalization in the course of multilateral GATT negotiations
by ensuring that any trade concession negotiated between two or more
countries will be promptly extended to a large number of countries. For
these reasons, it will be important to clarify the obligations assumed by
GATT members with respect to the MFN principle.
In view of the increasing importance of nontariff barriers as tariff barriers are reduced, it is crucial that the movement toward a more open
trading system be comprehensive, encompassing all forms of barriers to
trade. Among the major types of NTB's that distort trade are quantitative
import restrictions, export subsidies, restrictive government procurement
policies, and discriminatory design and performance standards.
Negotiations covering such a wide range of issues will be difficult for a
number of reasons: trade distortions may arise from otherwise legitimate
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domestic social policies; many of these practices are embedded in domestic
laws; there is no simple basis for measuring reciprocity in tradeoffs between
one type of NTB and another; and the feasible time schedule for concluding negotiations and implementing agreements is likely to vary widely from
one NTB to another. Nonetheless, inclusion of these measures in future trade
negotiations is essential; and considerable preparatory work, both technical
and definitional, has already been done, in the United States as well as in
a number of international groups and organizations.
Further steps toward trade liberalization should also be comprehensive
in the sense that they encompass all economic sectors. From the point of
view of the United States, it is particularly important that such negotiations include agricultural as well as industrial trade. Abundant natural
resources and advanced farm management and technology give this country
a comparative advantage which makes our farm products highly competitive in world markets. Our agricultural exports are estimated to have
reached an all-time high of $9j/£ billion last year. With rationalization of
the agricultural policies and liberalization of the related restrictive import
policies maintained by most industrialized countries, the United States
could realize its full potential for trade in this important sector.
Institutional Reforms
Certain institutional reforms would greatly help the movement toward a
more open and more equitable trading system. The present GATT framework, which has served well for the liberalization of trade, particularly tariff
barriers, now needs to be strengthened and modified. In particular, better
procedures should be found to deal with difficulties and disputes arising out
of changes in trade patterns and trading arrangements among particular
countries.
The failure of institutional arrangements to deal effectively with this range
of problems pokes certain dangers. Countries that cannot find a satisfactory
multilateral solution to their trade difficulties will increasingly be under
pressure to adopt unilateral restrictive measures that make trade less free
and are often discriminatory in their effect. Trade disputes that are not
resolved promptly and in accordance with agreed rules also tend to create
political problems at home that spill over into other areas and affect political and security relations among countries. Such trade disputes can also
prevent the smooth functioning of the international monetary system, both
by distorting economic flows and by undermining confidence in existing economic relationships.
Difficulties have arisen in the past with respect to measures which countries take to cushion the domestic impact of abrupt changes in trade patterns.
Under the existing rules of the GATT, countries can take temporary measures to restrain imports when rapid increases threaten to disrupt domestic
industry. A country imposing such restraints, however, is required to compensate other countries for any loss of trade that may result by making
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equivalent reductions in other trade barriers. These rules have proved unworkable in practice, and governments have tended to evade them.
In limited instances, the adjustment required by a change in trade patterns may be too large to be accomplished in a short time without excessive
social, personal, and political costs. In such cases temporary restraints on
the pace at which imports increase can provide time for the adjustment of
domestic resources to take place in the most constructive and least painful
way. These safeguards can also make it less likely that some countries will
resist general trade liberalization, fearing that it would cause abrupt dislocations in particularly sensitive industries.
A number of proposals have been put forward for a new safeguard system
which would assure that such measures are taken within the multilateral
framework. If safeguard actions are negotiated on a multilateral basis,
they are not nearly so likely to become a disguised form of protectionism
as they are if they are imposed by individual countries without international standards. Under the proposed system, it would be possible for importing countries to restrain imports temporarily without compensatory reductions of other trade barriers. Such actions would, however, be subject to
commonly accepted criteria, a procedure for international review, and provisions to prevent abuse of the system. The system should also include an
understanding that temporary safeguards must be accompanied by effective
domestic adjustments in the allocation of resources.
These various matters relating to reform of the international trading
system were discussed over a 2-year period by the OECD High Level Group
on Trade and Related Problems, a group of experts representing the major
industrial countries. Its report, issued in the summer of 1972, addresses all the
major issues concerning trade, including tariffs, nontariff barriers, unilateral
safeguards, trade in agricultural products, involvement of the less developed
countries, and East-West trade. Although there were divergences of opinion
on some issues among the group, particularly on agriculture, a high degree
of agreement was found on major substantive issues. The report emphasizes
the desirability of further liberalization of world trade and points to the
economic and political dangers inherent in a return to protectionism.
OTHER ASPECTS OF INTERNATIONAL ECONOMIC COOPERATION
The reform of the international monetary and trade systems will have a
global focus, inasmuch as the scope and membership of both the International Monetary Fund and the GATT are worldwide. Not all problems that
arise in international economic relationships can best be solved in a global
framework, however, since many issues that arise are of special interest to
certain groups of countries. In many cases institutional mechanisms have
been created for the purpose of examining common problems or exploring
common approaches, in other cases there exists only a focus for analysis.
The discussion below examines three sets of relationships that cut across
trade and monetary lines. The first is concerned with problems that arise
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among the industrialized market economies as a result of the high degree of
economic integration among them. The second focuses on the various dimensions of the monetary, trade, investment, and economic assistance relationships between developed and developing economies. The third looks at
the problems that may arise as economic relationships expand between centrally planned economies and the rest of the world.
Domestic Policies Affecting Trade and Investment
International monetary and trade rules are focused on measures affecting the flow of goods and financial assets across national borders. They
do not, on the whole, touch upon internal policy measures which are not
directed to international transactions as such but which nevertheless affect
the international location of economic activity. In an integrated world economy, however, measures taken in one country may have substantial effects
on the allocation of resources in other countries, and conflict among policy
objectives of various countries is therefore possible. These interrelations
have reached a particularly advanced state among the industrialized market
economies. For this reason, the Organization for Economic Cooperation and
Development (OECD), whose membership comprises most of the industrialized market economies, provides a useful forum for discussions on
questions of internal economic policies, their role in transmitting economic
influences from one country to another, and their relation to international
economic transactions.
A step toward intensified use of the OECD forum for such discussions
was taken recently when the Executive Committee of the Organization met
for the first time at higher political levels than before (Executive Committee New Style) to discuss new fields for possible cooperation. Just how the
focus of this area of international cooperation will be delineated remains to
be worked out, since it is not always possible to distinguish the matters that
clearly belong in the international monetary or trade sphere from those
relating primarily to internal policies. In particular, this latter area overlaps
with nontariff barriers which affect international trade and also with capital
controls related to the monetary adjustment process. Among the questions
likely to fall within the purview of this area, however, are those concerned
with national investment policies, including policies relating to multinational
corporations.
At its recent meeting, the OECD Executive Committee New Style agreed
to explore possible forms of cooperation on national policies affecting investment. Such policies are a particularly sensitive concern of all governments,
representing an area where national interests can conflict. By subsidizing
or otherwise encouraging some industries and not others, governments
can affect the pattern of domestic production and international trade.
Investment policies can thus be used to some extent as substitutes for
trade policy measures. The use of either may distort relative prices and cause
a less than optimal allocation of world resources. Although subsidies and
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trade restrictions can influence the location of production in similar ways,
subsidies affect adversely the terms of trade of the country giving them,
while trade barriers such as tariffs can shift the terms of trade in favor of
the country which imposes them.
Subsidies are not the only internal policy measure affecting investment,
production, and trade. Other frequently used policy tools are taxes, antitrust
policies, regulatory policies, patent policies, and government procurement
policies. There is a need to explore cooperatively the possibility of limiting
the use of such policies where they severely affect other countries.
Another field of investment policy open to conflict among national interests is the matter of rules governing the ownership of capital, including
land, productive facilities, and financial assets. No nation would readily
surrender the right to implement such rules, but every nation has an interest in protecting its citizens from arbitrary treatment by other governments. Considerable cooperation in this area has already been achieved by
the OECD, in particular in promulgating the Code of Liberalization of Capital Movements. Further progress would increase both efficiency and fairness
in international economic relations.
Another item of common interest in the investment area is the multinational corporation. Multinational corporations transmit capital, technology, and management skills from one country to another. Their ability
to manage resources in an international rather than a national market has
tended to improve the overall efficiency of the world economy. Because their
operations extend beyond the boundaries of any single nation, however, a
number of jurisdictional questions arise, and with increasing frequency these
corporations are believed—rightly or wrongly—to affect a country's ability to
pursue and achieve its domestic economic objectives. Moreover, multinational corporations personalize what would otherwise seem to be impersonal
market forces that transmit the impact of economic decisions from one
country to another. For this reason, these corporations tend to become a
focal point for problems faced by national governments as a consequence
of the growing economic interdependence among nations.
The OECD may also seek to work out cooperative arrangements on such
questions as regional policies, industrial policies, agricultural policies, general adjustment policies, regulations governing financial markets, and principles of taxation.
Industrialized and Developing Economies
One of the important objectives of reform is to create a more stable and
mutually beneficial framework for economic relations between developed
and developing countries. Both groups of countries can benefit from reducing the degree of arbitrariness in national decisions affecting international
trade, investment, and aid. The approaching negotiations provide an opportunity for mutual commitments that will serve the common interest and
137
can facilitate achievement of the commonly accepted goal of reducing the
gldbal gap in economic prosperity.
Developed and developing countries are dependent on each other in many
ways. Developing economies are the source of a substantial proportion of the
raw materials used by the industrialized economies, and increasingly the
source of manufactures involving labor-intensive production methods as well.
On the other hand, industrialized economies are the source of much of the
capital equipment, technology, management skills, and financial capital
needed by the developing countries to increase their production capabilities
and provide the basis for long-term diversification of their economies.
Most developing countries are members of the International Monetary
Fund. They are represented by nine members on the Committee of Twenty,
which is mapping out a reform of the international monetary system. This
participation should help assure that the new rules will work effectively on a
global basis and will give due weight to the needs of the developing
countries.
For developing countries, exports not only provide most of their foreign
exchange, but are also an important means of achieving economies of large
scale production in many industries. In order to increase their opportunities
for trade, the United States supports the general reduction of tariff barriers
in industrial countries to exports of developing countries. The United States
is also actively encouraging the full participation of these countries in the
approaching trade negotiations. The agenda for the negotiations, including
such items as the reduction of nontariff barriers and the imposition of safeguards, covers matters of even greater concern to these countries than tariff
questions. But their influence on the outcome of the negotiations will also be
greater if countries which are not currently members of the GATT are willing to accept the obligations of GATT membership. The commitment to this
framework of rules and obligations would help to ensure developing countries against arbitrary action by others. An obligation to avoid highly complex and discretionary nontariff barriers could also improve the efficiency
of their own planning efforts and facilitate trade with each other, which
has been declining in relative importance for many years.
The efficient transfer of capital from developed to developing countries
is another important objective of a well-functioning international economic
system. Such transfers of capital are desirable because they make available
to developing countries more resources for investment, as well as giving
them access to new production and management techniques. In recent years,
there has been a reduction in the relative importance of bilateral economic
assistance and increased reliance on the multilateral development banks as
channels of public aid. Loans by these institutions have almost doubled in
the 5-year period from 1968 through 1972, and U.S. contributions have also
increased substantially. At the same time, U.S. bilateral economic assistance
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has declined slightly. Private capital flows from developed to developing
countries have also continued to expand at a rapid rate, nearly doubling
during the 5-year period from 1967 through 1971, the last year for which
data are available. The size of these private flows makes it increasingly desirable to create arrangements which assure developing countries that
such investments contribute to their economic advancement and assure
developed countries that their investments will not be treated arbitrarily.
Such arrangements should include internationally accepted standards and
procedures for the settlement of disputes.
Market and Centrally Planned Economies
Trade and monetary relations between market economies and centrally
planned economies have been carried on outside the framework of the multilateral trade and payments system, generally on the basis of bilateral trade
agreements. These agreements may sometimes specify the quantities and
prices of commodities to be exchanged. More often they are more open-ended,
providing only a set of ground rules for trade contracts negotiated between
individual state trading companies and private firms.
Trade between market and centrally planned economies can be advantageous for both sides, and with a relaxation of political tensions this trade can
be expected to grow significantly. In the past the United States has engaged
in less trade with the centrally planned economies than has western Europe.
Recently, however, the United States has taken a number of steps to expand
its trade with these countries; among such moves have been the signing of
trade agreements with the Soviet Union and Poland and the elimination of
the embargo on bilateral trade with the People's Republic of China.
Trade with the Soviet Union is likely to grow particularly fast. The
Soviet Union has large quantities of raw materials and fuels, many of which
are beginning to be in short supply in the United States. On the other hand,
the Soviet Union has a large import requirement for food and for manufactured products that depend on advanced technology. The United States can
supply both.
The particular characteristics of the centrally planned economies will require the development of special rules as trade between them and the market
economies expands. In trade among market economies, bilateral settlement
of claims has been abandoned in favor of a multilateral settlement
system. Since few of the centrally planned economies are part of this multilateral payments system, special arrangements will have to be made to
assure that settlements of net balances will be effected.
For trade among market economies, rules have also been developed to
prevent excessive disruption of domestic production and trade with third
countries by large and rapid shifts in trade patterns. As trade with the
centrally planned economies grows, it may be necessary to develop similar
rules to prevent sudden disruption not only of economic activity within
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individual market economies, but also of trade patterns among the market
economies.
Finally, it is important to ensure that commercial disputes are settled
amicably and are not allowed to spread into the political sphere. In trade
among market economies, contracts are usually made between individual
firms, and whatever disputes arise are settled through the respective courts
in a manner that is usually acceptable to both parties. In trade with centrally planned economies, the fact that one of the parties to any trade contracts is the state can create special problems with respect to the settlement
of disputes.
In anticipation of some of the possible problems that a rapid expansion
of trade could give rise to, the recent trade agreement between the United
States and the Soviet Union included these provisions:
1. The creation of a joint U.S.-U.S.S.R. Commercial Commission to resolve difficulties arising at the government level.
2. A procedure for guarding against market disruptions. Under it, after
consultation, the U.S.S.R. will not ship products to the United States which
the U.S. Government has advised will "cause, threaten, or contribute to disruption of its domestic market."
3. An arbitration agreement which encourages the settlement of commercial disputes by arbitration in a country other than the Soviet Union or the
United States under the Arbitration Rules of the Economic Commission
for Europe, a United Nations agency. The U.S.-Soviet trade agreement also
provides for the reciprocal extension of credit facilities, nondiscriminatory
tariff treatment of each other's imports, the establishment of commercial
offices in the two countries, the availability of business facilities, and the
settlement of the World War II lend-lease debt owed the United States by
the U.S.S.R.
*
*
*
*
*
In advancing proposals for reform, the United States has kept in mind
the necessity of building on commonly accepted principles. Foremost among
these principles is the belief that an open exchange of goods, services, and
capital based on market relationships can benefit all countries. Moreover,
if all countries are to remain committed to freer trade and investment, the
international rules must give everyone a chance to share in the benefits.
Recent experience has shown the need for certain reforms in current rules
and practices. The rules should more explicitly define international standards of conduct and yet provide greater flexibility in the means of discharging these international responsibilities. Also, the various aspects of the
international economic system dealing with monetary, trade and investment
questions should be better related to each other. Lastly, any stable and wellfunctioning international economic system must rest upon sound domestic
policies to promote domestic growth and price stability in the major countries.
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Appendix A
SUPPLEMENTS TO CHAPTERS IN THE ANNUAL REPORT
of the
COUNCIL OF ECONOMIC ADVISERS
490-000 O - 73 - 10
141
SUPPLEMENT TO CHAPTER 2
Description of the 1972 Controls Program
The regulations that spelled out the Economic Stabilization Program
(ESP) in 1972 covered hundreds of pages. Quarterly Reports of the Cost
of Living Council describe the program fully. Here the discussion includes
only the principal elements which explain the general character of the
system.
The system began on August 15, 1971, with an initial freeze affecting
nearly all wages, prices, and rents and lasting 90 days. One of the main purposes of the freeze was to permit the development of a more durable, although
still temporary, program without giving prices and wages a chance to run
away in anticipation of the new program.
The Phase II program was announced on October 7 to succeed the
freeze on November 14, 1971. The initial design of the system and the
modifications to it during 1972 were made in accordance with a few
general themes:
1. The success of the system would depend primarily upon voluntary support. The standards of the program and their application had to be regarded
as fair and reasonable so that the great voluntary support which came forth
when the program began could be preserved. To achieve this result it was
desirable that price and wage controls should not be imposed unilaterally on
the economy by the Government but that representatives of the private sector should participate in the system's development.
2. The system would operate in circumstances where the expansion of
output and employment would be a major national objective. Price and
wage controls should not interfere with that expansion.
3. The controls were intended to be temporary. Some standards and
procedures that, if permanent, could not be tolerated from an equity standpoint would be tolerable and accepted if temporary. Similarly, elements of
the system that, if they were permanent, might have serious adverse economic
effects would be much less harmful if retained for a limited period. The
complexities and refinements of standards and the magnitude of administrative apparatus which might be necessary in a permanent system could
be minimized in a temporary one. However, the temporary system had to
be designed to avoid a price upsurge once the controls were removed or
relaxed.
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4. The controls were not expected to withstand a strong pressure of
excess demand on inelastic supply of products or labor. The system, in its
standards and administrative mechanism, did not contemplate the elaboration and force that would have been needed to resist excess demand pressure. Moreover, the system was not to be applied in some of the main areas
where increases, if they did occur, would result from demand pressure—
notably farm product prices and market interest rates.
ORGANIZATION OF THE PROGRAM
The program was based on a broad grant of authority originally given
to the President (although not requested by him) when Congress passed
the Economic Stabilization Act in August of 1970. This authority was extended, with a number of qualifications, some of which will be referred
to below, by Public Law 92-210 of December 1971. The renewed authority
would expire on April 30, 1973.
The President delegated his authority under the Act to the Cost of Living
Council (CLC), an interagency committee at Cabinet level chaired by the
Secretary of the Treasury. The CLC in turn delegated authority for major
functions under the Act to a number of committees, composed mainly of
private citizens. The involvement of private citizens was intended to
bring to the program both special expertise and a representation of the
interests of diverse segments of the community. (The structure is depicted
in Chart 12.)
The CLC retained authority to set objectives of the program, to determine its coverage, and to assure general consistency in the operation of
the various segments. It delegated to the Price Commission and to the
Pay Board authority to prescribe standards of permissible prices and employee compensation and to decide on the application of these standards
in particular cases. The Price Commission consisted of seven citizens
including a full-time chairman and was assisted by a staff of about 600. The
Pay Board initially consisted of 15 members, five each from labor, management, and the public. In March 1972 four of the five labor members withdrew, in disagreement with the decision made in the Pacific longshoremen's
case. The Pay Board was then reconstituted to consist of seven members, all
representing the general public although one was a labor leader and one was
from management. By the time this revision of the Board occurred, the tripartite group had already established the basic pay standards and procedures,
which continued to be applied by the new Board and were generally observed by employers and employees. The Chairman of the Pay Board served
full time and the Board had a staff of about 200.
The Construction Industry Stabilization Committee (CISC), a tripartite
body, was established in March 1971 to restrain construction costs,
which had been rising rapidly because of unusually large wage increases.
Although CISC was established prior to the freeze and followed procedures
144
Chart 12
Organization of the Economic
Stabilization Program in 1972
Committee on
Interest and
Dividends
COST OF LIVING
COUNCIL
National
Commission on
Productivity
Committee en
Health Services
Industry
Committee on
State and Local
Government
Cooperation
PAY BOARD
Construction
Industry
Stabilization
Committee
STABILIZATION
OFFICES
(INTERNAL REVENUE
SERVICE)
of its own during the program, it operated under the general guidance and
standards of the Pay Board.
The Price Commission was advised in particular areas of its jurisdiction
by a Rent Advisory Board and a Retail Advisory Committee. Advisory committees on the health industry and on State and local governments assisted
both the Price Commission and the Pay Board.
145
The Economic Stabilization Act required that mandatory ceilings be
placed upon interest rates, when necessary, to prevent them from rising at a
rate which would interfere with orderly economic growth. The Cost of
Living Council found that the behavior of interest rates was not such as
to call for mandatory ceilings under the Act. However, as a part of the Phase
II structure, a Committee on Interest and Dividends was established, consisting of the heads of the chief financial agencies in Government and
chaired by the Chairman of the Board of Governors of the Federal Reserve
System. Its role was to enlist voluntary cooperation of lenders and corporations in holding down institutionally determined interest rates and dividends.
The field operation of the stabilization program consisted mainly of providing information on the regulations and checking compliance with them.
These duties, which during the freeze had been assigned to the Office of
Emergency Preparedness, were assigned to a staff from the Internal Revenue
Service (IRS) operating under the policy supervision of the Director of the
Cost of Living Council. For the public, the local offices of the IRS were
usually the point of contact with the program.
About 3,000 IRS personnel were assigned to the Economic Stabilization
Program in 1972. Including them, total employment in the program was
about 4,000. In contrast, during World War II, 60,000 people had been employed in controlling prices. During the Korean war the number was about
15,000.
GOALS AND STANDARDS
When Phase II was announced in October 1971, the Cost of Living Council set an interim goal of getting the inflation rate down to 2 to 3 percent
by the end of 1972. Attainment of the goal would be measured mainly by
the consumer price index (CPI), the most familiar of all price indexes. For
a certain class of American consumers, namely urban wage earners and
clerical workers and their families, it is the best available measure of
changes in the average prices they pay for the things they buy, although
this is not true of every consumer.
The goal would be measured in terms of the consumer price index, but
the calculations leading to the idea that the goal was feasible, and to the
control standards by which it was to be achieved, related in the first instance
to the gross national product (GNP) deflator for the priavte economy. The
feasible behavior of the private GNP deflator was derived from estimates of
private compensation per man-hour, output per man-hour, labor costs per
unit of output, and the relation between prices and unit labor costs. Conversion of the estimate into a goal for the CPI rested on the observation that over
extended periods the increases in the CPI and the private GNP price deflator
were not very different. Short-term differences resulted mainly from the behavior of food prices. In the fall of 1971, when the goal was set, food prices
were not expected to rise rapidly in 1972 and cause an exceptional rise in the
CPI relative to the private deflator. As it turned out, the rise in the CPI rela-
146
tive to the rise in the private deflator was greater in 1972 than in all but 1
year since 1950.
Setting 3 percent as the upper end of the target range implied a determination to reduce the rate somewhat below what would have been commonly considered probable in the absence of the controls. A 3-percent inflation rate would be a reduction by half from the peak CPI rate reached
in 1969 and would bring the rate to a level last seen in 1967.
The basic standards set by the Pay Board and the Price Commission were
intended to achieve the goal set by the Cost of Living Council. In fact for
a variety of reasons, including provisions of the Economic Stabilization Act,
as amended, these basic standards were modified in many ways. Some of
these qualifications will be discussed below. Here we confine ourselves to the
logic of the system itself.
The Pay Board set a standard for permissible pay increases of 5J4 percent
per year. The "normal" rate of productivity growth—the trend in output per
man-hour—was considered to be about 3 percent a year. If total labor compensation per hour rose by 5J/2 percent on the average, the normal rise of
labor costs per unit of output would be (approximately) 2J4 percent. The
basic standard for prices was the pass-through of costs—that prices would be
permitted to rise in the same proportion as costs. In the calculation of costs,
however, allowance would be made for the normal rise of productivity.
Application of these two standards together would limit average price increases in the controlled sector to 2j/i percent if the system was closed, that is,
if all costs consisted of labor or purchased supplies whose prices were governed by the same standards. However, if some of the costs of the controlled
sector originated outside that sector and rose by more than 2*/2 percent a
year, the prices of the controlled sector would also rise by more than 2J4
percent. As a practical matter, the controls affected purchases originating
in the domestic, nonfarm, nonfinancial sector of the economy, a sector representing about 90 percent of the total.
It was recognized that productivity would probably rise by more than
the 3-percent trend rate during the expansion of 1971-72. One consequence might be an increase in the share of the value of output going to
profits and other nonlabor shares. However, since the labor share of income
was at or close to a cyclical high point when the control system began, some
movement in that direction seemed appropriate.
Pay standard. The 5 / 2 -percent pay standard was modified in a number
of respects, all of which raised the permissible wage increase:
1. Increases in excess of 5 / 2 percent, scheduled under agreements reached
before November 14, 1971, could go into effect unless specifically disallowed
by the Pay Board. With some exceptions, payments held up during the freeze
were permitted to be made retroactively in the early part of Phase II.
2. Increases in excess of 5^» percent would be allowed in order to correct
a gross inequity in the relation between the pay of one group of employees
and another group with which the first group had a well-established parity.
147
3. During the first year of Phase II, increases beyond 5*/2 percent were
allowed to workers whose pay had increased less than 7 percent a year in
the preceding 3 years.
4. Wage increases would be permitted above the standard if they were
granted as part of an incentive program designed to improve productivity.
5. Congress also specified that certain fringe benefits would not be subject to restraint unless they were "unreasonably inconsistent with the standards for wage, salary, and price increases." To implement this mandate,
the Pay Board decided to permit increases in compensation above 5*/i percent equal to 0.7 percent of compensation when in the form of pension,
profit-sharing, or savings plans, thus raising the standard to 6.2 percent.
Additional increments were allowed for units which had lagged in implementing fringe benefits in the past.
6. The Economic Stabilization Act specifically exempted wages paid to
individuals whose earnings were "substandard" or who could be considered
to be among the "working poor." The Cost of Living Council initially decided that this provision exempted all wages of less than $1.90 an hour.
However, in July a Federal court agreed with the contention of a suing labor
union that the $1.90 figure was inconsistent with the intent of Congress. The
Cost of Living Council then raised the exemption level to $2.75 per hour.
At this level more than 40 percent of the workers in the private nonfarm
sector were estimated to be exempt from coverage.
Price standard. The basic price standard, as already noted, provided that
prices could be increased in the same proportion as allowable costs. There
were, however, a number of qualifications to this standard.
1. In the calculation of costs to justify price increases, the rise in wage
rates was to be discounted by the rise in productivity to permit calculation
of an estimated increase in labor costs per unit of output. The productivity
rise used for this purpose was at first calculated by each firm on the basis
of its own forecast of its own experience. Thus, if the actual productivity increase exceeded or fell short of the calculated rate, the actual cost increases
might be less or more than the costs allowed for price determination. Moreover, beginning in April 1972 the Price Commission required that instead
of using their own estimates, firms should compute their allowable costs by
applying productivity factors calculated by the Price Commission, using
data developed by the Bureau of Labor Statistics for different industries
on the basis of 1958-69 experience. This created another source of possible discrepancy between a firm's actual costs and the costs used in determining its permissible prices; but the change gave the firm a greater
incentive to improve its productivity.
2. Wholesale and retailing firms were permitted to pass through increased costs of merchandise, but there was no provision for passing through
increases in operating costs. If operating costs rose by a larger percentage
than merchandise costs, the permitted price rise would not be as large in
percentage terms as the total cost increase.
148
3. When a material with a particularly volatile price constituted a large
part of a firm's co3ts, the firm was permitted to raise its price to pass through
an increase in that cost without notifying the Price Commission in advance,
even though the firm's size would otherwise require prenotification. However, if the firm operated under the volatile pricing rule it might raise its
price only by the absolute dollar-and-cents amount of the cost increase, not
by the percentage of the cost increase. It also had to reduce its price correspondingly when the volatile cost declined.
4. Many large, multiproduct firms operated under term limit pricing
(TLP) agreements with the Price Commission. These agreements specified
a maximum percentage by which the firm might raise the average of all its
prices during a period, usually a year. This percentage was arrived at after
consideration of the firm's cost increases, and the arrangement permitted the
firm to raise the price of a particular product without notifying the Price
Commission. Such TLP agreements as negotiated were subject to a maximum limit, which was initially 2.0 percent and was subsequently reduced to
1.8 percent. They also commonly specified a maximum increase permitted
for any single product or product line. Thus a common agreement might
permit a firm to increase the average of all of its prices by 1.5 percent but
not to increase any single price by more than 8 percent; many firms found
this latter rule the most restrictive. The rationale of the TLP system was
that, in exchange for flexibility and relief from red tape, firms would agree
to smaller price increases than they might have been able to justify by costs
on a case-by-case basis.
5. The Price Commission usually did not recognize, for purposes of price
determination, labor cost increases in excess of 5j/i percent, even though
these might have been approved by the Pay Board.
6. Even if otherwise justified, price increases were not permitted where
the firm's profit margin (profits as a percentage of sales) exceeded the
average profit margin of the best 2 of the 3 fiscal years preceding August 15,
1971. The main purpose of this rule was to provide a safeguard against
the unavoidable difficulties of estimating unit costs in advance, or even
checking them after the fact, especially for multiproduct firms. In this situation there might be a tendency for firms to overestimate their costs, and
effective monitoring would be impossible. The profit-margin test provided
a simple means of limiting any slippage resulting from imperfect application of the other tests. It did not apply to a firm which had not raised
its prices above the levels of the base period, usually defined as the 30 days
preceding the freeze of August 15,1971.
THE FIRM-BY-FIRM APPROACH
An important and unusual feature of the 1971-72 price-wage control
system is that the unit of control was the firm, or in some cases the collective bargaining unit, rather than the product or occupation. That is, the
149
Price Commission did not set a price ceiling for each covered product—
men's white button-down shirts of certain specifications, for example—
which applied to all sellers of that product. Instead it laid down rules for
determining the ceiling price of each product sold by a particular firm—or,
where the TLP applied, the average price of all the products sold by that
firm.
This system had the great advantage that each firm could compute its
permissible prices for itself from information available in its own accounts,
aside from the sector productivity factor published by the Price Commission
and the overall TLP terms, which were applicable to a relatively small
number of firms. Firms did not have to wait for price determinations by
the control agency, although the larger firms had to have approval of their
calculations. This do-it-yourself approach to price control was the only way
to get the system into operation quickly and then keep it in operation without a large Government staff to determine the ceilings. Moreover, it gave
recognition to differences among products and firms that the market recognized but that could hardly be taken into account in price-control regulations.
On the other hand, the firm-by-firm approach contained a number of
actual or potential difficulties. Customers and enforcement officers were unable to tell what a firm's ceiling price was without study of the firm's books.
In some cases it froze a price relation among firms which for some transitory
reason existed in the base period but which would be unfair or inefficient
if continued for long. Since, with some exceptions, a firm's ceiling prices
would depend on its own costs, the pressure to hold down costs would be
weakened. If the product in question were scarce, a situation might emerge
in which it carried different prices simultaneously in the market, and which
created problems of fairness and efficiency in allocation. These difficulties
were not expected to become pervasive, however, as long as excess demand
and shortages were not common and as long as the controls were considered
to be temporary. Competition would tend to establish a one-price system,
even if ceiling prices differed among firms; for that reason, and also out of
regard for what would happen when controls ended, companies could not be
complacent about increases in their costs.
The application of the pay standards on a firm-by-firm basis or on the
basis of individual bargaining units could raise similar problems. However,
the factors determining permissible pay increases were more uniform among
firms than the factors determining permissible price increases, and they were
less likely to produce distortions. Moreover, the standards of the Pay Board
made more explicit provision for preserving customary relations among
groups of employees.
COVERAGE AND ADMINISTRATION
The Phase II program was initially very comprehensive in its coverage,
measured either by the number of economic units or by the proportions of
150
the value of output and income to which it applied. During 1972 the number of economic units covered was substantially reduced, but the proportion
of the value of output covered remained large.
The system applied directly to the prices of goods and services, including
residential rents, and to employee compensation, including the compensation of executives. It applied indirectly to profit rates through the control
of the relation between costs and prices and through the profit-margin rule,
and it applied to rental income on residential property in the same way.
Interest rates and dividends were the object of a voluntary restraint program.
The most important exempt sector was agriculture (defined to include
fisheries and forests). Initially farm products were exempt at all stages of
distribution as long as they were unprocessed. Thus lettuce in a retail store
was exempt from price control. In June the exemption was narrowed to
only the first sale at the farm. However, since the percent increase in farm
prices for all types of products could be passed through at the subsequent
stages, this modification amounted to control of the processing and distribution margins rather than control of the farm prices.
Farm product prices were exempted because they did not conform to
the pattern upon which the controls system was based. The theory of the
controls system was that the price increases to which it was directed, both
occurring and in prospect, were not "equilibrating"; that is, they were not
price increases necessary to elicit more production or to distribute a short
supply. In fact, in many cases where supply could be quickly expanded, there
would be more demanded and therefore produced if prices did not rise. These
price increases could therefore be repressed without creating shortages. Farm
prices, however, are determined in highly competitive markets, and they
adjust continually to equate the quantities demanded and supplied. To
repress the price increases in those markets would create shortages and
rather than increase supply would probably reduce it. Similar reasoning
justified exemption of market interest rates, prices of financial assets, and
prices of imports. Prices of exports were exempted because they did not
enter into the price level confronting American consumers.
Pay scales of the Federal Government and prices charged by it were
exempted with the understanding that other means would be used to keep
these wages and prices consistent with the goals of the stabilization program. A number of less important categories were exempted for administrative reasons.
Within the controlled area, firms and bargaining units were divided for
purposes of administration into three categories or tiers on the basis of size
(Table 32). Although the same standards of price and wage behavior
applied on all tiers, the large economic units were subjected to closer surveillance than the smaller ones, but not because the large units were believed
likely to be more "inflationary" than small ones. There were two main reasons
for this decision. First, an administrative staff of a given size could observe
a given volume of economic activity more effectively by watching a few
151
large companies than by watching many small ones. Second, close scrutiny
of a part of the market was believed likely to yield better control than loose
scrutiny of all of it, the reasoning being that the behavior of the closely
watched part would discipline the behavior of the others because of competitive pressures.
TABLE 32.—Classification of firms and workers in Economic Stabilization Program l
Tier
Firm
Employees
1 Prenotification of wage or price increases; quarterly reporting of
price, sales, profits
Sales of $100 million and over (1,700
firms, 45 percent of sales)
Wage units of 5,000 or more workers (15 percent of total)
II Reporting of increases; quarterly reporting of price, sales, profits
Sales of $50 million to $100 million
(1,700 firms, 5 percent of sales)
Wage units of 1,000 to 5,000 workers (6 percent of total)
III No reporting; subject to ESP regulations and monitoring
Sales of less than $50 million (1.5 million enterprises, 25 percent of sales)
Other workers (29 percent of total)
1
As of the end of 1972 exemptions had been granted to 6.5 million enterprises with 25 percent of total sales and to 50
percent of all employees (including exempted employees of State and local governments).
Source: Cost of Living Council.
The largest firms, those in Tier I, were required to notify the Price Commission in advance and to get approval of any price increase unless they
had previously obtained a term limit pricing agreement or some other
special provision, such as a volatile price rule. The firms in Tier II were not
required to obtain advance approval unless they sought an exception from
the rules; but they were required to file quarterly reports, which were
prescribed by the Price Commission and from which compliance could be
checked. Tier III firms were not required to file reports, but their compliance was open to spot check by the Internal Revenue Service.
The procedures relating to pay were similar to those governing prices.
Small business exemptions. Despite the tier arrangement described above,
it became clear almost as soon as Phase II began that a disproportionate
part of the administrative capacity of the system was being used to provide
information and to process complaints in cases that had little effect on the
inflation problem. The Cost of Living Council decided that it could use
its resources better by concentrating them on the larger economic units,
relying on competition from them to restrain price increases by the smaller
ones. In January retail firms with annual sales of less than $100,000 were
exempted. This action removed from control three-fourths of all retail firms
but only 15 percent of all retail sales. At the same time the Cost of Living
Council exempted from rent controls all apartments or houses whose landlord owned four or fewer units. Apartments renting for $500 or more a
month were also exempted, but on a different ground—namely, that keeping down the rents of luxury apartments was not so urgent a national interest
as to justify the administrative burdens it involved. The effect of these
actions was to exempt from control about 45 percent of all rental units.
152
In May the Cost of Living Council exempted from both price and wage
controls all firms and local government units with 60 or fewer employees—
with certain exceptions. The exceptions were firms in the construction and
health service industries and firms in which more than half of the employees
were affected by a collective bargaining contract which covered more than
60 employees. The selection of 60 as the cutoff point was influenced by the
desire to exempt as many firms as possible but at the same time to keep
a significant fraction of the sales of each industry under control.
Administration and compliance. The relatively small staff of the economic
stabilization agencies had the twofold task of informing the public of the rules
and regulations and of developing procedures for ensuring compliance. The
staff was also responsible for processing inquiries, requests for approval of
price and wage increases, complaints alleging violations, applications for
exceptions and exemptions, and appeals for review of decisions. At the end
of 1972 there had been 3.3 million direct contacts with the public. Of
these 95 percent were inquiries, 58 percent of which referred to rents,
with questions on prices and wages making up the remainder in equal proportions. More than 10,000 prenotifications of price increases by larger Tier I
firms were received, many necessitating detailed Price Commission analyses
and lengthy meetings with company representatives. Notification of many
wage increases negotiated by larger employee units numbering more than
1,000 workers also required review procedures by the Pay Board.
The major burden of responding to inquiries, complaints, and requests
for exceptions fell on the seven regional offices and 360 district and subdistrict offices of the Internal Revenue Service. As the program matured
and guidelines and decision precedents became established, more authority
for decision making was delegated to these field offices, particularly in
administering price and rent controls.
Reliance primarily on voluntary compliance, adopted at the beginning of
the Economic Stabilization Program, was maintained through 1972. The
Internal Revenue Service did, however, conduct numerous investigations
based on citizens' complaints, in addition to the more than 800 investigations
carried out at the direction of ESP officials. Most potential violations were
handled through price rollbacks rather than legal action. Administrative
sanctions ordinarily required firms to refund or reduce prices in amounts
sufficient to offset the dollar amount of the apparent excess profit margin,
or in the amount of revenue derived from the price increases, whichever
was smaller. However, double or treble price reductions and refunds were
sometimes required. In exceptional cases, legal action was initiated. About
300 such actions were undertaken in the first year of Phase II.
SUPPLEMENTARY ANTI-INFLATION MEASURES
As 1972 progressed, rapidly rising prices of food, especially meat, became
a more and more critical problem for the controls program. Partly because
food prices weigh heavily in the public's perception of what is happening
153
to living costs, the higher food prices were threatening to weaken public
confidence in the program.
The control system could not satisfactorily restrain the increase of food
prices. Prices at the farm level were exempted; and although controls were
repeatedly considered during 1972, they were always rejected on the
ground that such controls would cause shortages immediately and discourage
the expansion of supplies for the future.
A large part, about two-thirds, of the value of food is added in processing
and distribution after the products leave the farm. The price or margin at
these stages was controlled; but sometimes the controls left room for increasing margins, and from time to time the Cost of Living Council made special
appeals to food processors and distributors to hold margins down. The Internal Revenue Service also concentrated on assuring compliance with the
controls in food processing and marketing.
However, over the Phase II period, competition, controls, and voluntary
cooperation successfully constrained the margin between food prices at the
farm and food prices at retail. According to Department of Agriculture
estimates, this margin increased by only 0.6 percent from the third quarter
of 1971 to the third quarter of 1972. In the same period the farm price of
domestically produced farm foods increased by 11.7 percent, while retail
food prices increased by 4.9 percent.
Rising food prices, and the inability of price controls to curb them, focused
attention on the range of other measures available to Government which
could restrain the rise of food costs. In general, five measures were applied
which operated to increase supplies, either immediately or in the longer run.
1. In June limitations on the import of meat were suspended for 1972. In
December this suspension was continued into 1973.
2. Government-controlled stocks of meat and grains were reduced.
3. Export subsidies for wheat and rice were discontinued; this action
eliminated an artificial incentive to export that was reducing domestic
supplies.
4. Limits on the planting of wheat, rice, feed grains, and soybeans in 1973
were eased.
5. Import quotas on nonfat dry milk were increased temporarily at the
beginning of 1973.
In addition to foods, two other commodity areas, lumber and hides, registered substantially higher prices despite the controls. In both cases the
Administration tried to curb price increases by special measures. Steps were
taken to increase timber cutting in the national forests and to enforce the
control regulations more strictly on lumber sales. The Department of Commerce imposed a limit on the export of hides in order to increase the domestic
supply, a move that was soon overturned, however, by congressional action.
154
SUPPLEMENT T O CHAPTER 4
In order to answer the question whether the occupational distribution
of women has moved closer to that of men's, an index of occupational
dissimilarity was constructed for 1960 and 1970. The particular measure
of dissimilarity used here is calculated by taking the absolute difference
(for each of 197 occupations) between the percentage of the female experienced civilian labor force in a given occupation and the percentage
of the male experienced civilian labor force in the same occupation, summing these differences across the 197 occupations, and then dividing this
sum by 2. Those persons in the experienced labor force who did not report
their occupation were excluded from the denominator. If men and women
were to have the identical occupational distributions then the value of the
index would be 0. At the other extreme, if men and women were completely
occupationally segregated, so that they were never in the same occupation,
the index would have a value of 1.
The values of the occupational dissimilarity index, calculated as described,
were as follows:
1960
. 629
1970
. 598
The index therefore indicates a very small change in the direction of
increased occupational similarity between 1960 and 1970. The data for
the calculations were taken from the decennial censuses of 1960 and 1970.
In Table 33, women's representation in a group of detailed occupations
is given for 1950, 1960, and 1970.
TABLE 33.—Women in experienced civilian labor force, 1950, I960, and 1970
(14 years of age and over)
Number of women (thousands)
Women as percent of all persons in
occupation
Occupational group
TOTAL
Professional and technical workers
_ .
Accountants
Architects .
Engineers
Farm and home management advisers
Lawyers and judges
Librarians
Life and physical scientists
Personnel and labor relations workers
Pharmacists
Physicians, medical and osteopathic
Dietitians
Registered nurses
Therapists
Health technicians...
Clergymen
Other religious workers
1960
1970
1960
1970
16,481.9
22,303.7
30,601.0
28.1
32.8
38.0
1,896.9
2,723.9
4,397.6
39.0
38.4
39.9
14.9
16.5
26.2
46.1
4.1
88.8
11.0
28.3
8.7
6.7
96.5
97.6
47.2
3.5
85.4
9.2
33.1
7.5
6.9
92.7
97.5
63.4
68.2
49.7
4.9
82.0
13.7
30.9
12.0
81.9
187.0
46.3
6.4
7.5
64.6
15.2
34.2
7.2
16.2
24.8
613.7
16.4
88.0
20.3
6.5
13.4
101.5
29.2
91.7
13.3
26.1
37.8
819.3
48.5
184.1
28.7
38.6
57.0
.
1950
1950
.9
6.7
5.0
7.0
50.7
12.6
15.0
7.4
12.3
21.7
399.2
(i)
7.3
155
.8
7.2
4.7
2.0
6.3
20.1
3.8
1.3
•fl
4.4
69.9
2.1
.8
2.3
63.3
3.6
1.6
9.3
92.0
97.3
63.5
69.7
2.9
55.7
TABLE 33.—Women in experienced civilian labor force, 1950, I960, and
1970—Continued
(14 years of age and over)
Number o f women (thousands)
Occupational group
1950
1960
1970
Women as percent of all persons in
occupation
1950
1960
1970
Professional and technical workers— Cont'd.
Social scientists
Social workers .
Recreation workers
Teachers, elementary
.
. . .
Teachers, secondary
Teachers college and university
Engineering and science technicians
Draftsmen
Radio operators
Authors
.
^
Dancers
Designers
Editors and reporters.
Musicians and composers
Photographers
Other professional, technical, and kindred
workers
Managers and administrators, except farm
Buyers, wholesale and retail trade
Credit men
Public administrators and postal inspectors..
Managers and superintendents, building
Administrators, n.e.c, Federal
Administrators, n.e.c, State
Administrators, n e e , local
Officials of societies and unions
Postmasters and mail superintendents
Purchasing agents and buyers n e e
Restaurant, cafeteria and bar managers .
Other specified managers and administrators,
except farm
11.3
54.0
7.7
M
1.7
5.8
29.4
n
15.1
59.4
14.9
851.2
280.5
46.5
43.5
12.3
3.1
7.3
3.9
13.4
39.0
29.8
6.5
32.0
138.9
22.5
1,199.4
498.7
140.4
68.7
23.6
7.6
7.7
5.7
27.2
61.5
33.5
9.5
32 9
69.3
45 4
Ja
10.2
36.5
32.1
25 4
62.8
51 2
85.8
49.3
23.9
11.1
5.6
16.7
25.5
86.0
19 3
36.6
38.6
12.2
23 2
62 8
42 0
83.7
49 3
28.6
12.9
8.0
25.9
29.1
81.3
24 2
40.6
34.8
14 2
0)
270.1
513.9
(0
33.9
32.9
680.8
844.5
1,034.3
13.7
14.8
16.6
35.5
6.6
2.5
22.9
5.2
34.2
12.0
3.1
20.0
12.1
52.8
17.0
6.2
34.0
20.4
4.8
6.5
24,6
19.2
4.4
34.2
10.6
18.8
3.2
17.3
6.2
93.9
17.2
5.1
15.0
10.3
95.5
20.6
8.2
11.3
22.5
112.6
22.9
10.9
44.9
9.5
26.9
35.6
25.1
3.9
43.6
15.3
12.8
21.8
11.8
39.3
9.2
32.5
29.8
28.3
6.1
40.2
16.9
13.4
26.2
16.2
31.8
13.7
34.2
(0
72.4
223.4
(0
14.9
18.4
2.0
27.8
5.0
45.0
10.8
11.3
14.3
8.0
43.0
17.6
13.3
18.9
2.2
3.4
3.1
6.3
11.0
12.3
11.8
2.3
2.7
2.1
9.5
Managers and administrators, n.e.c., salaried:
Construction
Manufacturing
Transportation
Communication and utilities
Wholesale trade.
Retail, hardware, etc
Retail general merchandise
Retail, foodstores.
.
Retail, motor vehicles and accessories
Retail, apparel and accessories
Retail furniture, etc
Other retail trade
Finance, insurance and real estate
Business and repair services
Personal services
All other industries
. .
4.2
5.7
8.3
1.4
13.6
12.7
2.4
14.1
3.1
13.7
25.4
6.1
21.2
39.6
23.6
9.5
3.9
17.0
3.4
14.7
47.9
16.1
28,7
64.5
6.8
4.4
9.7
5.4
3.3
7.1
8.7
7.0
4.3
7.4
5.1
25.4
17.3
5.7
19.9
5.3
24.2
32.8
19.8
36.0
64.0
23.2
12.8
4.3
33.5
11.2
12.4
13.9
10.8
33.7
25.3
2.8
6.0
2.1
4.5
2.4
8.0
1.3
6.5
4.6
4.0
4.7
10.6
5.0
5.1
1.9
9.1
9.8
8.1
8.4
23.3
19.4
32.4
26.1
2.7
26.2
8.9
4.4
33.5
10.7
11.9
14.7
16.8
35.8
27.8
24.6
12.3
5.4
34.2
12.1
13.1
17.5
14.0
26.8
26.8
Managers and administrators, n.e.c. selfemployed:
Construction
Manufacturing
Transportation
Wholesale trade
Retail, hardware, etc..__
Retail, general merchandise
Retail, food
Retail, gas service stations
Retail, apparel and accessories stores
Retail, furniture, etc
Other retail trade
Finance, insurance and real estate
Business and repair services
Personal services.
All other industries.
2.6
2.9
15.2
11.8
2.4
7.1
3.8
_.
4.6
6.9
3.4
15.1
70.6
10.8
42.7
30.1
23.6
18.4
5.2
4.1
3.5
3.6
24.4
4.9
38.8
7.2
7.4
39.5
14.7
156
19.2
4.5
32.8
8.3
8.1
43.6
21.3
10.0
3.7
27.4
3.0
6.2
27.8
7.4
29.5
7.3
14.3
10.9
6.0
28.0
14.2
1.3
6.9
33.7
9.2
15.9
11.5
8.4
33.1
20.3
3.4
41.9
13.6
25.1
12.6
11.9
31.3
22.1
TABLE 33.— Women in experienced civilian labor force, 1950, 1960, and 7970—-Continued
(14 years of age and over)
Number of women (thousands)
Women as percent of all persons in
occupation
Occupational group
Sales workers
Advertising agents and salesmen
Demonstrators
Hucksters and peddlers
Insurance agents, brokers, and underwriters.
Newsboys
Real estate agents and brokers
Sales representatives, manufacturing
Sales representatives, wholesale
Salesmen and clerks, retail..
Other salesworkers
Clerical and kindred workersBank tellers
Bookkeepers .
Cashiers
Collectors, bill and account
Dispatchers and starters, vehicle. - .
Library attendants and assistants
Mail carriers, post office .
Messengers and office boys
Office machine operators
Shipping and receiving clerks
Stenographers, typists, and secretaries
Telegraph operators
Telephone operators
Ticket, station, and express agents
Other clerical workers
Bakers
Bookbinders
Compositors and typesetters
Decorators and window dressers
Electricians
Linemen and servicemen, telegraph, telephone, and power
Engravers, except photoengravers
Foremen nonmanufacturing
Foremen manufacturing
inspectors .
..
Machinists
Mechanics and repairmen, except air, auto...
Aircraft mechanics
. .
Auto mechanics
Opticians, lensgrinders and polishers
Painters, construction and maintenance
Pressmen and plate printers, printing
Stationary engineers
Tailors
_
Upholsterers
Other craftsmen .
_
Dressmakers and seamstresses, except factory
Filers, polishers, sanders and buffers
Laundry and drycleaning operatives
Meatcutters and butchers, except manufacturing _
Milliners
Painters, manufactured articles
Photographic process workers
Sawyers
Textile operatives
Bus drivers
Deliverymen and routemen
Taxicab drivers and chauffeurs
Truckdrivers
Other specified operatives
490-000 O - 73 - 11
1970
1,374.7
1,736.0
2,096.7
34.2
36.2
38.6
5.3
11.0
27.3
4.1
22.1
23.0
15.3
1,228.9
34.3
4.9
26.7
37.7
36.1
8.6
46.8
50.8
21.3
1,451.4
51.8
13.0
36.7
96.4
57.6
13.9
85.2
36.8
42.8
1,619.4
94.8
15.1
77.5
14.9
8.9
3.8
15.6
7.2
3.8
48.9
23.0
13.9
93.2
60.5
9.7
4.3
23.9
10.7
4.2
54.4
20.2
20.1
91.1
78.7
12.5
7.4
32.0
8.8
6.6
56.5
27.0
4,343.4
6,407.0
9,910.0
61.9
67.9
73.6
27.7
566.3
193.7
94.6
793.6
393.1
9.1
3.4
10.9
119.5
20.3
1,524.9
7.6
349.2
28.1
4.4
9.3
1,494.9
44.6
77.4
81.4
16.0
12.7
76.7
2.0
18.6
81.6
6.8
94.6
21.6
95.8
12.7
47.2
70.2
83.4
77.1
20.0
10.8
75.7
2.2
14.7
74.4
8.1
96.5
22.8
95.8
21.8
54.6
86.2
82.0
83.7
36.2
17.1
78.6
239.1
26.4
2,233.5
4.7
356.2
16.2
2,196.0
218.6
1,291.7
734.8
19.2
10.5
101.2
20.5
12.1
423.1
62.9
3,786.9
3.7
398.3
36.7
2,789.8
247.3
295.3
524.1
3.1
3.1
5.0
13.9
19.5
12.2
14.0
21.4
17.6
16.2
24.4
33.9
20.9
24.9
41.9
11.6
58.1
18.2
58.9
31.9
46.3
30.0
58.1
15.3
57.7
5.1
1.4
5.6
2.1
10.7
2.4
2.1
2.7
18.2
51.2
7.3
22.8
58.2
6.6
16.6
1.0
15.4
1.9
2.4
9.1
2.5
1.8
16.3
3.2
7.1
5.1
1.6
23.1
35.3
44.2
51.1
80.9
9.7
12.8
35.0
4.5
12.9
6.5
14.8
14.1
2.6
22.5
10.7
101.8
3,190.8
3,521.2
140.3
7.3
302.7
121.7
21.0
282.9
3.5
6.7
5.2
7.9
Craftsmen
Operatives.
1960
3.9
4.1
_
1970
1950
2.1
2.8
7.6
7.4
4.3
2.4
5.5
6.2
3.8
5.8
3.9
12.5
14.8
13.5
2.6
2.5
8.4
.8
14.5
17.9
10.0
7.7
1.9
27.5
5.3
4.4
8.8
6.5
8.7
8.0
1.5
1.4
3.3
.6
.4
1.6
1.3
1.1
1.6
7.5
2.5
3.1
1.4
8.7
1.1
9.9
1.3
4,222.6
27.4
28.7
31.5
96.9
26.9
261.0
97.3
4.8
67.6
96.7
13.8
65.3
95.0
21.8
69.8
11.2
2.2
2.1
3.1
89.4
12.1
43.7
2.6
2 9
90.7
13.5
45.8
2.3
53.2
10.1
(0
36.7
2,060.6
21.6
2,602.1
157
.6
15.3
1.8
6.1
.6
26.5
18.6
31.4
9.6
247.6
67.1
21.3
4.6
8.3
6.9
8.0
19.7
74.0
14.7
96.6
29.4
94.5
36.7
58.9
12.1
2.1
4.8
.8
19.3
16.5
21.5
2.4
278.5
18.6
15.0
4.3
3.4
8.6
O)
9.3
1960
1950
9.0
1.7
1.6
.6
3.3
2.7
.5
23.1
4.1
8.8
1.5
31.7
16.5
2.8
5.4
89.4
15.3
46.9
8.9
54.8
28.0
3.3
5.7
1.5
39. T
TABLE 33.—Women in experienced civilian labor force, 1950, I960, and 1970—Continued
(14 years of age and over)
Number of women (thousands)
Occupational group
1950
1960
1970
Women as percent of all persons in
occupation
1950
Operatives—Cont'd.
Miscellaneous and not specified operatives,
n.e.c
Lumber and wood products
Furniture and fixtures
Stone, clay, and glass products
Primary metal industries
Fabricated metal industries
._
Machinery, except electrical
Electrical machinery, equipment, and supplies
Transportation equipment
Professional and photographic equipment,
and watches
Miscellaneous manufacturing industries...
Food and kindred products
.
Tobacco manufactures
Apparel and other fabricated textile products
Paper and allied products
Printing, publishing, etc
Chemicals, etc
Rubber and miscellaneous plastic
Leather products
Wholesale and retail
_.
Business and repair services
Public administration
Other nonmanufacturing
Laborers, except farm
Miscellaneous and not specified laborers
Lumber and wood products, except furniture
Stone, clay, and glass products
Metal industries
_
Electrical machinery, equipment, and supplies '.
Food and kindred products...
Textile mill products
Apparel and other fabricated textile products
Leather and leather products
Other manufacturing
_
Transportation, communication, and public utilities
Wholesale and retail trade....
Public administration
Other nonmanufacturing industries
Other nonfarm laborers
Farm workers
Farmers, owners, and tenants
Farm managers
Farm laborers, wage workers
Farm laborers, unpaid family workers
Other farm laborers
O)
8
0)
8
0)
8
8
8
660.0
796.2
25.7
29.6
10.6
8.3
16.5
6.9
27.9
16.3
11.7
14.9
19.7
12.7
33.1
25.7
11.4
15.6
15.1
3.8
19.7
11.8
15.1
28.1
18.7
7.1
22.9
16.0
79.3
15.4
113.8
27.1
50.3
10.7
55.2
16.1
15.8
57.2
91.8
17.7
19.5
66.5
76.6
10.3
42.6
34.2
31.5
54.9
48.8
39.0
34.8
51.6
87.4
46.4
32.4
18.5
31.9
18.2
35.5
5.4
2.3
18.2
74.5
43.0
36.7
25.5
60.7
26.3
47.1
8.1
3.7
38.9
74.0
25.5
42.4
12.4
26.4
43.9
31.4
10.9
13.3
12.0
75.5
23.7
45.5
17.0
35.1
57.6
30.6
14.7
16.2
21.0
193.1
294.6
5.1
8.4
61.2
75.0
5.3
10.9
.6
2.5
4.5
4.2
10.1
1.9
1.8
1.6
6.3
1.3
4.7
2.1
7.0
6.6
6.1
4.3
6.5
2.6
18.3
11.2
13.9
32.7
14.9
22.1
1.7
1.6
16.0
1.8
1.4
17.1
43.0
19.2
7.6
49.3
34.8
14.4
2.9
3.S
1.5
3.0
1.1
7.7
3.0
11.8
7.3
13.1
1U
3.2
11.5
1.5
15.4
132.1
220.0
5.1
7.8
602.2
394.8
222.3
9.6
9.5
118.3
2.4
148.9
330.7
2.0
119.0
59.9
2.7
117.7
39.3
2.7
4.8
2.9
11.5
44.4
2.2
4.6
4.4
13.9
36.2
7.1
0)
158
147! 6
126.8
.7
TABLE 33.~Women in experienced civilian labor force, 1950, I960, and 1970—Continued
(14 years of age and over)
Number of women (thousands)
Occupational group
Service workers
Cleaners and charwomen
Janitors and sextons
Bartenders
Cooks, except private household
Counter and fountain workers . .
Waiters and waitresses
Practical nurses
Other health services
Attendants, recreation and amusement
Attendants, personal service, n.e.c
Boarding and lodging housekeepers
Elevator operators
Barbers, hairdressers, and cosmetologists
Housekeepers, except private household
Guards and watchmen
Policemen and detectives
Other protective service workers
Other service workers, except private household
Housekeepers, private household
Laundresses, private household..
Other private household workers
Occupation not reported
Women as percent of all persons in
occupation
1950
1960
1970
3,564.1
4,890.3
5,751.9
58.1
61.9
60.0
75.3
56.5
13.1
257.1
47.4
579.8
138.4
232 0
5.2
33.5
23.6
27.0
193.2
85.8
5.3
167.7
91.3
20.5
385.4
119.4
780.0
166.5
445.0
13.0
46.8
26.4
24.9
278.0
51.0
5.2
60.5
12.0
41.7
11.6
11.1
63.9
70.9
86.8
95.4
73.4
17.6
55.6
88.5
32.5
56.9
73.6
2.0
56.6
12.7
21.1
62.1
75.0
89.0
96.4
86.2
23.8
62.6
71.9
27.6
68.0
71.8
5.2
3.9
7.0
2.1
14.2
266.1
165.2
41.9
550.5
126.3
1,002.4
233.2
847.4
19.7
40.9
5.4
10.2
442.4
76.6
17.0
13.5
28.7
345.2
147.4
73.3
1,219.1
496.8
149.0
40.7
1,561.9
447.6
1,297.7
1950
6.4
55.2
50.9
81.8
96.4
72.6
7.9
67.2
75.6
29.1
49.2
77.2
2.1
1960
1970
2.0
2.7
1.5
7.1
11.0
761.5
101.5
11.9
989.7
45.4
97.6
97.0
94.5
68.8
95.5
98.2
96.5
66.0
96.2
94.8
96.6
2,147.1
35.2
37.6
41.5
3.6
i Data are not available because of changes in classification,
n.e.c.=not elsewhere classified.
Note: Occupational classifications in this table are not exactly comparable with Census classifications because of regrouping detailed occupations.
Detail for 1950 is not always strictly comparable with later years because of changes in classification.
The data are based on samples drawn from the decennial censuses. The sample sizes are: 1950, ZlA percent; 1960, 25
percent; 1970, 20 percent.
Detail may not add to totals because of rounding.
Sources: Department of Commerce, Bureau of the Census, and Council of Economic Advisers.
159
SUPPLEMENT TO CHAPTER 5
The following memorandum elaborates the United States proposal for
establishing a system in which nations' reserve movements would serve as
quantitative indicators to guide the balance-of-payments adjustment process. The basic U.S. proposal was contained in an address by Secretary of
the Treasury Shultz at the Annual Meetings of the International Monetary
Fund and the International Bank for Reconstruction and Development, September 26, 1972. The memorandum was made available to the Deputies
of the Committee of Twenty in November 1972.
THE U.S. PROPOSALS FOR USING RESERVES AS AN INDICATOR
OF THE NEED FOR BALANCE-OF-PAYMENTS ADJUSTMENT
I. INTRODUCTION
1. There appears to be general agreement that a reformed international
monetary system should promote prompter and more effective adjustment
of balance-of-payments disequilibria. The U.S. proposals are based on the
premise that each country will be willing to work within the context of a
system that provides strong, equitable and balanced incentives to achieve
and maintain external balance.
2. In the U.S. view, the most promising approach is a system in which
disproportionate changes in a nation's reserves in either direction serve as
objective indicators that balance-of-payments adjustment measures are
needed. We visualize a system in which disproportionately large gains in
reserves for a particular country indicate the need for adjustment measures
to eliminate a balance-of-payments surplus, just as, in any system of convertibility into reserve assets, disproportionately large losses of reserves indicate the need for adjustment to eliminate a balance-of-payments deficit. A
variety of adjustment instruments would be acceptable. The purpose of this
paper is to develop the logic of this approach.
3. The international monetary system in past years has failed to provide
adequate inducements to achieve and maintain balance-of-payments equilibrium, defined as a situation in which external payments are in reasonable
balance at normal levels of employment and economic activity, and without
inappropriate utilization of controls. This failure was reflected in both large
and persistent imbalances, and in recent years in some tendency toward increased use of controls. Deficit countries could often maintain disequilibria
160
for a considerable period through measures distorting trade, capital flows, or
the internal economy; they were usually permitted or even encouraged to
borrow extensively. (In the case of the United States, this "borrowing" in
large part took the form of increased holdings by foreign monetary authorities of U.S. dollar obligations.) Surplus countries, able to accumulate reserves more or less indefinitely, felt under even less pressure to adjust, and an
increasingly common response has been controls on the inward flow of
capital.
4. Viewed from the perspective of a single country—particularly a country in a relatively advanced stage of development—balance-of-payments surpluses have been considered a more comfortable and more desirable state
of affairs than deficit or balance. A surplus country could avoid the politically embarrassing adjustment actions which a deficit country might be
forced to take. A strong trading position was frequently considered a vehicle
for domestic economic expansion and maintenance of full employment. A
persistently strong currency and large reserves might be felt to provide useful
protection against unexpected external influences, and even to symbolize
prudent economic management. Prior to the introduction of the SDR
scheme, the system depended on balance-of-payments disequilibrium for
growth in reserves—growth in global reserves over time could be accomplished only as other countries ran surpluses offset by U.S. deficits,
financed through an expansion of U.S. liabilities.
5. Some of these incentives to run surpluses were recognized in the discussion leading up to Bretton Woods, and they were reflected in the strictures
placed on competitive devaluation. Nevertheless, while overt competitive devaluations have not been important, many countries still more or less consciously have aimed for payments surpluses and adapted their economic
policy instruments to that end. At the very least, surpluses were tolerated
while deficits were a source of concern and action. There was nothing in the
system to assure compatibility of nations' balance-of-payments objectives—
nothing to assure that the surpluses which many countries sought would be
offset by targeted deficits in equal amounts on the part of other countries.
6. Within this general context, there were systematic tendencies for surpluses and deficits to fall in a particular pattern. From the viewpoint of the
United States, as the largest unit in the world economic system and in
important ways in the least flexible position, these pressures toward surplus
and currency undervaluation by others have had their counterpart in a
persistent deficit in its own accounts. It was long felt inappropriate, in the
light of the disturbing implications for stability in world financial markets,
for the United States to initiate exchange rate action to correct this deficit.
When the imbalance increased substantially and such action was undertaken, the resistance by its trading partners seemed to confirm their reluctance to lose a surplus position, as well as to demonstrate the difficulty of
achieving the needed adjustment in the absence of agreed criteria for reconciling balance-of-payments objectives. From the viewpoint of some other
161
countries, the mechanism that permitted the chronic U.S. deficit and their
surpluses to persist—namely, the tendency for that imbalance to be financed,
in part, by increased dollar holdings of other countries—indicated that the
United States was not subject to the usual constraints of a deficit country.
In concept, the introduction of the SDR successfully freed the system of
the need for continuous U.S. deficits to meet reserve needs. But by itself
that reform was not sufficient to change the basic bias in the system.
7. While the system operated satisfactorily for a number of years—in
fact it may have been preferable to any realistic alternative—it was a system of continuous imbalance, of protracted disequilibrium. From the viewpoint of both the U.S. and other nations, the results were increasingly
unsatisfactory, creating major stresses that undermined stability. The system failed, in the end, because it depended on a measure of broad equilibrium for sustained, satisfactory operation, yet failed to induce the
adjustments required to achieve equilibrium. The actions taken by the
United States on August 15, 1971, signaled the untenability of the previously
existing arrangements. The interim arrangements developed since that time,
including the Smithsonian Agreement of December 1971, do not provide a
long-term solution to these problems.
8. The U.S. proposals for a future system are designed to encourage
equilibrium by promoting needed adjustments actively, rather than simply
prohibiting unwarranted moves; and to apply equivalent incentives for
adjustment evenhandedly to all nations. The proposals are evolutionary, in
the sense that they would build on certain areas of widespread agreement
incorporated in past arrangements: the SDR, convertibility, the prohibition
on competitive devaluation, and emphasis on the need for international
financial arrangements to support liberal trade and payments. They would
differ from the past in building these and other elements of the system into
arrangements for actively promoting adjustment, reconciling balance-of-payments objectives, and overcoming the systematic bias toward surpluses.
II. THE NEED FOR OBJECTIVE CRITERIA
9. The U.S. proposals take as a point of departure that the stability and
durability of a new monetary system will be crucially dependent on finding
an equitable and effective means of promoting the adjustment of external
imbalances.
10. In approaching that objective, we believe success is dependent upon
finding an appropriate blend among three possible approaches, each of
which contains some advantages, but none of which is satisfactory by itself.
The three approaches are:
a) national discretion—a degree of which is essential in a world of
sovereign nations and desirable in allowing maximum practicable
freedom of action among individual countries, but which, relied on
alone, assures neither equilibrium nor an equitable sharing of adjustment responsibilities;
162
b) discretionary authority of a central institution—which can bring
to bear the influence and collective wisdom of the entire world
community on particular adjustment problems, but which can
lead to endless debate, indecision, or unbalanced decisions in a
potentially politically charged atmosphere, and which requires at
least the appearance of ceding more authority to an international
body than nations will yield at this stage of international development;
c) objective criteria—which can be helpful in establishing measurements for indicating adjustment needs for various nations and
various situations on a standardized basis, but which do not unerringly point to appropriate adjustments or permit needed discretion by national authorites.
11. The U.S. proposal aims at a balance among these approaches—to
utilize the advantages of each, while avoiding the disadvantages which
might result from excessive or singleminded reliance on any of the three.
We propose that objective criteria be established to note and locate the
existence of an undesirable degree of balance-of-payments disequilibrium,
and to create a strong presumption that effective adjustment policies should
be implemented. But we would leave to the country concerned substantial
discretion in determining the composition of those adjustment policies. And
international consultations would be utilized to determine the applicability
of the criteria to particular situations and to consider exceptional cases in
which the rules might be overridden.
12. Use of objective indicators as an important element of the adjustment
mechanism appears essential on grounds of efficacy and equity. Adjustment decisions are frequently difficult for any government, and there is a
tendency to postpone and avoid such decisions until long after the time
when adjustment policies should have been adopted. Equally, international
groups are reluctant to deal promptly with difficult and politically sensitive
adjustment questions. Without objective indicators there is a danger that
needed actions will not be taken. It is much better to get advance agreement
in principle that when certain internationally agreed indicators, recognized as being objective, signal adjustment is needed, there will be a strong
presumption that appropriate measures will be adopted—but recognizing
there might be valid reasons for overriding the indicators in exceptional
cases. Such an approach is much more likely to result in equal treatment
for all nations: it would call for comparable adjustment inducements for
all countries—whether large or small, developed or developing, reserve
currency country or not—to eliminate payments disequilibria, whether surplus or deficit.
III. ADJUSTMENT, RESERVES, AND CONVERTIBILITY
13. The U.S. proposals assume that most nations will want to maintain
established values for their exchange rates—par values or central rates—
163
in conjunction with a generalized system of convertibility of national currencies into international reserve assets. In a system of established exchange
values and convertibility, there is a close relationship between balance-ofpayments disequilibria and reserve changes. Accordingly, in our view the
single most valid indicator that a country is in actual or emerging disequilibrium—as well as the most readily available, the most comprehensive, and
the least ambiguous—is a persistent movement of its reserves in one direction or another.
14. To be viable, a convertibility system must be capable of satisfying the
sum of individual countries' normal needs for and secular growth in reserves. Nations individually, either explicitly through formulation of overt
balance-of-payments objectives, or more implicitly through their behavior,
express an effective demand for reserves. Unless the international monetary
system is capable of meeting these national demands in the aggregate and
changing the level of reserves to meet changes in such needs over time, a
satisfactory reconciliation of national balance-of-payments aims, and therefore sustained balance-of-payments equilibrium, cannot be assured. For if
reserves are not adequate to these demands in the aggregate, nations are incapable by definition of reaching their desired reserve positions simultaneously. A decision to provide the system with too few reserves induces—and
sanctions—a destabilizing and ultimately fruitless competition for scarce
reserves. Creation of too many reserves pushes too great a share of the adjustment pressures onto surplus countries and facilitates world inflation.
15. A critical defect of the system in the past was that while it tried to
promise unlimited convertibility, and while fundamentally it required a broad
measure of balance-of-payments equilibrium for sustained operation, it did
not provide the supply of acceptable reserve assets or the discipline on adjustment policies necessary to achieve these objectives. A basic feature of
the U.S. proposal is that nations must, through the process of negotiation,
reach a collective decision on the appropriate normal stock and rate of increase of reserves, and be prepared to accept the consequences of that decision in terms of their own individual reserve positions and their own
freedom of action to run surpluses or deficits.
16. It would be essential in the proposed system that countries regard their
balance-of-payments disequilibria, whether surplus or deficit, as a source of
concern before the agreed indicators came into play. In other words, countries would not be expected to ignore imbalances blithely until their disequilibria had become so extreme as to prompt strong international concern
through the indicator mechanism. Reserve fluctuations would signal emerging disequilibria; movement to outer indicators signalling strong international concern would occur only when countries failed to make the appropriate responses as the disequilibria built up.
17. Convertibility itself cannot promote adequate or equitable adjustment. Convertibility is in that sense an asymmetrical tool, operating only
on deficit countries. In the framework of the U.S. proposal, the inherent
164
link of convertibility to reserve fluctuations would result in broadly symmetrical pressures upon surplus and deficit nations.
18. In short, the logic of the U.S. proposals is that a) better balance-ofpayments adjustment is required and is essential to the maintenance of a
convertibility system; b) such an adjustment process, in turn, requires recognition by both surplus and deficit countries of their obligations and responsibilities to take action; c) in that context, objective indicators of the need
for adjustment are essential; d) a broad equality between the availabiliy of,
and demands for, reserves in the system must be satisfied; and e) all of these
needs can be brought together, in the context of a system of established exchange rates supported by convertibility, by the use of reserve movements
as the main indicator of the need for adjustment.
IV. DESCRIPTION OF THE PROPOSED ADJUSTMENT/RESERVE/CONVERTIBILITY SYSTEM
19. These principles could be incorporated into several alternative operational frameworks. Such alternative formulations could, for example, (a)
emphasize the use of net or gross reserves as the basis for measuring fluctuations in reserves; (b) focus attention largely on changes in resei yes from an
existing starting level or on an appropriate distribution of individual countries5 reserves in relation to some "objective" standard; and (c) provide for
either relatively narrow or relatively wide ranges of fluctuation in reserves
before international disciplines come into play. While the underlying principles and logic of the various approaches would be broadly similar, the particular formulation chosen would determine the speed, force and manner
with which the adjustment pressures would operate. For its part, the United
States wishes to continue to examine the advantages and disadvantages of
the alternatives with care, and would welcome the contribution toward this
effort that others can make.
20. The use of fluctuations in countries' reserves as the main indicator of
adjustment need requires a judgment about a "base" level and trend of reserves for each country. Abstracting from transitional problems (noted
later), these "base levels" could be established in several different ways. For
instance, the distributional pattern of national quotas in the IMF (allowing
for any agreed revisions in the future) might represent one approach toward
determining a broadly acceptable distribution of reserves in normal circumstances. Another approach would be to give heavy weight to the actual
level of reserves at the start of the system for the majority of countries, relying on separate negotiations for those countries whose reserves at the start
of the system were judged to be seriously excessive or inadequate. Countries'
"base levels," in any case, would be expected to rise over time, consistent
with collective decisions about world SDR creation. The manner in which
"base levels" should be calculated would clearly be a matter for careful ne-
165
gotiation. What is necessary is that some pattern be accepted that is generally
satisfactory.
21. Use of reserve fluctuations to achieve an evenhanded stimulus to adjustment will require a broad consistency between the total of established
"base levels" for individual countries and the actual supply of reserves in the
system as a whole. Conceptually, in a system which did not provide for reserve currencies, this need could be met simply by assuring that the aggregate of gold, SDR's and IMF positions—that is, "primary reserves"—equaled
the aggregate of countries' "base levels" of reserves. If in such a system aggregate "base levels" were above total primary reserves, a destabilizing and
potentially deflationary competition for reserves could result; if "base levels"
were below the total of primary assets, too large a share of adjustment pressures would be shifted toward surplus countries and world inflation might be
facilitated.
22. In practice, we assume that some nations will wish to hold foreign
exchange in their reserves and should be permitted to do so. Some nations
will want flexibility of reserve management, and the system as a whole will
benefit from an ability to respond flexibly to sudden and reversible increases
in the need for liquidity during periods of strain related to speculative or
other factors. Thus, in structuring the proposed system consideration will
need to be given to the complication introduced by the existence of a possibly fluctuating margin of foreign exchange holdings. In a convertibility
system, foreign exchange holdings are potential claims on primary reserves.
Consequently, a stable system must provide enough primary reserves in
relation to the whole to meet reasonable demands for conversion of these
potential convertibility claims and/or must limit demands for conversion
by individual countries that would otherwise claim an excessive proportion
of the available supply of primary reserves.
23. There are a number of complementary approaches which could reconcile the existence of foreign exchange holdings in reserves with the
stability and evenhanded working of a system of reserve indicators. One
approach would be to equate the aggregate of "base levels" with the total
of primary reserves and provide limits on the disproportionate accumulation of primary reserves by a country above its base level. Some assurance
against excessive claims for primary reserves growing out of past accumulation of foreign exchange could also be provided by arrangements providing
for bilateral or multilateral funding of existing foreign exchange reserves to
the extent the holder wished to fund such balances, or by a facility for
exchange of such balances—initially or over time—into SDR's. These aspects of the question should receive careful study, but are not further considered here.
24. Under a reserve-indicator system, certain points would be established
above and below each country's base level to guide the adjustment process
and to assure even-handed convertibility disciplines. Such points would be
set according to uniform procedures for each country, and could be de
166
scribed as follows, again abstracting from special arrangements that would
be appropriate during a transitional period. (See Chart 13.)
a) A "low point" would be set at some point below the "base level."
In concept, this might approximate a level of reserves considered
to be close to the minimum level ordinarily necessary to maintain
confidence and to guard against extreme emergencies. If a country's
reserves fell below its "low point" for a period of time, definite
adjustment pressures would be anticipated and acceptable adjustment measures would be expected. In the absence of adequate policies over a specified period, international sanctions—for example,
refusal to provide credit, or loss of scheduled SDR allocations—
might become effective. Such sanctions would be avoided only if
the IMF, through approval of a satisfactory program of adjustment, made a finding that sanctions were not warranted. Negotiated credits to deficit countries would ordinarily be permitted—
but excessive or prolonged borrowing to circumvent the indicators
would not be allowed.
b) A "lower warning point" would be set at a point between a country's
"base level" and the "low point." Small devaluations would be freely
permitted a country at any time its reserves were below its base
level. Proposals for larger devaluations would always require IMF
approval; such proposals would not ordinarily be looked upon with
favor unless a country's reserves had fallen below its "lower warning
point."
c) An "outer point" would be established above a country's "base
level." As a country moved toward its "outer point," it would be
expected to apply adjustment measures of progressive intensity. If
reserves rose to the "outer point," remained at or above that level
for a specified period, and an adequate program of adjustment were
not in place, international action to induce adjustment would take
effect. For example, the IMF might authorize other countries to
impose general import taxes or surcharges against the country concerned, there might be a loss of scheduled SDR allocations, or there
might be a tax on the country's excess reserve holdings with proceeds to go to development assistance. Such sanctions could be
avoided, or postponed, only if the IMF made a positive finding they
were not warranted, on the basis of an agreed program of adjustment—involving, for example, major moves toward liberalization of
import restrictions, removal of any controls on the outward flow
of capital, provision of concessional untied aid, or revaluation.
Standards should be developed for judging the adequacy of such
programs and their consistency with progress toward a liberal world
economic order. If reserve gains persisted despite the agreed program, authorization for sanctions would, after a further period, take
167
Chart 13
Illustration for Individual Country
of Reserve Indicator System
RESERVES
If reserves remain at outer point for
specified period, adjustment measures
required. International sanctions unless IMF overrides.
Location of convertibility
point related to volume of
primary reserves relative
to base levels, for system
as a whole. If a country
reaches the convertibility
point, further acquisition
of primary reserves prohibited.
Convertibility
— Point
J
\
• Outer point-
Warning Point'
•
Base Level
Warning P o i n t -
If reserves remain at low point for
specified period, adjustment measures
required. International sanctions unless IMF overrides.
Low Point-
TIME
effect. In any event, the IMF would review the country's position
periodically, and make such recommendations and authorizations
as it deemed appropriate.
d) An "upper warning point" would be set between the "base level"
and the "outer point," analogous to the lower warning point, representing an international judgment that adjustment is called for. The
IMF would be expected to report on the country's balance-of-payments position and prospects, and revaluation or other adjustment
measures would be anticipated.
e) Depending on the volume of total reserves relative to primary reserves in the system, this "upper warning point" might coincide with
a "convertibility point" representing the maximum accumulation
of primary reserves for each country that would be justified, consistent with the level of aggregate primary reserves in the entire system, for the convertibility mechanism to operate equitably with
respect to both deficit and surplus countries. Both to provide an
incentive for adjustment, and to prevent countries from placing further convertibility pressures on others, a country reaching such a
168
"convertibility point" would be unable to acquire additional primary reserves, through either purchase or SDR allocation.
25. A reserve-indicator system such as the one sketched above should be
supplemented and elaborated by consultative procedures within the IMF
concerning adjustment programs and problems. For such procedures to be
effective, national policy officials at a politically responsive level should be
drawn into the process. Such IMF review could take into account supplementary criteria in considering the nature and magnitude of any need for
adjustment.
26. Countries would not be expected to delay adjustment action until
they had reached the indicator points. The purpose of a reserve-indicator
system is to provide strong incentives for countries to act in limited steps,
using a variety of tools suited to their circumstances before their situation
becomes so urgent as to involve international concern and action. Moreover,
while countries would at given points be brought under overt international
pressure for adjustment, they would still have a range of policy options at
their disposal. The range of "acceptable adjustment measures" for the system would, however, be limited to those consistent with market mechanisms
and a liberal world trade and payments order. Exchange rate changes are
not seen as the only, or necessarily the most desirable, means of adjustment
in all cases.
27. Even though the aim of the system is to promote equilibrium, some
scope for fluctuation in reserves is obviously necessary and desirable. No
workable system can or should try to assure lock-step economic performance
from 124 nations differing greatly in size, stage of development, and economic circumstance. Through the process of negotiation, an international
consensus should be reached in defining the indicator points so as to get
"enough" elbow room for some fluctuation in reserves to meet transitory
payments imbalances, but not "so much" that adjustment is inappropriately
delayed.
28. The reserve-indicator system should be designed to permit countries
maximum flexibility to the extent compatible with maintaining the system's
basic principles:
a) As noted, a small devaluation without requirement for approval
might be permitted at any time a country's reserves were below base
level. Small revaluations might be permitted at any time. While in
practice, situations would seldom, if ever, arise for withholding
international approval from larger revaluations, restraint will continue to be necessary to guard against competitive devaluation.
b) A country could opt for a transitional float, under agreed rules, in
lieu of a discrete exchange rate change. If it intended to reestablish and maintain a central value for its currency within a given
period, a reserve-deficient country could be permitted, under suitable guidelines, to increase its reserves toward its base level. If a
country's reserves were above its base level at the time of initia
169
tion of the transitional float, it would not be permitted further
reserve accumulation.
c) A country could depart from the regime of established parities to
float for a period of indefinite duration but only if it adhered to
internationally agreed standards that would assure the consistency
of its actions with the basic requirements of a cooperative order.
These standards would relate, for example, to movements in its
reserves, its intervention policies, elimination of controls on the
inward flow of capital, avoidance of restrictive trade controls imposed for balance-of-payments purposes and elimination of any
existing extraordinary balance-of-payments measures. Exchange rate
systems nominally establishing a central or par value but envisaging
very frequent changes such as those now in force in some less developed countries, could be integrated with this rule.
d) Any group of countries in the process of forming a monetary
union—with an implicit high degree of political and economic integration—could choose to operate as a unit. In this instance, the
relevant criteria would be applied to the unit as a whole, which
would be expected to speak with one voice in international forums.
The reserve norms for the unit would have to be recalculated to
reflect external trade and appropriate treatment of intra-unit assets.
e) On a selective basis, consideration should be given to special arrangements for exclusion from reserves, and thus from measurements of adjustment need, of an "investment fund" of foreign
securities or other foreign assets held by official agencies. Such funds
might be appropriate for selected countries that wanted to hold
over a prolonged period of time within official accounts (or with
official inducements), foreign assets for long-term investment purposes. Such countries could be asked to observe certain criteria with
respect to term, size and nature of the holdings. Oil producing
countries with relatively large external assets would be candidates
for such arrangements.
f) Negotiated official credits (including IMF credits) should be permitted. Satisfactory procedures for the recording of such credits under the reserve-indicator system would need to be devised.
g) In general, the system should neither ban nor encourage official
holdings of foreign exchange. However, in the context of the proposed system, such holdings would presumably not loom so large
relatively as in recent years. Each country should have the right to
place limits on the further accumulation of its own currency of
issue by official institutions in any other individual country or group
of countries. Each country that chose to permit foreign official
holdings of its currency must provide reasonable and normal investment facilities for those holdings.
170
29. The United States proposal neither gives special rights to nor imposes
special obligations on any country or group of countries. It assumes a monetary system in which all countries are treated equally. All would have the
same freedom to use the full exchange rate margins permitted in the system.
All would have the same rights to allow their currencies to float, transitionally or indefinitely, under the same internationally agreed rules of
behavior and surveillance. All maintaining established values for their currencies would have the same obligation to assure convertibility of their
currencies—meaning that officially held balances of foreign currencies could
be freely presented to the issuing country for conversion into primary reserve
assets, with the choice among SDR's, reserve positions in the IMF and gold
to be made by the issuing country.
V. TRANSITIONAL ARRANGEMENTS
30. At the present time there is a highly unbalanced pattern of reserves
and balance-of-^payments positions among the major industrial nations. Unquestionably there would be a need for special transitional arrangements to
put into being the system proposed by the United States. Various approaches
for dealing with these problems can be developed. For example, proposals
that have been put forward for funding, consolidating or otherwise dealing
with foreign exchange balances which holding countries may regard as excess may be particularly relevant. The U.S. has an open mind on particular
arrangements that might be proposed. We merely want to note that some
generally acceptable transitional arrangements are necessary. This transitional problem is not unique to the proposed system. Any monetary system
based upon concepts of equilibrium and convertibility will require special
measures to deal with transitional problems.
VI. SOME QUESTIONS ABOUT THE PROPOSALS
31. Three questions which might be raised about the operational feasibility of the U.S. proposal are discussed below. These questions could arise
under any system based on reserves as an indicator of adjustment need.
Indeed, we should note comparable problems will arise, perhaps in a different form, in any par value-convertibility system, and often in more severe
form.
32. The first question is: Is it possible to define reserves so as to assure
they are useful and accurate criteria?
33. Based on reserves as the key indicator of disequilibrium and the need
for adjustment, the system proposed by the U.S. depends on clear and
reliable definitions of what constitutes both primary and total reserves, to
assure that they give the appropriate signals in a given situation and to
assure that the rules cannot be easily circumvented by artificial reserve transactions or concealment of reserves.
34. Primary reserves are more easily defined. They would consist of
SDR's, reserve positions in the IMF, and monetary gold. There would be
171
a precise and known amount of primary reserves for each nation and for the
system as a whole.
35. Primary reserves would, of course, be widely transferred among
nations for settlement purposes. Primary reserves might also be borrowed
and lent. In order to assure the consistency of the aggregate level of primary
reserves in the system with the operation of the system, appropriate rules
would need to be devised to assure against double counting of primary reserves. For example, it might be agreed that lending and borrowing should
not increase the calculated primary reserves of the borrower, nor reduce
those of the lender.
36. Definition and measurement of reserves other than primary reserves
have in the past been more complicated and more ambiguous. Possibilities
for evading the adjustment rules might arise unless there were agreement on
a suitably broad definition of what constitutes reserves. An appropriate approach to this problem would be to start from a very broad definition of
reserves—all official claims on foreigners, liquid or non-liquid, whether held
by or on behalf of the monetary authorities or by other government agencies. Exceptions would be made as appropriate. Long-term aid loans, for
example, and normal export credits would presumably be omitted; approved
"investment funds," as described above, would be excluded—though care
must be taken that such funds not be used as a subterfuge for reserve increases. At any rate, with experience in operating the system, technical discussions would probably help to refine the definitions, so as to reduce the
risks of window-dressing and make the system function as effectively as
possible.
37. The second question is: How do we deal with problems of heavy speculative capital flows?
38. Speculative problems will be a factor in any system—indeed, they
proved to be a critically important factor in the Bretton Woods system. The
system proposed by the U.S. actually contains a number of features which
should reduce the problem of speculation, as compared both with the
past and with other approaches to reform of which we are aware.
39. The proposal aims at a system which fosters balance, and prompt adjustments to restore equilibrium, through a variety of adjustment measures.
Thus, the persistent payments imbalances which in the past were a major
factor in generating massive speculative capital movements would be eliminated or sharply diminished.
40. With the system based broadly on the concept of equilibrium, it cannot be overemphasized that national behavior which is truly in the spirit
of this concept must help to assure that crisis points are not reached. The
existence of the various indicator points on reserve movements does provide
limits on disequilibria, and it is possible that movement close to those
limits could stimulate some speculative activity, just as very large reserve
gains or losses trigger speculative activity in the present system. But for
fully satisfactory operation of the system, countries should endeavor to
172
adjust their positions as the disequilibria emerge, and well before they
reach the extremes, both because of the consequences involved in reaching the limits, and because they have accepted external balance as a practical,
operative balance-of-payments objective. If a country persists in avoiding
adjustment, it will eventually—and appropriately—be subject to the disciplines of the system, including speculative pressures. Much as in the past
system, adjustment of some kind becomes unavoidable when disequilibria
become extreme. What is missing in "the past and present systems, and what
the proposed system attempts to provide, is a real incentive for needed
adjustment to occur before it is forced by crisis.
41. Also, the proposal has to be looked at in the context of a system of
adequately wide exchange rate bands, which would be expected to reduce
the prospect for large capital flows significantly.
42. Nonetheless, even with an improved adjustment system there could
still be some question of whether false signals could result from speculative
capital flows. The answer is that the proposed system contains several
important "safety valves." First, there are areas, or zones, within which
reserves can move in response to speculative or other pressures without
bringing overt international requirements for adjustment measures. Second,
there is a time factor envisaged at both the "low point" and the "outer point"
which would provide scope for speculative or other flows to occur and reverse
themselves, without bringing strong international action to induce adjustment. (This factor could also play an important role in inhibiting speculative
movements themselves.) Third, if a nation were pushed across its "outer
point" by, say, a heavy inflow of speculative capital, and remained above
that point, it need not necessarily appreciate its exchange rate—the requirement is for any "acceptable" adjustment program. Fourth, if the reserve
increment were due to capital inflows based on unfounded speculation
on an exchange rate change—and the IMF agreed that basic adjustment
was not needed—a program dealing exclusively with that problem in an
internationally acceptable manner would presumably satisfy the international
community. The international community could vote to override the reserve
indicators in a case where the signals are judged to be obviously wrong.
43. In discussing these "safety valves," however, it should be remembered
that signals are not necessarily "wrong" simply because speculative capital
flows arise—such flows may indicate a genuine need for adjustment measures. The system cannot enable nations to avoid needed adjustments simply
by blaming their problems on speculation.
44. The third question is: Aren't reserve indicators retrospective and insufficiently refined, pointing to past maladjustments rather than present or
future needs and unable to take account of the composition of the balance of
payments?
45. Reserves are more comprehensive, more reliable and more quickly
available indicators than other criteria of external balance. While reserves
may be distorted in the short run, no other single series provides a superior
490-000 O - 73 - 12
173
x
'
u
basis for analysis. In a convertibility system, reserve data are necessarily indicative of disequilibrium in the adjustment process; this has always been understood in terms of inducements to adjust for deficit countries—and the
concept applies with equal logic to adjustment needs of surplus countries.
While other data may provide useful information affecting international
judgments of adjustment need, such data should be supplementary.
46. It would, of course, be helpful to have reliable indicators of future
economic performance. But we don't. It would be useful to know each nation's balance-of-payments position for the next year or two or three—but
the present state of the art does not provide data of such reliability that
governments can place primary reliance on them in formulating policies for
the future. Nor are governments likely to agree on any given assessment of
prospects. Attempts to rely on such projections can lead to endless disputes.
One has only to recall the discussions prior to the Smithsonian Agreement, of
prospective cyclically adjusted current account balances, to realize the opportunities for disagreement.
47. The U.S. proposal does envisage that such "supplementary criteria"
as are available should be used to assist the reserve indicators in pointing to
adjustment needs. In particular, some countries may have objectives with
respect to certain elements in their balance of payments, such as for the current account. And these elements in some cases may be considered more
stable. Since inconsistent objectives in that respect could inhibit the process
of balance-of-payments adjustment, attention to current account results and
objectives could be useful. However, in the end we will require a consistency
in the total balance-of-payments results (as reflected in reserve movements)
and primary attention to one sector of the balance of payments, however important, would not be consistent with this requirement.
174
Appendix B
REPORT TO THE PRESIDENT ON THE ACTIVITIES
of the
COUNCIL OF ECONOMIC ADVISERS DURING 1972
175
LETTER OF TRANSMITTAL
COUNCIL OF ECONOMIC ADVISEES,
Washington, D.C., December 29, 1972.
T H E PRESIDENT:
SIR : The Council of Economic Advisers submits this report on its activities
during the calendar year 1972 in accordance with the requirements of the
Congress, as set forth in Section 4(d) of the Employment Act of 1946.
Respectfully,
HERBERT STEIN, Chairman.
EZRA SOLOMON.
MARINA V.N. WHITMAN.
177
Report to the President on the Activities of the
Council of Economic Advisers During 1972
The Employment Act of 1946 established the Council of Economic Advisers to advise and assist the President in discharging his responsibilities
under the act. In carrying out its duties in 1972, the Council devoted major
attention to the programs and policies that were initiated by the President's
New Economic Policy announced in August 1971.
Herbert Stein became Chairman of the Council on January 1, 1972,
succeeding Paul W. McCracken, who returned to the University of Michigan.
Mr. Stein is on leave of absence from the University of Virginia, where he
is A. Willis Robertson Professor of Economics. Ezra Solomon served on the
Council throughout 1972. He became a Member in June 1971 and is on
leave of absence from Stanford University, where he is Dean Witter Professor of Finance.
On March 13, 1972, Marina v.N. Whitman became a Member of the
Council, filling a vacancy created by the departure of Mr. McCracken at the
end of 1971. Mrs. Whitman is on leave of absence from the University of
Pittsburgh, where she is Professor of Economics.
Past Council Members and their dates of service are listed below
Name
Edwin 6. Nourse
Leon H. Keyserling
John D. Clark
Roy Blough
Robert C. Turner
Arthur F. Burns
Neil H. Jacoby
Walter W. Stewart
Raymond J. Saulnier
Joseph S. Davis
Paul W. McCracken
Karl Brandt
Henry C. Wallich
James Tobin
Kermit Gordon
Walter W. Heller
Gardner Ackley
John P. Lewis
Otto Eckstein
Arthur M. Okun
James S. Duesenberry
Merton J. Peck
Warren L Smith
Hendrik S. Houthakker
Paul W. McCracken
Position
Chairman
Vice Chairman
Acting Chairman
Chairman
Member
Vice Chairman
Member
Member
Chairman
Member
Member
Member
Chairman
Member
Member
Member
Member...
Member
Member
Chairman
Member
Chairman
Member
Member
Member
,
Chairman
Member
Member
Member
Member
Chairman
Oath of office date
August 9,1946
August 9,1946
November 2,1949
May 10,1950
Augusts 1946
May 10,1950
June 29,1950
September8,1952
March 19,1953
September 15,1953
December 2,1953
April 4,1955
December 3,1956
May 2,1955
December 3,1956
November 1,1958
May 7,1959
January 29,1961
January 29,1961
January 29,1961...
August 3, 1962
_. November 16,1964
May 17, 1963....
September 2,1964
November 16,1964
February 15,1968
February 2,1966
February 15,1968
July 1,1968
February 4, 1969
February 4,1969
179
Separation date
November 1,1949.
January 20,1953.
February 11,1953.
August 20,1952.
January 20,1953.
December 1,1956.
February 9,1955.
April 29, 1955.
January 20,1961.
October 31,1958.
January 31,1959.
January 20,1961.
January 20,1961.
July 31,1962.
December 27,1962
November 15,1964.
February 15,1968.
August 31,1964.
February 1,1966.
January 20,1969.
June 30,1968.
January 20,1969.
January 20,1969.
July 15,1971.
December 31,1971.
ECONOMIC POLICY MAKING AND THE COUNCIL OF
ECONOMIC ADVISERS
RESPONSIBILITIES OF THE COUNCIL
The central responsibility of the Council is to contribute economic analysis to the solution of public policy problems that warrant the attention of the
Executive Office of the President. In the Employment Act of 1946, which
created the Council, the primary goal mandated by the Congress was "to
promote maximum employment, production, and purchasing power." The
Council's major responsibility continues to be to provide the President with
analysis and recommendations directed toward reaching that goal. The
Council furnishes the President with regular reports on current economic
conditions and forecasts of the economic outlook. Economic studies contribute information for Presidential decisions on appropriate policies to
achieve greater price stability, to expand employment and economic growth,
and to reach balance in the Nation's external payments position. In 1972
particular emphasis was placed on the proper evolution of aggregate demand
management, the operation and evaluation of the price-wage control system of the Economic Stabilization Program, and the formulation of proposals for international economic reform.
The Council's role has broadened far beyond the primary goal of macroeconomic policy set forth in the Employment Act. Under the act, the Council
is also given responsibility "to appraise the various programs and activities
of the Federal Government." Experience has demonstrated that economic
analysis can be useful in dealing with many issues other than employment and
price stability. As the Council has become increasingly involved in a broader
range of subjects, its direct advisory role to the President has been expanded
to include advisory work with many departments, agencies, and offices in the
executive branch. Members of the Council's staff maintain close working relations with other agencies and assist in evaluating current programs and
developing new ones.
The Council's activities in 1972 covered a wide range of economic issues.
The Council participated in areas of emerging prominence, including the
evaluation of science policies, the development of programs to improve environmental quality, studies of productivity in the food sector, and an intensive review of the Nation's energy problems. Contributions were made to
the analysis of changes in tax regulations, social security benefits and financing, Federal credit programs and regulation of financial markets, as well as
to the formulation of agricultural programs, review of the timber supply
situation, and the evaluation of housing programs. The Council continued
to analyze the problems of certain regulated industries, particularly transportation, and examined several aspects of national growth policy. Work in
the area of human resources included a review of manpower programs and
the study of a variety of issues in health and education. In many instances
the Council provided leadership to interagency studies in these fields.
180
The problems and policies of international trade and investment continue to be a major concern of the Council. The Council helps formulate
the Administration's position on overall international trade policy, and it
also works on the resolution of specific trade problems. In 1972 the Council
contributed to decisions on meat imports, preparations for upcoming trade
legislation and negotiations, and studies of the impact of direct foreign investment and the transfer of technology abroad.
The Council also provided liaison with the President's Advisory Panel on
Timber and the Environment. The Panel is expected to submit its report
and recommendations to the President in early 1973.
In September the President announced that he had requested the Chairman to organize an Advisory Committee on the Economic Role of Women.
The Committee's purpose is to expand knowledge of the role of women in
the economy, to highlight problem areas, and to ensure that the economic
interests of women are considered in the formation of economic policy. The
first meeting of the Committee is planned for early 1973.
Early each year the President submits the Economic Report of the President to the Congress as required by the Employment Act. The Council
assumes major responsibility for preparation of this Report which, together
with the Annual Report of the Council of Economic Advisers, reviews the
progress of the economy over the past year and outlines the Administration's policies and programs to achieve the goals of the act.
POLICY COORDINATION
Much of the Council's work is performed through joint activities with
other agencies of the executive branch. The "Troika" system is the main
working group that monitors the overall performance of the economy, examines the economic outlook, and analyzes stabilization policies. It ensures
close working relationships between officials of the Treasury, the Office of
Management and Budget (OMB), and the Council. A group of senior staff
economists from all three agencies, known as T-3, conducts studies which
are submitted to a second tier composed of a Council Member, the
economist for OMB, and the Assistant Secretary of the Treasury for Economic Policy. This group, called T-2, reviews the analysis and clears it for
consideration by the Troika, which includes the Chairman of the Council,
the Director of OMB, and the Secretary of the Treasury. The Troika meets
on a regular schedule every 2 weeks. When problems or concerns are such
that the Chairman of the Board of Governors of the Federal Reserve System joins the Troika, the group is referred to as the "Quadriad." Both the
Troika and the Quadriad meet from time to time with the President.
During 1972 the Council worked closely with the Cost of Living Council, which supervises the Economic Stabilization Program. Mr. Stein is Vice
Chairman of this group, Mrs. Whitman serves on its planning committee,
and senior staff economists are members of its senior review group and
various informal working groups.
181
The Council is active in several areas of work coordinated by the Council
on International Economic Policy and the Domestic Council. The Chairman also served as a member df the National Commission on Productivity,
the Regulations and Purchasing Review Board, the Property Review Board,
the Oil Policy Committee, the Joint Board on Fuel Supply and Transport,
and the Defense Programs Review Committee.
In addition to these relatively formal groups that provide for coordination of economic analysis and policy, the Council and the professional staff
served as members of approximately 30 other interagency working groups,
including several on the quality of Federal economic statistics.
In November 1972 the President announced a new Council on Economic
Policy, which will be chaired by George P. Shultz, the Secretary of the
Treasury. The Council of Economic Advisers will be a member of the
new Council and will participate actively in many of the working groups
that will be the main vehicle through which the new Council will function.
The Chairman and Council Members appeared before the Joint Economic
Committee (JEC) of the Congress four times during 1972. The JEC, like
the Council, was created by the Employment Act of 1946. The act requires
the JEC "to make a continuing study of matters relating to the Economic
Report" and to submit its own report and recommendations to the House
and Senate. The Council testified on the Economic Report before the JEC
on February 7 and appeared again on July 24 in connection with the
midyear review of the economy. In addition, the Chairman presented testimony with Mrs. Whitman to the JEC regarding the Economic Stabilization
Program (April 14); and he presented testimony with Mr. Solomon during
the hearings on unemployment problems (October 26). Mr. Stein also
testified before two other congressional committees in 1972: before the
House Ways and Means Committee on June 6 and September 19 in connection with raising the Federal debt ceiling and before the House Appropriations Committee on January 27 concerning the Federal budget. Mr.
Solomon testified on the relation between the Federal budget and the
economy before the Senate Appropriations Committee and the House Ways
and Means Committee on February 1.
The Council maintained an active role in the growing international
dialogue on economic policy. The Chairman heads the U.S. delegation to
the Economic Policy Committee of the Organization for Economic Cooperation and Development. He also serves as Vice Chairman of the
Committee. Council Members and senior staff economists attended meetings
of several different working parties of the Committee during the year. Mr.
Solomon and Mrs. Whitman head the U.S. delegations to Working Party II
on economic growth and resource allocation and Working Party IV on inflation, respectively. A new activity was initiated in March when Mr. Solomon
and two members of the staff met in Tokyo with officials of the Japanese
Economic Planning Agency to discuss economic issues of common interest.
In September a six-member delegation from Japan came to Washington
182
to continue the informal discussions. This exchange proved to be productive, and plans are being made to continue it in 1973. The Council was also
host to a delegation from the Economic Council of Romania in March
1972. The delegation was headed by Manea Manescu, Chairman of the
Economic Council and one of Romania's Vice Presidents.
PUBLIC INFORMATION
The annual Economic Report is the principal medium through which the
Council informs the public of its work and its views. It is also an important
vehicle for presenting and explaining the Administration's overall economic
policy, both domestic and international. Distribution of Reports in recent
years has averaged about 50,000 copies. The Council also assumes primary
responsibility for the monthly Economic Indicators, a publication prepared
by the Council's Statistical Office, under the supervision of Frances James.
The Joint Economic Committee issues Indicators, which has a distribution
of approximately 10,000 copies.
Information is also provided to the public through the speeches and
participation in seminars and panels by the Chairman, the Members, and
the senior staff economists throughout the year. The Council held frequent
press conferences during 1972 to comment on important economic statistics
shortly after they were released. Each year the Council answers numerous
requests from the press and provides economic information in response to
inquiries from individual citizens. In addition, the Council and staff schedule visits from business, academic, and other groups and individuals as
often as they can without interfering with other responsibilities.
ORGANIZATION AND STAFF OF THE COUNCIL
OFFICE OF THE CHAIRMAN
The Chairman is officially charged with reporting the Council's views to
the President under authority of the Employment Act, as amended in 1953
by Reorganization Plan No. 9. He performs this duty through direct consultations with the President, regular memoranda on the economy, and written
submissions on special issues that arise. The Chairman represents the Council at meetings of the Cabinet and in many other formal and informal contacts with Government officials.
COUNCIL MEMBERS
Together the two Council Members are responsible for all subject matter
covered by the Council, including direct supervision of the work of the
professional staff. Members represent the Council at a wide variety of
meetings and assume major responsibility for the Council's involvement in
many activities. One of the Council Members automatically becomes Acting
Chairman whenever the Chairman is absent from Washington.
183
In practice, the small size of the Council's staff permits the Chairman
and Council Members to work as a team in most circumstances. There is,
however, an informal division of subject matter between them. Mr. Solomon's areas in 1972 included domestic economic and financial conditions
and outlook; fiscal policy and monetary policy; manpower programs; taxation and social security; energy; defense; housing; and national growth
policy.
Mrs. Whitman is responsible for the analysis of international economic
developments and policy. Other areas under her supervision include price
and wage developments, particularly the Economic Stabilization Program;
human resource programs; industry studies, including agriculture and transportation; environmental programs; and issues related to regulated
industries.
PROFESSIONAL STAFF
At the end of 1972 the professional staff consisted of 13 senior staff economists, two statisticians, and eight members of the junior research staff. Members of the professional staff were responsible for economic analyses and
policy recommendations in major subject areas involving the Council's interests and responsibilities. In addition, staff economists carried out many
different Council and interagency assignments requiring a broad application of their general knowledge and analytical skills.
The professional staff and their special fields at the end of the year were:
Senior Staff Economists
John D. Darroch
Geza M. Feketekuty
Murray F. Foss
William E. Gibson
Ronald F. Hoffman
Mary W. Hook
William A. Johnson
Leo V. Mayer
June A. O'Neill
Nicholas S. Perna
Gary L. Seevers
Robert D. Tollison
Robert C. Vogel
Prices and Industry Studies
International Finance and Trade
Economic Analysis and Forecasting
Monetary Policy, Financial and Mortgage Markets,
and International Finance
Public Finance and Social Security
Business Conditions and Forecasting
Energy, Defense, Urban Economics, and National
Growth Policy
Food and Agriculture
Manpower Programs, Health, Education, Welfare,
and the Economic Role of Women
Labor Economics and Manpower Programs
Special Assistant to the Chairman
Environment, Industry Regulation, Research and
Development
Fiscal Policy, Public Finance, and Econometrics
Statisticians
Frances M. James
Catherine H. Furlong
Senior Statistician
Statistician
184
Junior Staff Economists
Paul W. Boltz
David G. Munro
Andrew J. Safir
Lydia Segal
Mary E. Sullivan
Public Finance
Economic Analysis and Forecasting
International Finance and Trade
Econometrics and Forecasting
Financial and Mortgage Markets
Research Assistants and Interns
Zell Berman
Irwin L. Collier, Jr.
Robert S. Dohner
Frances M. James, Senior Staff Statistician, continued to be in charge
of the Council's Statistical Office. Miss James has major responsibility for
managing the Council's economic and statistical information system. She
supervises the publication of Economic Indicators and the preparation of
tables and charts for the Economic Report and for a wide variety of meetings
throughout the year. She also handles the fact checking of memoranda,
testimony, and speeches. Catherine H. Furlong, Dorothy Bagovich, V. Madge
McMahon, and Natalie V. Rentfro assist Miss James.
The Council conducts a student intern program, employing a limited
number of promising graduate and undergraduate students of economics
for temporary periods, particularly during the summer months. Interns who
served during 1972 wfere Irwin L. Collier, Jr. (Yale University), Robert S.
Dohner (Harvard University), Eric B. Herr (Indiana University), Susan C.
Nelson (Princeton University), William P. Starnes (Rice University), Mary
E. Sullivan (University of Minnesota), and Michelle J. White (Princeton
University).
Each year the Council obtains the consulting services of several economists.
Consultants who provided services during 1972 included Alan Greenspan
(Townsend-Greenspan & Co.), Hendrik S. Houthakker (Harvard University) , Stephen P. Magee (University of Chicago), Thomas G. Moore (Michigan State University), and G. Paul Wonnacott (University of Maryland).
James R. Golden (U.S. Military Academy) was a member of the professional
staff during the summer.
In preparing the Economic Report, the Council relied upon the editorial
assistance of Rosannah C. Steinhoff.
SUPPORTING STAFF
The Administrative Office provides administrative support for the entire
Council staff including preparation and analysis of the Council's budget;
procurement of equipment and supplies; processing of legislative referrals;
distribution of Council speeches, reports, and congressional testimony; and
responding to correspondence and inquiries from the general public. James H.
Ayres served as Administrative Officer, assisted by Nancy F. Skidmore, Elizabeth A. Kaminski, Margaret L. Snyder, Bettye T. Siegel, and D. Carolyn
185
Fletcher. The duplicating, mail, and messenger department was operated by
James W. Gatling, Frank G. Norman, and Kharl A. Williams.
Tne secretarial staff for the Chairman and Council Members consisted of
Joyce A. Pilkerton, Mary Catherine Fibich, Alice H. Williams, Mayme Burnett, and Patricia A. Lee. Secretaries for the professional staff included
Cheryl L. Green, Dorothy L. Green, Bessie M. Lafakis, Jean P. Noll, Julie L.
Ohner, Earnestine Reid, Linda A. Reilly, and Lillie M. Sturniolo.
DEPARTURES
The Council's professional staff is drawn primarily from universities and
research institutions, and these economists normally serve for 1 or 2 years.
Senior staff economists who resigned during the year were Eric A. Hanushek
(U.S. Air Force Academy), Alan K. McAdams (Cornell University), Edward J. Mitchell (Cornell University), J. Carter Murphy (Southern
Methodist University), Mark J. Riedy (Federal Home Loan Bank Board),
Frank C. Ripley (Data Resources, Inc.), Bernard Saffran (Swarthmore
College), and James R. Wetzel (Board of Governors of the Federal Reserve
System). A. Gilbert Heebner also resigned from the position of Special
Assistant to the Chairman to return to the Philadelphia National Bank.
Junior economists who resigned in 1972 were Ray ton Gerald, William R.
Keeton, and H. Kemble Stokes, Jr. Other resignations included Daisy S.
Babione, secretary; Evelyn D. DeZerne, research assistant; Karen J. MacFarland, secretary; Joanne M. Vinyard, research assistant; and A. Keith
Miles of the Administrative Office. Laura B. Hoffman, secretary, and
Eleanor A. McStay, secretary, retired from Federal service during 1972.
186
Appendix C
STATISTICAL TABLES RELATING TO INCOME,
EMPLOYMENT, AND PRODUCTION
187
CONTENTS
NATIONAL INCOME OR EXPENDITURE:
G-l. Gross national product or expenditure, 1929-72
C-2. Gross national product or expenditure in 1958 dollars, 1929-72
C-3. Implicit price deflators for gross national product, 1929-72
C-4. Implicit price deflators and alternative price measures of gross
national product and gross private product, 1939-72
C-5. Gross national product by industry in 1958 dollars, 1947-71
G-6. Gross national product by major type of product, 1929-72
G—7. Gross national product by major type of product in 1958 dollars,
1929-72
C-8. Gross national product: Receipts and expenditures by major economic
groups, 1929-72
G-9. Gross national product by sector, 1929-72
G-10. Gross national product by sector in 1958 dollars, 1929-72
G—11. Gross product originating in nonfinancial corporations and dollar
costs per unit of output, 1948-72
C-12. Personal consumption expenditures, 1929-72
G-l3. Gross private domestic investment, 1929-72
G-14. Relation of gross national product and national income, 1929-72
C-15. National income by type of income, 1929-72
C-16. Relation of national income and personal income, 1929-72
G-17. Disposition of personal income, 1929-72
G-l8. Total and per capita disposable personal income and personal consumption expenditures in current and 1958 dollars, 1929—72
C-19. Sources of personal income, 1929-72
G-20. Sources and uses of gross saving, 1929-72
C-21. Saving by individuals, 1946-72
C-22. Number and money income (in 1971 dollars) of families and unrelated
individuals, by race of head, 1947-71
Page
193
194
196
198
199
200
201
202
204
205
206
207
208
209
210
211
212
213
214
216
217
218
POPULATION, EMPLOYMENT, WAGES, AND PRODUCTIVITY:
C-23.
C-24.
C-25.
C-26.
C-27.
C-28.
C-29.
C-30.
Population by age groups, 1929-72
Noninstitutional population and the labor force, 1929-72
Civilian employment and unemployment by sex and age, 1947-72. .
Selected unemployment rates, 1948-72
Unemployment by duration, 1947-72
Unemployment insurance programs, selected data, 1946-72
Wage and salary workers in nonagricultural establishments, 1929-72.
Average weekly hours and hourly earnings in selected private nonagricultural industries, 1947-72
C-31. Average weekly earnings in selected private nonagricultural industries, 1947-72
C-32. Output per man-hour and related data, private economy, 1947-72. .
C-33. Changes in output per man-hour and related data, private economy,
1948-72
http://fraser.stlouisfed.org/
490-000 O - 73 - 13
Federal Reserve Bank of St. Louis
189
219
220
222
223
224
225
226
228
229
230
231
PRODUCTION AND BUSINESS ACTIVITY:
C-34.
C-35.
C-36.
C-37.
C-38.
C-39.
C-40.
C-41.
C-42.
C-43.
Pag€
Industrial production indexes, major industry divisions, 1929-72....
Industrial production indexes, market groupings, 1947-72
Industrial production indexes, selected manufactures, 1947-72
Manufacturing output, capacity, and utilization rate, 1948-72
New construction activity, 1929-72
New housing starts and applications for financing, 1929-72
Business expenditures for new plant and equipment, 1947-73
Sales and inventories in manufacturing and trade, 1947-72
Manufacturers' shipments and inventories, 1947-72
Manufacturers' new and unfilled orders, 1947-72
232
233
234
235
236
238
240
241
242
243
Consumer price indexes by expenditure classes, 1929-72
Consumer price indexes by commodity and service groups, 1939-72.
Consumer price indexes, selected commodities and services, 1939-72.
Consumer price indexes, seasonally adjusted, 1970-72
Wholesale price indexes by major commodity groups, 1929-72
Wholesale price indexes by stage of processing, 1947-72
Percent changes in consumer price indexes, major groups, 1948-72..
Percent changes in wholesale price indexes, major groups, 1948-72..
244
245
246
247
248
250
252
253
PRICES:
C-44.
C-45.
C-46.
C-47.
C-48.
C-49.
C-50.
C-51.
MONEY STOCK, CREDIT, AND FINANCE:
C-52.
C-53.
C-54.
C-55.
C-56.
C-57.
C-58.
C-59.
C-60.
Money stock measures, 1947-72
Commercial bank loans and investments, 1930-72
Total funds raised in credit markets by nonfinancial sectors, 1964—72.
Private liquid asset holdings, nonfinancial investors, 1965-72
Federal Reserve Bank credit and member bank reserves, 1929-72. .
Bond yields and interest rates, 1929-72
Short-and intermediate-term consumer credit outstanding, 1929-72.
Instalment credit extended and repaid, 1946-72
Mortgage debt outstanding by type of property and of financing,
1939-72
C-61. Mortgage debt outstanding by lender, 1939-72
C-62. Net public and private debt, 1929-71
254
255
256
258
259
260
262
263
264
265
266
GOVERNMENT FINANCE:
C-63. Federal budget receipts and outlays, fiscal years 1929-74
C-64. Federal budget receipts, outlays, financing, and debt, fiscal years
1963-74
C-65. Relation of the Federal budget to the Federal sector of the national
income and product accounts, fiscal years 1971-74
C-66. Receipts and expenditures of the Federal Government sector of the
national income and product accounts, 1949-74
C-67. Public debt securities by kind of obligation, 1946-72
C-6L8. Estimated ownership of public debt securities, 1946-72
C-69. Average length and maturity distribution of marketable interestbearing public debt, 1946-72
C-70. Receipts and expenditures of the government sector of the national
income and product accounts, 1929-72
C-71. Receipts and expenditures of the State and local government sector of
the national income and product accounts, 1946-72
C-72. State and local government revenues and expenditures, selected fiscal
years, 1927-71
190
267
268
270
271
272
273
274
275
276
277
CORPORATE PROFITS AND FINANCE:
C-73. Profits before and after taxes, all private corporations, 1929-72
C-74. Sales, profits, and stockholders' equity, all manufacturing corporations, 1947-72
C-75. Relation of profits after taxes to stockholders' equity and to sales, all
manufacturing corporations, by industry group, 1950—72
C—76. Sources and uses of funds, nonfarm nonfinancial corporate business,
1946-72
C-77. Current assets and liabilities of U.S. corporations, 1939-72
C-78. State and municipal and corporate securities offered, 1934-72
C-79. Common stock prices, earnings, and yields, and stock market credit,
1949-72
C-80. Business formation and business failures, 1929-72
Page
278
279
280
282
283
284
285
286
AGRICULTURE:
C-81.
C-82.
C-83.
C-84.
Income of farm people and farmers, 1929-72
Farm production indexes, 1929-72
Farm population, employment, and productivity, 1929-72
Indexes of prices received and prices paid by farmers, and parity ratio,
1929-72
C-85. Selected measures of farm resources and inputs, 1929-72
C-86. Comparative balance sheet of the farming sector, 1929-73
287
288
289
290
291
292
INTERNATIONAL STATISTICS:
C-87. U.S. balance of payments, 1946-72
C-88. U.S. merchandise exports and imports by commodity groups,
1958-72
C-89. U.S. merchandise exports and imports by area, 1966-72
C-90. U.S. overseas loans and grants, by type and area, fiscal years,
1962-72
C-91. International reserves, 1949, 1953, and 1967-72
C-92. U.S. reserve assets, 1946-72
C-93. Price changes in international trade, 1964-72
C-94. Consumer price indexes in the United States and other major industrial countries, 1957-72
General Notes
Detail in these tables may not add to totals because of rounding.
Unless otherwise noted, all dollar figures are in current dollars.
See Economic Report 1972 for data for intervening years not shown here.
Symbols used:
p Preliminary.
__ Not available (also, not applicable).
191
293
295
296
297
298
299
300
301
NATIONAL INCOME OR EXPENDITURE
TABLE C-l.—Gross national product or expenditure, 1929-72
Year or quarter
Total
gross
national
product
Personal
consumption
expenditures i
Government purchases of goods and services4
Gross
private
'domestic
investments
Net
exports
of goods
and
services 3
Federal
Total
Total
National
defense *
Other
State
and
local
Percent
change
from
preceding
period,
total gross
national
product6
Billions of dollars
7.2
1929..
103.1
77.2
16.2
1.1
8.5
1.3
1.3
1933..
55.6
45.8
1.4
.4
8.0
2.0
2.0
1939..
90.5
66.8
9.3
1.1
13.3
5.1
1.2
3.9
8.2
6.9
1940..
1941..
1942..
1943..
1944..
1945..
1946..
1947..
1948..
1949..
99.7
124.5
157.9
191.6
210.1
211.9
208.5
231.3
257.6
256.5
70.8
80.6
88.5
99.3
108.3
119.7
143.4
160.7
173.6
176.8
13.1
17.9
9.8
5.7
7.1
10.6
30.6
34.0
46.0
35.7
1.7
1.3
.0
-2.0
-1.8
-.6
7.5
11.5
6.4
6.1
14.0
24.8
59.6
88.6
96.5
82.3
27.0
25.1
31.6
37.8
6.0
16.9
51.9
81.1
89.0
74.2
17.2
12.5
16.5
20.1
2.2
13.8
49.4
79.7
87.4
73.5
14.7
9.1
10.7
13.3
3.8
3.1
2.5
1.4
1.6
2. 5
3.5
5.8
6.8
8.0
7.9
7.7
7.4
7.5
8.1
9.8
12.6
15.0
17.7
10.2
24.9
26.8
21.3
9.7
.9
-1.6
10.9
11.3
-.4
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
284.8
328.4
345.5
364.6
364.8
398.0
419.2
441.1
447.3
483.7
191.0
206.3
216.7
230.0
236.5
254.4
266.7
281.4
290.1
311.2
54.1
59.3
51.9
52.6
51.7
67.4
70.0
67.9
60.9
75.3
1.8
3.7
2.2
.4
1.8
2.0
4.0
5.7
2.2
.1
37.9
59.1
74.7
81.6
74.8
74.2
78.6
86.1
94.2
97.0
18.4
37.7
51.8
57.0
47.4
44.1
45.6
49.5
53.6
53.7
14.1
33.6
45.9
48.7
41.2
38.6
40.3
44.2
45.9
46.0
4.3
4.1
5.9
8.4
6.2
5.5
5.3
5.3
7.7
7.6
19.5
21.5
22.9
24.6
27.4
30.1
33.0
36.6
40.6
43.3
11.0
15.3
5.2
5.5
.1
9.1
5.3
5.2
1.4
8.2
I960..
1961..
1962.
1963..
1964..
1965..
1966..
1967..
1968..
1969..
503.7
520.1
560.3
590.5
632.4
684.9
749.9
793.9
864.2
930.3
325.2
335.2
355.1
375. 0
401.2
432.8
466.3
492.1
536.2
579.5
74.8
71.7
83.0
87.1
94.0
108.1
121.4
116.6
126.0
139.0
4.0
5.6
5.1
5.9
8.5
6.9
5.3
5.2
2.5
1.9
99.6
107.6
117.1
122.5
128.7
137.0
156.8
180.1
199.6
210.0
53.5
57.4
63.4
64.2
65.2
66.9
77.8
90.7
98.8
98.8
44.9
47.8
51.6
50.8
50.0
50.1
60.7
72.4
78.3
78.4
8.6
9.6
11.8
13.5
15.2
16.8
17.1
18.4
20.5
20.4
46.1
50.2
53.7
58.2
63.5
70.1
79.0
89.4
100.8
111.2
4.1
3.2
7.7
5.4
7.1
8.3
9.5
5.9
8.9
7.6
1970..
197L.
1972 P.
976.4
1,050.4
1,152.1
616.8
664.9
721.1
137.1
152.0
180.2
3.6
.7
-4.1
219.0
232.8
254.9
96.5
97.8
105.9
75.1
71.4
76.2
21.5
26.3
29.7
122.5
135.0
148.9
5.0
7.6
9.7
6.0
-4.2
Seasonally adjusted annual rates
1970: I.
IV..
1971: I .
Ill
IV..
1972:1..
II.
IV i
958.0
971.7
986.3
989.7
604.1
613.4
623.0
626.5
132.9
137.7
139.9
137.8
3.6
3.9
4.0
2.8
217.3
216.7
219.5
222.6
99.7
96.2
95.2
95.0
78.9
74.7
73.8
72.9
20.9
21.6
21.4
22.1
117.6
120.5
124.3
127.6
3.9
5.9
6.1
1.4
1, 023.4
1, 043.0
,056.9
, 078.1
648.0
660.4
670.7
680.5
143.9
153.0
152.2
158.8
4.5
.1
.4
-2.1
227.0
229.5
233.6
240.9
96.2
96.3
97.9
100.7
72.5
71.2
70.1
71.9
23.7
25.0
27.8
28.7
130.8
133.3
135.7
140.2
14.3
7.9
5.4
8.3
, 109.1
., 139.4
., 164.0
., 195. 8
696.1
713.4
728.6
746.2
168.1
177.0
183.2
192.4
-4.6
-5.2
-3.4
-3.0
249.4
254.1
255.6
260.3
105.7
108.1
105.4
104.5
76.7
78.6
75.1
74.4
28.9
29.6
30.2
30.1
143.7
146.0
150.2
155.8
12.0
11.4
8.9
11.4
1
See Table C-12 for detailed components.
See Table C-13 for detailed components.
See Table C-8 for exports and imports separately.
* Net of Government sales.
* This category corresponds closely to the national defense classification in the "Budget of the United States Government
for the Fiscal Year ending June 30,1974."
6
Changes are based on unrounded data and therefore may differ slightly from those obtained from published data.
2
3
Source: Department of Commerce, Bureau of Economic Analysis.
193
T A B L E iO*2.—Gross
national product or expenditure tn1958 dollars, 1929-72
Personal consumption
expenditures
Year or
quarter
Gross private domestic investment
Total
gross
national
product
Fixed investment
Total
Durable
goods
Nondurable
goods
Nonresidential
Serv- Total
ices
Structures
Producers'
durable
equipment
Total
Total
Residential
structures
Change
fn business
inventories
IMillions of 1958 dollars
1929
203.6
139.6
16.3
69.3
54.0
40.4
36.9
26.5
13.9
12.6
10.4
3.5
1933
141.5
112.8
8.3
58.6
46.0
5.3
9.7
7.6
3.3
4.3
2.1
-4.3
1939
209.4
148.2
14.5
81.2
52.5
24.7
23.5
15.3
5.9
9.4
8.2
1.2
1940
1941
1942
1943
1944
1945..... .
1946
1947
1948
.. .
1949
227.2
263.7
297.8
337.1
361.3
355.2
312.6
309.9
323.7
324.1
155.7
165.4
161.4
165.8
171.4
183.0
203.5
206.3
210.8
216.5
16.7
19.1
11.7
10.2
9.4
10.6
20.5
24.7
26.3
28.4
84.6
89.9
91.3
93.7
97.3
104.7
110.8
108.3
108.7
110.5
54.4
56.3
58.5
61.8
64.7
67.7
72.1
73.4
75.8
77.6
33.0
41.6
21.4
12.7
14.0
19.6
52.3
51.5
60.4
48.0
28.1
32.0
17.3
12.9
15.9
22.6
42.3
51.7
55.9
51.9
18.9
22.2
12.5
10.0
13.4
19.8
30.2
36.2
38.0
34.5
6.8
8.1
4.6
2.9
3.8
5.7
12.5
11.6
12.3
11.9
12.1
14.2
7.9
7.2
9.6
14.1
17.7
24.6
25.7
22.6
9.2
9.8
4.9
2.9
2.5
2.8
12.1
15.4
17.9
17.4
4.9
9.6
4.0
—.2
—1.9
—2.9
10.0
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
355.3 230.5
383.4 232.8
395.1 239.4
412.8 250.8
407.0 255.7
438.0 274.2
446.1 281.4
452.5 288.2
447.3 290.1
475.9 307.3
34.7
31.5
30.8
35.3
35.4
43.2
41.0
41.5
37.9
43.7
114.0
116.5
120.8
124.4
125.5
131.7
136.2
138.7
140.2
146.8
81.8
84.8
87.8
91.1
94.8
99.3
104.1
108.0
112.0
116.8
69.3
70.0
60.5
61.2
59.4
75.4
74.3
68.8
60.9
73.6
61.0
59.0
57.2
60.2
61.4
69.0
69.5
67.6
62.4
68.8
37.5
39.6
38.3
40.7
39.6
43.9
47.3
47.4
41.6
44.1
12.7
14.1
13.7
14.9
15.2
16.2
18.5
18.2
16.6
16.2
24.8
25.5
24.6
25.8
24.5
27.7
28.8
29.1
25.0
27.9
23.5
19.5
18.9
19.6
21.7
25.1
22.2
20.2
20.8
24.7
8.3
10.9
3.3
.9
-2.0
6.4
4.8
1.2
-1.5
4.8
1960
1961
1962
1963
1964
1965 .
1966
1967.
1968
1969..
487.7
497.2
529.8
551.0
581.1
617.8
658.1
675.2
706.6
725.6
316.1
322.5
338.4
353.3
373.7
397.7
418.1
430.1
452.7
469.1
44.9
43.9
49.2
53.7
59.0
66.6
71.7
72.9
81.3
85.6
149.6
153.0
158.2
162.2
170.3
178.6
187.0
190.2
197.1
201.3
121.6
125.6
131.1
137.4
144.4
152.5
159.4
167.0
174.4
182.2
72.4 68.9 47.1
69.0 67.0 45.5
79.4 73.4 49.7
82.5 76.7 51.9
87.8 81.9 57.8
99.2 90.1 66.3
109.3 95.4 74.1
101.2 93.5 73.2
105.2 98.8 75.6
110.5 103.8 80.1
17.4
17.4
17.9
17.9
19.1
22.3
24.0
22.6
23.4
24.3
29.6
28.1
31.7
34.0
38.7
44.0
50.1
50.6
52.2
55.8
21.9
21.6
23.8
24.8
24.2
23.8
21.3
20.4
23.2
23.7
3.5
2.0
6.0
5.8
5.8
9.0
13.9
7.7
6.4
6.7
1970
1971...
1972 P
722.1
741.7
789.7
477.0
495.4
524.8
83.1
92.1
103.1
23.6
22.8
22.9
54.0
54.0
61.3
22.3
29.1
35.0
4.1
2.6
207.0 186.8 104.0 99.9
211.1 192.2 108.6 105.9
220.5 201.2 123.8 119.3
77.6
76,8
84.3
4.6
-3.9
4.5
Seasonally adjusted annual rates
1970: 1
II..III...
IV....
720.4
723.2
726.8
718.0
474.1
476.9
480.2
476.5
83.8
84.7
84.9
78.9
204.4
206.0
207.7
209.9
185.9
186.2
187.6
187.8
102.0 101.0
105.6 100.0
106.2 101.3
102.2 97.4
78.8
78.9
79.3
73.6
24.0
23.9
23.5
22.9
54.8
55.0
55.7
50.7
22.2
21.1
22.0
23.9
0.9
5.6
4.9
4.8
1971: ! _ . . _
II...
III...
IV...
731.9
737.9
742.5
754.5
488.2
493.0
497.4
503.2
88.8
90.0
94.2
95.4
210.0
211.2
210.5
212.8
189.3
191.8
192.8
195.0
105.0
110.0
107.3
112.0
101.2
104.7
106.6
111.3
75.3
76.4
76.4
79.2
23.4
23.0
22.5
22.2
51.9
53.3
53.9
57.0
25.9
28.3
30.1
32.1
3.8
5.3
1972: L . . .
II...
III...
IV v.
766.5
783.9
796.1
812.4
511.0
520.9
528.7
538.6
98.6
100.7
104.5
108.4
214.7
220.1
221.9
225.3
197.7
200.0
202.3
204.9
116.6
122.0
125.5
131.1
116.3
118.0
119.3
123.4
82.2
83.6
84.2
87.2
23.0
23.0
22.6
23.1
59.2
60.6
61.6
64.0
34.2
34.4
35.1
36.3
.3
3.9
6.2
7.7
See footnotes at end of table.
194
J
TABLE C-2.—Gross national product^ orexpenditure in 1958 dollars,
Net exports of goods and
services
Government purchases of
goods and services i
Year or quarter
Net
exports
Exports
Imports
Total
Federal
State
and
local
1929-72—Continued
Addendum:
Gross
private
product
Percent change from
preceding period3
Total
gross
national
product
Gross
private
product
Billions of 1958 dollars
1.5
11.8
10.3
22.0
3.5
18.5
190.9
1933
.0
7.1
7.1
23.3
6.0
17.3
127.5
-1.9
-2.7
1939
1.3
10.0
8.7
35.2
12.5
22.7
188.7
8.5
9.4
2.1
.4
-2.1
-5.9
-5.8
-3.8
8.4
12.3
6.1
6.4
11.0
11.2
7.8
6.8
7.6
10.2
19.6
22.6
18.1
18.1
8.9
10 8
9.9
12.6
13 4
13.9
11.2
10.3
12.0
11.7
36.4
56 3
117.1
164.4
181 7
156.4
48.4
39.9
46 3
53.3
15.0
36 2
98.9
147.8
165.4
139.7
30.1
19.1
23.7
27.6
21.4
20 1
18 3
16.6
16 3
16 7
18.4
20.8
22 7
25.7
205.6
236 6
257.3
272.8
286 9
282 5
275.1
281.4
295 0
294.1
8.5
16 1
12 9
13.2
72
-1 7
-12.0
-.9
44
.2
9.0
15.0
8.8
6.1
52
-1.5
-2.6
2.3
4.8
-.3
2.7
5.3
3.0
1.1
3.0
3.2
50
6.2
2.2
.3
16.3
19.3
18.2
17.8
18.8
20.9
24.2
26.2
23.1
23.8
13.6
14.1
15.2
16.7
15.8
17.7
19 1
19.9
20.9
23.5
52.8
75.4
92.1
99.8
88.9
85.2
85 3
89.3
94.2
94.7
25.3
47.4
63.8
70 0
56.8
50.7
49 7
51.7
53.6
52.5
27 5
27.9
28.4
29 7
32.1
34.4
35 6
37.6
40.6
42.2
324.2
344.6
353.2
371 1
366.2
397.2
404 8
410 5
405.2
433.4
9.6
7.9
3.0
4.5
-1.4
7.6
1.8
1.5
-1.1
6.4
10.2
6.3
2.5
5.0
-1.3
8.5
1.9
1.4
-1.3
7.0
4.3
5.1
4.5
56
8.3
6.2
4.2
3.6
1.0
.2
27.3
28.0
30.0
32 1
36.5
37.4
40.2
42.1
45.7
48.4
23.0
22.9
25.5
26 6
28.2
31.2
36 1
38.5
44.7
48.3
94.9
100.5
107.5
109 6
111.2
114.7
126 5
140.2
147.7
145.9
51.4
54 6
60.0
59 5
58.1
57.9
65 4
74.7
78.1
73.5
43.5
45 9
47.5
50 1
53.2
56.8
61 1
65.5
69.6
72.4
444.0
452 3
482.9
503 2
532.0
567.0
603 5
617.5
647.0
664.9
2.5
1.9
6.6
4.0
5.4
6.3
6.5
2.6
4.7
2.7
2.4
1.9
6.7
4.2
5.7
6.6
6.4
2.3
4.8
2.8
2.2
.1
-1.8
52.2
52.6
56.9
50.0
52.5
58.7
139.0
137.6
142.9
64.7
60.8
61.6
74.3
76.8
81.3
661.3
681.0
728.4
~2.1
6.5
T.O
1929 .
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
..
.
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972*._
.
6.9
Seasonally adjusted annual rates
1970: 1
II
IM
IV
1971: 1
||
III
IV
1972: 1
||
III
IV*
. .
. .
1.9
2.0
2.9
1.9
51.9
52.3
52.4
52.1
50.0
50.4
49.5
50.1
142.4
138.6
137.5
137.3
69.0
64.8
62.9
62.1
73.5
73.8
74.6
75.1
659.5
662.3
666.1
657.4
-2.5
1.5
2.0
-4.8
-2.6
1.7
2.3
-5.1
2.7
-.7
.1
-1.8
53.0
53.0
54.4
49.9
50.3
53.8
54.3
51.7
136.1
135.7
137.6
141.1
60.2
59.7
61.0
62.3
75.9
76.0
76.7
78.8
671.3
677.5
681.7
693.7
8.0
3.4
2.5
6.7
8.7
3.7
2.5
7.2
-3.3
-2.8
-.7
-.3
55.5
54.2
57.2
60.5
58.9
57.0
57.9
60.8
142.2
143.9
142.6
143.0
62.8
63.7
60.8
59.2
79.4
80.3
81.8
83.8
705.6
723.0
734.5
750.3
6.5
9.4
6.3
8.5
7.1
10.2
6.5
8.9
1 Net of Government sales.
2 Changes are based on unrounded data and therefore may differ slightly from those obtained from published data.
Source: Department of Commerce, Bureau of Economic Analysis.
195
TABLE C-3.—Implicit price deflators for gross national product, 1929-72
[Index numbers, 1958=100]
Gross private domestic investment1
Persona! consumption
expenditures
Fixed investment
Year or quarter
Total
gross
national
product i
Nonresidential
Total
Durable
goods
Nondurable
goods
Services
Structures
Producers'
durable
equipment
44.6
Total
Total
1929-
50.64
55.3
56.4
54.5
56.1
39.4
39.9
35.7
1933..
39.29
40.6
41.9
38.0
43.6
30.6
31.6
27.9
34.5
1939..
43.23
45.1
46.0
43.2
47.7
37.7
38.7
33.1
42.2
1940..
1941..
1942..
1943..
1944..
1945..
1946..
1947..
1948..
1949..
43.87
47.22
53.03
56.83
58.16
59.66
66.70
74.64
79.57
79.12
45.5
48.7
54.8
59.9
63.2
65.4
70.5
77.9
82.3
81.7
46.5
50.4
59.3
64.2
71.5
75.9
76.8
82.7
86.3
86.8
43.8
47.7
55.6
62.5
66.2
68.7
74.3
83.6
88.5
85.6
47.9
49.8
52.7
55.3
57.5
58.7
62.7
67.9
72.1
74.3
39.0
42.0
46.5
49.3
51.1
51.5
58.5
66.7
73.9
74.7
40.0
42.7
47.8
49.9
51.0
51.0
56.3
64.5
70.7
72.8
33.9
36.4
41.3
46.8
48.6
49.2
54.4
64.4
71.5
71.2
43.4
46.3
51.5
51.1
51.9
51.7
57.5
64.6
70.3
73.6
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
80.16
85.64
87.45
88.33
89.63
90.86
93.99
97.49
100.00
101.66
82.9
88.6
90.5
91.7
92.5
92.8
94.8
97.7
100.0
101.3
87.8
94.2
95.4
94.3
92.9
91.9
94.9
98.4
100.0
101.4
86.0
93.3
94.3
93.9
94.2
93.6
94.9
97.7
100.0
99.9
76.3
80.0
83.6
87.7
90.0
92.0
94.6
97.3
100.0
103.0
77.5
83.1
85.3
86.6
86.8
89.0
94.0
98.5
100.0
102.6
74.4
80.4
82.6
84.0
84.8
86.7
92.4
97.9
100.0
102.2
72.9
79.3
83.2
84.9
86.0
88.1
93.4
98.6
100.0
102.7
75.2
80.9
82.2
83.5
84.0
85.9
91.8
97.5
100.0
102.0
I960..
1961..
1962..
1963..
1964..
1965..
1966..
1967..
1968..
1969.
103.29
104.62
105.78
107.17
108.85
110.86
113.95
117.59
122.30
128. 20
102.9
103.9
104.9
106.1
107.4
108.8
111.5
114.4
118.4
123.5
100.9
100.6
100.8
100.4
100.4
99.6
98.7
100.3
103.4
106.1
101.2
101.9
102.8
104.0
104.9
106.9
110.7
113.0
117.1
122.2
105.8
107.6
109.0
110.9
113.1
115.1
118.3
122.2
126.9
133.2
103.4
103.9
104.9
106.0
107.6
109.3
111.8
115.9
120.4
126.4
102.9
103.4
104.1
104.5
105.7
107.5
110.2
113.8
117.5
123.0
104.0
105.6
107.1
108.9
111.1
114.7
118.9
124.0
129.8
141.0
102.2
102.1
102.3
102.3
103.0
103.9
106.0
109.3
112.0
115.2
1970...
1971...
1972'.
135.23
141.61
145.88
129.3
134.2
137.4
108.9
112.4
112.8
127.7
131.7
135.8
140.1
147.4
151.7
132.2
140.0
146.2
130.0
137.7
142.9
152.7
168.4
184.1
120.1
124.7
127.5
Seasonally adjusted
1970: L..
II..
III.
IV..
132.97
134.38
135.71
137.85
127.4
128.6
129.7
131.5
107.6
108.1
109.0
110.9
126.1
127.4
128.2
129.2
137.8
139.4
140.8
142.6
130.1
131.4
132.0
135.6
127.2
128.9
130.4
133.8
147.6
151.1
153.7
158.5
118.2
119.3
120.6
122.6
1971: I . . .
II..
III.
IV.
139.84
141.34
142.35
142.88
132.8
134.0
134.8
135.2
112.4
113.2
112.7
111.3
130.2
131.3
132.3
133.2
145.2
146.7
148.4
149.2
137.4
139.8
141.0
141.2
135.4
137.5
139.1
138.6
160.9
166.3
171.9
174.9
123.9
125.0
125.4
124.5
1972: L.
II..
III.
144.68
145.34
146.21
147.20
136.2
137.0
137.8
138.6
112.6
113.0
113.5
112.1
134.2
135.0
136.1
137.8
150.1
151.2
152.2
153.4
144.2
145.8
146.9
147.8
141.3
142.6
143.5
144.1
179.3
182.7
185.0
189.6
126.5
127.4
128.3
127.7
IV p
See footnotes at end of table.
196
TABLE C-3.—Implicit price deflators for gross national product, 1929-72—Continued
[Index numbers, 1958=100]
Year or quarter
Exports and imports
of goods and services*
Exports
Imports
Government purchases of goods
and services
Federal
Total
State and
local
Gross national product by
sector
Private 2
General
government
1929
59.5
57.3
38.6
36.0
39.1
51.73
34.1
1933
33.7
28.8
34.5
33.1
35.0
39.92
33.5
1939
44.1
38.6
37.9
40.8
36.3
43.93
36.8
48.6
53.0
61.5
65.2
G9.9
71.3
75.4
87.3
92.7
87.0
40.8
43.0
48.3
51.2
53.2
56.4
64.9
79.4
86.4
82.2
38.5
44.0
50.9
53.9
53.1
52.6
55.8
62.9
68.1
71.0
40.2
46.6
52.5
54.9
53.8
53.1
57.3
65.6
69.8
73; 0
37.3
39.2
42.3
44.6
46.1
48.6
53.2
60.4
66.4
68.9
44.69
48.66
55.51
60.85
62.02
62.59
68.25
76.27
81.40
80.60
36.0
34.7
37.3
39.7
43.3
48.3
55.4
58.5
60.8
64.7
84.9
97:0
98.8
95.2
94.3
94.9
97.5
101.3
100.0
98.8
88.7
107.2
103.6
99.1
100.8
100.6
102.5
104.0
100.0
99.3
71.8
78.5
81.0
81.8
84.1
87.1
92.1
96.4
100.0
102.4
72.9
79.4
81.2
81.4
83.5
86.9
91.7
95.8
100.0
102.2
70.8
76.9
80.6
82.8
85.3
87.5
92.7
97.3
100.0
102.6
81.41
87.35
88.99
89.65
90.77
91.57
94.53
97.92
100.00
101.41
67.1
70.5
74.4
76.6
79.5
84.0
88.7
93.3
100.0
104.2
99.9
101.9
100.8
100.6
101.5
104.7
107.7
109.7
110.9
114.6
101.0
100.1
98.5
99.5
101.5
103.4
105.6
106.5
107.7
111.1
105.0
107.1
109.0
111.8
115.7
119.4
124.0
128.5
135.1
144.0
104.2
105.2
105.6
108.0
112.2
115.5
118.8
121.5
126.5
134.5
105.9
109.4
113.2
116.3
119.5
123.5
129.4
136.4
144.8
153.6
102.76
103.73
104.73
105.80
107.05
108.83
111.56
114.79
118.90
124.30
108.6
113.6
116.6
121.5
128.4
133.5
140.3
147.6
159.1
171.0
120.5
125.8
129.6
118.6
124.5
132.6
157.6
169.1
178.3
149.2
160.8
171.9
165.0
175.7
183.1
130.31
135.91
139.49
188.8
205.7
221.7
1940
1941. . .
1942
1943
1944
1945 . .
1946 . . . . .
1947
1948
1949
1950.
1951
1952
1953
1954
1955
1956
1957
1958
1959
.
. .
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
..
1971.
1972 v
.
.
Seasonally adjusted
1970:1
II
Ill
IV
118.5
120.4
121.7
121.4
115.8
117.4
120.8
120.4
152.6
156.3
159.7
162.2
144.6
148.5
151.3
152.9
160.1
163.2
166.7
169.8
128.31
129.49
130.71
132.73
183.3
187.6
190.6
193.6
1971:1
II....
Ill
IV
125.2
125.8
125.9
126.3
122.8
123.8
125.4
126.0
166.8
169.2
169.7
170.7
159.9
161.3
160.5
161.5
172.3
175.4
177.1
178.0
134.28
135.69
136.63
136.98
201.5
204.6
206.4
210.1
1972:1
II
Ill
IV P
127.4
129.1
130.1
131.7
128.0
131.9
134.3
136.1
175.4
176.6
179.2
182.0
168.2
169.9
173.4
176.6
181.0
181.9
183.6
185.8
138.40
139.00
139.77
140.71
217.5
220.7
223.1
225.5
* Separate deflators are not available for total gross private domestic investment, change in business inventories, and
net exports of goods and services.
2 Gross national product less compensation of general government employees. See also Tables C-9 and C-10.
Source: Department of Commerce, Bureau of Economic Analysis.
197
TABLE C-4.—Implicit price deflators and alternative price measures of gross national product and
gross private product, 1939-72
Gross national product price
measures, 1958=100
Year or
quarter
Total
Percent change from preceding period i
Total
Private
Price Implicit Price
Implicit index,
index,
price
price
1967 deflator
1967
deflator weights
weights
Implicit
price
deflator
Price
index,
1967
weights
Private
Chain
price
index
Implicit
price
'deflator
Price
index,
1967
weights
Chain
price
index
1939...
43.23
43.93
—1 5
-1 6
1940
1941
1942
1943
1944
43.87
47.22
53.03
56.83
58.16
44.69
48.66
55.51
60.85
62.02
1.5
7.7
12.3
7.2
2.3
1.7
8.9
14.1
9.6
1.9
1945
1946
1947
1948
1949.
59.66
66.70
74.64
79.57
79.12
62.59
68.25
76.27
81 40
80.60
2.6
11.8
11.9
6.6
-.6
.9
9.0
11.8
6.7
-1.0
1950
1951
1952
1953
1954
80.16
85.64
87.45
88.33
89.63
81.41
87.35
88.99
89.65
90.77
1.3
6.8
2.1
1.0
1.5
1.0
7.3
1.9
.7
1.2
1955
1956..
1957.
1958
1959
90.86
93.99
97.49
100. 00
101.66
91.57
94 53
97.92
100.00
101.41
1.4
3.4
3.7
2.5
1.7
.9
3.2
3.6
2.1
1.4
1960
1961
1962
1963.
1964
103. 29
104. 62 105. 78
107.17
108. 85
102.76
- 103.73
104 73
105. 80
107 05
1.6
1.3
1.1
1.3
1.6
1.3
.9
1.0
1.0
1.2
1965
1966
1967
1968
1969
110.86
113.94
117.59
122. 30
128.20
110.75
114.06
117.58
122. 51
128.61
108.83
111.56
114.79
118.90
124. 30
108.65
111.62
114.78
119.10
124.67
1.8
1.8
3.2
4.0
4.8
3.0
3.1
4.2
5.0
3.1
4.2
4.9
1.7
2.5
2.9
3.6
4.5
2.7
2.8
3.8
4.7
2.9
3.8
4.6
1970.
1971
1972 v
135. 23
141.61
145.88
135. 56
142. 40
147.97
130.31
135.91
139.49
130.64
136. 53
140. 92
5.5
4.7
3.0
5.4
5.1
3.9
5.3
5.0
3.7
4.8
4.3
2.6
4.8
4.5
3.2
4.7
4.5
3.1
Seasonally adjusted annual rates
1970:1
II
III
IV
132.97
134.38
135. 71
137.85
133.25
134.92
136.15
137.99
128.
129.
130.
132.
31
49
71
73
128. 59
130.05
131.11
132. 87
6.5
4.3
4.0
6.5
6.0
5.1
3.7
5.5
5.8
5.1
3.5
5.6
5.3
3.7
3.8
6.3
4.7
4.6
3.3
5.5
4.6
4.6
3.2
5.6
1971:1
II
Ill
IV
139. 84
141. 34
142. 35
142.88
140. 35
141.98
143.11
144.11
134. 28
135. 69
136. 63
136.98
134. 67
136.18
137. 36
137.94
5.9
4.4
2.9
1.5
7.0
4.7
3.5
2.5
6.8
4.6
3.4
2.1
4.8
4.3
2.8
1.0
5.5
4.6
3.5
1.7
5.5
4.4
3.4
1.4
1972:1
II
III
IV*
144.68
145.34
146. 21
147.20
146. 26
147. 35
148.49
149.72
138. 40
139.00
139. 77
140.71
139. 47
140. 32
141.34
142.48
5.1
1.8
2.4
2.7
6.1
3.0
3.1
3.4
5.6
2.7
3.1
3.0
4.2
1.7
2.2
2.7
4.5
2.5
2.9
3.3
4.4
2.3
2.9
2.8
1
Changes are based on unrounded data and therefore may differ slightly from those obtained from published indexes.
Source: Department of Commerce, Bureau of Economic Analysis.
198
TABLE C-5.—Gross national product by industry in 1958 dollars, 1947-71
[Billions of 1958 dollars]
Year
1947
1948
1949
..
AgriTotal culture, Congross fores- tract
natry,
contional
and
strucproduct fishtion
eries
Manufacturing
Total
TransGovportaFinance,
erntion, Whole- insurment
Non- comDusale
ance, ServAll
and
rable durable muniand
and
ices govern- other i
goods goods cation, retail
real
ment
indus- indus- and
trade estate
entertries
utilitries
prises
ties
309.9
323.7
324.1
17.9
20.0
19.4
12.9
14.1
14.7
91.8
96.3
90.9
52.3
55.0
50.5
39.4
41.3
40.4
29.6
30 4
28.7
52.7
54.2
55.2
35.6
36.5
37.8
30. &
31.9
32.1
32.4
33.2
34.7
6.7
7.1
10.6
1950
1951
1952....
1953
1954
355.3
383.4
395.1
412.8
407.0
20.4
19.5
20.2
21.2
21.6
16.2
18.2
18.3
18.9
19.3
105.5
116.2
118.7
128.6
119.5
60.8
69.0
71.5
79.1
71.2
44.7
47.2
47.3
49.5
48.3
30.8
34.3
34.6
35.7
36.4
60.4
61.4
62.9
64.9
65.5
41.0
42.9
44.7
46.8
49.8
33.1
34.0
34.5
35.3
35.4
35.9
43.9
47.2
47.1
46.1
12.1
13.0
14.0
14.3
13.5
1955
1956. .
1957...
1958
1959
438.0
446.1
452.5
447.3
475.9
22.1
22.0
21.5
22.0
22.3
20.8
21.8
21.1
20.7
22.0
133.6
134.1
134.6
123.7
138.9
80.7
79.4
79.6
69.6
79.9
52.9
54.6
54.9
54.0
59.0
38.6
40.5
41.3
40.6
43.3
71.6
73.8
75.1
75.1
80.8
52.7
54.8
57.0
59.2
61.4
38.2
40.2
41.8
42.9
45.1
46.0
46.2
46.9
47.3
47.9
14.4
12.7
13.1
16.0
14.1
1960
1961
1962 .
1963
1964
487.7
497.2
529.8
551.0
581.1
23.1
23.4
23.3
24.0
23.6
21.7
21.4
21.7
21.9
23.3
140.9
140.4
154.6
162.4
173.7
81.0
79.7
90.0
95.6
102.4
59.9
60.7
64.7
66.8
71.3
44.9
46.0
48.9
51.9
54.7
82.3
83.5
88.9
92.8
98.9
64.1
67.1
71.2
74.4
78.3
46.7
48.3
50.8
52.2
54.7
49.2
50.6
52.6
53.9
56.1
14.7
16.3
17.9
17.4
17.8
1965....
1966.
1967
1968
1969...
617.8
658.1
675.2
706.6
725.6
25.0
23.7
25.2
24.8
25.4
23.5
24.7
23.1
23.8
24.1
190.5
205.7
205.4
219.2
228.6
114.8
125.1
123.9
131.8
136.9
75.7
80.7
81.4
87.4
91.7
59.2
64.0
66.5
70.9
75.4
104.8
111.6
113.9
120.8
124.2
83.1
86.8
91.6
95.2
95.5
57.7
60.6
63.4
65.8
67.7
58.0
61.8
65.5
68.6
70.3
15.8
19.4
20.6
17.6
14.3
1970
1971...
722.1
741.7
26.1
26.9
23.6
24.0
217.8
221.4
125.8
125.8
92.0
95.7
77.4
80.9
126.8
131.9
95.6
98.8
68.7
69.5
70.0
70.0
16.0
18.1
i Mining, rest of the world, and residual (the difference between gross national product measured as sum of final products and gross national product measured as sum of gross product by industries).
Source: Department of Commerce, Bureau of Economic Analysis.
199
TABLE C-6.—Gross national product by major type of product, 1929-72
[Billions of dollars]
Goods output
Year or
quarter
Final
sales
Durable goods
Total
Inventory
change
Total
gross
national
product
Total
Final
sales
ll
U
Total
Final
sales
Nondurable goods
ll
•«
c
o
Gross
Serv- Struc- auto
ices tures product
>>
Total
Final
sales
II
c
o
1.7
56.1
54.3
17
17 5
16.1
55.6
57.2 - 1 . 6
27.0
?8.6 - 1 . 6
4.9
5.4
1939
90.5
90.1
.4
49.0
48 6
.4
1? 7
1? 4
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
99 7
124.5
157.9
191 6
210.1
211.9
208.5
231.3
257.6
256.5
97.5
120.1
156.2
192.2
211.1
213.0
202.1
231.8
252.9
259.6
7 7
56.0
72.5
93.6
120.4
132.3
128.9
124.9
139.7
154.2
147.5
53.8
68.0
91.9
121.0
133.3
129.9
118 5
140.1
149.4
150.5
7 7
-.5
4.7
-3.1
16.6
26.8
35.5
54.2
57.9
48.9
36 9
46.0
48.7
47.8
15.4 1 7
23.8 3.0
34.5 1.0
54.2
0
58.5 - . 6
50.? - 1 . 3
31.6 5.3
44.3 1.7
.7
48.0
49.9 - 2 . 1
39.3 38.4 1.0
45.6 44.? 1.4
58.1 57.4
66.2 66.8 - 6
3
74.4 74.8
.2
80.0 79.7
88.0 86 9 1,1
93.7 95.9 - 2 . 2
105. 5 101.5 4,0
99.7 100.6 - 1 . 0
1950
1951
1952 . . . .
1953
1954
1955
1956
1957
1958— —
1959
284.8
328.4
345.5
364 6
364 8
398.0
419.2
441 1
447.3
483 7
278.0 6.8 162.4 155.6 6.8
318.1 10.3 189.7 179.4 10.3
342.4 3.1 195.6 192.5 3.1
4 204.1 203.7
364.1
4
366.4 - 1 5 197.1 198.6 - 1 . 5
392.0 6.0 216.4 210.4 6.0
414.5 4.7 225.4 220.7 4.7
439.8 1 3 234.6 233.3 1 3
448.8 - 1 . 5 230.8 232.3 - 1 . 5
478.9 4 8 249.1 244.4 4,8
60.4
73.7
74.6
79.4
72.1
85.7
90.3
94.4
83.6
95.6
56.3 4.1
66.8 6.9
73. 5 1.1
78.5
9
74.6 - ? 5
82.7 3.0
87 5 ?.8
93.1 1 3
86.4 - 2 . 8
93.2 7 3
102.0
116.0
1?1.0
124.8
125.0
130.7
135,1
140.2
147.2
153.6
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
503.7
520.1
560 3
590.5
632 4
684.9
749.9
793 9
864.2
930.3
500.2 3.6
518.1 ?.O
554.3 6.0
584.6 5 9
626.6 5 8
675.3 9.6
735.1 14.8
785.7 8 7
857.1 7.1
922.5 7.8
1929
103 1
1933
1970
1971
1972
....
....
P....
101.4
976.4 971.5
1,050.4 1,046.7
1.152.1 1,146.2
4.5
1.8
- 6
-1.0
-1.0
6.4
-.5
4.7
-3.1
259.6
262.3
284.5
298.6
319.4
347.2
383.3
398.9
429.5
457.5
4.5
1.8
- 6
-1.0
-1.0
6.4
1.4
38 5
38.2
g
?2.1
n 7 -1,1
36.3
36.2
4.9 184.9 183.0
3 6 195.7 194.6
5.8 222.7 217.6
35.6
11.4
25.7
2.9
1 34.0
7.5
8.3
35.4
40.3
50 3
62.5
71.8
76.5
68.0
70.2
75.7
80.8
15.6
21.4
27.7
28.3
7.2
8.8
11.9
99.3 7 7 87.0
112.6 3,4 101.2
119.1 ?,0 110.8
125.2 - . 5 118.8
124.1 l n 123.5
127.7 2.9 132.6
133 ? 1 9 142.3
140.2
.0 154.2
145.9 1.3 163.4
151.1 7 4 176.2
35.4
37.5
39.1
41.7
44.2
49.0
51.5
52 3
53.1
58.3
15.4
13.5
12.0
16.3
14.6
21.2
16.9
19.5
14.5
19.1
56.8
58.3
62 6
65.7
68.8
74.8
77.5
78.6
88.1
94.9
21.4
17.9
22.5
25.1
25.8
31.8
30.0
28.9
36.3
36.6
3.0 409.2 95.4
7 5 443.9 111.0
.7 482.2 127.1
30.7
40.9
43.0
256.0 3.6 99.5 97.4 ? 1 160.1 158 6
260.2 ?.O 96 5 96.6 - . 1 165.8 163 7
278.5 6.0 109.0 106.2 2.8 175.5 172.2
292.7 5 9 116.1 113.3 ? 8 182.5 179.4
313.6 f> 8 127.0 122.8 4 ? 192.4 190.7
337.6 9.6 139.6 133.0 6.7 207.6 204.7
368.5 14.8 156 7 146.? 10 5 ??6.6 ??? 3
390.7 8 ? 161.1 156.5 4 7 237.7 234.2
422.4 7.1 174.5 169.6 4.9 255.0 252.9
449.7 7.8 187.3 182.3 5.0 270.2 267.4
4.9 471.9 467.0
3 6 495.5 491.8
5.8 542.8 536.9
0 3
1.9 287.0 284.0
1 1 299.8 297.3
5.2 320.1 319.4
1 5 187.3
? 1 199.5
3.2 213 3
3 1 226.2
1.6 244.2
3.0 262.9
4 3 289.1
3 "i 316.5
2.1 346.6
2.8 377.9
11.8
14.0
8.7
6.1
6.5
Seasonally adjusted annual rates
462.3
467.3
472.7
465.6
1.5
6.3
6.2
5.7
185.4
186.8
193.4
173.9
184.4 1.0
185.2 1.6
187.4 6.0
174.8 - . 9
278.4
286.7
285.4
297.3
277.8
282.1
285.2
290.7
0.5
4.7
.2
6.6
400.6
405.1
412.2
418.7
93.5
93.1
95.3
99.8
30.9
35.1
34.2
22.5
4.9 487.1 482.2
6.6 492.4 485.8
1.3 497.5 496.2
1.7 504.8 503.1
4.9
6.6
1.3
1.7
193.3
194.5
196.7
198.2
189.6 3.7
191.0 3.6
197.7 - 1 . 0
200.1 - 1 . 9
293.8
297.9
300.8
306.6
292.6
294.8
298.5
303.0
1.2
3.1
2.3
3.5
431.3
441.1
446.7
456.3
105.0
109.5
112.7
117.0
42.5
40.1
42.4
38.8
1972: L . . . 1,109.1 1,108.6
.4 517.6 517.2
II... 1,139.4 1,134.4 5.0 537.1 532.1 5!o
III.. 1,164.0 1,156.0 8.0 550.4 542.4 8.0
IV '. 1,195.8 1,185.9 10.0 566.0 556.0 10.0
209.2
217.6
226.1
238.0
.4
208.8
214.6 3.0
220.7 5.4
226.2 11.9
308.4
319.6
324.3
327.9
308.4
.0
317.5 2.1
321.7 2.6
329.9 - 1 . 9
467.3
477.3
487.3
496.8
124.2
125.0
126.3
133.1
39.9
41.5
46.0
44.5
1970: !____
II...
III..
IV..
958.0
971.7
986.3
989.7
956.4
965.5
980.2
984.1
1971: l__._
II...
III..
IV-.
1,023.4
1,043.0
1,056.9
1,078.1
1,018.5
1,036.4
1,055.6
1,076.4
i
1.5
6.3
6.2
5.7
463.8
473.6
478.8
471.2
Source: Department of Commerce, Bureau of Economic Analysis.
200
TABLE C-7.—Gross national product by major type of product in 1958 dollars, 1929-72
[Billions of 1958 dollars]
Goods output
Year or
quarter
Total
Ingross
na- Final ventional sales tory
prodchange
uct
3.5
1929
203.6 200.1
1933
141.5 145.9 - 4 . 3
1939
209.4 208.2
1940
1941
1942
1943
1944 . .
1945
1947
1948
1949
227.2
263.7
297.8
337.1
361.3
355.2
312.6
309.9
323.7
324.1
222.3
4.9
254.1
9.6
293.8
4.0
337.3 - . 2
363.2 - 1 . 9
358.2 - 2 . 9
302.6 10.0
310.1 - . 2
319.1
4.6
328.1 - 3 . 9
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
355.3
383.4
395.1
412.8
407.0
438.0
446.1
452.5
447.3
475.9
1960......
1961
1962
1963
1964
1965
1966
1967
1968
1969
487.7
497.2
529.8
551.0
581.1
617.8
658.1
675.2
706.6
725.6
1970
1971
1972
722.1 718.0
741.7 739.1
789.7 785.2
1946
P
Total
Total
Final
sales
103.9 100.4
68.8
Nondurable goods
Durable goods
Total
Final
sales
Total
Final
sales
II
Serv- Strucices tures
Gross
auto
product
2-5
30.3
3.5
33.6
30.9
2.7
70.4
69.5
0.8
69.3
73.2 - 4 . 3
11.7
13.4 - 1 . 7
57.1
59.8 - 2 . 7
63.0
9.8
.6
83.0
82.5
110.7 109.5
1.2
27.6
27.0
76.9
21.8
124.0
143.4
158.1
187.4
204.8
198.0
172.1
172.2
178.4
174.2
119.0
133.8
154.1
187.6
206.7
201.0
162.1
172.4
173.8
178.1
4.9
9.6
4.0
-.2
35.6
50.0
57.2
85.6
95.9
84.3
54.7
60.1
61.3
58.0
32.8 2.7 88.4 86.2 2.2 80.0
43.5 6.6 93.4 90.3 3.1 89.8
54.4 2.9 100.9 99.7 1.2 107.7
.4 101.7 102.4 - . 6 131.8
85.2
97.4 -1.5 108.8 109.3 - . 4 144.0
87.4 -3.1 113.7 113.6
.2 144.3
46.1 8.6 117.4 116.0 1.4 113.3
58.6 1.5 112.2 113.8 -1.7 106.5
60.0 1.2 117.1 113.8 3.3 109.3
61.0 -3.0 116.2 117.1 - . 9 112.4
23.2
30.5
31.9
17.9
12.4
12.9
27.2
31.2
36.1
37.5
10.3
11.4
14.8
347.0
8.3
372.5 10.9
391.8
3.3
411.8
.9
409.0 - 2 . 0
431.6
6.4
441.2
4.8
451.2
1.2
448.8 - 1 . 5
471.1
4.8
192.6
208.4
214.0
225.4
215.1
236.1
239.0
239.8
230.8
247.7
184.3 8.3
197.5 10.9
210.7 3.3
224.5
.9
217.1 - 2 . 0
229.7 6.4
234.2 4.8
238.5 1.2
232.3 - 1 . 5
242.9 4.8
73.4
84.
84.6
68.3 5.2 119.1 116.0 3.1 117.5
76.1 8.0 124.3 121.4 2.9 130.5
83.2 1.5 129.4 127.6 1.8 136.3
89.9 1.2 134.4 134.6 - . 2 140.3
84.8 -3.0 133.2 132.3
.9 141.8
93.0 3.4 139.7 136.7 3.0 147.5
93.5 3.0 142.5 140.7 1.8 153.0
95.0 1.2 143.6 143.6
.0 160.1
86.4 -2.8 147.2 145.9 1.3 163.4
91.6 2.4 153.7 151.2 2.5 171.2
45.2
44.4
44.7
47.0
50.2
54.3
54.0
52.6
53.1
57.0
19.1
15.9
13.5
18.7
17.1
24.6
18.6
20.2
14.5
18.5
484.2
495.2
523.8
545.2
575.2
608.8
644.2
667.5
700.2
718.9
256.0
257.3
277.3
289.7
308.6
330.7
356.8
363.1
379.7
390.0
252.6 3.5 97.8 95.9
255.3 2.0 94.9 94.9
271.3 6.0 107.0 104.1
283.9 5.8 114.2 111.4
302.8 5.8 124.6 120.4
321.7 9.0 136.5 130.1
342.9 13.9 151.8 141.9
355.4 7.7 152.2 148.0
373.3 6.4 160.7 156.2
383.3 6.7 167.5 163.2
176.6
184.0
193.7
200.9
210.8
221.9
236.3
249.1
259.7
268.2
55.0
55.8
58.8
60.4
61.6
65.2
65.0
63.0
67.2
67.3
21.0
17.5
22.0
24.7
25.5
31.8
30.6
29.0
35.4
35.0
2.6 272.5
2.0 278.4
.6 291.1
63.8
69.5
74.8
28.4
36.4
38.4
1.2
3.5
2.0
6.0
5.8
5.8
9.0
13.9
7.7
6.4
6.7
4.1 385.8 381.7
2.6 393.8 391.2
4.5 423.9 419.4
-1.9
-2.9
10.0
-.2
4.6
-3.9
91.0
81.9
96.5
96.5
96.2
83.6
94.0
4.1 160.0 158.6
2.6 164.5 163.8
4.5 185.9 181.9
2.0
.0
2.8
2.8
4.1
6.5
9.8
4.3
4.4
4.3
158.2
162.3
170.3
175.6
184.1
194.2
205.1
210.9
219.0
222.5
156.7
160.3
167.2
172.5
182.3
191.6
201.0
207.4
217.0
220.1
1.4 225.8 223.2
.6 229.4 227.3
4.0 238.1 237.5
.6
1.5
2.0
3.1
3.1
1.7
2.6
4.1
3.5
2.0
2.5
Seasonally adjusted annual rates
1970:1....
II...
III..
IV...
720.4
723.2
726.8
718.0
719.5
717.5
721.9
713.2
0.9
5.6
4.9
4.8
383.1
383.8
385.5
374.6
0.9
5.6
4.9
4.8
162.4
162.9
166.9
147.6
161.8 0.7
161.5 1.4
162.2 4.7
148.7 - 1 . 1
221.6
226.6
223.5
231.7
221.3
222.3
223.3
225.8
0.3
4.2
.2
5.9
272.5
271.1
272.9
273.6
64.0
62.6
63.5
65.0
29.2
32.8
31.6
20.0
1971:
L...
II.
Ill
IV..
731.9
737.9
742.5
754.5
728.1
732.6
741.7
753.8
3.8 389.4 385.6
5.3 391.0 385.7
.7 394.5 393.7
.7 400.4 399.7
3.8
5.3
.7
.7
162.7
162.8
164.9
167.4
159.8 2.9
160.0 2.8
166.0 - 1 . 1
169.5 - 2 . 1
226.6
228.3
229.5
233.0
225.8
225.7
227.7
230.2
.9
2.6
1.9
2.8
274.8
278.2
278.4
282.3
67.7
68.8
69.6
71.8
37.1
34.8
37.8
35.8
1972:
I....
II..
III.
IV*.
766.5
783.9
796.1
812.4
766.3
780.0
789.8
804.7
.3
3.9
6.2
7.7
.3
3.9
6.2
7.7
175.0
181.4
187.9
199.1
174.8
179.1
183.8
189.9
232.0
239.2
240.9
240.1
.0
232.0
237.6 1.6
238.7 2.2
241.6 - 1 . 5
285.2
289.3
293.2
296.6
74.3
74.0
74.1
76.6
35.6
37.0
40.6
40.4
384.0
389.5
390.3
379.4
407.0
420.7
428.7
439.2
406.8
416.7
422.5
431.5
Source: Department of Commerce, Bureau of Economic Analysis.
201
.3
2.3
4.1
9.2
TABLE G-8.—Gross national product: Receipts and expenditures by major economic groups, 1929-72
[Billions of dollars]
Persons
Government
Disposable personal
Income
Year or
quarter
Total
Less:
Interest
paid
and
transfer
payments
to foreigners
Net receipts
Expenditures
PerEquals: sonal
Tax
Less:
PerTotal
and TransTranssonal
conexclud- sump- saving nonfers,
fers, Equals: Total
or
ing intax
interinterNet
extion
terest
reest,
disest
reexpendiand
and
and
ceipts
pendi- saving ceipts
tures
transor ac- sub- 3
subtures
fers
cruals sidies
sidies*
Equals:
Purchases
of
goods
and
services
1929.
83.3
1.9
81.4
77.2
4.2
11.3
1.8
9.5
10.3
1.8
8.5
1933.
45.5
.7
44.9
45.8
-.9
9.3
2.7
6.7
10.7
2.7
8.0
1939.
70.3
.9
69.4
66.8
2.6
15.4
4.2
11.2
17.6
4.2
13.3
1940.
1941..
1942..
1943..
1944..
1945..
1946..
1947..
1948..
1949..
75.7
92.7
116.9
133.5
146.3
150.2
160.0
169.8
189.1
188.6
1.0
1.1
.8
'.B
1.0
1.4
1.8
2.2
2.4
74.7
91.6
116.1
132.7
145.5
149.3
158.6
168.0
186.9
186.2
70.8
80.6
88.5
99.3
108.3
119.7
143.4
160.7
173.6
176.8
3.8
11.0
27.6
33.4
37.3
29.6
15.2
7.3
13.4
9.4
17.7
25.0
32.6
49.2
51.2
53.2
50.9
56.8
58.9
56.0
4.4
4.0
4.4
4.7
6.5
10.4
18.5
17.3
18.8
21.3
13.3
21.0
28.2
44.4
44.7
42.8
32.4
39.5
40.1
34.7
18.4
28.8
64.0
93.3
103.0
92.7
45.5
42.4
50.3
59.1
4.4
4.0
4.4
4.7
6.5
10.4
18.5
17.3
18.8
21.3
14.0
24.8
59.6
88.6
96.5
82.3
27.0
25.1
31.6
37.8
1950..
1951..
1952..
1953..
1954..
ia55_.
1956..
1957..
1958..
1959..
206.9
226.6
238.3
252.6
257.4
275.3
293.2
308.5
318.8
337.3
2.9
3.1
3.5
4.3
4.6
5.1
5.9
6.4
6.5
7.1
204.1
223.5
234.8
248.3
252.9
270.2
287.2
302.2
312.3
330.3
191.0
206.3
216.7
230.0
236.5
254.4
266.7
281.4
290.1
311.2
13.1
17.3
18.1
18.3
16.4
15.8
20.6
20.7
22.3
19.1
68.7
84.8
89.8
94.3
89.7
100.4
109.0
115.6
114.7
128.9
22.9
19.9
19.0
19.5
21.9
23.4
25.5
28.7
33.0
34.0
45.8
64.9
70.8
74.8
67.8
76.9
83.5
86.8
81.6
95.0
60.8
79.0
93.7
101.2
96.7
97.6
104.1
114.9
127.2
131.0
22.9
19.9
19.0
19.5
21.9
23.4
25.5
28.7
33.0
34.0
37.9
59.1
74.7
81.6
74.8
74.2
78.6
86.1
94.2
97.0
I960..
1961..
1962..
1963..
1964..
1965..
1966..
1967_.
1968..
1969..
350.0
364.4
385.3
404.6
438.1
473.2
511.9
546.3
591.0
634.4
7.8
8.1
8.6
9.7
10.7
12.0
13.0
13.9
15.1
16.7
342.3
356.3
376.6
394.9
427.4
461.3
498.9
532.4
575.9
617.7
325.2
335.2
355.1
375.0
401.2
432.8
466.3
492.1
536.2
579.5
17.0
21.2
21.6
19.9
26.2
28.4
32.5
40.4
39.8
38.2
139.8
144.6
157.0
168.8
174.1
189.1
213.3
228.9
263.5
296.7
36.5
41.3
42.8
44.4
46.7
49.9
55.5
62.8
70.7
77.9
103.3
103.3
114.2
124.3
127.3
139.2
157.9
166.2
192.7
218.8
136.1
149.0
159.9
166.9
175.4
186.9
212.3
242.9
270.3
287.9
36.5
41.3
42.8
44.4
46.7
49.9
55.5
62.8
70.7
77.9
99.6
107.6
117.1
122.5
128.7
137.0
156.8
180.1
199.6
210.0
1970..
19711972*
689.5
744.4
795.1
17.9
18.5
19.3
671.6
725.8
775.9
616.8
664.9
721.1
54.9
60.9
54.8
302.0
321.6
365.7
93.0
105.7
117.1
209.0
215.9
248.6
312.1
338.5
372.0
93.0
105.7
117.1
219.0
232.8
254.9
Seasonally adjusted annual rates
1970: L... 667.9
II... 687.2
III.. 699.1
IV.. 704.0
17.5
17.8
18.1
18.3
650.4
669.4
681.0
685.7
604.1
613.4
623.0
626.5
46.3
55.9
58.0
59.2
299.0
303.7
303.0
302.4
81.8
96.5
95.2
98.5
217.2
207.2
207.8
203.9
299.1
313.2
314.7
321.2
81.8
96.5
95.2
98.5
217.3
216.7
219.5
222.6
1971:1....
II—
III..
IV..
725.7
742.9
750.4
758.5
18.3
18.4
18.7
18.8
707.4
724.5
731.7
739.7
648.0
660.4
670.7
680.5
59.3
64.1
61.0
59.3
313.5
318.8
323.3
330.7
100.6
107.4
106.5
108.4
212.9
211.4
216.8
222.3
327.5
336.9
340.2
349.4
100.6
107.4
106.5
108.4
227.0
229.5
233.6
240.9
1972:1....
II...
III..
IV*.
770.5
782.6
798.8
828.4
18.8
19.1
19.4
19.8
751.7
763.5
779.4
808.6
696.1
713.4
728.6
746.2
55.7
50.1
50.8
62.4
353.8
361.4
368.8
112.1
114.1
115.7
126.6
241.7
247.3
253.1
361.6
368.3
371.2
386.9
112.1
114.1
115.7
126.6
249.4
254.1
255.6
260.3
See footnotes at end of table.
202
TABLE C-8.—Gross national product: Receipts and expenditures by major economic groups,
1929-72—Continued
[Billions of dollars]
Business
nternational
Net
Year
or
quarter
Gross
retained
earnings 3
Net exports of goods
Excess
Gross
of
and services
transpritransExcess fers to
vate
of inforfers
domes- vest- eigners
or
tic
Equals: of net
ment by perExexinvestsons
Less:
Net
(-)
ports
ment4
and
ports
Imex(_)5
Governports
ports
Total
income
or receipts
Statistical
discrepancy
Gross
national
product
or expenditure
ment
1929
1933
.
1939
11.2
16.2
-5.1
0.4
7.0
5.9
1.1
-0.8
102.4
0.7
103.1
3.2
1.4
1.8
.2
2.4
2.0
.4
-.2
55.0
.6
55.6
8.4
9.3
-.9
.2
4.4
3.4
1.1
-.9
89.2
1.3
90.5
.2
.2
.2
.2
3
.8
2.9
2.6
4.5
5.6
5.4
5.9
4.8
4.4
5.3
7.2
14.7
19.7
16.8
15.8
3.6
4.6
4.8
6.5
7.1
7.9
7.2
8.2
10.3
9.6
1.7
1.3
0
-2.0
-1.8
-.6
7.5
11.5
6.4
6.1
-1.5
-1.1
.2
2.2
2.1
1.4
-4.6
-8.9
-1.9
-.5
98.7
124.1
159.0
193.6
207.6
208.0
208.4
230.4
259.5
256.2
1.0
.4
-1.1
-2.0
2.5
3.9
.'9
-2.0
.3
99.7
124.5
157.9
191.6
210.1
211.9
208.5
231.3
257.6
256.5
13.8
18.7
18.0
16.9
17.8
19.8
23.6
26.5
23.1
23.5
12.0
15.1
15.8
16.6
15.9
17.8
19.6
20.8
20.9
23.3
1.8
2.2
-.2
1.8
2.0
4.0
5.7
2.2
.1
2.1
.5
.5
-1.5
-3.4
.2
2.3
283.3
325.1
343.3
361.6
362.1
395.9
420.4
441.1
445.8
484.5
1.5
3.3
2.2
3.0
2.7
2.1
-1.1
.0
1.6
-.8
284.8
328.4
345.5
364.6
364.8
398.0
419.2
441.1
447.3
483.7
23.2
23.0
25.1
26.4
28.6
32.3
38.1
41.0
48.1
53.6
4.0
5.6
5.1
5.9
8.5
6.9
504.8
520.8
559.8
590.8
633.7
688.0
750.9
794.6
866.9
936.3
-1.0
-.8
.5
-.3
-1.3
503.7
520.1
560.3
590.5
632.4
684.9
749.9
793.9
864.2
930.3
59.3
65.4
3.6
.7
-4.1
1940.
1941..
1942 .
1943
1944
1945. .
1946
1947.
1948....
1949
10.5
11.4
14.5
16.3
17.1
15.1
14.5
20.2
28.0
29.7
13.1
17.9
9.8
5.7
7.1
10.6
30.6
34.0
46.0
35.7
-2.7
-6.5
4.6
10.6
10.0
4.6
-16.1
-13.8
-18.0
-6.0
1950
1951
1952...
1953
1954.
..
1955
1956
1957
1958
1959
29.4
33.1
35.1
36.1
39.2
46.3
47.3
49.8
49.4
56.8
54.1
59.3
51.9
52.6
51.7
67.4
70.0
67.9
60.9
-24.7
-26.2
-16.8
-16.5
-12.5
-21.1
-22.8
-18.1
-11.5
-18.5
4 0
3.5
2.5
2.5
2.3
2.5
I960..
1961
1962
1963
1964
1965
1966
1967
1968
1969
56.8
58.7
66.3
68.8
76.2
84.7
91.3
93.0
95.4
97.0
74.8
71.7
83.0
87.1
94.0
108.1
2.4
2.6
2.7
2.8
121.4
116.6
126.0
139.0
-18.0
-13.0
-16.8
-18.4
-17.8
-23.4
-30.1
-23.5
-30.6
-42.0
2.9
27.2
28.6
30.3
32.3
37.1
39.2
43.4
46.2
50.6
55.5
97.3
109.9
123.8
137.1
152.0
180.2
-39.7
-42.1
-56.3
3.2
3.6
3.8
62.9
66.1
73.7
.
1970 ._
1971
1972 v
75.3
2.4
2.3
2.4
2.4
2.8
2.8
2.8
3.0
2.9
77.8
3.7
2.2
.4
-1.7
5.3
-3.0
-2.5
-3.1
-5.7
-4.1
-2.4
1.9
.4
1.0
5.2
2.5
-2.2
-.4
2.8
7.8
-3.1
-1.0
1
-2.7
-6.1
981.1
1,055.2
1,152.2
-4.7
-4.8
.1
976.4
1,050.4
1,152.1
966.0
Seasonally adjusted annual rates
1970: 1
II
III
IV
1971: 1
II
III
IV.
1972: 1
II
III
IV *
95.3
97.9
98.3
97.9
132.9
137.7
139.9
137.8
-37.6
-39.8
-41.6
-39.9
3.1
103.2
108.6
110.5
117.2
143.9
153.0
152.2
158.8
-40.7
-44.4
115.9
124.8
125.1
168.1
177.0
183.2
192.4
-41.7
-41.6
-52.2
-52.2
-58.1
3.4
61.5
63.0
63.7
63.2
57.9
59.2
59.8
60.4
3.9
4.0
2.8
-0.5
-.7
-.6
.6
977.6
990.4
990.9
-7.9
-5.9
-4.0
-1.0
958.0
971.7
986.3
989.7
3.2
3.4
3.8
4.0
66.3
66.7
68.5
63.0
61.8
66.6
68.2
65.1
4.5
.1
.4
-2.1
-1.4
3.2
3.4
6.1
1,026.7
1,047.9
1,062.8
1,083.2
-3.3
-4.9
-5.9
-5.2
1,023.4
1,043.0
1,056.9
1,078.1
3.8
3.8
3.8
3.8
70.7
70.0
74.4
79.7
75.3
75.2
77.8
82.7
-4.6
-5.2
-3.4
-3.0
8.4
9.0
7.2
6.7
1,113.1
1,139.4
1,161.6
-4.1
-.1
2.3
1,109.1
1,139.4
1,164.0
1,195.8
3.1
3.3
3.6
1 Personal income less personal tax and nontax payments (fines, penalties, etc.).
2 Government transfer payments to persons, foreign net transfers by Government, net interest paid by government,
subsidies
less current surplus of government enterprises, and disbursements less wage accruals.
3
Capital consumption allowances, corporate inventory valuation adjustment, and undistributed corporate profits, and
private wage accruals less disbursements.
* Private business investment, purchases of capital goods by private nonprofit institutions, and residential housing.
See Table C-13.
5 Net foreign investment less capital grants received by the United States, with sign changed.
Source: Department of Commerce, Bureau of Economic Analysis.
203
TABLE C-9.—Gross national product by sector, 1929-72
[Billions of dollars]
Gross private product *
Year or
quarter
Total
gross
national
product
Business
Total
Total
Nonfarm *
Farm
Households
and
institutions
Rest of
the world
Gross
government
product 3
1929.
103.1
98.8
95.1
85.4
9.7
2.9
0.8
43
1933.
55.6
50.9
48.9
44.3
4.6
1.7
.3
4.7
1939
90.5
82.9
80.3
74.0
6.3
2.3
.3
76
1940
1941
1942
1943...
1944
1945
1946
1947. .
1948
1949
99.7
124.5
157.9
191.6
210.1
211.9
208.5
231.3
257.6
256.5
91.9
115.1
142.8
166.0
177.9
176.8
187.7
214.6
240.1
237.0
89.1
112.2
139.5
6.5
8.9
13.0
15.3
15.3
15.9
18.8
20.2
23.3
18.8
2.4
2.5
2.9
3.2
3.7
4.1
4.5
5.1
5.6
5.9
.4
.4
.4
172.3
182.7
208.6
233.5
230.1
82.6
103.3
126.5
147.2
158.5
156.4
163.9
188.5
210.2
211.4
.4
.4
.6
.8
1.0
1.0
7.8
94
15.1
25.6
32.2
35.2
20.8
16.7
17.4
19.4
1950
1951
1952
1953
1954
1955
1956 .
1957
1958
1959
284.8
328.4
345.5
364.6
364.8
398.0
419.2
441.1
447.3
483.7
263.9
301.0
314.3
332.7
332.4
363.8
382.6
402.0
405.2
439.4
256.3
292.8
305.8
323.6
322.7
352.9
370.8
389.3
391.7
425.0
236.3
269.9
283.7
303.3
303.1
334.1
352.2
370.9
370.9
405.3
20.0
22.9
22.2
20.3
19.6
18.8
18.6
18.4
20.8
19.6
6.4
6.9
7.2
7.8
8.1
9.1
9.8
10.5
11.4
12.2
1.2
1.3
1.3
1.3
1.6
1.8
2.1
2.2
2.0
2.2
20.9
27.4
31.2
31.9
32.5
34.2
36.6
39.1
42.1
44.3
1960
1961
1962.
1963.
1964
1965
1966
1967
1968
1969
503.7
520.1
560.3
590.5
632.4
684.9
749.9
793.9
864.2
930.3
456.3
469.2
505.7
532.4
569.4
617.1
673.3
708.8
769.3
826.5
440,7
452.3
487.4
513.0
548.2
594.4
648.9
681.6
739.0
794.1
420.2
431.4
466.2
491.5
527.6
570.8
624.0
657.0
713.9
766.2
20.5
20.9
21.2
21.5
20.6
23.7
24.9
24.6
25.2
27.9
13.2
14.0
15.0
16.0
17.3
18.5
20.2
22.8
25.5
28.1
2.4
2.9
3.3
3.4
4.0
4.2
4.1
4.5
4.7
4.3
47.5
50.9
54.7
58.1
63.0
67.8
76.6
85.1
94.9
103J
976.4
1,050.4
1,152.1
861.8
925.6
1, 016.0
826.3
884.7
970.8
797.3
853.9
937.4
28.9
30.9
33.4
30.9
33.9
37.8
4.6
6.9
7.3
114.7
124.8
136.1
.
.
1970
1971
1972 v
Seasonally adjusted annual rates
958.0
971.7
986.3
989.7
846.2
857.7
870.7
872.6
811.7
823 4
834.6
835.3
782.0
794.3
806.0
807.0
29.7
29 2
28.7
28.2
30.0
30.1
31.3
32.3
4.5
4.1
4.8
5.1
111.7
114.1
115.6
117.2
1971: 1. _
II
Ill
IV......
1,023.4
1, 043.0
1,056.9
1, 078.1
901.4
919.3
931.4
950.2
862.7
878.7
890.9
906.6
832.8
848.5
859.6
874.5
29.9
30.2
31.2
32.1
33.0
33.2
34.3
35.1
5.7
7.4
6.2
8.5
122.1
123.7
125.5
127.9
1972: 1 .
II
III
IV v
1,109.1
1,139.4
1,164.0
1,195.8
976.6
1,005.0
1, 026.6
1,055.7
933.7
960.8
980.4
1,008.5
901.8
928.2
947.4
972.2
31.9
32.6
33.0
36.3
36.0
37.3
38.6
39.4
6.8
6.9
7.6
7.8
132.5
134.4
137.4
140.1
1970: 1 . . . .
II
III
IV
12 Gross national product less compensation of general government employees.
Includes compensation of employees in government enterprises.
3 Compensation of general government employees.
Source: Department of Commerce, Bureau of Economic Analysis.
204
TABLE C-10.—-Gross national product by sector in 1958 dollars, 1929-72
[Billions of 1958 dollars]
Year or
quarter
Total
gross
national
product
Gross private product1
Business
Total
Nonfarm3
Total
Farm
Households
and
institutions
Rest of
the world
Gross
government
product'
1929..
203.6
190.9
182.1
165.1
17.0
.7.4
1.4
1933..
141.5
127.5
120.6
103.0
17.5
5.7
1.2
14.0
1939..
209.4
188.7
180.7
162.5
18.2
7.1
.9
20.6
1940..
1941..
1942..
1943..
1944..
1945..
1946..
1947..
1948..
1949..
227.2
263.7
297.8
337.1
361.3
355.2
312.6
309.9
323.7
324.1
205.6
236.6
257.3
272.8
286.9
282.5
275.1
281.4
295.0
294.1
197.1
228.1
248.7
264.9
278.9
274.6
267.0
272.8
286.0
284.7
179.6
209.3
228.0
245.3
259.5
256.5
248.6
255.8
267.0
266.2
17.5
18.8
20.6
19.6
19.4
18.1
18.5
17.0
19.0
18.4
7.6
7.5
7.8
7.2
7.1
7.1
7.1
7.5
7.9
8.2
1.0
.9
.8
.8
.9
.8
.9
1.1
1.2
1.2
21.6
27.2
40.5
64.3
74.4
72.8
37.5
28.6
28.7
30.1
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
355.3
383.4
395.1
412.8
407.0
438.0
446.1
452.5
447.3
475.9
324.2
344,6
353.2
371.1
366.2
397.2
404.8
410.5
405.2
433.4
314.2
334.5
343.2
360.7
355.4
385.4
392.2
397.5
391.7
419.4
294.9
316.2
324.2
340.7
335.0
364.4
371.4
377.2
370.9
398.3
19.4
18.4
19.0
20.0
20.4
20.9
20.8
20.3
20.8
21.1
8.7
8.8
8.8
9.1
9.2
10.1
10.6
10.9
11.4
11.7
1.3
1.2
1.2
1.3
1.6
1.8
2.0
2.1
2.0
2.2
31.1
38.8
41.8
41.7
40.9
40.7
41.3
41.9
42.1
42.5
I960..
1961..
1962..
1963..
1964..
1965..
1966..
1967..
1968..
1969...
487.7
497.2
529.8
551.0
581.1
617.8
658.1
675.2
706.6
725.6
444.0
452.3
482.9
503.2
532.0
567.0
603.5
617.5
647.0
664.9
429.5
436.9
466.7
486.6
514.4
548.9
584.9
597.8
626.5
644.6
407.6
414.8
444.6
463.8
492.1
525.2
562.5
573.9
603.1
620.5
21.9
22.2
22.1
22.8
22.3
23.7
22.4
23.9
23.4
24.1
12.2
12.4
12.9
13.2
13.7
14.0
14.6
15.4
16.0
16.3
2.3
2.9
3.4
3.4
3.9
4.1
3.9
4.3
4.5
4.0
43.7
44.8
46.9
47.8
49.1
50.8
54.6
57.6
59.7
60.7
19701971..
1972 p.
722.1
741.7
789.7
661.3
681.0
728.4
640.7
658.5
705.0
616.0
633.0
681.7
24.7
25.5
23.3
16.7
16.9
17.9
4.0
5.6
5.4
60.7
60.7
61.4
12.7
Seasonally adjusted annual rates
19(70:1.
II
III
IV
1971:
L...
II —
III
IV
1972:1
II
III
IV v
720.4
723.2
726.8
718.0
659.5
662.3
666.1
657.4
638.8
642.3
645.4
636.4
614.7
617.1
620.8
611.2
24.1
25.2
24.5
25.1
16.7
16.5
16.7
16.8
4.1
3.6
4.0
4.2
60.9
60.8
60.7
60.5
731.9
737.9
742.5
754.5
671.3
677.5
681.7
693.7
649.7
654.8
659.8
669.8
623.9
629.3
633.9
644.8
25.8
25.4
25.9
25.0
16.9
16.7
16.9
17.1
4.7
6.0
5.0
6.8
60.6
60.5
60.8
60.8
766.5
783.9
796.1
812.4
705.6
723.0
734.5
750.3
682.9
700.1
710.8
726.3
659.2
676.4
688.4
703.0
23.8
23.8
22.4
23.4
17.4
17.7
18.2
18.2
5.4
5.2
5.6
5.7
60.9
61.6
62.1
1
Gross national product less compensation of general government employees.
Includes compensation of employees in government enterprises.
* Compensation of general government employees.
3
Source: Department of Commerce, Bureau of Economic Analysis.
490-000 O - 73 - 14
205
TABLE C-ll.—Gross product originating in nonfinancial corporations and dollar costs per unit of
output, 1948-72
Gross product
originating in
nonfinancial
corporations (billions of dollars)
Current dollar costs per unit of 1958 dollar gross product (dollars)
Corporate profits and inventory valuation adjustment
Year or quarter
Total
costsi
Capital
consumption
allowances
ComIndirect pensaNet
tion of interest
business
emtaxes 2 ployees
Profits
after
taxes
plus inventory
valuation
adjustment
Total
Profits
tax
liability
0.005
.006
0.171
.162
0.069
.057
0.103
.104
.507
.541
.570
.584
.591
.005
.005
.006
.006
.007
.180
.186
.168
.154
.149
.090
.103
.086
.084
.074
.090
.083
.082
.070
.075
.081
.085
.090
.097
.094
.582
.619
.642
.659
.654
.007
.007
.009
.011
.010
.170
.160
.155
.142
.164
.084
.081
.076
.069
.080
.086
.079
.078
.073
.084
.091
.095
.100
.100
.100
.099
.103
.101
.102
.103
.670
.670
.665
.664
.664
.011
.013
.014
.015
.015
.151
.149
.154
.158
.168
.073
.073
.071
.074
.074
.078
.076
.082
.084
.094
357.8
385.0
390.2
415.0
433.9
.099
.100
.107
.109
.115
.100
.096
.100
.105
.109
.660
.678
.707
.727
.764
.017
.019
.023
.025
.029
.179
.180
.167
.166
.145
.077
.078
.073
.082
.078
.102
.102
.094
.084
.067
427.4
438.8
475.3
.124
.132
.136
.118
.124
.122
.812
.832
.843
.035
.037
.036
.119
.128
.134
.063
.067
.069
.056
.061
.065
Current
dollars
1958
dollars
19481949-
137.0
133.3
172.9
165.6
0.793
.805
0.040
.047
0.070
.076
0.507
.514
1050..
19511952..
19531954..
151.7
174.3
182.0
194.7
191.6
186.4
203.5
207.1
219.8
213.4
.814
.857
.879
.886
.046
.049
.054
.059
.069
.075
.075
.081
.083
.081
1955..
1956..
195719581959-
216.3
231.2
241.9
236.0
263.7
237.2
244.0
247.2
236.0
260.8
.072
.076
.082
.091
1960..
1961196219631964..
273.1
278.4
302.8
320.0
346.0
267.1
270.6
292.9
308.0
329.7
1965..
1966196719681969197019711972 *
377.6
413.0
430.8
469.9
504.3
516.1
549.4
604.9
Seasonally adjusted annual rates
1970: L .
II.
Ill
IV.
510.9
516.4
521.9
515.3
429.6
429.6
431.2
419.2
1.189
1.202
1.210
1.229
0.122
.123
.124
.129
0.114
.116
.118
.122
0.800
.804
.812
.831
0.033
.035
.036
.037
0.120
.124
.121
.110
0.065
.064
.065
.058
0.055
.059
.056
.052
1971: I..
II.
Ill
IV.
536.2
546.9
552.2
562.6
432.0
436.8
438.9
447.3
1.241
1.252
1.258
1.258
.128
.131
.134
.135
.123
.122
.124
.126
.826
.831
.834
.836
.037
.037
.037
.037
.128
.131
.128
.124
.070
.071
.067
.061
.058
.061
.061
.063
1972: I..
II.
III.
582.4
599.3
610.0
459.6
471.7
478.9
1.267
1.271
1.274
.135
.138
.137
.123
.122
.123
.842
.841
.842
.037
.036
.036
.130
.133
.136
.068
.068
.070
.063
.065
.066
1 This is equal to the deflator for gross product of nonfinancial corporations, with the decimal point shifted two places to
the left.
2
Also includes business transfer payments less subsidies.
Source: Department of Commerce, Bureau of Economic Analysis.
206
TABLE C-12.—Personal consumption expenditures, 1929-72
[Billions of dollars]
Nondurable goods
Durable goods
Services
Year
or
quarter
5o
11
1929...
77.2
9.2
3.2
4.8
1.2
37.7
19.5
9.4
1.8
7.0
30.3
11.5
4.0
2.6
1933...
45.8
3.5
1.1
1.9
.5
22.3
11.5
4.6
1.5
4.6
20.1
7.9
2.8
1.5
7.9
1939..
66.8
6.7
2.2
3.5
1.0
35.1
19.1
7.1
2.2
6.7
25.0
9.1
3.8
2.0
10.1
1940..
1941..
1942..
1943..
1944..
1945..
1946..
1947..
1948..
1949..
70.8
80.6
88.5
99.3
108.3
119.7
143.4
160.7
173.6
176.8
7.8
9.6
6.9
6.6
6.7
8.0
15.8
20.4
22.7
24.6
2.7
3.4
'.Z
.8
1.0
4.0
6.2
7.5
9.9
3.9
4.9
4.7
3.9
3.8
4.6
8.6
10.9
11.9
11.6
1.1
1.4
1.6
1.9
2.2
2.5
3.2
3.3
3.4
3.2
37.0
42.9
50.8
58.6
64.3
71.9
82.4
90.5
96.2
94.5
20.2
23.4
28.4
33.2
36.7
40.6
47.4
52.3
54.2
52.5
7.4
8.8
11.0
13.4
14.4
16.5
18.2
18.8
20.1
19.3
2.3
2.6
2.1
1.3
1.6
1.8
3.0
3.6
4.4
5.0
7.1
3.0
9.3
10.6
11.7
13.0
13.8
15.7
17.5
17.7
26.0
28.1
30.8
34.2
37.2
39.8
45.3
49.8
54.7
57.6
9.4
10.2
11.0
11.5
12.0
12.5
13.9
15.7
17.5
19.3
4.0
4.3
4.8
5.2
5.9
6.4
6.8
7.5
8.1
8.5
2.1
2.4
2.7
3.4
3.7
4.0
5.0
5.3
5.8
5.9
10.4
11.2
12.3
14.0
15.6
16.8
19.7
21.4
23.3
23.9
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
191.0
206.3
216.7
230.0
236.5
254.4
266.7
281.4
290.1
311.2
30.5
29.6
29.3
33.2
32.8
39.6
38.9
40.8
37.9
44.3
13.1
11.6
11.1
14.2
13.6
18.4
16.4
18.3
15.4
19.5
14.1
14.4
14.3
14.9
15.0
16.6
17.5
17.3
17.1
18.9
3.3
3.6
3.9
4.1
4.2
4.6
5.0
5.2
5.4
5.9
98.1
108.8
114.0
116.8
118.3
123.3
129.3
135.6
140.2
146.6
53.9
60.4
63.4
64.4
65.4
67.2
69.9
73.6
76.4
78.6
19.6
21.2
21.9
22.1
22.1
23.1
24.1
24.3
24.7
26.4
5.4
6.1
6.8
7.7
8.2
9.0
9.8
10.6
11.0
11.6
19.2 62.4
21.1 67.9
21.7
73.4
22.7
79.9
22.6 85.4
24.0 91.4
25.4 98.5
27.1 105.0
28.2 112.0
30.1 120.3
21.3
23.9
26.5
29.3
31.7
33.7
36.0
38.5
41.1
43.7
9.5
10.4
11.1
12.0
12.6
14.0
15.2
16.2
17.3
18.5
6.2
6.7
7.1
7.8
7.9
8.2
8.6
9.0
9.3
10.1
25.4
26.9
28.7
30.8
33.2
35.5
38.6
41.3
44.3
48.0
I960..
1961..
1962..
1963..
1964...
1965...
1966...
1967...
1968...
1969...
325.2
335.2
355.1
375.0
401.2
432.8
466.3
492.1
536.2
579.5
45.3
44.2
49.5
53.9
59.2
66.3
70.8
73.1
84.0
90.8
20.1
18.4
22.0
24.3
25.8
30.3
30.3
30.5
37.5
40.2
18.9
19.3
20.5
22.2
25.0
26.9
29.9
31.4
34.3
37.1
6.3 151.3
6.5 155.9
6.9 162.6
7.5 168.6
8.5 178.7
9.1 191.1
10.5 206.9
11.2 215.0
12.3 230.8
13.5 245.9
80.5
82.9
85.7
88.2
92.9
98.8
105.8
108.5
115.3
120.6
27.3
27.9
29.6
30.6
33.5
35.9
40.3
42.3
46.3
50.2
12.3
12.4
12.9
13.5
14.0
15.3
16.6
17.6
19.0
20.9
31.2 128.7
32.7 135.1
34.4 143.0
36.3 152.4
38.2 163.3
41.1 175.5
44.4 188.6
46.6 204.0
50.2 221.3
54.2 242.7
46.3
48.7
52.0
55.4
59.3
63.5
67.5
71.8
77.3
84.1
20.0
20.8
22.0
23.1
24.3
25.6
27.1
29.1
31.2
33.8
10.8
10.6
11.0
11.4
11.6
12.6
13.6
14.5
15.5
16.6
51.6
54.9
58.0
62.5
68.1
73.8
80.4
88.5
97.3
108.2
1970... 616.8 90.5
1 9 7 1 . . . 664.9 '03.5
1972 *_. 721.1 116.3
37.3
46.7
52.9
39.0
42.0
47.7
14.2 264.4 132.1
14.8 278.1 136.4
15.7 299.5 144.8
52.0
56.9
61.9
22.2
23.5
25.2
58.1 261.8 90.9
61.3 283.3 99.2
67.6 305.4 107.2
36.3
39.5
43.3
18.2
19.9
21.7
116.3
124.8
133.2
12.2
Seasonally adjusted annual rates
1970:
I..
II..
III.
IV.
1971:
L_
II..
ML
IV.
1972:
117.
III.
IV p
1
2
604.1 90.2
613.4 91.6
623.0 92.6
626.5 87.5
37.8
39.2
39.4
33.0
38.7
38.8
38.8
39.6
13.8
13.6
14.5
14.9
257.8
262.4
266.3
271.3
128.0
131.2
133.9
135.2
51.1
51.8
51.7
53.6
21.8
22.0
22.3
22.8
56.9 256.1 88.7
57.4 259.4 90.1
58.4 264.1 91.4
59.7 267.7 93.4
35.3
35.9
36.9
37.2
17.7
18.0
18.5
18.8
114.3
115.5
117.2
118.3
648.0
660.4
670.7
680.5
99.8
101.9
106.1
106.1
44.9
45.4
48.8
47.9
41.0
41.4
41.9
43.5
13.9
15.0
15.5
14.7
273.4
277.2
278.5
283.4
135.1
135.9
136.6
137.9
55.1
56.7
57.4
58.5
23.0
23.0
23.5
24.3
60.1 274.8 95.8
61.6 281.3 98.1
60.9 286.1 100.3
62.8 290.9 102.5
38.0
39.1
40.0
40.7
19.3
19.8
20.2
20.4
121.8
124.3
125.7
127.3
696.1
713.4
728.6
746.2
111.0
113.9
118.6
121.5
49.9
51.3
54.8
55.5
46.5
46.8
47.9
49.4
14.7 288.3
15.7 297.2
15.9 302.0
16.6 310.4
140.3
144.1
145.8
149.1
59.4
61.5
62.6
64.2
24.6
24.5
25.4
26.1
64.0
67.1
68.2
71.0
41.2
42.7
44.0
45.2
21.0
21.5
21.9
22.4
130.3
132.0
134.0
136.6
Includes consumer purchases of mobile homes.
Includes imputed rental value of owner-occupied dwellings.
Source: Department of Commerce, Bureau of Economic Analysis.
207
296.7
302.4
308.0
314.3
104.2
106.1
108.1
110.2
TABLE C—13.—Gross private domestic investment, 1929—72
[Billions of dollars]
Change in
business
inventories
Fixed investment
Year or
quarter
Total
gross
private
domestic
investment
Nonresidential
Total
Residential structures
Producers'
durable
equipment
Structures
Total
1929
1933...
Total
Nonfarm
Total
Nonfarm
Total
Total
Nonfarm
Farm
16.2
14.5
10.6
5.0
4.8
5.6
4.9
4.0
3.8
0.2
1.7
1.4
3.0
2.4
.9
.9
1.5
1.3
.6
.5
.0
-1.6
9.3
8.9
5.9
2.0
1.9
4.0
3.4
2.9
2.8
.4
13.1
17.9
9.8
5.7
7.1
10.6
30.6
34.0
46.0
35.7
11.0
13.4
8.1
6.4
8.1
11.6
24.2
34.4
41.3
38.8
7.5
9.5
6.0
5.0
6.8
10.1
17.0
23.4
26.9
25.1
2.3
2.9
1.9
1.3
1.8
2.8
6.8
7.5
8.8
8.5
2.2
2.8
1.8
1.2
1.7
2.6
6.1
6.7
8.0
7.7
5.3
6.6
4.1
3.7
5.0
7.3
10.2
15.9
18.1
16.6
4.6
5.6
3.5
3.2
4.2
6.3
9.2
14.0
15.5
13.7
3.4
3.9
2.1
1.4
1.3
1.5
7.2
11.1
14.4
13.7
3.2
3.7
1.9
1.2
1.1
1.4
6.7
10.4
13.6
12.8
2.2
4.5
1.8
-.6
-1.0
-1.0
6.4
47.3
49.0
48.8
52.1
53.3
61.4
65.3
66.5
62.4
70.5
27.9
31.8
31.6
34.2
33.6
38.1
43.7
46.4
41.6
45.1
9.2
11.2
11.4
12.7
13.1
14.3
17.2
18.0
16.6
16.7
8.5
10.4
10.5
11.9
12.3
13.6
16.5
17.2
15.8
15.9
18.7
20.7
20.2
21.5
20.6
23.8
26.5
28.4
25.0
28.4
15.7
17.7
17.6
18.6
18.0
21.2
24.2
25.9
22.0
25.4
19.4
17.2
17.2
18.0
19.7
23.3
21.6
20.2
20.8
25.5
18.6
16.4
16.4
17.2
19.0
22.7
20.9
19.5
20.1
24.8
6.8
10.3
3.1
1957...
1958..
1959
54.1
59.3
51.9
52.6
51.7
67.4
70.0
67.9
60.9
75.3
-L5
6.0
4.7
1.3
-1.5
4.8
I960....
1961
1962
1963...
1964.
1965
1966
1967
1968
1969..
74.8
71.7
83.0
87.1
94.0
108.1
121.4
116.6
126.0
139.0
71.3
69.7
77.0
81.3
88.2
98.5
106.6
108.4
118.9
131.1
48.4
47.0
51.7
54.3
61.1
71.3
81.6
83.3
88.8
98.5
18.1
18.4
19.2
19.5
21.2
25.5
28.5
28.0
30.3
34.2
17.4
17.7
18.5
18.8
20.5
24.9
27.8
27.3
29.6
33.5
30.3
28.6
32.5
34.8
39.9
45.8
53.1
55.3
58.5
64.3
27.7
25.8
29.5
31.2
36.3
41.6
48.4
50.0
53.6
59.2
22.8
22.6
25.3
27.0
27.1
27.2
25.0
25.1
30.1
32.6
22.2
22.0
24.8
26.4
26.6
26.7
24.5
24.5
29.5
32.0
3.6
2.0
6.0
5.9
5.8
9.6
14.8
8.2
7.1
7.8
1970.
1971.
1972*
137.1
152.0
180.2
132.2
148.3
174.3
100.9
105.8
120.4
36.0
38.4
42.2
35.2
37.5
41.4
64.9
67.4
78.2
59.2
60.9
70.3
31.2
42.6
53.9
30.7
42.0
53.2
4.9
3.6
5.8
1939...
1940
1941...
1942..
1943.
1944... . . .
1945...
1946.
1947...
1948..
1949..
1950..
1951..
1952...
1953__.
1954
1955...
1956..
A. 7
-3.1
Seasonally adjusted annual rates
1970: I
II
Ill—IV
132.9
137. ?
139.9
137.8
131.4
131.4
133.7
132.1
100.2
101.7
103.4
98.5
35.5
36.1
36.2
36.3
34.7
35.3
35.4
35.5
64.8
65.6
67.2
62.1
59.2
59.8
61.2
56.6
31.2
29.7
30.3
33.6
30.6
29.4
29.9
33.0
0.5
.3
.4
.6
1.5
6.3
6.2
5.7
1971: I
II
III
IV
143.9
153.0
152.2
158.8
139.0
146.4
150.9
157.2
101.9
105.0
106.3
109.8
37.6
38.3
38.7
38.8
36.8
37.5
37.9
38.0
64.3
66.7
67.6
71.0
58.3
60.4
60.8
64.2
37.0
41.4
44.5
47.3
36.6
40.9
43.9
46.7
.5
.5
.7
.6
4.9
6.6
1.3
1.7
1972: I
II
168.1
177.0
183.2
192.4
167.7
172.0
175.2
182.4
116.1
119.2
120.7
125.6
41.3
42.0
41.8
43.8
40.5
41.2
40.9
43.0
74.8
77.2
79.0
81.8
67.7
69.6
71.0
72.8
51.6
52.8
54.4
56.8
51.0
52.1
53.7
55.9
.6
.6
.8
.9
.4
5.0
8.0
10.0
Ill —
IV'..-
Source: Department of Commerce, Bureau of Economic Analysis.
208
TABLE C—14.—Relation of gross national product and national income, 1929—72
[Billions of dollars]
Year or quarter
Gross
national
product
Less:
Capital
consumption
allowances
Equals:
Net
national
product
Plus:
Subsidies
less
current
surplus
of government
enterprises
Less:
Indirect
business
tax and
nontax
liability
Business Statistical
discreptransfer
payments
ancy
Equals:
National
income
1929..
103.1
7.9
95.2
-0.1
7.0
0.6
0.7
1933..
55.6
7.0
48.6
.0
7.1
.7
.6
40.3
1939..
90.5
7.3
83.2
.5
9.4
.5
1.3
72.6
1940..
1941..
1942..
1943..
1944..
1945..
1946..
1947..
1948..
1949..
99.7
124.5
157.9
191.6
210.1
211.9
208.5
231.3
257.6
256.5
7.5
8.2
9.8
10.3
11.0
11.3
9.9
12.2
14.5
16.6
92.2
116.3
148.1
181.3
199.1
200.7
198.6
219.1
243.1
239.9
.4
.1
\l
.7
.8
.9
-.2
-.1
-.1
10.0
11.3
11.8
12.7
14.1
15.5
17.1
18.4
20.1
21.3
.4
.5
.5
.5
.5
.5
.5
.6
.7
.8
1.0
.4
-1.1
-2.0
2.5
3.9
.1
.9
-2.0
.3
81.1
104.2
137.1
170.3
182.6
181.5
181.9
199.0
224.2
217.5
1950..
1951..
1952..
1953..
1954..
1955._
1956..
1957..
1958..
1959..
284.8
328.4
345.5
364.6
364.8
398.0
419.2
441.1
447.3
483.7
18.3
21.2
23.2
25.7
28.2
31.5
34.1
37.1
38.9
41.4
266.4
307.2
322.3
338.9
336.6
366.5
385.2
404.0
408.4
442.3
.2
.2
-.1
-.4
-.2
-.1
.8
.9
.9
.1
23.3
25.2
27.6
29.6
29.4
32.1
34.9
37.3
38.5
41.5
.8
.9
1.0
1.2
1.1
1.2
1.4
1.5
1.6
1.7
1.5
3.3
2.2
3.0
2.7
2.1
-1.1
.0
1.6
-.8
241.1
278.0
291.4
304.7
303.1
331.0
350.8
366.1
367.8
400.0
I960..
1961..
1962..
1963..
1964..
1965..
1966..
1967..
1968..
1969..
503.7
520.1
560.3
590.5
632.4
684.9
749.9
793.9
864.2
930.3
43.4
45.2
50.0
52.6
56.1
59.8
63.9
68.9
74.5
81.6
460.3
474.9
510.4
537.9
576.3
625.1
685.9
725.0
789.7
848.7
.2
1.4
1.4
.8
1.3
1.3
2.3
1.4
.7
1.0
45.2
47.7
51.5
54.7
58.4
62.5
65.7
70.4
78.6
85.9
1.9
2.0
2.1
2.3
2.5
2.7
3.0
3.1
3.4
3.8
-1.0
-.8
.5
-.3
-1.3
-3.1
-1.0
-.7
-2.7
-6.1
414.5
427.3
457.7
481.9
518.1
564.3
620.6
653.6
711.1
766.0
1970..
1971..
1972 P.
976.4
1,050.4
1,152.1
86.3
93.8
103.7
890.1
956.6
1,048.4
1.5
.9
1.7
93.4
101.9
110.1
4.2
4.6
4.9
-4.7
-4.8
.1
798.6
855.7
934.9
86.8
Seasonally adjusted annual rates
1970: L_
II.
III
IV.
958.0
971.7
986.3
989.7
85.1
85.8
86.6
87.9
872.9
885.9
899.7
901.8
1.3
1.7
1.6
1.4
90.6
92.6
94.8
95.7
4.1
4.2
4.3
4.4
-7.9
-5.9
-4.0
-1.0
787.5
796.7
806.3
804.1
1971:1..
II.
III
IV
,023.4
,043.0
,056.9
,078.1
90.2
92.4
95.0
97.4
933.2
950.6
961.9
980.7
1.7
.8
.3
.7
99.2
100.3
102.6
105.6
4.5
4.6
4.7
4.7
-3.3
-4.9
-5.9
-5.2
834.5
851.4
860.8
876.2
1972:1..
IL
III
IV
,109.1
,139.4
,164.0
,195.8
99.7
105.3
104.1
105.6
1, 009.3
1, 034.1
1, 059.9
1, 090.2
1.2
1.6
1.8
2.1
106.7
108.7
111.4
113.5
4.8
4.9
5.0
5.0
-4.1
-.1
2.3
903.1
922.1
943.0
Source: Department of Commerce, Bureau of Economic Analysis.
209
TABLE C-15.—National income by type of income, 1929-72
[Billions of dollars]
Business and professional income
Compensation of
employees
Year or
quarter
Total
national
income 1
Total
SuppleWages ments
to
and
sala- wages
and
ries
sala-2
ries
In-
Inventory
Total unin- valucorpo- ation
rated adjustenter- ment
prises
come
nf
OT
Income
of
farm
proprietors 3
Rental
income
of
persons
Corporate profits
and inventory
valuation
adjustment
Corporate
Total profits
before
taxes *
Inventory
valuation
adjustment
1929
86.8
51.1
50.4
0.7
9.0
8.8
0.1
6.2
5.4
10.5
10.0
0.5
1933
40.3
29.5
29.0
.5
3.3
3.9
-.5
2.6
2.0 - 1 . 2
1.0
-2.1
1939......
72.6
48.1
45.9
2.2
7.4
7.6
-.2
4.4
2.7
6.3
7.0
-.7
1940
1941...
1942...
1943...
1944...
1945...
1946...
1947...
1948...
1949...
81.1
104.2
137.1
170.3
182.6
181.5
181.9
199.0
224.2
217.5
52.1
64.8
85.3
109.5
121.2
123.1
117.9
128.9
141.1
141.0
49.8
62.1
82.1
105.8
116.7
117.5
112.0
123.0
135.4
134.5
2.3
2.7
3.2
3.8
4.5
5.6
5.9
5.9
5.8
6.5
8.6
11.1
14.0
17.0
18.2
19.2
21.6
20.3
22.7
22.6
8.6
11.7
14.4
17.1
18.3
19.3
23.3
21.8
23.1
22.2
.0
-.6
-.4
-.2
-.1
4.5
6.4
9.8
11.7
11.6
12.2
14.9
15.2
17.5
12.7
2.9
3.5
4.5
5.1
5.4
5.6
6.6
7.1
8.0
8.4
9.8
15.2
20.3
24.4
23.8
19.2
19.3
25.6
33.0
30.8
10.0
17.7
21.5
25.1
24.1
19.7
24.6
31.5
35.2
28.9
-.2
-2.5
-1.2
-.8
-.3
-.6
-5.3
-5.9
-2.2
1.9
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
241.1
278.0
291.4
304.7
303.1
331.0
350.8
366.1
367.8
400.0
154.6
180.7
195.3
209.1
208.0
224.5
243.1
256.0
257.8
279.1
146.8
171.1
185.1
198.3
196.5
211.3
227.8
238.7
239.9
258.2
7.8
9.6
10.2
10.9
11.5
13.2
15.2
17.3
17.9
20.9
24.0
26.1
27.1
27.5
27.6
30.3
31.3
32.8
33.2
35.1
25.1
26.5
26.9
27.6
27.6
30.5
31.8
33.1
33.2
35.3
-1.1
-.3
.2
-.2
.0
-.2
-.3
-.1
-.1
13.5
15.8
15.0
13.0
12.4
11.4
11.4
11.3
13.4
11.4
9.4
10.3
11.5
12.7
13.6
13.9
14.3
14.8
15.4
15.6
37.7
42.7
39.9
39.6
38.0
46.9
46.1
45.6
41.1
51.7
42.6
43.9
38.9
40.6
38.3
48.6
48.8
47.2
41.4
52.1
-5.0
-1.2
1.0
-1.0
-.3
-1.7
-2.7
-1.5
-.3
1960..
1961
1962
1963
1964..
1965..
1966..
1967..
1968..
1969..
414.5
427.3
457.7
481.9
518.1
564.3
620.6
653.6
711.1
766.0
294.2
302.6
323.6
341.0
365.7
393.8
435.5
467.2
514.6
566.0
270.8
278.1
296.1
311.1
333.7
358.9
394.5
423.1
464.9
509.7
23.4
24.6
27.5
29.9
32.0
35.0
41.0
44.2
49.7
56.3
34.2
35.6
37.1
37.9
40.2
42.4
45.2
47.3
49.5
50.5
34.3
35.6
37.1
37.9
40.3
42.8
45.6
47.6
50.3
51.2
.0
.0
.0
.0
-.1
-.4
-.4
-.3
-.7
-.8
12.0
12.8
13.0
13.1
12.1
14.8
16.1
14.8
14.7
16.7
15.8
16.0
16.7
17.1
18.0
19.0
20.0
21.1
21.2
22.6
49.9
50.3
55.7
58.9
66.3
76.1
82.4
78.7
84.3
79.8
49.7
50.3
55.4
59.4
66.8
77.8
84.2
79.8
87.6
84.9
-.'5
-1.7
-1.8
-1.1
-3.3
-5.1
1970..
1971..
1972 P
798.6 603.8 541.9
855.7 644.1 573.5
934.9 705.2 626.4
61.9
70.7
78.7
49.9
52.6
55.6
50.7
53.4
56.8
-.*8
-1.2
16.9
17.3
19.6
23.3
24.5
25.6
69.9
78.6
87.7
74.3
83.3
93.7
-4.4
-4.7
-6.0
-\J
-1.5
-.4
.5
.2
.3
Seasonally adjusted annual rates
1970: L II...
III..
IV..
787.5
796.7
806.3
804.1
594.3
600.7
609.0
611.2
534.9
539.5
546.1
547.2
59.5
61.2
62.8
63.9
49.7
50.0
50.1
49.9
18.0
17.1
16.5
15.9
23.0
23.2
23.4
23.8
69.3
71.5
72.0
66.9
75.8
75.2
76.6
69.6
-6.4
-3.7
-4.6
-2.8
1971: I...
II...
ML.
IV..
834.5
851.4
860.8
876.2
628.6
639.6
648.0
660.4
560.4
569.6
576.5
587.3
68.2
70.0
71.5
73.0
51.3
52.4
53.1
53.8
16.8
16.9
17.6
18.1
23.9
24.4
24.8
25.0
76.6
80.1
78.3
79.4
81.3
84.5
84.1
83.2
-4.7
-4.4
-5.8
-3.9
1972: I... 903.1 682.7 606.6
II.. 922.1 697.8 620.0
III- 943.0 710.2 630.6
IV
730.0 648.5
76.1
77.8
79.6
81.5
54.3
54.4
56.2
57.4
19.1
18.7
19.1
21.6
25.2
24.2
26.2
26.9
81.8
86.1
89.6
88.2
91.6
95.7
-6.5
-5.5
-6.1
-5.9
» National income is the total net income earned in production. It differs from gross national product mainly in that i t
excludes depreciation charges and other allowances for business and institutional consumption of durable capital goods,
and indirect business taxes. See Table C-14.
* Employer contributions for social insurance and to private pension, health, and welfare funds; compensation for
injuries;
directors' fees; pay of the military reserve; and a few other minor items.
3
Includes change in inventories.
* See Table C-73 for corporate tax liability and profits after taxes.
Source: Department of Commerce, Bureau of Economic Analysis.
210
TABLE C-16.—Relation of national income and personal income, 1929-72
[Billions of dollars]
Less:
Year or quarter
National
income
1929..
Corporate
profits
and inventory
valuation
adjustment
Equals:
Plus:
ContriWage
Govbutions accruals ernment
for
transfer
less
payments
social
disto perinsur- bursesons
ance
ments
Interest
paid
by
government
(net)
and by
consumers
Dividends
Business Personal
transfer income
payments
10.5
0.2
0.9
2.5
5.8
0.6
85.9
1933..
40.3
-1.2
.3
1.5
1.6
2.0
.7
47.0
1939..
72.6
6.3
2.1
2.5
1.9
3.8
.5
72.8
1940..
1941..
1942..
1943..
1944..
1945..
1946..
1947..
1948..
1949..
81.1
104.2
137.1
170.3
182.6
181.5
181.9
199.0
224.2
217.5
9.8
15.2
20.3
24.4
23.8
19.2
19.3
25.6
33.0
30.8
2.3
2.8
3.5
4.5
5.2
6.1
6.0
5.7
5.2
5.7
2.7
2.6
2.6
2.5
3.1
5.6
10.8
11.1
10.5
11.6
2.1
2.2
2.2
2.6
3.3
4.2
5.2
5.5
6.1
6.5
4.0
4.4
4.3
4.4
4.6
4.6
5.6
6.3
7.0
7.2
.4
.5
.5
'.5
.5
78.3
96.0
122.9
151.3
165.3
171.1
178.7
191.3
210.2
207.2
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
241.1
278.0
291.4
304.7
303.1
331.0
350.8
366.1
367.8
400.0
37.7
42.7
39.9
39.6
38.0
46.9
46.1
45.6
41.1
51.7
6.9
8.2
8.7
8.8
9.8
11.1
12.6
14.5
14.8
17.6
14.3
11.5
12.0
12.8
14.9
16.1
17.1
19.9
24.1
24.9
7.2
7.6
8.1
9.0
9.5
10.1
11.2
12.0
12.1
13.6
8.8
8.6
8.6
8.9
9.3
10.5
11.3
11.7
11.6
12.6
.9
1.0
1.2
1.1
1.2
1.4
1.5
1.6
1.7
227.6
255.6
272.5
288.2
290.1
310.9
333.0
351.1
361.2
383.5
I960..
1961..
1962..
1963..
1964..
1965..
19661967..
1968..
1969-
414.5
427.3
457.7
481.9
518.1
564.3
620 6
653.6
711.1
766.0
49.9
50.3
55.7
58.9
66.3
76.1
82.4
78.7
84.3
79.8
20.7
21.4
24.0
26.9
27.9
29.6
38.0
42.4
47.1
54.2
26.6
30.4
31.2
33.0
34.2
37.2
41.1
48.7
56.1
61.9
15.1
15.0
16.1
17.6
19.1
20.5
22.2
23.6
26.1
28.7
13.4
13.8
15.2
16.5
17.8
19.8
20.8
21.4
23.6
24.3
1.9
2.0
2.1
2.3
2.5
2.7
3.0
3.1
3.4
3.8
401.0
416.8
442.6
465.5
497.5
538.9
587.2
629 3
688.9
750.9
1970..
1971..
1972 P.
798.6
855.7
934.9
69.9
78.6
87.7
57.7
65.3
73.9
75.2
89.0
99.1
31.0
31.1
31.6
24.8
25.4
26.4
4.2
4.6
4.9
806.3
861.4
935.8
0.0
!6
Seasonally adjusted annual rates
1970:I...
II..
III.
IV.
787.5
796.7
806.3
804.1
69.3
71.5
72.0
66.9
56.3
57.5
58.5
58.6
2.5
-2.1
-.4
.0
67.0
76.7
76.6
80.6
30.4
30.7
31.4
31.5
24.8
24.7
24.9
24.7
4.1
4.2
4.3
4.4
785.7
806.1
813.4
819.8
1971:1...
IIIII.
IV.
834.5
851.4
860.8
876.2
76.6
80.1
78.3
79.4
64.0
64.8
65.7
66.9
.0
.2
.6
1.4
82.8
90.7
90.3
92.1
31.3
31.0
31.1
30.9
25.5
25.4
25.5
25.2
4.5
4.6
4.7
4.7
838.0
858.1
867.9
881.5
1972:1.-.
II..
Ill-
903.1
922.1
943.0
81.8
86.1
89.6
71.9
73.1
74.6
76.2
-1.4
-.5
-.2
.0
94.4
95.7
97.7
108.4
30.9
31.8
31.7
32.0
26.0
26.2
26.5
26.7
4.8
4.9
5.0
5.0
907.0
922.1
939.9
974.3
Source: Department of Commerce, Bureau of Economic Analysis.
211
TABLE CM 7.—Disposition of personal income, 1929-72
Percent of disposable
personal income
Less: Personal outlays
Year or
quarter
Personal
income
Less:
Personal
tax
and
nontax
payments
Equals:
Disposable
personal
income
Total
Equals:
PerPerPersonal
sonal
sonal
Interest
contransfer saving
sump- paid by
paycontion
ments
expend- sumers to foritures
eigners
Personal
outlays
Total
Billions of dollars
1929
85.9
2.6
83.3
79.1
1933
47.0
1.5
45.5
46.5
1939
72.8
2.4
70.3
67.7
77.2
Consumption
expenditures
Personal
saving
Percent
1.5
0.3
45.8
.5
.2
66.8
.7
.2
95.0
92.7
5.0
-.9
102.0
100.6
-2.0
2.6
96.3
95.0
3.7
4.2
1940
1941...
1942
::
1943 ..
1944...
1945
:.
1946
1947...
1948
"
1949
1950
1951
1952...
1953
V.
1954
1955—
1956.
1957.......
1958
1959
78.3
96.0
122.9
151.3
165.3
171.1
178.7
191.3
210.2
207.2
2.6
3.3
6.0
17.8
18.9
20.9
18.7
21.4
21.1
18.6
75.7
92.7
116.9
133.5
146.3
150.2
160.0
169.8
189.1
188.6
71.8
81.7
89.3
100.1
109.1
120.7
144.8
162.5
175.8
179.2
70.8
80.6
88.5
99.3
108.3
119.7
143.4
160.7
173.6
176.8
.8
.9
.7
.5
.5
.5
.8
1.1
1.5
1.9
.2
.2
.1
.2
.4
.5
.7
.7
.7
.5
3.8
11.0
27.6
33.4
37.3
29.6
15.2
7.3
13.4
9.4
94.9
88.2
76.4
75.0
74.5
80.3
90.5
95.7
92.9
95.0
93.6
86.9
75.7
74.4
74.0
79.7
89.6
94.6
91.8
93.8
5.1
11.8
23.6
25.0
25.5
19.7
9.5
4.3
7.1
5.0
227.6
255.6
272.5
288.2
290.1
310.9
333.0
351.1
361.2
383.5
20.7
29.0
34.1
35.6
32.7
35.5
39.8
42.6
42.3
46.2
206.9
226.6
238.3
252.6
257.4
275.3
293.2
308.5
318.8
337.3
193.9
209.3
220.2
234.3
241.0
259.5
272.6
287.8
296.6
318.3
191.0
206.3
216.7
230.0
236.5
254.4
266.7
281.4
290.1
311.2
2.4
2.7
3.0
3.8
4.0
4.7
5.4
5.8
5.9
6.5
.5
.4
.4
.5
.5
.5
.6
.6
.6
.6
13.1
17.3
18.1
18.3
16.4
15.8
20.6
20.7
22.3
19.1
93.7
92.4
92.4
92.8
93.6
94.3
93.0
93.3
93.0
94.4
92.3
91.0
90.9
91.1
91.9
92.4
91.0
91.2
91.0
92.3
6.3
7.6
7.6
7.2
6.4
5.7
7.0
6.7
7.0
5.6
I960—
1961
1962
1963—
1964
1965.
1966
1967
1968.
1969
401.0
416.8
442.6
465.5
497.5
538.9
587.2
629.3
688.9
750.9
50.9
52.4
57.4
60.9
59.4
65.7
75.4
83.0
97.9
116.5
350.0
364.4
385.3
404.6
438.1
473.2
511.9
546.3
591.0
634.4
333.0
343.3
363.7
384.7
411.9
444.8
479.3
506.0
551.2
596.2
325.2
335.2
355.1
375.0
401.2
432.8
466.3
492.1
536.2
579.5
7.3
7.6
8.1
9.1
10.1
11.3
12.4
13.2
14.3
15.8
.5
.5
.5
.6
.6
.7
.6
.7
.8
.9
17.0
21.2
21.6
19.9
26.2
28.4
32.5
40.4
39.8
38.2
95.1
94.2
94.4
95.1
94.0
94.0
93.6
92.6
93.3
94.0
92.9
92.0
92.2
92.7
91.6
91.5
91.1
90.1
90.7
91.3
4.9
5.8
5.6
4.9
6.0
6.0
6.4
7.4
6.7
6.0
1970
1971
1972*
806.3
861.4
935.8
116.7
117.0
140.7
689.5
744.4
795.1
634.7
683.4
740.4
616.8
664.9
721.1
16.9
17.6
18.2
1.0
1.0
1.1
54.9
60.9
54.8
92.0
91.8
93.1
89.4
89.3
90.7
8.0
8.2
6.9
Seasonally adjusted annual rates
Seasonally adjusted
1970: L___
II
III...
IV...
785.7
806.1
813.4
819.8
117.8
119.0
114.3
115.8
667.9
687.2
699.1
704.0
621.6
631.2
641.1
644.8
604.1
613.4
623.0
626.5
16.5
16.8
17.1
17.3
1.0
1.0
1.0
1.0
46.3
55.9
58.0
59.2
93.1
91.9
91.7
91.6
90.4
89.3
89.1
89.0
6.9
8.1
8.3
8.4
1 9 7 1 : I....
II
111 —
IV...
838.0
858.1
867.9
881.5
112.3
115.2
117.5
123.0
725.7
742.9
750.4
758.5
666.4
678.8
689.4
699.2
648.0
660.4
670.7
680.5
17.4
17.5
17.6
17.7
.9
.9
1.1
1.1
59.3
64.1
61.0
59.3
91.8
91.4
91.9
92.2
89.3
88.9
89.4
89.7
8.2
8.6
8.1
7.8
1972: I....
II —
III —
IV p..
907.0
922.1
939.9
974.3
136.5
139.5
141.1
145.9
770.5
782.6
798.8
828.4
714.9
732.5
748.0
766.0
696.1
713.4
728.6
746.2
17.8
18.0
18.2
18.6
1.0
1.1
1.2
1.2
55.7
50.1
50.8
62.4
92.8
93.6
93.6
92.5
90.3
91.2
91.2
90.1
7.2
6.4
6.4
7.5
Source: Department of Commerce, Bureau of Economic Analysis.
212
TABLE C—18.—Total
and per capita disposable personal income and personal consumption
expenditures in current and 1958 dollars, 1929-72
Disposable personal income
Year or quarter
Total (billions
of dollars)
Current
dollars
1958
dollars
Personal consumption expenditures
Per capita
(dollars)
Current
dollars
Total (billions
of dollars)
1958
dollars
Current
dollars
1958
dollars
Population
(thousands)^
Per capita
(dollars)
Current
dollars
1958
dollars
1929
83.3
150.6
683
1,236
77.2
139.6
634
1,145
121,875
1933
45.5
112.2
362
893
45.8
112.8
364
897
125,690
1939
70.3
155.9
537
1,190
66.8
148.2
510
1,131
131,028
1,259
1,427
1,582
1,629
',673
,642
,606
,513
,567
,547
70.8
80.6
88.5
99.3
108.3
119.7
143.4
160.7
173.6
176.8
155.7
165.4
161.4
165.8
171.4
183.0
203.5
206.3
210.8
216.5
536
604
656
726
782
855
,014
,115
,184
,185
1,178
1,240
1,197
1,213
1,238
',308
,439
,431
,438
,451
132,122
133,402
134,860
136,739
138,397
139,928
141,389
144,126
146,631
149,188
,520
,509
,525
,572
,575
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
75.7
92.7
116.9
133.5
146.3
150.2
160.0
169.8
189.1
188.6
166.3
190.3
213.4
222.8
231.6
229.7
227.0
218.0
229.8
230.8
573
695
867
976
1,057
1,074
1,132
1,178
1,290
1,264
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
206.9
226.6
238.3
252.6
257.4
275.3
293.2
308.5
318.8
337.3
249.6
255.7
263.3
275.4
278.3
296.7
309.3
315.8
318.8
333.0
1,364
1,469
1,518
1,583
1,585
1,666
1,743
1,801
1,831
1,905
,646
,657
,678
,726
,714
,795
,839
,844
,831
,881
191.0
206.3
216.7
230.0
236.5
254.4
266.7
281.4
290.1
311.2
230.5
232.8
239.4
250.8
255.7
274.2
281.4
288.2
290.1
307.3
,259
,337
,381
,441
,456
,539
,585
,643
,666
,758
1,673
1,683
1,666
1,735
151,684
154, 287
156,954
159,565
162,391
165, 275
168, 221
171,274
174,141
177,073
I960
1961
1962
1963
1964
1965
1966
1967
1968.
1969.
350.0
364.4
385.3
404.6
438.1
473.2
511.9
546.3
591.0
634.4
340.2
350.7
367.3
381.3
407.9
435.0
458.9
477.5
499.0
513.6
1,937
1,984
2,065
2,138
2,283
2,436
2,604
2,749
2,945
3,130
1,883
1,909
1,969
2,015
2,126
2,239
2,335
2,403
2,486
2,534
325.2
335.2
355.1
375.0
401.2
432.8
466.3
492.1
536.2
579.5
316.1
322.5
338.4
353.3
373.7
397.7
418.1
430.1
452.7
469.1
,800
,825
,903
1,981
2,091
2,228
2,372
2,476
2,671
2,859
1,749
1,756
1,814
1,867
1,948
2,047
2,127
2,164
2,256
2,315
180,671
183,691
186,538
189, 242
191,889
194,303
196,560
198,712
200, 706
202,677
1970.
1971.
1972
689.5
744.4
795.1
533.2
554.7
578.7
3,366
3,595
3,807
2,603
2,679
2,771
616.8
664.9
721.1
477.0
495.4
524.8
3,010
3,211
3,453
2,328
2,393
2,513
204,879
207,049
208,837
,659
Seasonally adjusted annual rates
1970: I .
II
III
IV
667.9
687.2
699.1
704.0
524.2
534.2
538.9
535.4
3,273
3,359
3,407
3,421
2,569
2,611
2,626
2,602
604.1
613.4
623.0
626.5
474.1
476.9
480.2
476.5
2,960
2,998
3,036
3,044
2,323
2,331
2,341
2,316
204,082
204,600
205,186
205,795
1971: I .
II.
III
IV
725.7
742.9
750.4
758.5
546.6
554.6
556.5
560.9
3,517
3,592
3,620
3,649
2,650
2,682
2,684
2,698
648.0
660.4
670.7
680.5
488.2
493.0
497.4
503.2
3,141
3,193
3,235
3,274
2,366
2,384
2,399
2,421
206,310
206,806
207,312
207,856
1972: I .
II.
Ill
IV
770.5
782.6
798.8
828.4
565.7
571.4
579.6
597.9
3,700
3,751
3,821
3,954
2,716
2,739
2,773
2,854
696.1
713.4
728.6
746.2
511.0
520.9
528.7
538.6
3,342
3,420
3,485
3,562
2,454
2,497
2,529
2,571
208,255
208,628
209,053
209, 509
i Population of the United States including Armed Forces overseas; includes Alaska and Hawaii beginning 1960. Annual
data are for July 1; quarterly data are for middle of period, interpolated from monthly data.
Source: Department of Commerce (Bureau of Economic Analysis and Bureau of the Census).
213
TABLE O 1 9 . — Sources of personal income, 1929-72
[Billions of dollars]
Wage and salary disbursements*
Year or quarter
Total
personal
income
Commodityproducing
industries
Total
Total
Manufacturing
Proprietors'
income
Distributive
industries
Service
industries
Government
Other
labor
income i
15.6
8.4
4.9
0.6
8.8
5.2
5.1
.4
3.3
Business
and
professional
1929..
85.9
50.4
21.5
16.1
1933..
47.0
29.0
9.8
7.8
1939..
72.8
45.9
17.4
13.6
13.3
7.1
8.2
.6
7.4
1940..
1941..
1942..
1943..
1944..
1945..
1946..
1947..
1948..
1949-
78.3
96.0
122.9
151.3
165.3
171.1
178.7
191.3
210.2
207.2
49.8
62.1
82 1
105.6
116.9
117.5
112.0
123.0
135.3
134.6
19.7
27.5
39.1
48.9
50.3
45.8
46.0
54.3
61.0
57.7
15.6
21.7
30.9
40.9
42.9
38.2
36.5
42.5
47.2
44.7
14.2
16.3
18.0
20.1
22.7
24.8
31.0
35.2
37.6
37.7
7.5
8.1
9.0
9.9
10.9
12.0
14.4
16.1
17.9
18.6
8.4
10.2
16.0
26.6
33.0
34.9
20.7
17.4
18.9
20.6
.7
.7
.9
1.1
1.5
1.8
1.9
2.3
2.7
3.0
8.6
11.1
14.0
17.0
18.2
19.2
21.6
20.3
22.7
22.6
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
227.6
255.6
272.5
288.2
290.1
310.9
333.0
351.1
361.2
383.5
146.7
171.0
185.1
198.3
196.5
211.3
227.8
238.7
239.9
258.2
64.6
76.1
81.8
89.4
85.4
92.8
100.2
103.8
99.7
109.1
50.3
59.4
64.2
71.2
67.6
73.9
79.5
82.5
78.7
86.9
39.9
44.3
46.9
49.8
50.2
53.4
57.7
60.5
60.8
64.8
19.9
21.7
23.3
25.1
26.4
28.9
31.6
33.9
35.9
38.7
22.4
28.9
33.1
34.1
34.6
36.2
38.3
40.4
43.5
45.6
3.8
4.8
5.3
6.0
6.3
7.3
8.4
9.5
9.9
11.3
24.0
26.1
27.1
27.5
27.6
30.3
31.3
32.8
33.2
35.1
I960..
1961..
1962..
1963..
1964..
1965..
1966..
1967..
1968..
1969..
401.0
416.8
442.6
465.5
497.5
538.9
587.2
629.3
688.9
750.9
270.8
278.1
296.1
311.1
333.7
358.9
394.5
423.1
464.9
509.7
112.5
112.8
120.8
125.7
134.1
144.5
159.3
166.5
181.5
197.5
89.7
89.8
96.7
100.6
107.2
115.6
128.1
134.2
145.9
157.6
68.1
69.1
72.5
76.0
81.2
86.9
93.8
100.3
109.2
120.0
41.5
44.0
46.8
49.9
54.1
58.3
63.7
70.5
78.5
88.1
48.7
52.2
56.0
59.5
64.3
69.3
77.7
85.8
95.7
104.1
12.0
12.7
13.9
14.9
16.6
18.7
20.7
22.3
25.4
28.4
34.2
35.6
37.1
37.9
40.2
42.4
45.2
47.3
49.5
50.5
1970..
1971..
1972*
806.3
861.4
935.8
541.9
572.9
627.0
201.0
206.1
224.6
158.3
160.3
175.9
129.2
138.2
151.5
96.7
105.0
116.1
115.1
123.5
134.8
32.1
36.5
40.3
49.9
52.6
55.6
9.0
Seasonally adjusted annual rates
1970: I—.
II...
III..
IV..
785.7
806.1
813.4
819.8
532.4
541.6
546.5
547.2
201.8
201.3
202.2
198.6
159.6
159.2
159.6
154.9
126.3
127.9
130.6
131.8
94.4
95.9
97.2
99.3
109.9
116.5
116.5
117.6
30.7
31.5
32.6
33.7
49.7
50.0
50.1
49.9
1971: I . . .
II...
III..
IV..
838.0
858.1
867.9
881.5
560.4
569.5
575.9
585.9
202.9
205.7
206.0
209.9
158.5
160.2
160.0
162.7
134.8
137.2
139.1
141.7
101.6
103.9
106.3
108.4
121.1
122.7
124.6
125.9
34.8
36.1
37.2
38.0
51.3
52.4
53.1
53.8
1972: I....
II...
III..
IV p.
907.0
922.1
939.9
974.3
608.0
620.5
630.8
648.5
217.5
222.6
225.1
233.3
168.8
174.1
176.6
183.9
147.2
150.1
152.4
156.3
111.9
114.7
117.5
120.1
131.4
133.1
135.8
138.8
38.8
39.8
40.8
41.8
54.3
54.4
56.2
57.4
See footnotes at end of table.
214
TABLE O19.—Sources of personal income,
1929-72—Continued
[Billions of dollars]
Transfer payments
Year or
quarter
Rental
income Diviof per- dends
sons
Personal
interest
income
Total
Old age,
survivors,
disability,
and health
insurance
benefits
State
unemployment insurance
benefits
Veterans
benefits
Other
Less:
Personal
contributions
for social
insurance
Nonagricultural
personal
income 3
77.6
1929
5.4
5.8
7.2
1.5
0.6
0.9
0.1
1933
2.0
2.0
5.7
2.1
.5
1.6
.2
43.2
1939
2.7
3.8
5.5
3.0
0.0
0.4
.5
2.0
.6
66.9
1940
1941
1942
1943
1944
1945
1946..
1947
1948
1949
2.9
3.5
4.5
5.1
5.4
5.6
6.6
7.1
8.0
8.4
4.0
4.4
4.3
4.4
4.6
4.6
5.6
6.3
7.0
7.2
5.4
5.5
5.3
5.3
5.6
6.3
6.8
7.5
7.9
8.5
3.1
3.1
3.1
3.0
3.6
6.2
11.3
11.7
11.2
12.4
.0
.1
.1
.2
.2
.3
.4
.5
.6
.7
.5
.3
.3
.1
.1
.4
1.1
.5
1.7
!5
.5
.9
2.8
6.7
6.7
5.8
5.1
2.0
2.2
2.2
2.2
2.4
2.7
3.1
3.7
4.1
4.9
."8
1.2
1.8
2.2
2.3
2.0
2.1
2.2
2.2
72.3
87.8
111.0
137.3
151.2
156.4
161.0
173.0
189.4
191.3
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
9.4
10.3
11.5
12.7
13.6
13.9
14.3
14.8
15.4
15.6
8.8
8.6
8.6
8.9
9.3
10.5
11.3
11.7
11.6
12.6
9.2
9.9
10.6
11.8
13.1
14.2
15.7
17.6
18.9
20.7
15.1
12.5
13.0
14.0
16.0
17.3
18.5
21.4
25.7
26.6
1.0
1.9
2.2
3.0
3.6
4.9
5.7
7.3
8.5
10.2
1.4
.8
1.0
1.0
2.0
1.4
1.4
1.8
3.9
2.5
4.9
3.9
3.9
3.7
3.9
4.3
4.3
4.4
4.6
4.6
7.9
5.9
6.0
6.3
6.5
6.8
7.2
7.9
8.7
9.4
2.9
3.4
3.8
4.0
4.6
5.2
5.8
6.7
6.9
7.9
210.9
236.4
254.1
271.9
274.7
296.4
318.5
336.6
344.3
368.5
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
15.8
16.0
16.7
17.1
18.0
19.0
20.0
21.1
21.2
22.6
13.4
13.8
15.2
16.5
17.8
19.8
20.8
21.4
23.6
24.3
23.4
25.0
27.7
31.4
34.9
38.7
43.6
48.0
52.9
59.3
28.5
32.4
33.3
35.3
36.7
39.9
44.1
51.8
59.6
65.8
11.1
12.6
14.3
15.2
16.0
18.1
20.8
25.7
30.3
33.0
2.8
4.0
2.9
2.8
2.6
2.2
1.8
2.1
2.1
2.1
4.6
4.8
4.8
5.0
5.3
5.6
5.7
6.6
7.3
8.3
10.0
10.9
11.2
12.2
12.9
14.0
15.7
17.5
20.0
22.4
9.3
9.6
10.3
11.8
12.5
13.4
17.7
20.5
22.8
26.3
385.2
400.0
425.5
448.1
480.9
519.5
566.3
609.4
668.8
728.3
1970
1971
1972*
23.3
24.5
25.6
24.8
25.4
26.4
65.8
69.6
72.9
79.5
93.6
104.0
38.5
44.5
50.2
3.9
5.7
5.4
9.7
11.3
12.7
27.4
32.2
35.7
28.0
31.2
35.5
782.8
837.2
909.2
Seasonally adjusted annual rates
1970: I
II.
III...
IV....
23.0
23.2
23.4
23.8
24.8
24.7
24.9
24.7
63.5
64.9
66.8
68.0
71.1
80.9
80.9
85.0
34.2
41.4
39.0
39.4
2.7
3.6
4.2
5.1
9.1
9.4
9.8
10.5
25.2
26.5
28.0
29.9
27.4
27.8
28.3
28.4
761.4
782.4
790.3
797.2
1971: I
II....
III...
IV....
23.9
24.4
24.8
25.0
25.5
25.4
25.5
25.2
68.6
69.1
70.2
70.6
87.3
95.2
95.0
96.8
40.4
46.7
45.0
45.7
5.0
5.7
5.9
6.2
11.0
11.2
11.3
11.6
30.9
31.6
32.8
33.3
30.5
31.0
31.3
31.9
814.4
834.4
843.6
856.5
1972: !..._
25.2
24.2
26.2
26.9
26.0
26.2
26.5
26.7
71.0
72.7
73.4
74.5
99.2
100.6
102.7
113.5
46.8
48.1
48.8
57.2
5.4
5.6
5.8
5.0
11.9
12.3
12.5
14.0
35.1
34.6
35.6
37.3
34.6
35.1
35.8
36.5
881.0
896.4
913.9
945.8
* The total of wage and salary disbursements and other labor income differs from compensation of employees in Table
C—15 in that it excludes employer contributions for social insurance and the excess of wage accruals over wage disbursements.
2 Includes change in inventories.
3
Nonagricultural income is personal income exclusive of net income of unincorporated farm enterprises, farm wages,
agricultural net interest, and net dividends paid by agricultural corporations.
Source: Department of Commerce, Bureau of Economic Analysis.
215
TABLE C-20.—Sources and uses of gross saving, 1929-72
[Billions of dollars]
Gross private saving and government surplus or deficit,
national income and product accounts
Government surplus
or deficit ( - )
Private saving
Year or
quarter
Total
Persona)
Total
saving
Gross
business
saving
Total
Federal
State
and
local
Gross investment
Capital
grants
received
by the
United
States i
Total
Gross
private
domestic investment
Net
foreign
investments
Statistical
discrepancy
1929
16.3
15.3
4.2
11.2
1.0
1.2
-0.2
17.0
16.2
0.8
1933
.9
2.3
— Q
3.2
-1.4
-1.3
-.1
1.6
1.4
.2
.6
1939
8.8
11.0
2.6
8.4
-2.2
-2.2
(3)
10.2
9.3
.9
1.3
1940
1941
1942.
1943
1944
1945
1946
1947
1948
1949
13.6
18.6
10 7
5.5
2.5
5.2
35.1
42.0
49.9
35.9
14.3
22.4
42.0
49.7
54.3
44.7
29.7
27.5
41.4
39.0
3.8
11.0
27 6
33.4
37.3
29.6
15.2
7.3
13.4
9.4
10.5
11.4
14 5
16.3
17.1
15.1
14.5
20.2
28.0
29.7
-.7
-3.8
-31 4
-44.1
-51.8
-39.5
5.4
14.4
8.5
-3.2
-1.3
-5.1
-33.1
-46.6
-54.5
-42.1
3.5
13.4
8.4
-2.4
.6
1.3
1.8
2.5
2.7
2.6
1.9
1.0
.1
-.7
14.6
19.0
9.6
3.5
5.0
9.1
35.2
42.9
47.9
36.2
13.1
17.9
9.8
5.7
7.1
10.6
30.6
34.0
46.0
35.7
1.5
1.1
—.2
-2.2
-2.1
-1.4
4.6
8.9
1.9
.5
1.0
.4
—1 1
-2.0
2.5
3.9
50 4
56.1
49.5
47 5
48.5
64.8
72.7
71.2
59.2
73.8
42 5
50.3
53.3
54 4
55 6
62.1
67.8
70.5
71.7
75.9
13 1
17.3
18.1
18 3
16.4
15.8
20.6
20.7
22.3
19.1
29 4
33.1
35.1
36 1
39.2
46.3
47.3
49.8
49.4
56.8
79
9.1
6.2
5.8
-3.8 -3.8
-6 9 -7 0
-7.0 -5.9
2.7
4.0
5.7
4.9
2.1
.7
-12.5 -10.2
-2.1 -1.2
-1.2
-1.1
-1.3
-.9
-1.4
-2.3
-.8
51.8
59.5
51.6
50 5
51.3
66.9
71.6
71.2
60.7
73.0
54 1
59.3
51.9
52.6
51.7
67.4
70.0
67.9
60.9
75.3
-2.2
.2
—.3
-2.1
-.5
1.5
3.4
-.2
-2.3
15
3.3
2.2
3.0
2.7
2.1
-1.1
.0
1.6
-.8
1960
1961
1962
1963 . - 1964
1965
1966...
1967
1968 . .
1969
77.5
75 5
85.0
90.5
101.0
115.3
124.9
119.5
128.3
144.0
73.9
79 8
87.9
88.7
102.4
113.1
123.8
133.4
135.2
135.2
17.0
21 2
21 6
19.9
26.2
28.4
32.5
40.4
39.8
38.2
56.8
58 7
66.3
68.8
76.2
84.7
91.3
93.0
95.4
97.0
3.7
3.5
-4 3 -3 8
- 2 9 -3.8
1.8
.7
-1.4 -3.0
2.2
1.2
-.2
1.1
-13.9 -12.4
-6.8 -6.5
8.8
8.1
.2
-.5
.9
1.2
1.7
1.0
1.3
-1.6
—.3
.7
76.5
74.7
85.5
90.3
99.7
112.2
123.9
118.8
125.6
137.9
74.8
71.7
83.0
87.1
94.0
108.1
121.4
116.6
126.0
139.0
1.7
3.0
2.5
3.1
5.7
4.1
2.4
2.2
-.4
-1.0
-1.0
-.8
.5
—.3
-1.3
-3.1
—1.0
-.7
-2.7
-6.1
1970
1971
1972 v
142.1
153.9
172.2
152.2
170.8
178.4
54.9
60.9
54.8
97.3 -10.1 -12.9
109.9 -16.9 -21.7
123.8 - 6 . 2 -18.5
2.8
4.8
12.3
138.3
149.8
173.0
137.1
152.0
180.2
1.2
-2.1
-7.1
-4.7
-4.8
.1
....
1950
1951
1952
1953
1954 . . .
1955
1956
1957 . . . .
1958
1959
0.9
.7
.7
0.7
.9
-2.0
.3
Seasonally adjusted annual rates
1970:1
141.3
II
144.3
I I I . . . . 144.5
IV
138.2
141.5
153.9
156.3
157.0
46.3
55.9
58.0
59.2
1971:1
II
III.-.IV....
148.5
154.8
154.6
157.8
162.5
172.8
171.5
176.5
59.3
64.1
61.0
59.3
103.2
108.6
110.5
117.2
1972:1
II
III....
IV p
163.9
168.0
173.6
171.6
174.9
176.0
55.7
50.1
50.8
62.4
115.9
124.8
125.1
95.3 - 0 . 2 - 3 . 8
97.9 - 9 . 6 -13.4
98.3 -11.8 -14.7
97.9 -18.8 -19.7
3.6
3.8
2.9
.9
0.9
.9
.9
.9
134.3
139.3
141.4
138.1
132.9
137.7
139.9
137.8
1.4
1.6
1.5
.3
-7.9
-5.9
-4.0
-1.0
-16.0
-23.0
-23.1
-24.7
2.0
5.0
6.2
6.0
.7
.7
.7
.7
146.0
150.5
149.5
153.4
143.9
153.0
152.2
158.8
2.1
-2.5
-2.7
-5.4
-3.3
-4.9
-5.9
-5.2
- 7 . 7 -14.8
- 6 . 9 -21.6
- 2 . 4 -11.8
7.1
14.8
9.4
.7
.7
.7
.7
160.5
168.7
176.7
190.5
168.1
177.0
183.2
192.4
—7.7
-8.3
-6.5
-6.1
-4.1
-.1
2.3
-14.0
-18.0
-16.9
-18.7
1
Allocations of special drawing rights (SDR).
2 Net exports of goods and services less net transfers to foreigners.
3 Surplus of $32 million.
* Deficit of $41 million.
Source: Department of Commerce, Bureau of Economic Analysis.
216
TABLE C-2\.—Saving
by individuals,
1946-72l
[Billions of dollars}
Increase in financial assets
Year or
quarter
1946
1947
1948..
1949...
Total
Securities
Currency Savand
ings Gov- CorpoTotal 2 deacern- rate Corpomand counts
ment and
rate
desecu- for- stock*
posits
rities 3 eign
bonds
Insurance
Non- MortCon- cor- gage
and
debt Con- Other
pen- Non- sumer porate
on sumer debts
sion farm dure- homes rables busi- non- credit
ness farm
serves
assets homes
(«)
5.3
5.4
5.3
5.5
4.2
6.9
10.5
9.0
5.8
7.5
7.1
7.0
3.3
3.3
7.4
2.5
3.8
4.3
5.0
4.1
2.7
3.2
2.8
2.9
0.0
2.5
2.9
2.6
.7
1.6
1.6
.9
.7
6.9
6.2
7.7
7.9
7.9
13.7
13.5
12.8
13.5
13.7
10.2
5.5
3.6
6.4
4.9
6.4
4.6
2.5
1.6
2.5
7.4
7.1
6.4
7.7
8.6
4.1
1.2
4.8
3.9
1.1
5.6
4.0
2.8
2.1
6.0
1.1 8.4
1.9 9.6
1.5 9.5
1.5 10.0
.6 11.4
17.7
16.4
13.8
12.7
16.5
9.9
5.9
4.9
.6
5.5
3.5
1.9
2.3
3.3
3.2
12.2
11.2
8.8
8.8
12.6
6.4
3.5
2.6
.2
6.4
6.8
3.4
4.2
6.2
7.9
11.6
12.2
12.8
13.9
15.2
14.5
12.0
12.8
12.6
12.5
5.1
2.9
6.7
8.9
11.2
2.2
3.2
5.6
6.9
6.2
10.8
10.9
12.7
14.8
16.0
4.6
1.8
5.8
7.9
8.5
5.7
8.7
8.5
11.8
11.4
17.1
19.0
19.4
19.9
20.7
12.0
11.5
9.2
12.8
13.3
14.8
15.2
12.4
16.7
16.2
9.0
7.2
8.2
7.8
9.0
15.2
12.3
10.5
14.9
16.2
10.0
7.2
4.6
11.1
9.3
13,9
12.6
18.6
17.4
16.1
12.4 - 2 . 6 24.7
7.6 - 5 . 2 26.9
10.6
16.5
9.9
16.2
8.2
13.8
12.5
24.5
4.3
10.4
15.9
24.8
19.2
13.2
8.8
9.8
5.6
.1
-2.9
-2.1
6.3
3.4
2.3
2.7
1950
1951..
1952...
1953
1954
26.9
29.4
26.7
30.3
27.6
13.7
18.1
21.9
22.4
22.2
2.6
4.4
1.6
.9
2.0
2.5
4.9
7.8
8.3
9.3
.0
-.7
1.4
2.2
.5
-A
.0
-.4
1955 .
1956...
1957
1958
1959
33.9
35.7
33.7
33.0
33.6
28.2
29.7
28.3
31.7
35.4
1.1
1.7
-.6
4.0
.6
8.8
9.6
12.1
14.1
11.3
5.9
3.6
2.1
-2.1
8.5
1.1
.9
1.0
1.1
.3
1960
1961
1962
1963
1964
29.6
33.1
36.0
39.9
47.0
28.9
36.5
38.0
45.9
53.1
-.3
2.7
1.0
3.4
4.7
11.4
16.5
25.7
24.6
27.4
3.6
.9
-.7
5.5
4.0
1965
1966
1967
1968
1969
53.8
62.4
61.9
66.3
59.6
57.2
60.7
65.8
72.4
62.6
8.0
2.6
11.2
12.8
3.6
28.0
20.5
34.8
30.4
6.1
3.4
12.1
-2.5
4.3
19.7
1970
1971
82.9
83.1
87.1
96.3
6.3
8.6
- 1 . 2 —0.9
1.6 - . 8
1.3 - . 2
1.7 - . 4
44.5 - 2 . 4
73.5 -17.7
Less Increase in
debt
1.1
1.1
1.0
.8
26.0
20.9
23.1
18.8
.
Net investment in
-.8
.2 - . 4
.3
.4
-.6 -2.0
- . 3 -2.7
-.1
-.1
.7
1.9
4.8
4.8
5.7
-1.9
-1.0
-4.2
-7.6
-4.1
Seasonally adjusted annual rates
1970: L . . .
II...
III..
IV...
67.0 64.5
91.7 89.9
94.1 106.7
79.2 88.5
1971: 1 . . . .
II...
ML.
IV...
1972: !____
II...
III..
0.8
13.7
47.0
2.1
70.3 - 4 . 5
60.2 - 2 1 . 0
10.2 - 8 . 0 22.2
7.3
2.2 26.5
16.6
1.2 23.7
15.5 - 5 . 7 26.4
11.2
10.3
9.2
11.6
11.9
11.9
11.2
4.4
8.1
8.8
8.5
7.5
11.6
12.0
13.6
12.9
4.8
6.2
6.4
.4
12.3
11.0
21.7
19.6
88.5 87.9
85.1 99.0
76.5 90.6
81.7 106.1
15.1 100.9 - 5 2 . 2
8.6 65.1 - 8 . 6
- 1 . 4 57.3 - 5 . 9
11.1 70.6 - 4 . 6
11.2 - 1 4 . 9 27.9
7.0 - . 7 28.2
9.0
.0 23.7
3.1 - 5 . 3 27.8
12.9
16.0
17.3
19.7
15.0
15.5
18.0
16.2
13.3
13.7
14.9
13.5
13.9
23.4
29.1
31.7
4.0
9.0
12.6
14.5
22.7
26.6
22.6
27.6
81.9 103.0
96.9 126.1
94.2 124.8
12.5
-2.0
7.8
92.1 - 1 8 . 5
73.1
12.4
6.4
83.8
4.1 - 8 . 8 18.2
2.9
.8 33.5
.0 - 7 . 3 26.6
20.1
21.5
23.6
19.3
20.4
23.1
16.1
15.2
15.8
27.5
37.0
41.8
13.9
17.5
18.6
35.1
31.6
32.8
7.7
3.3
8.9
5.3
i Saving by households, personal trust funds, nonprofit institutions, farms, and other noncorporate business.
Includes commercial paper and miscellaneous financial assets, not shown separately.
Consists of U.S. savings bonds, other U.S. Treasury securities, U.S. Government agency securities, and State and local
obligations.
* Includes investment company shares.
* Private life insurance reserves, private insured and noninsured pension reserves, and government insurance and
pension reserves.
* Security credit, policy loans, noncorporate business mortgage debt, and other debt.
3
3
Source: Board of Governors of the Federal Reserve System.
217
unrelated individuals
TABLE C-22.—,•Number and money income {in 1971 dollars) offamilies and
by race of head, 1947-71
Year
With incomes
under $3,000 Total
Total
number
(millions)
Median
income
FAMILIES^
1947
1948.
1949
37.2
38.6
39.3
$5,483
5^367
5,278
7.9
8.4
9.2
21.2
21.8
23.3
1950...
1951
1952
1953
1954
1955
1956
1957
1958
1959
39.9
40.6
40.8
41.2
42.0
42.9
43.5
43.7
44.2
45.1
5,594
5,783
5,939
6,433
6,288
6,693
7,122
7,138
7,126
7,524
8.6
8.0
7.7
7.5
8.3
7.6
6.8
6.9
6.9
6.7
21.6
19.7
18.9
18.3
19.8
17.6
15.7
15.8
15.7
14.9
1960...
1961
1962
1963.. .
1964
1965
1966... .
45.5
46.3
47.0
47.4
47.8
48.3
48.9
7,688
7,765
7,975
8,267
8,579
8,932
9,281
6.6
6.8
6.4
6.1
5.7
5.5
5.1
1966« . .
1967 >
1968 > . .
1969*
49.1
49 8
50.5
51.2
9,360
9,683
10,049
10,423
1970*.
19711
51.9
53.3
10,289
10,285
UNRELATED
INDIVIDUALS 3
1947
1948
1949
Negro and other races
White
Total
Number
Per(milcent
lions)
With incomes
under $3,000
With incomes
under $3,000 Total
number
(millions)
Median
income Number Per(milcent
lions)
number
(millions)
Median
income
34.1
35.3
$5,714
5,578
5,491
18.4
19.1
20.7
3.1
3.3
$2,930
2,973
2,808
6.3
6.7
6.6
6.0
5.3
5.3
5.4
5.1
19.3
17.0
16.4
16.2
17.4
15.3
13.3
13.4
13.4
12.5
7,982
8,109
8,353
8,664
8,956
9,311
9,638
5.1
5.?
5.0
4.6
4.4
4.2
4.0
44.1
44.8
45.4
46.0
9,726
10 041
10 404
10,822
46.5
47.6
10,674
10,672
38.2
39.0
39.5
39.7
40.2
40.9
5,811
6,017
6 285
6,677
6,555
6 976
7,452
7 428
7,425
7,838
14.6
14.7
13.6
12.9
11.9
11.3
10.5
41.1
41.9
42.4
42.7
43.1
43.5
44.0
5.1
4.7
4.2
4.1
10.3
9.5
8.3
8.1
4.3
4.4
8.3
8.3
Number Per(milcent
lions)
1.6
1.7
51.2
50.4
53.2
3.8
3.9
4.0
4.0
4.0
4.2
3,142
3,171
3,569
3,753
3,637
3,860
3,928
3 978
3,805
4,045
1.6
1.5
1.5
1.5
1.6
1.6
47.8
47.3
40.5
38.9
42.9
39.4
37.7
37.7
39.4
38.5
12.5
12 5
11.7
10.8
10.1
9.6
9.0
4.3
4.5
4.6
4.8
4.8
4.8
4.9
4,416
4,321
4,456
4,596
5,012
5,160
5,766
1.5
1.6
1.5
1.5
1.3
1.2
1.1
34.8
34.8
32.3
30.7
26.8
25.8
23.1
3.8
3.7
3.2
3.1
8.7
8.2
7.0
6.8
5.0
5.0
5.1
5.2
5,824
6,234
6,508
6,847
1.1
1.1
1.0
.9
22.7
21.2
18.7
18.0
3.3
3.3
7.0
6.9
5.4
5.7
6,806
6,714
1.0
1.1
19.0
19.4
With incomes
under $1,500
With incomes
under $1,500
With incomes
under $1,500
Number Percent
(millions)
Number Per(mil- cent
lions)
Number Per(mil- cent
lions)
8.2
8.4
9.0
$1,815
1,741
1,839
3.6
3.8
3.9
44.2
45.3
43.8
1950
1951
1952 .
1953
1954 . .
1955
1956
1957 . .
1958
1959
9.4
9.1
9.7
9.5
9.7
9.9
9.8
10.4
10.9
10.9
1 825
1,883
2,166
2 125
1,844
1,992
2,137
2,193
2,123
2,188
4.2
4.1
3.8
4.0
4.4
4.1
3.9
4.0
4.2
4.1
44.5
45.0
39.5
41.7
45.0
41.8
40.3
38.6
38.8
37.9
1960
1961 . .
1962
1963
1964
1965
1966
11.1
11.2
11.0
11.2
12.1
12.1
12.4
2 365
2,378
2,349
2,382
2,597
2,771
2,833
4.0
3.9
3.6
3.6
3.7
3.4
3.3
19662
1967 2
1968«
1969 2
12.3
13.1
13.8
14.5
2,900
3,241
3,250
19702
19712
15.4
16.3
3,277
3,316
7.2
7.3
$1,905
1 818
1,945
3.1
3 2
42.9
43.8
42.1
1.0
1.1
$1,357
1,328
1 394
0.5
.6
53.7
55.2
53.2
.9
'.6
.8
.8
.8
53.3
51.4
47.4
45.2
57.0
52.8
48.6
50.7
49.7
50.1
3.5
3.4
3.3
3.2
3.4
3.3
43.1
43.9
38.1
41.0
42.9
39.9
39.1
36.5
37.1
35.8
1.4
1.4
1.3
1.5
1.6
1.6
1,374
1,448
1,605
1 759
1,317
1,415
1,620
1,482
1,513
1,497
2 545
2,557
2,514
2 497
2,738
2 887
2,945
3.2
3.2
2.9
3.0
3.0
2.8
2.8
33.8
33.0
30.7
30.5
29.2
26.7
25.5
1.5
1.6
1.5
1.5
1.6
1.7
1.6
1 479
1,567
1,677
1,718
1,886
2 101
2,139
.8
.8
.7
.7
.6
.6
.6
50.8
48.5
45.5
45.0
40.6
36.5
36.1
10.7
11.3
12.0
12.5
3,013
3,432
3,409
2.9
2.6
2.6
25.4
21.6
21.1
1.6
1.8
1.8
2.0
2,233
2,362
2,410
.6
.6
34.7
31.8
33.7
13.4
14.2
3,425
3,465
2.7
2.7
20.1
18.9
1.9
2.1
2,354
2,325
.6
33.1
31.8
8.2
8.5
8.5
8.9
9.2
9.3
1 911
1,966
2 335
2 249
1 983
2,139
2,204
2 326
2,263
2,327
36.1
35.1
32.8
32.5
30.9
28.1
26.9
9.6
9.6
9.5
9.7
10.4
10.5
10.8
3.5
3.2
3.3
26.7
22.9
22.8
3.3
3.3
21.7
20.5
1 The term "family" refers to a group of two or more persons related by blood, marriage, or adoption and residing
together; all such persons are considered members of the same family.
23 Based on revised methodojogy.
The term "unrelated individuals" refers to persons 14 years old and over (other than inmates of institutions) who are
not living with any relatives.
Source: Department of Commerce, Bureau of the Census.
218
POPULATION, EMPLOYMENT, WAGES, AND
PRODUCTIVITY
TABLE C-23.—Population by age groups, 1929-72
[Thousands of persons]
Age (years)
July 1
Total
Under 5
1929
1933
1939.
1940
1941
1942
1943
1944
121,767
125,579
130,880
132,122
133,402
134,860
136,739
138, 397
5-15
16-19
20-24
25-44
26,800
9,127
10,694
35,862
21, 076
6,474
10,612
26,897
9,302
11,152
37,319
22, 933
7,363
10,418
25,179
9,822
11,519
39,354
25,823
8,764
24,811
24,516
24,231
24,093
23,949
9,895
9,840
9,730
9,607
9,561
11,690
11, 807
11,955
12,064
12,062
39,868
40,383
40,861
41,420
42,016
9,031
9,288
9,584
9,867
10,147
23,907
24,103
24, 468
25, 209
25,852
26,721
27, 279
28,894
30, 227
31, 480
32,682
33,994
35, 272
36, 445
37, 368
9,361
9,119
9,097
8,952
8,788
42, 521
43,027
43,657
44, 288
44,916
45,672
46,103
46,495
46,786
47, 001
30,849
31,362
31, 884
32,394
32, 942
12,397
12,803
13, 203
13,617
14,076
8,744
8,916
9,195
9,543
10, 215
12,036
12,004
11,814
11,794
11,700
11,680
11, 552
11,350
11, 062
10,832
10,714
10,616
10,603
10,756
10,969
26,249
26,718
27,196
27,671
28,138
28,630
29, 064
29,498
29,931
30,405
47,194
47, 379
47,440
47, 337
47,192
33, 506
34, 057
34, 591
35,109
35, 663
14.525
14,938
15, 388
15,806
16, 248
36,200
36,714
37,251
37,794
38,382
38,997
39,610
40,258
40,890
41,454
41,938
42,343
42,695
16,679
17,108
17,476
17,785
18,108
1950
1951
1952
1953
1954
139,928
141, 389
144,126
146, 631
149,188
152, 271
154,878
157, 553
160,184
163, 026
1955
1956
1957
1958
1959
165,931
168, 903
171,984
174,882
177, 830
1960
1961
1962
1963
1964
180,671
183,691
186,538
189,242
191,889
20,337
20. 504
20,448
20,316
20,127
38,496
39,753
41,184
41,640
42,313
10,694
11,072
11,215
12,004
12,737
11,124
11,450
11,954
12,707
13,256
47,140
47,089
47,008
46,996
46,965
1965
1966
1967
1968
1969
194,303
196,560
198,712
200, 706
202,677
42,944
43,695
44,234
44,609
44,804
204,879
207,049
208,837
13, 504
14,294
14, 212
14,449
14,804
15,259
15,604
15,923
13,755
14,090
15,227
15, 766
16,465
1970
1971
1972
19,786
19,171
18,528
17,880
17,339
17,167
17,289
17,242
46,912
46,976
47,188
47,714
48,055
48,413
48,781
50,126
44,730
44,304
43,684
8,542
8,446
8,414
8,460
8,637
17,192
18,163
18,219
Note.—Includes Armed Forces overseas beginning 1940. Includes Alaska and Hawaii beginning 1950.
Source: Department of Commerce, Bureau of the Census.
65 and
over
11,734
10,579
10,850
11,301
12, 016
12, 524
12, 979
13, 244
14,406
14,919
15,607
16,410
17,333
17,312
17, 638
18, 057
18,566
19,003
19,494
19,887
20,175
1945
1946
1947
1948
1949
45-64
219
10,494
10,828
11,185
11,538
11,921
18,405
18,723
19,066
19,396
19,754
20,177
20,567
20,948
TABLE C-24.—Noninstitutional population and the labor force, 1929-72
Civilian labor force
Noninstitutional
population i
Year or month
Total
labor
force
(including
Armed
Armed
Forcesi
Forces)
Employment
Total
Total
Agricultural
Nonagricultural
Unemployment
Thousands of persons 14 years of age and over
Labor
force
participation
Unemrate
ploy(total
ment
rate (per- labor
cent of force as
civilian percent
of nonlabor
force)
institutional
population)
Percent
1929
49 440
260
49 180
47 630
10 450
37 180
1 550
3.2
1933
51, 840
250
51, 590
38, 760
10,090
28,670
12,830
24.9
1939
55, 600
370
55, 230
45, 750
9,610
36,140
9,480
17.2
1940
1941
1942
1943 . . .
1944
100,380
101 520
102,610
103,660
104,630
56,180
57 530
60,380
64,560
66,040
540
1 620
3,970
9,020
11,410
55,640
55 910
56,410
55,540
54,630
47,520
50 350
53,750
54,470
53,960
9,540
9 100
9,250
9,080
8,950
37,980
41 250
44,500
45,390
45,010
8,120
5 560
2,660
1,070
670
14.6
9.9
4.7
1.9
1.2
56.0
56.7
58.8
62.3
63.1
1945
1946
1947
105,530
106,520
107,608
65,300
60,970
61,758
11,440
3,450
1,590
53,860
57,520
60,168
52,820
55,250
57,812
8,580
8,320
8,256
44,240
46,930
49,557
1,040
2,270
2,356
1.9
3.9
3.9
61.9
57.2
57.4
Thousands of persons 16 years of age and over
1947
1948
1949 . . .
103,418
104 527
105,611
60,941
62,080
62,903
1,591
1,459
1,617
59,350
60,621
61, 286
57,039
58 344
57,649
7,891
7 629
7,656
49,148
50,713
49,990
2,311
2,276
3,637
3.9
3.8
5.9
58.9
59.4
59.6
1950 . .
1951
1952 _
1953 _ .
1954
106,645
107,721
108,823
110,601
111,671
63,858
65,117
65,730
66,560
66,993
1,650
3,100
3,592
3,545
3,350
62, 208
62,017
62,138
63,015
63,643
58,920
59,962
60, 254
61,181
60,110
7,160
6,726
6,501
6,261
6,206
51,760
53,239
53,753
54,922
53,903
3,288
2,055
1,883
1,834
3,532
5.3
3.3
3.0
2.9
5.5
59.9
60.4
60.4
60.2
60.0
1955 .
1956
1957 .
1958
1959
112,732
113 811
115!065
116 363
117,881
68,072
69 409
69,729
70, 275
70,921
3,049
2 857
2,800
2,636
2,552
65,023
66 552
66,929
67,639
68,369
62,171
63 802
64,071
63,036
64,630
6,449
6,283
5,947
5,586
5,565
55,724
57,517
58,123
57,450
59,065
2,852
2,750
2,859
4,602
3,740
4.4
4.1
4.3
6.8
5.5
60.4
61.0
60.6
60.4
60.2
1960
1961
1962
1963
1964 .
119 759
121,343
122 981
125,154
127,224
72,142
73,031
73,442
74,571
75,830
2,514
2,572
2,828
2,738
2,739
69,628
70,459
70,614
71,833
73,091
65,778
65,746
66,702
67, 762
69,305
5,458
5,200
4,944
4,687
4,523
60,318
60,546
61,759
63,076
64,782
3,852
4,714
3,911
4,070
3,786
5.5
60.2
60.2
59.7
59.6
59.6
1965
1966 . .
1967
1968
1969 . .
129, 236
131,180
133,319
135,562
137,841
77,178
78,893
80,793
82, 272
84,240
2,723
3,123
3,446
3,535
3,506
74,455
75,770
77,347
78,737
80,734
71,088
72,895
74,372
75,920
77,902
4,361
3,979
3,844
3,817
3,606
66,726
68,915
70,527
72,103
74,296
3,366
2,875
2,975
2,817
2,832
4.5
59.7
60.1
60.6
60.7
61.1
1970
1971
140,182
142,596
85,903
86,929
3,188
2,817
82,715
84,113
78,627
79,120
3,462
3,387
75,165
75,732
4,088
4,993
5.9
61.3
61.0
. . . . 145, 775
88,991
2,449
86,542
81,702
3,472
78,230
4,840
5.6
61.0
1972*
.
.
See footnotes at end of table.
220
6.7
5.5
5.7
5.2
3.8
3.8
3.6
3.5
4.9
TABLE C-24.—Noninstitutional population and the labor force,
1929-72—Continued
Civilian labor force
Year or month
Noninstitutional
population i
Total
labor
force
(includ-
ing
Armed
Forces *
Employment
Armed
Forces)
Total
Total
Agricultural
Nonagricultural
Unemployment
Labor
force
participation
Unemrate
ployment
(total
rate (per- labor
cent of force as
civilian percent
labor
of nonforce) institutional
population)
Seasonally adjusted
141,500
141,670
141,885
142,088
142,285
142,482
86,669
86,291
86,343
86,594
86,814
86,314
2,976
2,950
2,930
2,882
2,850
2,816
83,693
83,341
83,413
83,712
83,964
83,498
78,679
78,441
78,417
78,736
78,906
78,653
3,411
3,294
3,370
3,533
3,402
3,293
75,268
75,147
75,047
75,203
75,504
75,360
5,014
4,900
4,996
4,976
5,058
4,845
6.0
5.9
6.0
5.9
6.0
5.8
61.3
60.9
60.9
60.9
61.0
60.6
142,685
142,886
143,104
143,321
143,517
143,723
86,836
87,146
87,252
87,413
87,774
87,803
2,797
2,775
2,749
2,717
2,696
2,658
84,039
84,371
84,503
84,696
85,078
85,145
79,095
79,264
79,476
79,738
79,987
80,040
3,371
3,396
3,368
3,413
3,447
3,409
75,724
75,868
76,108
76,325
76,540
76,631
4,944
5,107
5,027
4,958
5,091
5,105
5.9
6.1
5.9
5.9
6.0
6.0
60.9
61.0
61.0
61.0
61.2
61.1
May.
June
144,697
144,895
145,077
145,227
145,427
145,639
88,238
88,058
88,768
88,647
88,850
88,947
2,594
2,540
2,504
2,463
2,419
2,393
85,644
85,518
86,264
86,184
86,431
86,554
80,579
80,594
81,216
81,209
81,458
81,752
3,397
3,369
3,460
3,313
3,338
3,331
77,182
77,225
77,756
77,896
78,120
78,421
5,065
4,924
5,048
4,975
4,973
4,802
5.9
5.8
5.9
5.8
5.8
5.5
61.0
60.8
61.2
61.0
61.1
61.1
July
Aug
Sept
Oct
Nov
Dec
145,854
146,069
146,289
146,498
146,709
146,923
88,985
89,337
89,471
89,651
89,454
89,707
2,388
2,396
2,405
2,415
2,431
2,440
86,597
86,941
87,066
87,236
87,023
87, 267
81,782
82,061
82,256
82,397
82,525
82,780
3,443
3,610
3,579
3,658
3,556
3,650
78,339
78,451
78,677
78,739
78,969
79,130
4,815
4,880
4,810
4,839
4,498
4,487
5.6
5.6
5.5
5.5
5.2
5.1
61.0
61.2
61.2
61.2
61.0
61.1
1971:Jan
Feb
Mar
fc
June
July
Aug
Sept
Oct
Nov.
Dec
1972:Jan*
Feb
Mar
i Not seasonally adjusted.
•Data beginning with 1972 not strictly comparable with prior data because of adjustment to 1970 Census data, which
added 787,000 to the noninstitutional population, 333,000 to the civilian labor force, and 301,000 to civilian employment.
For further details, see "Employment and Earnings," February 1972.
Note.—Labor force data in Tables C-24 through C-27 are based on household interviews and relate to the calendar
week including the 12th of the month. For definitions of terms, area samples used, historical comparability of the data,
comparability with other series, etc., see "Employment and Earnings."
Seasonally adjusted data in this table have been revised and do not agree with those published beginning February
1972. They are subject to correction when the annual official revision of the series is published.
Source: Department of Labor, Bureau of Labor Statistics.
490-000 O - 73 - 15
221
TABLE C-25.—Civilian employment and unemployment by sex and age,
1947-72
(Thousands of persons 16 years of age and over)
Employment
Males
Unemployment
Females
Males
Females
Year or
month
Total
20
20
Total
16-19 years
Total 16-ia years
years and Total years and
over
over
20
Total 16-19 years Total 16-19 years
years and
years
over
1947.
1948.
1949.
57,039 40,994 2,218 38,776 16,045
58,344 41,726 2,345 39,38216,618
"7,649 40,926 2,124 38,80316,723
1950.
1951.
1952.
1953.
1954.
58,920 41,580
59,962 41,780
60,254 41,684
11,18142,431
10,110 41,620
17,340
18,182
18,570
18,750
18,490
15,824
16,570
612 16,958
584 17,164
49017,000
3,288
2,055
1,883
1,834
3,532
2,239
1,221
1,185
1,202
2,344
1955.
1956.
1957.
1958.
1959.
62,17142,621 2,095 40,526 19,550
63,802 43,380 2,164 41,216 20,422
64,07143, • " * 117 41,239 20,714
63,036 42,
__ 20,613
64,630 43,466
198 41,267 21,164
548 18,002
654 18,767
66319,052
570 19,043
640 19,524
2,852
2,750
2,859
4,602
3,740
1960.
1961.
1962.
1963.
1964.
65,778 43,904
65,746 43,656
"
66,i, 702 44, 177
762 44,657
69! 305 45; 474
41,543 21,874
41,342 22,090
41,815 22,525
42,25123,105
42,886 23,831
,769 20,105
,793 20,296
,, 833 20,693
,849 21,257
,929 21,903
1965.
1966.
1967.
1968.
1969
71,,088 46,
72,895 461
2,918 43,422 24,748
3,252 43,668 25,976
3,186 44,293 26,893
751920 48,114 3,255 44,859 27,807
77,902 48,818 3,430 45,388 29,084
2,118 22,630
2,469 23,510
2,497 24,397
2,525 25,281
2,686 26,397
1970.
1971
1972
,691 14,354 2,311 1,692
,683 14,937 2,276 1,559
,58815,137 3,637 2,572
270 1,422
619
255 1,305
717
352 2,219 1,065
144
152
223
318
191
205
184
310
1,922 1,049
1,029
834
980
698
1,019
632
2,035 1,188
195
145
140
123
191
1,854
1,711
1,841
3,098
2,420
274
269
299
416
398
1,580
1,442 1,039
1,541 1,018
2,681 *., 504
2,022 ,320
176
209
197
262
256
3,852
4,714
3,911
4,070
3,786
2,486
2,997
2,423
2,472
2,205
425
479
407
500
487
2,060
2,518
2,016
1,971
1,718
,366
,717
,488
,598
,581
286
349
313
383
386
3,366
2,875
2,975
2,817
2,832
1,914
1,551
1,508
1,419
1,403
479 1,435 ,452
432 1,120 ,324
448 1,060 ,468
427
993 .,397
441
963 1,429
395
404
391
412
41;
78,627 48,960 3,407 45,553 29,667 2,734 26,933 4,088 2,235
79,120 49,245 3,470 45,775 29,875 2,725 27,149 4,993 2,776
81,702 50,630 3,750 46,880 31,072 2,972 28,100 4,840 2,635
599 1,636 1,853
691 2,086 2,217
707 1,928 2,205
506
567
595
2,186
2,156
2,106
2,135
1,985
2,360
2,314
2,362
2,406
2,587
39,394
39,626
39,578
40,296
39,634
Seasonally adjusted
1971:Jan...
Feb...
Mar...
Apr...
May...
June..
July...
Aug...
Sept..
Oct...
Nov...
Dec...
1972:Jan__.
Feb...
Mar...
Apr...
May..
June..
July..
Aug...
Sept..
Oct...
Nov...
Dec...
78,679 48,869
78,441 48, 765
78,417 48,815
78, 736 49,109
78,906 49, 206
78,653 49,087
3,426 45,443 29,810 2,720 27,090 5,014
3,441 45,324
".
:. — 2, 730 26, 946 4,900
29,676
3,382 45,433 29,
1,602 2, 716 26, 886 4,996
3,489 45,620 29,627
J,627 2,718 26,909 4,976
3,451 45, 755 29, 700 2, 719 26, 981 5,058
3,321 45, 766 29, 566 2,609 26,957 4,845
2,784
2,717
2,724
2,736
2,820
2,699
701
669
670
677
722
645
2,083
2,048
2,054
2,059
2,098
2,054
2,230
2,183
2,272
2,240
2,238
2,146
587
560
590
556
582
527
79, 095 49,1,363 3,476 45,887 29,732
79,264 49,1,379 3,487 45,892 29, 885
79,476 49,433 3,477 45,956 30, 043
9,584 3,541 46i.043 30',
. 154
79,738 49,
79,987 49,
9,683 3,615 46,068 30, 304
3,566
46,078
30,
80,040 49,644
396
2,712 27,020
2, 760 27,125
2, 734 27,309
2, 723 27,431
2, 759 27, 545
2,830 27,566
4,944
5,107
5,027
4,958
5,091
5,105
2,746
2,869
2,813
2,781
2,833
2,851
690
710
673
719
710
737
2,056
2,159
2,140
2,062
2,123
2,114
2,198
2,238
2,214
2,177
2,258
2,254
585
556
574
556
582
583
80, 579 49, 880 3,619 46,261 30,
80, 594 49,868 3, 546 46,322 30,
81, 216 50, 282 3,686 46, 596 30,
81,209
,2 50,
500,250
250
250 3,710 46, 540 30,
8 1 8 50,375
0,375 3, 718 46,657 31
81,458
, 7525050,710 3, 786 46,924 31
81,752
2,926 27,773 5,065
2,911 27, 815 4,924
2, 982 27, 952 5,048
2, 997 27,962 4,975
3,061 28,022 4,973
2, 970 28,072 4,802
2,782
till
2,760
2,736
2,579
745
850
784
725
716
614
2,037
1,958
2,025
2,035
2,020
1,965
2,283
2,116
2,239
2,215
2,237
2,223
644
620
618
623
546
568
81, 782 50,708
82,061 50,852
82,256 51,034
82,2
"" 397 51,132
82,3
82,5525 51,165
82,7780 51,336
2,927 28,147
2,896 28,313
2,935 28, 287
2,984 28,281
3,067 28, 293
4,815
4,880
4,810
4,839
4,498
3, 087 28,357 4,487
2,526
2,616
2,591
2,597
2,454
2,380
611
729
716
662
718
703
1,915
1,887
1,875
1,935
1,736
1,677
2,289
2,264
2,219
2,242
2,044
2,107
595
605
598
592
558
595
3,666 47,042 31,
3, 782 47, 070 31,
3,838 47,196 31,
3,905 47, 227 31,
3, 857 47,308 31,
3,86147,475 31,
Note.-See Note, Table C-24.
Seasonally adjusted data in this table have been revised and do not agree with those published beginning February 1972.
They are subject to correction when the annual official revision of the series is published.
Source: Department of Labor, Bureau of Labor Statistics.
222
TABLE C-26.—Selected unemployment rates> 1948-72
[Percent]
By sex and age
Year or month
All
workers
By selected groups
By color
Both
sexes
16-19
years
Men
20
years
and
over
Women 20
years
and
over
White
Negro
and
other
races
Experienced
wage Houseand
hold
salary heads
workers
Married
men*
Fulltime
workers 2
Bluecollar
workers 3
4.2
8.0
1948..
1949..
3.8
5.9
9.2
13.4
3.2
5.4
3.6
5.3
3.5
5.6
5.9
8.9
4.3
6.8
3.5
5.4
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
5.3
3.3
3.0
2.9
5.5
4.4
4.1
4.3
6.8
5.5
12.2
8.2
8.5
7.6
12.6
11.0
11.1
11.6
15.9
14.6
4.7
2.5
2.4
2.5
4.9
3.8
3.4
3.6
6.2
4.7
5.1
4.0
3.2
2.9
5.5
4.4
4.2
4.1
6.1
5.2
4.9
3.1
2.8
2.7
5.0
3.9
3.6
3.8
6.1
4.8
9.0
5.3
5.4
4.5
9.9
8.7
8.3
7.9
12.6
10.7
6.0
3.7
3.3
3.2
6.2
4.8
4.4
4.6
7.2
5.7
4.6
1.5
1.4
1.7
4.0
2.8
2.6
2.8
5.1
3.6
5.0
2.6
2.5
I960..
1961..
1962..
1963..
1964..
1965..
1966..
1967..
1968..
1969..
5.5
6.7
5.5
5.7
5.2
4.5
3.8
3.8
3.6
3.5
14.7
16.8
14.7
17.2
16.2
14.8
12.8
12.8
12.7
12.2
4.7
5.7
4.6
4.5
3.9
3.2
2.5
2.3
2.2
2.1
5.1
6.3
5.4
5.4
5.2
4.5
3.8
4.2
3.8
3.7
4.9
6.0
4.9
5.0
4.6
4.1
3.4
3.4
3.2
3.1
10.2
12.4
10.9
10.8
9.6
8.1
7.3
7.4
6.7
6.4
5.7
6.8
5.6
5.5
5.0
4.3
3.5
3.6
3.4
3.3
3.7
3.2
2.7
2.2
2.1
1.9
1.8
3.7
4.6
3.6
3.4
2.8
2.4
1.9
1.8
1.6
1.5
1970..
1971..
1972..
4.9
5.9
5.6
15.2
16.9
16.2
3.5
4.4
4.0
4.8
5.7
5.4
4.5
5.4
5.0
8.2
9.9
10.0
4.8
5.7
5.3
2.9
3.6
3.3
Labor
force
time
lost*
7.2
3.9
3.6
3.4
7.2
5.8
5.1
6.2
10.2
7.6
5.1
5.3
8.1
6.6
5.5
4.9
4.2
3.5
3.4
3.1
3.1
7.8
9.2
7.4
7.3
6.3
5.3
4.2
4.4
4.1
3.9
6.7
8.0
6.7
6.4
5.8
5.0
4.2
4.2
4.0
3.9
2.6
3.2
2.8
4.5
5.5
5.1
6.2
7.4
6.5
5.3
6.4
6.0
5.2
3.8
3.7
4.0
7.2
6.7
Seasonally adjusted
1971: J a n . . .
Feb...
MarApr—
May..
June..
6.0
5.9
6.0
5.9
6.0
5.8
17.3
16.6
17.1
16.6
17.4
16.5
4.4
4.3
4.3
4.3
4.4
4.3
5.7
5.7
5.9
5.9
5.8
5.7
5.5
5.4
5.5
5.6
5.6
5.3
9.5
9.6
9.5
9.8
10.5
9.4
5.8
5.6
5.8
5.7
5.9
5.5
3.7
3.6
3.6
3.6
3.8
3.7
3.3
3.2
3.2
3.2
3.2
3.1
5.5
5.4
5.5
5.5
5.7
5. %
7.6
7.4
7.4
7.5
7.5
7.1
6.5
6.4
6.5
6.5
6.6
5.6
July—
Aug...
Sept..
Oct...
Nov...
Dec...
5.9
6.1
5.9
5.9
6.0
6.0
17.1
16.9
16.7
16.9
16.9
17.1
4.3
4.5
4.4
4.3
4.4
4.4
5.6
5.8
5.7
5.6
5.7
5.7
5.4
5.6
5.4
5.3
5.6
5.4
10.0
9.9
10.4
10.4
9.4
10.4
5.6
5.7
5.7
5.5
5.7
5.8
3.6
3.8
3.8
3.5
3.6
3.8
3.1
3.2
3.3
3.0
3.3
3.2
5.4
5.6
5.6
5.4
5.7
5.7
7.2
7.5
7.7
7.1
7.5
7.5
6.3
6.5
6.3
6.5
6.4
6.4
1972: J a n . . .
Feb...
MarApr—
May_.
June..
5.9
5.8
5.9
5.8
5.8
5.5
17.5
18.5
17.4
16.7
15.7
14.9
4.2
4.1
4.2
4.2
4.1
4.0
5.6
5.1
5.5
5.4
5.7
5.6
5.3
5.1
5.3
5.4
5.3
5.0
10.6
10.5
10.5
9.6
10.7
9.4
5.6
5.4
5.5
5.3
5.5
5.0
3.5
3.3
3.4
3.4
3.6
3.6
3.0
2.8
2.8
2.9
2.9
2.9
5.4
5.3
5.4
5.4
5.6
5.0
7.1
7.0
6.9
6.8
6.8
6.4
6.4
6.1
6.3
6.3
6.3
5.5
July..
Aug...
Sept..
Oct...
Nov...
Dec...
5.6
5.6
5.5
5.5
5.2
5.1
15.5
16.7
16.2
15.4
15.6
15.7
3.9
3.9
3.8
3.9
3.5
3.4
5.7
5.5
5.4
5.5
5.0
5.1
5.0
5.1
5.0
5.0
4.6
4.6
9.9
9.7
10.2
10.1
9.8
9.6
5.3
5.3
5.2
5.2
4.9
4.9
3.3
3.3
3.3
3.4
2.9
2.9
2.7
2.6
2.8
2.8
2.4
2.4
5.1
5.1
5.0
5.0
4.6
4.7
6.4
6.5
6.1
5.9
5.8
5.7
6.0
6.2
5.9
6.0
5.4
5.4
i Married men living with their wives. Data for 1949 and 1951-54 are for April; 1950, for March.
» Data for 1949-61 are for May.
3 Includes craftsmen, operatives, and nonfarm laborers. Data for 1948-57 are based on data for January, April, July,
and October.
4
Man-hours lost by the unemployed and persons on part-time for economic reasons as a percent of potentially available
labor force man-hours.
Note—See Note, Table C-24.
Seasonally adjusted data in the first four columns of this table have been revised and do not agree with those published beginning February 1972. They are subject to correction when the annual official revision of the series is published.
Source: Department of Labor, Bureau of Labor Statistics.
223
TABLE C-27.—Unemployment by duration, 1947-72
Duration of unemployment
Year or month
Total unemployment
Less than
5 weeks
5-14
weeks
15-26
weeks
27 weeks
and over
Average
(mean)
duration
in weeks
Thousands of persons 16 years of age and over
1947.
1948.
1949.
2,311
2,276
3,637
1,210
1,300
1,756
704
669
1,194
234
193
428
256
1950.
1951.
1952.
1953.
1954.
3,288
2,055
1,883
1,834
3,532
1,450
1,177
1,135
1,142
1,605
1,055
574
516
482
1,116
425
166
148
132
495
357
137
84
78
317
1955.
1956.
1957.
1958.
1959.
2,852
2,750
2,859
4,602
3,740
1,335
1,412
1,408
1,753
1,585
815
805
891
1,396
1,114
366
301
321
785
469
336
232
239
667
571
1960.
1961.
1962.
1963.
1964.
3,852
4,714
3,911
4,070
3,786
1,719
1,806
1,663
1,751
1,697
1,176
1,376
1,134
1,231
1,117
503
728
534
535
491
454
804
585
553
482
1965.
1966.
1967
1968
1969
3,366
2,875
2,975
2,817
2,832
1,628
1,573
1,634
1,594
1,629
983
779
893
810
827
404
287
351
239
177
1970
1971
1972.
4,088
4,993
4,840
2,137
2,234
2,223
1,289
1,578
1,458
271
256
242
427
665
597
164
116
156
133
235
517
562
Seasonally adjusted l
1971: Jan.
Feb.
Mar.
Apr.
May.
June.
5,012
4,886
5,009
5,056
5,156
4,801
2,318
2,218
2,155
2,176
2,245
2,118
1.630
i;605
1.633
,587
,552
,572
663
619
645
640
667
630
412
454
455
448
516
545
July.
Aug.
Sept.
Oct..
Nov.
Dec.
4,916
5,114
5,040
4,918
5,096
5,127
2,150
2,320
2,317
2,140
2,290
2,410
,532
,553
,567
,529
,650
,509
704
735
683
628
741
724
551
556
567
625
570
549
1972: Jan.
Feb.
Mar.
Apr.
May.
June
5,071
4,912
5,072
5,079
5,092
4,728
2,358
2,142
2,311
2,169
2,223
2,175
,502
,454
,412
,521
,514
,437
636
634
591
482
587
562
660
633
655
593
July.
Aug.
Sept.
Oct..
Nov.
Dec.
4,785
4,887
4,827
4,794
4,506
4,525
2,149
2,254
2,369
2,256
2,165
2,092
,478
,505
1,385
1,447
1,398
,445
594
658
644
587
554
497
544
550
550
463
428
545
605
566
i Because of independent seasonal adjustment of the various series, detail will not add to totals.
no.
* Data beginning with 1972 not strictly comparable with prior data because of adjustment to 19'
1970 Census data, which
added 32,000 to unemployment (detail by duration not available).
Note—See Note, Table C-24.
Seasonally adjusted data in this table are as published beginning Feburary 1972 and therefore do not agree with data
shown in Tables C-24 through C-26.
Source: Department of Labor, Bureau of Labor Statistics.
224
TABLE C-28.—Unemployment insurance programs, selected data,
State programs
All programs
Year or month
Covered
employmenu
Insured Total
unem- benefits Insured
ploypaid
unemment
(milploy(weekly
lions
ment3
averof dolage)"
lars) a *
Thousands
1,373.1
277
1,380.7
1,733.9
3,512.7
2,279.0
20.76
21.09
22.79
23.58
24.93
25.04
27.02
28.17
30.58
30.41
331
350
302
7 298
268
232
203
226
201
200
4.8
5.6
4.4
4.3
3.8
3.0
2.3
2.5
2.2
2.1
2,726.7
3,422.7
2,675.4
2,774.7
2, 522.1
2,166.0
1,771.3
2,092.3
2,031.6
2,127.9
32.87
33.80
34.56
35.27
35.92
37.19
39.75
41.25
43.43
46.17
1,805
2,150
1,850
296
295
265
3.4
4.1
3.5
3,848. 5
4,957.0
4,550.0
50.34
54.02
57.00
568.1
599.3
684.3
588.8
472.5
494.0
2,799
2,751
2,577
2,283
2,001
1,893
427
321
275
257
238
5.2
5.2
4.8
4.3
3.8
3.6
3.8
3.8
3.9
4.0
4.2
4.2
527.2
557.9
634.5
544.2
434.2
451.4
52.83
53.12
53.00
52.71
52.32
52.09
2,431
2,349
2,173
2,129
2,312
2,666
470.9
483.1
441.9
408.0
451.9
537.4
1,993
1,912
1,739
1,716
L.879
2', 221
236
252
298
358
3.8
3.6
3.3
3.2
3.5
4.2
4.1
4.2
4.3
4.4
4.2
3.8
428.0
433.6
400.3
367.2
406.9
489.6
55.47
56.27
56.48
53.46
53.96
54.58
3,097
3,122
2,922
2,430
2,105
1,951
597.7
638.3
683.2
516.4
472.7
423.0
2,524
2,492
2,279
2,005
1,740
1,636
385
293
242
237
216
250
4.8
4.7
4.3
3.8
3.3
3.1
3.4
3.5
3.5
3.6
3.7
3.6
550.9
589.5
628.9
472. S
429.2
382.1
55.35
56.71
57.21
56.90
56.32
55.23
2,087
1,763
1,554
1,511
1,691
1,991
402.0
405.3
313.5
311.4
413.7
482.6
1,823
1,564
,388
1,357
1,507
1,804
321
213
190
214
253
324
3.4
2.9
2.6
2.5
2.7
3.3
3.7
3.4
3.4
3.3
3.3
3.0
364.3
363.0
280.1
280.3
386.4
451.9
55.75
55.53
60.16
56.95
56.94
57.02
34,308
36,334
37,006
38,072
36,622
40,018
42,751
43,436
44,411
45,728
1,605
1,000
1,069
1,067
2,051
1,399
1,323
1,571
3,269
2,099
1,467.6
862.9
,043.5
,050.6
1,291.8
, 560.2
,540.6
,913.0
,290.6
2,854.3
1,870
1,265
1,215
1,446
2,526
1,684
I960..
1961..
1962..
1963..
1964..
1965..
1966..
1967..
1968..
1969..
2,071 3,022.8
46,334
2,994 4,358.1
46,266
1,946 3,145.1
47,776
48,434 '1,973 3,025.9
1,753 2,749.2
49,637
1,450 2,360.4
51, 580
1,129 1,890.9
54,739
1,270 2,221.5
56,342
1,187 2.191.0
57,977
1,177 2,298.6
59,999
1,908
2,290
1,783
7 1,806
1,605
1,328
1,061
1,205
1,111
1,101
1970...
1971 *.
1972*.
59,526
2,070 4.179.1
2,313 5,498.2
2,185 5,000.0
1971:
58,005
57,776
58,133
58,834
59,056
60,045
3,193
3,215
3,091
2,756
2,443
2,332
Nov *_.
Dec p . .
Percent
4.6
2.8
2.9
2.8
5.2
3.5
3.2
3.6
6.4
4.4
1950.
1951.
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
July p . .
Aug*..
Sept p..
Oct p...
thousands
Seasonally adjusted
AverTotal
weekly
(millions of check
dol(dollars)*
lars)*
18.50
17.83
19.03
20.48
2,878.5
1,785.5
1,328.7
2,269.8
Apr p..
May *__
June »_
Unadjusted
Benefits paid
1,094.9
775.1
789.9
1,736.0
2,804
1,793
1,446
2,474
1972: Jan *...
Feb*._
Mar*..
Insured unemployment as percent of covered
employment
4.3
3.1
3.0
6.2
31,856
33,876
34,646
33,098
July...
Aug...
Sept..
Oct*.
Nov P.
Dec p .
Exhaustions »
Initial
claims
Weekly average,
1946.
1947.
1948.
1949.
Jan...
Feb...
Mar...
Apr...
May...
June..
1946-72
1,295
997
980
1,973
1,513
969
990
1,044
189
187
200
340
236
208
215
218
304
226
227
270
369
250
342
282
840.4
998.2
962.2
2,026.9
1,350.3
1
Includes persons under the State, UCFE (Federal employee, effective January 1955), and RRB (Railroad Retirement
Board) programs. Beginning October 1958, also includes the UCX program (unemployment compensation for ex-servicemen).
2 Includes State, UCFE, RR, UCX, UCV (unemployment compensation for veterans, October 1952-January 1960), and
SRA (Servicemen's Readjustment Act, September 1944-September 1951) programs. Also includes Federal and State
extended benefit programs.
8
Covered workers who have completed at feast 1 week of unemployment.
« Includes benefits paid under extended benefit provisions of State laws, beginning June 1958. Annual data are net
amounts
and monthly data are gross amounts.
8
Individuals receiving final payments in benefit year. Data for New Jersey not available for April-June 1971.
« For total unemployment only. Excludes data for New Jersey for April-December 1971.
7
Programs include Puerto Rican sugarcane workers for initial claims and insured unemployment beginning July 1963.
8
June 1971 is latest month for which data are available for all programs combined. Workers covered by State
programs account for about 89 percent of t h e total.
Source: Department of Labor, Manpower Administration.
225
TABLE C-29.—Wage and salary workers in nonagricultural establishments, 1929-72
[All employees; thousands of persons]
Year or
month
Total
wage
and
salary
workers
Manufacturing
Total
Durable
goods
Nondurable
goods
Mining
Contract
construction
Transportation
and
public
utilities
Wholesale
and
retail
trade
Finance,
insurance,
and
real
estate
Services
Government
Federal
State
and
local
1929..
31,339
10,702
1,087
1,497
3,916
6,123
1,509
3,440
533
2,532
1933..
23,711
7,397
744
809
2,672
4,755
1,295
2,873
565
2,601
1939..
30,618
10,278
4,715
5,564
854
1,150
2,936
6,426
1,462
3,517
905
3,090
1940..
1941..
1942..
1943..
1944..
32,376
36,554
40,125
42,452
41,883
10,985
13,192
15,280
17,602
17,328
5,363
6,968
8,823
11,084
10,856
5,622
6,225
6,458
6,518
6,472
925
957
992
925
892
1,294
1,790
2,170
1,567
1,094
3,038
3,274
3,460
3,647
3,829
6,750
7,210
7,118
6,982
7,058
,502
,549
,538
,502
,476
3,681
3,921
4,084
4,148
4,163
9%
1,340
2,213
2,905
2,928
3,206
3,320
3,270
3,174
3,116
1945..
1946..
1947..
1948..
1949..
40,394
41,674
43,881
44,891
43,778
15,524
14,703
15,545
15,582
14,441
9,074
7,742
8,385
8,326
7,489
6,450
6,962
7,159
7,256
6,953
836
862
955
994
930
1,132
1,661
1,982
2,169
2,165
3,906
4,061
4,166
4,189
4,001
7,314
8,376
8,955
9,272
9,264
,497
,697
,754
,829
,857
4,241
4,719
5,050
5,206
5,264
2,808
2,254
1,892
1,863
1,908
3,137
3,341
3,582
3,787
3,948
1950..
1951..
1952..
1953..
1954..
45,222
47,849
48,825
50,232
49,022
15,241
16,393
16,632
17,549
16,314
8,094
9,089
9,349
10,110
9,129
7,147
7,304
7,284
7,438
7,185
901
929
898
866
791
2,333
2,603
2,634
2,623
2,612
4,034
4,226
4,248
4,290
4,084
9,386
9,742
10,004
10,247
10,235
,919
,991
2,069
2,146
2,234
5,382
5,576
5,730
5,867
6,002
1,928
2,302
2,420
2,305
2,188
4,098
4,087
4,188
4,340
4,563
1955..
1956..
19571958..
1959..
50,675
52,408
52,894
51,363
53,313
16,882
17,243
17,174
15,945
16,675
9,541
9,834
9,856
8,830
9,373
7,340
7,409
7,319
7,116
7,303
792
822
828
751
732
2,802
2,999
2,923
2,778
2,960
4,141
4,244
4,241
3,976
4,011
10,535
10,858
10,886
10,750
11,127
2,335
2,429
2,477
2,519
2,594
6,274
6,536
6,749
6,806
7,130
2,187
2,209
2,217
2,191
2,233
4,727
5,069
5,399
5,648
5,850
1960
1961
1962
1963
1964
54,234
54,042
55, 596
56,702
58,331
16,796
16,326
16,853
16,995
17,274
9,459
9,070
9,480
9,616
9,816
7,336
7,256
7,373
7,380
7,458
712
672
650
635
634
2,885
2,816
2,902
2,963
3,050
4,004
3,903
3,906
3,903
3,951
11,391
11,337
11, 566
11,778
12,160
2,669
2,731
2,800
2,877
2,957
7,423
7,664
8,028
8,325
8,709
2,270
2,279
2,340
2,358
2,348
6,083
6,315
6,550
6,868
7,248
1965..
1966..
1967..
1968..
1969..
60,815
63,955
65,857
67,915
70,284
18,062
19,214
19,447
19,781
20,167
10,406
11,284
11,439
11,626
11,895
7,656
7,930
8,008
8,155
8,272
632
627
613
606
619
3,186
3,275
3,208
3,285
3,435
4,036
4,151
4,261
4,310
4,429
12,716
13, 245
13,606
14,084
14,639
3,023 9,087
3,100 9,551
3,225 10,099
3,382 10,623
3,564 11,229
2,378
2,564
2,719
2,737
2,758
7,696
8,227
8,679
9,109
9,444
1970
1971
1972**
70,593
70,645
72,750
19,349
18,529
18,928
11,195
10,565
10,881
8,154
7,964
8,048
623
602
607
3,381
3,411
3,520
4,493
4,442
4,495
14,914
15,142
15,679
3,688 11,612
3,796 11,869
3,926 12,309
2,705 9,830
2,664 10,191
2,649 10,639
See footnotes at end of table.
226
TABLE G-29.—Wage and salary workers in nonagricultural establishments, 1929-72—Continued
[All employees; thousands of persons]
Manufacturing
Year or
month
Total
wage
and
salary
workers
I/On-
Total
Durable
goods
Nondurable
goods
Mining
tract
construction
Transportation
and
public
utilities
Government
wnoicsale
and
retail
trade
Finance,
insurance,
and
real
estate
Services
Whnlp
Federal
State
and
local
9,643
9,676
9,692
9,720
9,764
9,800
Seasonally adjusted
1970: J a n . . .
Feb...
Mar..
Apr...
May..
June..
70,875
71,007
71,081
71,007
70,730
70,574
19,990
19,916
19,897
19,772
19,547
19,445
11,690
11,627
11,634
11,536
11,391
11,285
8,300
8,289
8,263
8,236
8,156
8,160
624
624
623
621
619
621
3,380
3,461
3,465
3,410
3,368
3,368
4,506
4,496
4,497
4,473
4,479
4,505
14,871
14,919
14,907
14,903
14,915
14,896
3,652
3,659
3,672
3,680
3,685
3,685
11,500
11,549
11,559
11,590
11,585
11,573
2,709
2,707
2,769
2,838
2,768
2,681
July..
Aug..
Sept..
Oct...
Nov..
Dec...
70,612
70,472
70,499
70,065
69,968
70,274
19,378
19,241
19,205
18,641
18,471
18, 745
11,219
11,129
11,110
10,602
10,442
10,726
8,159
8,112
8,095
8,039
8,029
8,019
620
622
622
623
626
625
3,358
3,362
3,333
3,341
3,360
3,392
4,531
4,514
4,505
4,500
4,485
4,420
14,915
14,895
14,921
14,943
14,916
14,938
3,689
3,685
3,696
3,707
3,717
3,727
11,595
11,611
11,649
11,686
11,722
11,744
2,658 9,868
2,646 9,896
2,657 9,911
2,656 9,968
2,664 10,007
2,661 10,022
1971: J a n . . .
Feb...
Mar..
Apr...
May..
June..
70,331
70,266
70, 299
70, 461
70,643
70,574
18,690
18,608
18,519
18, 538
18,602
18,520
10,683
10,620
10,549
10,566
10,612
10,568
8,007
7,988
7,970
7,972
7,990
7,952
625
623
622
623
622
621
3,330
3,303
3,353
3,392
3,405
3,407
4,468
4,487
4,470
4,467
4,470
4,451
14,993
15,008
15,019
15,053
15,098
15,096
3,741
3,744
3,752
3,764
3,780
3,799
11,766
11,762
11,794
11,808
11,823
11,833
2,659
2,659
2,660
2,662
2,662
2,661
10,059
10,072
10,110
10,154
10,181
10,186
July..
Aug..
Sept..
Oct...
Nov..
Dec...
70,532
70, 548
70,843
70,861
71,103
71,291
18,453
18,393
18,517
18,495
18, 534
18,519
10,519
10,466
10,552
10,547
10,560
10,552
7,934
7,927
7,965
7,948
7,974
7,967
599
612
618
521
524
611
3,405
3,408
3,436
3,475
3,518
3,468
4,433
4,397
4,420
4,406
4,403
4,432
15,137
15,186
15, 232
15, 250
15, 299
15,333
3,803
3,804
3,821
3,835
3,847
3,855
11,865
11,889
11,918
11,951
11,997
12, 042
2,664
2,663
2,663
2,662
2,666
2,666
10,173
10,196
10,218
10,266
10,315
10,365
1972: J a n . . .
Feb...
Mar..
Apr...
May..
June..
71,552
71,744
72,011
72, 246
72, 592
72,699
18, 551
18,612
18,685
18, 790
18,892
18,931
10,575
10,621
10,673
10,755
10, 837
10, 857
7,976
7,991
8,012
8,035
8,055
8,074
615
613
614
605
604
600
3,523
3,494
3,512
3,493
3,535
3,550
4,455
4,438
4,487
4,481
4,490
4,491
15,379
15,456
15, 508
15,561
15,632
15,682
3,867
3,874
3,885
3,892
3,913
3,931
12,069
12,112
12,139
12, 206
12, 252
12, 290
2,673
2,669
2,667
2,664
2,665
2,646
10,420
10,476
10,514
10, 554
10,609
10, 578
July..
Aug..
Sept..
actNay *>_
Dec*.
72,661
72,984
73,176
73,589
73,868
73,892
18,861
18,930
19, 029
19, 219
19,321
19,356
10,843
10,897
10, 970
11,127
11,191
11,240
8,018
8,033
8,059
8,092
8,130
8,116
599
602
606
610
609
603
3,489
3,544
3,551
3,568
3,529
3,445
4,473
4,478
4,499
4,540
4,550
4,551
15,692
15,758
15,794
15,835
15,935
15,914
3,927
3,936
3,953
3,969
3,981
3,982
12, 341
12,419
12,379
12,451
12, 501
12,544
2,621
2,618
2,624
2,630
2,642
2,640
10,658
10,699
10,741
10,767
10,800
10,857
Note.—Data in Tables C-29 through C-31 are based on reports from employing establishments and relate to full- and
part-time wage and salary workers in nonagricultural establishments who worked during, or received pay for, any part of
the pay period which includes the 12th of the month.
Not comparable with labor force data (Tables C-24 through C-27), which include proprietors, self-employed persons,
domestic servants, and unpaid family workers, and which count persons as employed when they are not at work because
of industrial disputes, bad weather, etc.
For description and details of the various establishment data, see "Employment and Earnings."
Source: Department of Labor, Bureau of Labor Statistics.
227
TABLE C-30.—Average weekly hours and hourly earnings in selected private nonagricultural
industries, 1947-72
[For production or nonsupervisory workers]
Average gross hourly earnings,
current dollars
Average weekly hours
Year
or
month
Total
private Manunonag- facturriculing
tural i
Contract
construction
Total
private
Retail
Manunontrade 2 agri- facturing
cultural
Contract
construction
Adjusted hourly earnings,
total private nonagricultural s
1967=100
Retail
trade 2
1947
1948
1949
40.3
40.0
39.4
40.4
40.0
39.1
38.2
38.1
37.7
40.3 $1.131 $1. 217 $1.541 $0,838
40.2 1.225 1.328 1.713
.901
40.4 1.275 1.378 1.792
.951
1950
1951
1952
1953
1954
39.8
39.9
39.9
39.6
39.1
40.5
40.6
40.7
40.5
39.6
37.4
38.1
38.9
37.9
37.2
40.4
40.4
39.8
39.1
39.2
1955
1956
1957.
1958.
1959.
39.6
39.3
38.8
38.5
39.0
40.7
40.4
39.8
39.2
40.3
37.1
37.5
37.0
36.8
37.0
I960.
1961.
1962.
1963.
1964.
1965.
1966
1967.
1968
1969
38.6
38.6
38.7
38.8
38.7
39.7
39.8
40.4
40.5
40.7
38,8
38.6
38.0
37.8
37.7
1970
1971
1972
37.1
37.0
37.2
Current
dollars
1967
dollars*
42.6
46.0
48.2
63.7
63.8
67.5
8.0
4.8
0.2
5.8
1972:
Current
dollars
1967
dollars
1.335
1.45
1.52
,61
,65
1.440
1.56
1.65
1.74
1.78
1.863
2.02
2.13
2.28
2.39
.983
1.06
1.09
1.16
1.20
50.0
53.7
56.4
59.6
61.7
69.3
69.0
70.9
74.4
76.6
3.7
7.4
5.0
5.7
3.5
2.7
-.4
2.8
4.9
3.0
39.0
38.6
38.1
38.1
38.2
.95
2.02
1.86
1.95
2.05
2.11
2.19
2.45
2.57
2.71
2.82
2.93
1.25
1.30
1.37
1.42
1.47
63.7
67.0
70.3
73.2
75.8
79.4
82.3
83.4
84.5
86.8
3.2
5.2
4.9
4.1
3.6
3.7
3.7
1.3
1.3
2.7
36.7
36.9
37.0
37.3
37.2
38.0
37.6
37.4
37.3
37.0
2.09
2.14
2.22
2.28
2.36
2.26
2.32
2.39
2.46
2.53
3.08
3.20
3.31
3.41
3.55
1.52
1.56
1.63
1.68
1.75
78.4
80.8
83.5
85.9
88.6
88.4
90.2
92.2
93.7
95.3
3.4
3.1
3.3
2.9
3.1
1.8
2.0
2.2
1.6
1.7
41.2
41.3
40.6
40.7
40.6
37.4
37.6
37.7
37.4
37.9
36.6
35.9
35.3
34.7
34.2
2.45
2.56
2.68
2.85
3.04
2.61
2.72
2.83
3.01
3.19
3.70
3.89
4.11
4.41
4.79
1.82
1.91
2.01
2.16
2.30
91.9
95.6
100.0
106.6
113.6
97.2
98.4
100.0
102.3
103.5
3.7
4.0
4.6
6.6
6.6
2.0
1.2
1.6
2.3
1.2
39.8
39.9
40.6
37.4
37.3
36.9
33.8
33.7
33.6
3.22
3.43
3.65
3.36
3.56
3.80
5.24
5.69
6.05
2.44
2.57
2.70
121.2
129.7
137.8
104.2
106.9
110.0
6.7
7.0
6.2
.7
2.6
2.9
Seasonally
adjusted
annual rates»
Seasonally adjusted
1971:
Percent
change
from
preceding
period
Jan...
Feb..
Mar.
Apr
Apr..
May
Vlay_
JuneJuly..
Aug...
Sept..
Oct...
Nov...
Dec—
36.9
36.9
37.0
37.0
36.9
37.0
39.9
39.7
39.8
39.8
40.0
40.0
37.4
36.7
37.6
37.1
36.9
37.3
33.6
33.6
33.5
33.7
33.7
33.7
$3.33
3.35
3.37
3.39
3.42
3.43
$3.48
3.51
3.52
3.53
3.55
3.56
$5.47
5.52
5.53
5.58
5.63
5.67
$2.51
2.53
2.54
2.55
2.56
2.57
126.0
126.7
127.1
128.1
128.9
129.4
105.5
105.9
106.0
106.6
106.7
106.7
10.5
7.2
4.1
9.6
8.2
4.1
6.8
4.1
1.5
6.3
1.7
-.6
36.9
36.9
36.9
37.0
37.1
37.1
40.0
39.8
39.6
39.9
40.1
40.2
37.2
37.2
35.8
37.6
39.0
36.8
33.8
33.6
33.6
33.7
33.7
33.9
3.44
3.46
3.48
3.49
3.49
3.53
3.58
3.59
3.60
3.59
3.59
3.68
5.70
5.76
5.78
5.81
5.83
5.88
2.59
2.59
2.60
2.60
2.59
2.63
130.1
130.8
131.4
131.8
131.8
133.6
106.9
107.2
107.5
107.7
107.5
108.6
6.7
7.1
5.6
3.2
3.0
3.9
1.7
-2.1
13.5
Jan...
Feb...
Mar..
Apr...
May..
JuneJuly
Aug
Sept
Oct
Nov »
Dec »
37.0
37.2
37.1
37.3
37.0
37.1
40.1
40.4
40.4
40.8
40.5
40.7
37.1
37.3
37.2
36.7
36.7
36.9
33.7
33.6
33.6
33.7
33.7
33.8
3.55
3.56
3.59
3.62
3.62
3.63
3.69
3.72
3.74
3.76
3.78
3.79
5.91
5.93
5.97
6.01
6.02
6.01
2.65
2.65
2.66
2.67
2.68
2.69
134.6
134.8
135.5
136.7
136.7
137.1
109.1
108.7
109.2
110.0
109.6
109.8
9.6
1.6
6.0
11.5
5.8
-5.0
5.7
9.3
-3.9
2.4
37.2
37.1
37.3
37.3
37.2
37.2
40.6
40.6
40.8
40.7
40.9
41.0
37.0
37.1
37.1
37.6
37.0
35.6
33.7
33.6
33.5
33.5
33.5
33.8
3.64
3.67
3.69
3.73
3.73
3.74
3.79
3.83
3.86
3.86
3.89
3.93
6.01
6.06
6.10
6.15
6.19
6.26
2.71
2.72
2.73
2.74
2.74
2.75
137.8
138.3
139.3
140.5
140.7
141.9
110.0
110.1
110.4
111.0
110.8
111.6
6.9
4.4
9.1
10.6
1.3
11.3
1.7
1.4
3.2
6.6
-1.9
8.5
1 Also includes other private industry groups shown in Table C-29.
Includes eating and drinking places.
3 Adjusted for overtime (in manufacturing only) and for interindustry employment shifts.
* Current dollar earnings index divided by the consumer price index.
5
Computed from indexes to two decimal places.
Note.—See Note, Table C-29.
Source: Department of Labor, Bureau of Labor Statistics.
2
228
17.8
TABLE C~31.—Average weekly earnings in selected private nonagricultwral industries, 1947-72
[For production or nonsupervisory workers]
Average spendable weekly earnings, total
private nonagricultufal'
Average gross weekly earnings
Year or month
Total private
nonagricultural i
Current
dollars
1967
dollars2
Manu- Contract
facturing construction
Retail
trade 3
Current dollars
Amount
Percent change from
preceding period
Current
dollars
1967
dollars 2
Current
dollars
1967
dollars
1947..
1948..
1949..
$45.58
49.00
50.24
$68.13
67.96
70.36
$49.17
53.12
53.88
$58.87
65.27
67.56
$33.77
36.22
38.42
$44.64
48.51
49.74
$66.73
67.28
69.66
8.7
2.5
0.8
3.5
1950..
1951..
1952..
1953..
1954..
53.13
57.86
60.65
63.76
64.52
73.69
74.37
76.29
79.60
80.15
58.32
63.34
67.16
70.47
70.49
69.68
76.96
82.86
86.41
88.91
39.71
42.82
43.38
45.36
47.04
52.04
55.79
57.87
60.31
60.85
72.18
71.71
72.79
75.29
75.59
4.6
7.2
3.7
4.2
.9
3.6
-.7
1.5
3.4
.4
1955..
1956..
1957..
1958..
1959..
67.72
70.74
73.33
75.08
78.78
84.44
86.90
86.99
86.70
90.24
75.70
78.78
81.59
82.71
88.26
90.90
96.38
100.27
103.78
108.41
48.75
50.18
52.20
54.10
56.15
63.41
65.82
67.71
69.11
71.86
79.06
80.86
80.32
79.80
82.31
4.2
3.8
2.9
2.1
4.0
4.6
2.3
-.7
-.6
3.1
I960..
1961..
1962..
1963..
1964..
80.67
82.60
85.91
88.46
91.33
90.95
92.19
94.82
96.47
98.31
89.72
92.34
96.56
99.63
102.97
113.04
118.08
122.47
127.19
132.06
57.76
58.66
60.96
62.66
64.75
72.96
74.48
76.99
78.56
82.57
82.25
83.13
84.98
85.67
88.88
1.5
2.1
3.4
2.0
5.1
2.2
.8
3.7
1965..
1966..
1967..
1968..
1969..
95.06
98.82
101.84
107.73
114.61
100.59
101.67
101.84
103.39
104.38
107.53
112.34
114.90
122.51
129.51
138.38
146.26
154.95
164.93
181.54
66.61
68.57
70.95
74.95
78.66
86.30
88.86
90.86
95.28
99.99
91.32
91.21
90.86
91.44
91.07
4.5
2.7
2.5
4.9
4.9
2.7
-.1
-.4
.6
-.4
1970..
1971..
1972 v.
119.46
126.91
135.78
102.72
104.62
108.36
133.73
142.04
154.28
195.98
212.24
223.25
82.47
86.61
90.72
104.61
112.12
120.79
89.95
92.43
96.40
4.6
7.2
7.7
-1.2
2.8
4.3
Seasonally adjusted
annual rates
Seasonally adjusted
1971: Jan...
Feb..
Mar..
Apr..
May..
June.
$122.88
123.62
124.69
125.43
126.20
126.91
$102.95
103.32
103.99
104.34
104.45
104.63
$138.85
139.35
140.10
140.49
142.00
142.40
$204.58
202.58
207.93
207.02
207.75
211.49
$84.34
85.01
85.09
85.94
86.27
86.61
$108.94
109.52
110.37
110.95
111.56
112.12
$91.27
91.53
92.05
92.30
92.34
92.44
58.2
6.6
9.7
6.5
6.8
6.2
M.6
3.5
7.0
3.3
July..
Aug..
Sept..
Oct...
Nov..
Dec.
126.94
127.67
128.41
129.13
129.48
130.96
104.37
104.62
105.08
105.51
105.59
106.47
143.20
142.88
142.56
143.24
143.96
147.94
212.04
214. 27
206.92
218.46
227.37
216.38
87.54
87.02
87.36
87.62
87.28
89.16
112.14
112.71
113.30
113.86
114.14
115.31
92.21
92.36
92.72
93.03
93.08
93.75
.2
6.3
6.5
6.1
3.0
13.0
-2.9
2.0
4.8
4.1
.6
9.0
1972: Jan...
Feb..
Mar..
Apr..
May..
June.
131.35
132.43
133.19
135.03
133.94
134.67
106.48
106.75
107.32
108.62
107.39
107.92
147.97
150.29
151.10
153.41
153.09
154. 25
219.26
221.19
222.08
220.57
220.93
221.77
89.31
89.04
89.38
89.98
90.32
90.92
117.30
118.15
118.75
120.20
119.34
119.92
95.09
95.24
95.69
96.69
95.69
96.10
M.6
9.1
6.3
15.7
-8.3
6.0
*1.2
1.9
July..
Aug..
Sept..
Oct...
Nov*.
Dec*.
135.41
136.16
137.64
139.13
138.76
139.13
108.06
108.39
109.06
109.91
109.32
109.38
153.87
155.50
157.49
157.10
159.10
161.13
222.37
224.83
226.31
231.24
229.03
222.86
91.33
91.39
91.46
91.79
91.79
92.95
120. 50
121.09
122.26
123.43
123.14
123.43
96.16
96.39
96.88
97.50
97.01
97.04
6.0
6.0
12.2
12.1
-2.8
2.9
l!3
5.8
13.3
-11.7
5.3
.8
2.9
6.3
8.0
-5.9
.4
1 Also includes other private industry groups shown in Table C-29.
Earnings in current dollars divided by the consumer price index.
3 Includes eating and drinking places.
* Average gross weekly earnings less social security and income taxes for a worker with three dependents.
«In annualizing the rates of change, the effect of the change in tax rates at the beginning of 1971 and 1972 is taken into
account separately.
2
Note.-See Note, Table C-29.
Source: Department of Labor, Bureau of Labor Statistics.
229
TABLE C-32.—Output per man-hour and related data, private economy, 1947-72
[1967=100]
Output i
Man-hours 2
Output per
man-hour
Compensation
per man-hour 3
Unit labor
costs
Implicit price
deflator *
Year or quarter
Private Total Private
Total Private
Total Private Total Private
Total Private
Total
nonnonnonnonnonprivate farm private farm private nonprivate
private
farm
farm private farm
farm
1947
1948
1949
45.6
47.8
47.6
44.5
46.5
46.4
88.8
89.2
86.2
78.0
79.1
76.0
51.3
53.6
55.3
57.1
58.8
61.1
36.2
39.5
40.1
38.3
41.8
43.0
70.6
73.7
72.5
67.1
71.0
70.3
66.4
70.9
70.2
63.8
68.2
68.7
1950
1951
1952
1953
1954
52.5
55.8
57 2
60.1
59.3
51.3
55.0
56.3
59.1
58.3
87.9
90.7
91 2
92.0
88.6
79.0
82.9
84.1
85.9
82.6
59.7
61.5
62.7
65.3
66.9
65.0
66.3
66.9
68.9
70.5
42.8
46.9
49.8
52.9
54.5
45.3
49.3
52.0
54.9
56.6
71.7
76.3
79 4
81.0
81.5
69.7
74.3
77.6
79.7
80.3
70.9
76.1
77 5
78.1
79.1
69.4
74.0
75.9
77.2
78.5
1955
1956
1957
1958
1959
64.3
65.6
66 5
65.6
70.2
63.4
64.7
65.7
64.8
69.5
92.1
93.7
92 3
88.4
91.2
86.1
88.4
87.9
84.5
87.6
69.9
70.0
72.0
74.3
76.9
73.6
73.2
74.8
76.7
79.3
55.9
59.5
63 3
66.0
69.0
58.6
62.0
65.5
68.1
71.0
80.1
85.0
87 9
88.9
89.8
79.6
84.7
87.6
88.7
89.5
79.8
82.3
85 3
87.1
88.3
79.5
82.3
85 3
86.8
88.3
71.9
73.2
78 2
81 5
86.2
71.1
72.5
77 6
80.9
85.9
92 0
90.6
92 4
92 9
94.5
88.6
87.7
89 8
90.9
92.9
78.2
80.9
84 7
87.7
91.1
80.3
82.7
86 4
89.1
92.4
71.7
74.4
77 7
80.8
84.9
73.9
76.3
79 3
82.2
86.1
91 8
92.1
91 8
92 1
93.1
92.0
92.3
91 8
92.3
93.2
89.5
90.4
91 2
92.2
93.2
89.6
90.4
91 2
92.3
93.4
1960
1961
1962
1963
1964
.
. .
1965
1966
1967
1968
1969
91.8
97.7
100.0
104.8
107.7
91.5
97.9
100.0
105.1
108.0
97 4
99.7
100.0
101.8
104.2
96.3
99.5
100.0
102.1
105.1
94.2
98.0
100.0
102.9
103.3
95.1
98.4
100.0
102.9
102.7
88.4
94.5
100.0
107.6
115.8
89.2
94.6
100.0
107.3
114.8
93 8
96.5
100.0
104.6
112.1
93.9
96.2
100.0
104.3
111.8
94.8
97.2
100.0
103.6
108.3
94.8
96.8
100.0
103.5
108.1
1970
1971
1972*
107.1
110.3
118.0
107.2
110.4
118.8
102.6
102.0
104.7
103.8
103.2
105.9
104.3
108.1
112.7
103.4
107.1
112.1
124.6
133.4
141.7
123.1
131.8
140.3
119.4
123.4
125.7
119.1
123.2
125.1
113.5
118.4
121.5
113.5
118.4
120.9
Seasonally adjusted
1970: 1
II
III
.
IV . .
1971: l__
II
III
IV
1972: 1
II
III..
IV v
.
106.8
107.3
107.9
. 106.5
107.0
107.3
108.1
106.5
103.9
103.2
102.1
101.3
105.1
104.2
103.2
102.5
102.8
103.9
105.8
105.1
101.8
103.0
104.7
103.9
121.5
123.3
126.1
127.7
119.9
122.0
124.6
126.1
118.2
118.7
119.4
121.5
117.7
118.4
119.0
121.3
111.8
112.8
113.9
115.6
111.5
112.8
113.9
115.9
108.7
109.7
110.4
112.3
108.7
109.8
110.5
112.7
101.6
101.9
101.8
102.6
102.8
103.0
103.0
103.8
107.0
107.6
108.5
109.4
105.8
106.6
107.3
108.5
130.6
132.5
134.4
136.0
128.8
131.2
132.9
134.5
122.0
123.2
123.9
124.2
121.8
123.0
123.8
123.9
117.0
118.2
119.0
119.3
117.1
118.3
119.1
119.1
114.3
117.1
118.9
121.5
114.9
117.8
120.0
122.5
103.4
104.4
105.0
105.9
104.5
105.9
106.1
107.2
110.5
112.2
113.3
114.8
109.9
111.3
113.1
114.3
138.8
140.7
142.2
114.9
137.4
139.0
141.1
143.6
125.7
125.5
125.5
126.3
125.0
124.9
124.8
125.7
120.6
121.1
121.8
122.6
120.2
120.6
121.1
121.7
.
1 Output refers to gross national product in 1958 dollars.
2 Hours of all persons in private industry engaged in production, including man-hours of proprietors and unpaid family
workers. Man-hours estimates based primarily on establishment data.
3 Wages and salaries of employees plus employers' contribution for social insurance and private benefits plans. Also
i ncludes an estimate of wages, salaries, and supplemental payments for the self-employed.
* Current dollar gross product divided by constant dollar product.
Note.—Data relate to all persons
Source: Department of Labor, Bureau of Labor Statistics.
230
TABLE C-33.—Changes in output per man-hour and related data, private economy, 1948-72
[Percent change from preceding period]
Man-hours 2
Output '
Output per
man-hour
Compensation
per man-hour3
Unit labor
costs
Implicit price
deflator <
Year or quarter
Total Private Total Private Total
Total Private
Total Private Total Private
nonnonnonnonnonprivate farm
private farm private farm private farm private farm private
Private
nonfarm
1948..
1949..
4.8
-.3
4.4
-.1
0.4
3.4
1.3
-3.9
4.5
3.2
3.0
4.0
9.0
1.5
9.0
2.9
4.3
-1.6
5.8
-1.0
6.7
-1.0
6.8
1950..
1951..
1952..
1953..
1954..
10.2
6.3
2.5
5.1
-1.3
10.6
7.0
2.5
5.1
-1.5
2.0
3.2
.5
.8
-3.7
4.0
4.9
1.5
2.1
-3.8
8.1
3.0
1.9
4.2
2.4
6.3
2.0
.9
2.9
2.3
6.8
9.6
6.1
6.3
3.1
5.5
8.7
5.5
5.6
3.2
-1.2
6.4
4.1
2.0
.6
6.6
4.5
2.6
.9
1.0
7.3
1.9
.7
1.2
1.1
6.5
2.6
1.8
1.7
1955..
1956..
1957..
1958..
1959..
8.5
1.9
1.4
-1.3
7.0
8.8
2.0
1.6
-1.5
7.3
3.9
1.7
-1.5
-4.2
3.3
4.2
2.6
-.6
-3.9
3.7
4.4
.2
2.9
3.1
3.6
4.4
-.6
2.2
2.5
3.4
2.6
6.4
6.5
4.2
4.6
3.5
5.8
5.7
3.8
4.3
-1.7
6.2
3.5
1.1
1.0
-.9
6.4
3.4
1.3
.9
.9
3.2
3.6
2.1
1.4
1.3
3.4
3.7
1.7
1.8
I960..
1961..
1962..
1963..
1964..
2.4
1.9
6.8
4.2
5.7
2.4
1.9
7.1
4.3
6.1
1.1
-1.0
2.5
1.2
2.3
1.6
3.5
4.7
3.6
3.9
1.2
3.0
4.6
3.1
3.7
3.9
3.8
4.4
4.0
5.0
4.1
3.2
4.0
3.6
4.7
2.2
.3
-.3
.4
1.1
2.8
-1.5
2.0
.6
1.8
-'.5
.5
1.0
1.4
.9
.9
1.0
1.2
1.4
.9
.9
1.2
1.3
1965..
1966..
1967..
1968..
1969..
6.6
6.4
2.3
4.8
2.8
6.6
7.0
2.2
5.1
2.8
3.1
2.4
.3
1.8
2.3
3.6
3.3
.5
2.1
2.9
3.4
4.0
2.1
2.9
.4
2.9
3.5
1.6
2.9
-.1
4.1
6.9
5.8
7.6
7.6
3.7
6.1
5.7
7.3
7.0
.7
2.8
3.7
4.6
7.1
2.5
4.0
4.3
7.2
1.7
2.5
2.9
3.6
4.5
1.4
2.2
3.3
3.5
4.5
-.5
3.0
7.0
-.7
3.0
7.6
-1.5
-.6
2.6
-1.3
-.6
2.7
1.0
3.6
4.2
.6
3.6
4.7
7.6
7.1
6.2
7.2
7.1
6.4
6.5
3.4
1.9
6.6
3.4
1.6
4.8
4.3
2.6
5.0
4.3
2.1
1970...
1971...
1972 P.
Seasonally adjusted annual rates
1970: I
III.
IV..
II
Ill
IV
1971:
1972:
II
III.
IV* . . .
-2.6
-3.0
-5.1
-5.7
-1.2
-3.4
-3.8
-2.7
-1.8
1.1
2.9
-1.3
-2.5
-4.3
-3.3
-1.3
1.7
2.3
4.3
6.9
-1.9
4.7
6.9
-3.1
6.9
5.9
9.4
5.4
6.5
7.2
9.0
4.6
8.3
1.6
2.4
7.4
8.4
2.4
2.0
8.0
5.2
3.8
3.8
6.3
5.2
4.9
3.7
7.2
8.7
3.7
2.5
7.2
8.6
4.1
2.4
8.1
1.2
1.5
-.6
3.4
1.1
.9
-.2
3.3
7.5
2.2
3.2
3.7
7.4
3.2
2.5
4.7
9.2
6.2
5.8
4.7
9.1
7.5
5.2
4.9
1.7
3.9
2.6
1.0
1.5
4.2
2.5
.3
4.7
4.3
2.8
1.0
4.5
4.0
2.7
.1
3.1
3.8
2.3
3.4
2.8
5.2
.9
4.1
3.9
6.2
4.1
5.3
5.2
5.1
6.6
4.3
8.7
5.6
4.4
7.8
9.1
4.6
6.1
7.4
4.6
-.6
.3
2.3
3.8
-.5
-.4
3.0
4.2
1.7
2.2
2.7
3.7
1.5
1.4
2.1
7.0
8.1
10.2
10.6
6.5
8.9
7.5
8.6
1
Output refers to gross national product in 1958 dollars.
2
Hours of all persons in private industry engaged in production, including man-hours of proprietors and unpaid family
workers.
Man-hours estimates based primarily on establishment data.
3
Wages and salaries of employees plus employers' contribution for social insurance and private benefits plans. Also
includes
an
estimate of wages, salaries, and supplemental payments for the self-employed.
4
Current dollar gross product divided by constant dollar product.
Note.—Data relate to all persons.
Percent changes are based on original data and therefore may differ slightly from percent changes based on indexes
in Table C-32.
Source: Department of Labor, Bureau of Labor Statistics.
231
PRODUCTION AND BUSINESS ACTIVITY
TABLE C-34.—Industrial production indexes, major industry divisions^ 1929-72
[1967=100]
Total
industrial
production
Year or month
Manufacturing
Mining
Total
Durable
Utilities
Nondurable
1929. .
21.6
22.8
22.6
23.0
44.4
7.2
1933
13.7
14.0
9.1
19.7
31.5
6.5
1939
21.7
21.5
17.8
25.9
43.4
10.4
1940
1941
1942
1943. .
1944..1945
1946
1947
1948
1949
25.0
31.6
36.3
44.0
47.4
40.6
35.0
39.4
41.0
38.8
25.4
32.4
37.8
47.0
50.9
42.6
35.3
39.4
40.9
38.7
23.7
31.6
40.1
54.5
60.2
45.5
31.8
37.9
39.5
35.9
27.2
32.9
34.3
36.7
38.2
38.1
39.3
40.9
42.2
41.5
48.2
51.2
52.8
54.0
57.9
56.8
55.8
63.1
66 3
58.8
11.5
13.0
14.6
16.1
17.1
17.4
18.1
19.6
21.9
23.3
1950
1951
1952
1953
1954 .
1955
1956
1957
1958
1959
44.9
48.7
50.6
54.8
51.9
58.5
61.1
61.9
57.9
64.8
45.0
48.6
50.6
55.1
51.5
58.2
60.5
61.2
56.9
64.1
43.7
49.2
52.2
59.0
52.0
59.5
61.5
61.9
54.2
62.2
46.2
47.8
48.7
50.7
51.0
56.6
59.5
60.5
61.0
67.0
65 7
72.1
71.5
73.4
71 9
80.2
84.4
84 5
77.5
81.1
26.5
30.3
32,8
35.6
38.3
42.8
47.0
50.2
52.5
57.8
66.2
66.7
72.2
76.5
81.7
89.2
97.9
100.0
105.7
110.7
65.4
65.6
71.4
75.8
81.2
89.1
98.3
100.0
105.7
110.5
63.3
62.1
69.0
73.5
79.0
88.5
99.0
100.0
105.5
110.0
68.6
70.7
75.1
79.2
84.4
90.0
97.3
100.0
106.0
111.1
82.7
83.2
85 6
89.0
91.1
93 9
98.4
100.0
103.9
107.2
61.8
65.3
70.2
75.1
81.9
86.9
93.6
100.0
109.4
119.5
106.6
106.8
114.3
105.2
105.2
113.2
101.4
99.4
107.4
110.6
113.5
121.5
109.7
107.0
108.4
128.3
133.9
143.0
.
I960
1961.
1962
1963
1964
1965
1966
1967
1968
1969
.
.
1970
1971
. .
.
Seasonally adjusted
1971- Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
1972: Jan
Feb
Mar
Apr
May
June
July
Aug..
Sept
Oct
Nov*
Dec*.
.
.
.
105.5
106.0
106.0
106.5
107.4
107.4
103.6
104.2
103.5
104.8
105.9
106.0
98.3
98.9
98.5
99.6
101.1
100.7
111.2
111.8
110.8
112.3
112.8
113.7
111.6
110.4
111.7
110.8
108.7
108.6
131.3
132.7
133.0
132.7
132.8
133.8
106.7
105.6
107.1
106.8
107.4
108.1
105.8
104.2
105.7
106.1
106.0
106.2
100.3
97.4
99.3
100.1
99.1
99.5
113.8
114.0
115.1
114.7
115.9
116.0
105.6
106.3
105.9
97.7
102.5
107.8
136.2
134.1
134.0
135.2
136.0
135.8
108 7
110.0
111.2
112.8
113 2
113.4
107 1
108.5
109.7
111.8
112 3
112.5
100.4
102.1
103.4
105.8
106 3
106.8
116.8
117.8
118.8
120.3
120 8
121.3
107.3
107.2
108.5
109.0
107.9
108.2
137.4
139.7
139.7
140.2
141.1
141.0
113.9
115.0
116.1
117.3
118.4
119.3
113.2
114.1
115.2
116.6
117.5
118.6
107.7
108.4
109.7
111.3
112.6
113.9
121.0
122.6
123.3
124.3
124.6
125.3
107.9
107.7
110.2
109.9
110.9
109.4
142.5
144.1
145.6
146.3
147.1
146.1
Source: Board of Governors of the Federal Reserve System.
232
TABLE O-35.—Industrial production indexes^ market groupings, 1947-72
[1967=100]
Final products
Year or
month
Total
ndustrial
production
Consumer goods
Total
Total
Automotive
products
x
Materials)
Equipment
Home
goods
Total
Intermediate
products
Total
Business
Durable
goods
Nondurable
goods
1947
1948
1949
39.4
41.0
38.8
38.3
39.7
38.5
42.7
44.0
43.8
47.8
50.0
49.6
39.1
40.8
37.7
29.7
31.2
27.9
38.0
39.5
34.5
42.5
44.9
42.6
39.7
41.4
37.8
39.1
40.2
36.0
38.8
40.9
37.8
1950
1951
1952
1953
1954.
44.9
48.7
50.6
54.8
51.9
43.4
46.8
50.3
53.7
50.8
50.0
49.5
50.6
53.7
53.3
62.4
55.2
49.7
62.8
58.4
52.0
44.8
44.8
50.7
46.8
30.2
42.1
50.5
54.7
47.9
37.0
45.2
51.2
53.2
46.8
49.6
52.0
51.7
55.3
55.1
45.2
50.0
50.7
56.3
52.0
45.3
51.6
52.7
61.5
53.1
43.6
47.1
47.3
50.2
50.3
1955
1956
1957
1958
1959
58.5
61.1
61.9
57.9
64.8
54.9
58.2
59.9
57.1
62.7
59.5
61.7
63.2
62.6
68.7
77.7
63.9
66.9
53.2
66.8
55.2
58.1
56.8
53.6
61.6
48.9
53.7
55.9
50.0
54.9
50.7
58.7
61.0
51.5
57.9
62.6
65.3
65.3
63.9
70.5
61.5
63.1
63.1
56.8
65.5
65.0
65.2
65.1
54.8
65.3
56.9
59.5
59.3
58.1
65.0
1960
1961
1962..
1963
1964
66.2
66.7
72.2
76.5
81.7
64.8
65.3
70.8
74.9
79.6
71.3
72.8
77.7
82.0
76.4
69.8
84.5
92.5
96.8
62.0
63.9
69.4
74.9
81.7
56.4
55.6
61.9
65.6
70.1
59.4
57.7
62.7
65.8
74.7
71.0
72.4
76.9
81.1
87.3
66.4
66.4
72.4
77.0
82.6
66.1
64.6
71.8
76.6
82.7
65.9
68.2
72.9
77.1
82.1
1965
1966
1967
1968
1969
89.2
97.9
100.0
105.7
110.7
86.8
96.1
100.0
105.8
109.0
93.0
98.6
100.0
106.6
111.1
112.3
108.8
100.0
117.9
117.4
91.4
100.7
100.0
106.9
111.6
78.7
93.0
100.0
104.7
106.1
84.4
98.8
100.0
103.4
107.9
93.0
99.2
100.0
105.7
112.0
91.0
99.8
100.0
105.7
112.4
93.0
103.0
100.0
105.0
112.2
88.5
96.3
100.0
106.9
112.8
1970
1971
1972 v
106.6
106.8
114.3
104.5
104.7
111.1
110.3
115.7
123.1
99.9
119.5
126.9
107.6
112.6
124.2
96.3
89.4
94.5
101.4
96.8
104.4
111.7
112.5
120.6
107.7
107.4
116.3
103.2
101.7
112.0
112.5
114.1
121.7
Seasonally adjusted
1971:Jan...
Feb..
Mar..
Apr..
May..
June.
105.5
106.0
106.0
106.5
107.4
107.4
103.2
103.5
103.3
104.0
104.4
104.6
113.0
113.3
113.7
114.7
115.4
116.1
111.2
117.6
117.8
115.7
120.7
121.2
106.1
107.1
109.1
112.4
115.0
114.6
89.4
89.8
88.8
88.9
88.7
88.5
95.1
96.7
95.6
95.6
95.1
95.6
110.3
111.8
111.4
111.7
112.9
112.2
106.9
107.1
107.7
107.9
109.4
109.3
101.9
102.0
102.3
102.6
105.4
103.7
112.1
112.5
112.9
113.1
113.3
115.2
July.
Aug.
Sept.
Oct..
Nov.
Dec..
106.7
105.6
107.1
106.8
107.4
108.1
105.0
104.8
105.5
105.4
106.1
106.2
116.3
115.9
116.7
116.6
118.0
118.0
121.7
122.3
122.9
121.9
119.7
119.9
115.0
114.4
113.8
113.9
113.8
116.0
89.3
89.5
89.8
89.8
89.6
89.6
97.1
97.5
98.2
98.2
97.9
98.0
114.6
110.9
112.3
113.2
114.3
114.9
106.4
104.8
107.3
106.6
106.5
108.4
99.7
96.5
100.6
102.2
100.5
101.6
113.6
114.7
114.7
115.0
115.9
116.7
1972:Jan..
Feb..
Mar.
AprMay.
June.
108.7
110.0
111.2
112.8
113.2
113.4
106.4
107.6
108.2
109.8
110.2
110.1
118.5
119.6
119.6
122.0
122.2
122.1
116.6
119.5
119.3
128.9
127.4
125.7
118.1
120.7
118.7
124.2
124.3
126.1
89.5
90.9
92.4
92.7
93.4
93.3
98.4
99.9
101.3
101.3
102.5
102.4
115.9
117.0
117.3
117.3
119.3
119.1
109.2
110.8
113.1
115.0
115.6
116.1
103.5
105.8
107.8
110.4
111.1
111.1
116.0
117.0
119.8
120.6
121.3
122.5
July.
Aug.
Sept.
Oct.
Nov v
Dec p
113.9
115.0
116.1
117.3
118.4
119.3
110.2
111.3
112.4
113.8
114.6
115.8
122.0
123.1
124.4
125.5
126.7
127.9
124.7
127.1
124.8
130.7
136.6
144.4
123.5
125.1
125.7
127.3
127.3
127.5
93.4
94.8
95.8
97.1
97.9
98.7
102.1
105.0
106.7
108.3
109.0
110.4
120.5
121.2
121.7
123.6
126.0
127.5
116.8
117.4
119.1
120.0
120.6
121.1
111.5
112.6
116.0
117.1
117.2
118.4
123.3
123.7
122.7
123.3
124.9
125.0
i Also includes apparel and consumer staples, not shown separately,
i Also includes industrial fuel and power, not shown separately.
Source: Board of Governors of the Federal Reserve System.
233
T A B L E C—36.—Industrial production indexes, selected manufactures,
1947—72
{1967=100]
Durable manufactures
Year or
month
Nondurable manufactures
OrdTransFabrinance, LumportaPricated
private
ber,
Mation I nstru- and
mary metal
clay,
metals prod- chinery equip- ments govand
ment
ucts
ernglass
ment
ChemFurni- j Texicals,
ture ! tiles, Paper
petro- Foods
and ! apparel, and
leum,
and
printmiscel- and
and tobacco
ing rubber
laneous leather
1947..
1948..
1949..
64.8
67.4
56.7
50.2
51.1
46.1
31.0
33.9
34.0
24.5
25.2
22.5
7.8
9.0
9.2
1950
1951
1952
1953
1954
71.4
77.7
70.9
80.4
65.0
56.5
60.4
58.9
66.5
59.9
41.7
40.7
45.4
52.8
66.2
57.6
26.1
30.0
35.7
39.2
39.6
11.4
42.2
52.0
63.2
48.4
64.7
53.7
65.7
52.2
35.4
1955..
1956..
1957..
1958..
1959..
84.5
84.0
80.4
63.8
74.5
68.3
69.3
71.1
63.7
71.5
46.7
52.2
52.0
45.4
53.9
66.3
64.3
68.9
54.3
61.5
44.2
48.5
50.7
47.7
55.2
36.1
31.8
35.9
44.4
46.1
73.8
75.9
73.3
71.4
82.2
65.8
68.7
67.1
62.1
68.7
73.4
75.1
73.4
71.8
79.6
57.8
61.5
62.2
61.5
67.0
41.2
43.5
45.8
46.5
53.8
I960..
1961..
1962..
1963..
1964..
74.2
72.9
78.2
84.3
95.7
71.6
69.8
75.9
78.4
83.3
56.2
57.1
64.8
67.9
74.3
63.7
59.9
69.3
75.9
79.6
57.8
57.3
59.8
66.4
71.3
46.4
39.2
45.0
51.6
50.7
78.5
79.7
84.3
88.9
94.0
69.7
70.6
76.1
79.5
84.7
79.2
80.2
84.3
86.9
91.9
69.2
71.0
74.3
78.4
84.5
55.6
58.3
64.5
70.0
75.9
1965..
1966..
1967..
1968..
1969..
104.0
108.8
100.0
103.2
114.1
92.6
100.5
100.0
106.3
113.6
84.1
98.6
100.0
101.9
106.8
91.3
101.2
100.0
109.7
107.6
82.9
95.3
100.0
106.7
116.1
60.5
75.1
100.0
113.7
111.6
98.7
102.6
100.0
105.6
111.1
93.8
100.8
100.0
106.2
111.6
97.8
101.7
100.0
104.9
105.9
90.5
98.9
100.0
104.2
109.1
83.8
94.1
100.0
109.6
118.4
1970...
1971....
1972 p.
106.9
100.9
112.4
109.4
107.4
113.4
100.3
96.2
105.3
90.4
92.9
98.8
110.8
108.5
118.9
95.3
86.1
86.4
106.3
111.5
119.9
108.8
111.7
122.7
100.2
100.7
106.3
107.8
107.8
115.4
118.2
124.7
137.7
Seasonally adjusted
May...
June...
108.1
105.8
106.2
108.5
114.3
108.1
105.9
106.6
104.9
108.6
108.6
108.6
93.5
94.5
94.2
94.4
95.6
96.3
92.1
93.8
92.5
90.7
92.1
93.1
106.5
105.3
105.5
106.7
108.0
108.5
87.9
86.0
85.5
87.9
88.5
87.1
105.7
108.9
110.4
112.0
111.6
112.6
105.4
107.8
106.7
110.8
111.6
113.3
99.0
97.6
97.7
99.8
100.6
101.3
107.0
108.0
104.4
106.7
106.8
105.9
118.7
121.4
121.6
123.1
123.2
126.1
July...
Aug...
Sept...
Oct....
Nov...
Dec...
98.9
81.2
93.8
96.1
91.4
94.3
110.9
108.2
105.9
107.1
107.1
107.6
97.7
96.7
97.9
98.3
97.8
97.9
93.2
93.9
94.2
94.5
93.4
92.7
110.9
109.1
110.5
111.2
110.4
109.3
85.0
85.5
85.2
85.3
84.9
84.4
111.4
111.0
112.1
113.2
113.7
114.8
115.9
114.0
114.2
114.0
113.3
114.3
100.9
100.8
102.5
102.3
101.8
103.1
108.4
108.1
108.2
109.4
110.5
110.7
124.7
126.3
127.5
126.6
127.9
127.9
1972: Jan...
Feb..
Mar..
May". 1
June..
102.4
102.6
105.1
110.2
113.5
111.9
106.0
108.6
110.1
110.8
111.9
112.3
98.5
99.5
100.3
102.6
103.0
104.8
92.0
94.7
95.9
100.4
98.9
97.4
111.3
114.5
114.2
116.1
117.3
119.3
83.2
83.7
86.4
87.3
87.6
87.8
115.5
118.0
118.1
118.1
118.2
119.0
115.0
117.3
118.4
119.9
120.6
122.1
102.0
101.1
103.7
106.1
104.9
105.9
111.3
112.6
112.6
112.3
114.1
115.1
129.8
132.6
133.4
136.1
137.5
137.1
July..
Aug..
Sept..
Oct...
Nov p.
Dec »__
114.9
113.6
117.4
118.2
119.6
121.5
114.1
114.4
115.2
117.5
118.7
119.7
104.8
107.1
108.3
109.5
110.6
112.0
98.2
98.4
99.8
102.4
104.9
107.1
119.9
120.9
122.4
122.9
123.7
123.5
88.0
86.2
84.8
86.3
87.4
87.5
119.1
119.6
120.5
123.5
124.2
125.4
123.7
126.7
126.6
126.2
125.9
128.3
104.8
106.8
108.0
109.0
109.5
110.7
115.2
116.4
115.3
118.3
120.7
120.2
137.4
139.9
141.1
142.0
140.8
142.4
1971: J a n . . . .
Feb....
Mar...
Apr
Source: Board of Governors of the Federal Reserve System.
234
TABLE C-37.—Manufacturing
output, capacity, and utilization rate, 1948-72
Utilization rate 2
Period
Output 1
Capacity
Total
Primary
processing
1967 output=100
Advanced
processing
Percent
1948
1949
41.5
39.1
44.8
47.3
92.7
82.7
98.1
83.8
89.8
82.1
1950
1951
1952
1953
1954
45.4
49.3
50.9
55.4
51.4
49.4
51.8
54.9
58.1
61.2
91.9
95.1
92.8
95.5
84.1
97.8
100.1
91.2
94.3
82.9
88 8
92.5
93.7
96 1
84.7
1956
1957
1958
1959
58.1
60.3
61.1
56.9
64.0
64.4
68.3
74.8
75.7
78.6
90.0
88.2
84.5
75.1
81.4
93.7
90.7
85.2
75.2
82.7
87.7
86.9
84.1
75.0
80.7
1960
1961
1962
1963
1964
65.3
65.6
71.3
75.7
81.1
81.6
84.5
87.7
91.2
94.8
80.1
77.6
81.4
83.0
85.5
79.4
78.2
81.8
84.0
88.0
80.3
77.3
81.1
82.5
84.2
1966
1967
1968
1969
89.0
98.1
99.9
105.6
110.4
100.0
106.7
113.7
120.5
127.7
89.0
91.9
87.9
87.7
86.5
91.1
92.1
85.7
86.8
88.5
87.8
91.8
89.1
88.1
85.4
1970
1971
1972
105.3
105.2
113.0
134.6
140.3
145.6
78.3
75.0
77.6
81.5
79.3
83.5
76.5
72.7
74.5
Seasonally adjusted
1967: 1
98.8
98.9
99.9
101.9
111 2
112.8
114.5
116.2
88 9
87.7
87.3
87.7
87.1
84.4
84.9
86.5
89.9
89.5
88.6
88.4
1968: 1
103.5
105.3
106.3
107.3
117 9
119.6
121.3
123.0
87 9
88.1
87.6
87.2
86.1
87.6
86.6
87.0
88.8
88.3
88.2
87.3
19R9- 1
109.5
110.4
111.8
110.1
124.9
126.7
128 6
130.5
87.7
87.1
86 9
84.3
88.6
88.7
88.9
87.7
87.1
86.2
85.8
82.5
106.8
106.8
105.9
101.6
132.2
133 8
135.3
136.9
80.8
79.8
78.3
74.2
83.5
82.4
81.7
78.5
79.3
78.4
76.5
71.9
103.8
105.6
105.3
106.1
138.3
139.6
141.0
142.3
75.0
75.6
74.7
74.6
79.4
81.1
78.0
78.6
72.7
72.7
72.9
72.4
108.2
112.2
114.2
117.6
143.6
144.9
146.3
147.6
75.3
77.4
78.1
79.7
80.3
83.3
84.3
86.2
72.7
74.3
74.7
76.2
II
III
IV
II
III
IV
II
III
IV
1970:
II
III.
.
IV
1971 • 1
II
ill
IV
1972 1 P
II P..
Ill P
IV P
1 May differ slightly from data shown in Table C-34 because of rounding.
2 Output as percent of capacity.
Note.—For description of series, see "Federal Reserve Bulletin," October 1971 and November 1966.
Source: Board of Governors of the Federal Reserve System, based on data of Federal Reserve, Department of Commerce,
and McGraw-Hill Information Systems Company.
235
TABLE Q-38.—New construction activity, 1929-72
[Value put in place, millions of dollars]
Private construction
Year or month
Total
new
construction
Residential
buildings i
Public construction
Nonresidential buildings and other
construction»
Total
Total
Total 2
New
housing
units
Total
Commercials
Industrial
Other*
p.
j
State
and
erally
locally
owned owned «
1929
10,793
8,307
3,625
3,040
4,682
1,135
949
2,598
2,486
155
1933
2,879
1,231
470
290
761
130
176
455
1,648
516
1,132
1939
8,198
4,389
2,680
2,270
1,709
292
254
1,163
3,809
759
3,050
1940
1941
1942
1943.
1944
8,682
11,957
14,075
8,301
5,259
5,054
6,206
3,415
1,979
2,186
2,985
3,510
1 715
2,560
3,040
1,440
710
570
348
409
155
33
56
442
801
346
156
208
1,279
1,486
1,199
885
815
2,069
2,696
1,700
1,094
1,371
1,182
3,751
9,313
5,609
2,505
2,446
2,000
1,347
1,107
3,628
5,751
10,660
6,322
3,073
1945
1946
5,809
12,627
3,411
10,396
1,276
4,752
2,135
5,644
203
642
1,153
1,689
1,290
2,802
2,398
2,231
1,737
3,300
New series
1946
1947 .
1948
1949
14,308
20,041
26,078
26, 722
12,077
16,722
21,374
20,453
6,247
9,850
13,128
12,428
4,795
7,765
10,506
10,043
5,830
6,872
8,246
8,025
1,153
1,397
1,182
1,689
1,702
1,397
972
2,988
41213
5,452
5,871
2,231
3,319
4,704
6,269
1950
1951
1952
1953
1954
33, 575
35,435
36,828
39,136
41,380
26, 709
26,180
26,049
27,894
29,668
18,126
15,881
15,803
16, 594
18,187
15,551
13, 207
12,851
13,411
14,931
8,583
10, 299
10, 246
11,300
11,481
1,415
1,498
1,137
1,791
2,212
1,062
2,117
2,320
2,229
2,030
6,106
6,684
6,789
7,280
7,239
1955
1956
1957
1958 . . .
1959..
46, 519
47,601
49,139
50,153
55,305
34,804
34,869
35, 080
34, 696
39, 235
21,877
20,178
19,006
19, 789
24, 251
18,242
16,143
14, 736
15,445
19, 233
12,927
14,691
16,074
14, 907
14,984
3,218
3,631
3,564
3,589
3,930
2,399
3,084
3,557
2,382
2,106
1960
1961
1962
1963
1964
54,632
56, 292
59,965
64, 563
67,413
38, 769
39,144
42,096
45, 206
47,030
22,975
23,107
25,150
27,874
28,010
17, 279
17,074
19,443
21, 735
21, 786
15,794
16,037
16,946
17,332
19,020
4,180
4,674
5,144
4,995
5,396
2,851
2,780
2,842
2,906
3,565
73,412
76,002
77, 503
86,626
93,368
51,350
51,995
51,967
59,021
65,404
27,934
25,715
25,568
30,565
33,200
21,712
19,352
18,985
24,030
25,941
23,416
26, 280
26, 399
28,456
32,204
7,761
9,401
94,030
109,399
123, 570
65,932
79,535
93,390
31,864
43,062
53,910
24, 272
34,860
44, 540
34,068 9,754
36,473 11,619
39, 480 13, 520
1965
1966
1967
1968
1969
1970
1971..
1972*
.
720
See footnotes at end of table.
236
957
905
2,331
713
568
661
865
1,366
865
840
1,177
1,488
1,366
2,479
3 577
4,781
6,866
9,255
10, 779
11,242
11,712
1,624
2,981
4,185
4,139
3,428
5,242
6,274
6,594
7,103
8,284
7,310
7,976
8,953
8,936
8,948
11,715
12, 732
14,059
15,457
16,070
2,769
2,726
2,974
3,387
3,724
8,946
10,006
11,085
12,070
12,346
8,763
8,583
8,960
9,431
10,059
15,863
17,148
17,869
19,357
20,383
3,622
3,879
3,913
4,001
3,898
12,241
13,269
13,956
15,356
16, 485
6,021
6,783
14,674
16,020
22,062
24,007
25,536
27,605
27,964
4,014
3,964
3,475
3,367
3,313
18,048
20,043
22,061
24,238
24,651
6,538
5,423
4,660
17,776
19,431
21,300
28,098
29,864
30,180
3,292
3,976
4,430
24,806
25,888
25,750
TABLE C-38.—New construction activity,
1929-72—Continued
(Value put in place, millions of dollars]
Private construction
Year or month
Total
new
construction
Nonresidential buildings and other
constructionl
IResidential
buildings i
Total
Total 2
Public construction
New
housing
units
Total
Commercials
Industrial
Total
Federally
owned
Ctata
Oldie
ana
locally
owned'
Other *
. _
j
Seasonally adjusted annual rates
1971:Jan
Feb
Mar
Apr
May
June
July
Aug
Sept....
Oct
Nov
Dec
1972:Jan
Feb
Mar
Apr.....
May....
June
July....
Aug
Sept....
Oct *__..
Nov»___
102,
103,
104,
107,
108,
108,
337
494
943
181
014
465
72, 131
73, 208
74,714
77,223
77, 921
79, 688
36, 493
37,673
38, 785
40, 444
41, 896
42, 867
28,688
29,995
31,070
32,343
33,776
34, 795
35,
35,
35,
36,
36,
36,
638
535
929
779
025
821
10, 204
10,190
10, 651
11, 238
11, 150
11, 657
6,246
6,244
6,072
6,030
5,737
5,459
19,188
19,101
19,206
19, 511
19,138
19,705
30, 206
30,286
30,229
29,958
30,093
28,777
1,804
1,707
t,807
), 895
1,929
\5,937
26,402
26,579
26,422
26,063
26,164
24,840
110,
111,
110,
114,
114,
115,
194
021
660
047
627
553
80, 522
82,062
81, 555
82, 441
84, 153
85, 241
43,
44,
45,
46,
47,
47,
566
595
575
387
094
919
35,666
36,712
37, 458
37,671
37,954
38,710
36,956
37, 467
35,980
36 054
37 059
37, 322
12, 472
12, 936
11, 724
11, 779
12, 349
12,354
5,370
4,903
4,648
4,988
4,908
4,937
19,114
19, 628
19, 608
19, 287
19,802
20, 031
29, 672
28,959
29,105
31, 606
30,474
30,312
t1,523
'5,970
5,847
I1,052
I1,271
5,932
25,149
24,989
25,258
27, 554
26,203
26,380
120,790
121, 777
122 912
120 417
122 121
121 035
88 606
90 860
92 529
91 469
92 299
92,426
49, 594
51, 922
53 089
52,668
52, 330
52 923
40,424
42,807
44,031
43,624
43,286
43,655
39
38
39
38
39
39
012
938
440
801
969
503
13,
13,
13
13
14
13
272
247
244
411
132
477
4,935
4,674
4,796
4,649
4,723
4,944
20,805
21, 017
21,400
20,741
21,114
21,082
32,184
30, 917
30, 383
28,948
29,822
28,609
(,466
27,718
26, 536
25,613
24,788
25, 265
23,774
119,
122
124
129
129
91
93
94
96
97
53
54
55
56
56
44,012
44,726
45,908
46,686
47,135
38
39
38
39
41
016
293
813
917
103
12
13
13
13
13
979
406
490
770
848
4,592
4,814
4,432
4,301
4,587
20,445
21,073
20, 891
21,846
22,668
28, 283
29, 203
30,611
32,824
31,137
808
810
900
039
083
525
607
289
215
946
509
314
476
298
843
I1,381
1,770
i1,160
I1,557
i1,835
(,380
M24
1,183
(,391
(,488
23,903
25,079
26,428
28,433
i Beginning 1960, farm residential buildings included in residential buildings; prior to 1960, included in nonresidential
buildings and other construction.
3
Total includes additions and alterations and nonhousekeeping units, not shown separately.
3 Office buildings, warehouses, stores, restaurants, garages, etc.
< Religious, educational, hospital and institutional, miscellaneous nonresidential, farm, public utilities, and all other
private.
* Includes Federal grants-in-aid for State and locally owned projects.
« Preliminary estimates by Council of Economic Advisers.
Source: Department of Commerce, Bureau of the Census, except as noted.
http://fraser.stlouisfed.org/
490-000 O - 73 - 16
Federal Reserve Bank of St. Louis
237
TABLE C-39.—New housing starts and applications for financing, 1929-72
[Thousands of units]
Housing starts
Proposed
Private and
public i
home con-6
struction
Private i
Total (farm and nonfarm)
Year or month
Total
(farm
and
nonfarm)
Type of
structure 2
Nonfarm
Government
home programs
(nonfarm) 3
New
private
housing
units
authorized «
Total
One
family
Two or
more
families
FHA *
VA
Applications
for
FHA
commitments*
Requests
for
VA
appraisals
509.0
1929
93.0
1933
515.0
144.7
179.8
602.6
706.1
356.0
191.0
141.8
176.6
217.1
160.2
126.1
83.6
231.2
288.5
238.5
144.4
62.9
1945
1946
1947
1948
1949
326.0
1,023.0
1,268.0
1,362.0
1,466.0
38.9
57.1
178.3
216.4
252.6
7 8.8
91.8
160.3
71.1
90.8
56.6
121.7
286.4
293.2
327 0
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
1,952. 0
1,491.0
1,504.0
1,438.0
1,551.0
1,646.0
1,349.0
1,224.0
1,382.0
1,553.7 1,531.3
191 2
148.6
141.3
156.5
307.0
392.9
270.7
128.3
102.1
109.3 1,208.3
397 7
192 8
267.9
253.7
338.6
306.2
197.7
198.8
341.7
369.7
164 4
226.3
251.4
535.4
620.8
401.5
159.4
234.2
234.0
998.0
1,064.2
1,186.6
1,334.7
1,285.8
1,239.8
971.9
1,141.0
1,353.4
1,323.7
242.4
243.8
221.1
190.2
182.1
188.9
153.0
167.2
168.9
187.6
142.9
177.8
171.2
139.3
113.6
102.1
99.2
124.3
131.7
138.2
61.0 1,351.5
94 0 1,924 6
104.0 2,129.0
315.0
366 8
143.7
217.9
209.4
1939
.
. .
1940
1941
1942
1943
1944
New series
.
.
.
1960
1961
1962
1963
1964.
1965
1966
1967
1968
1969
1,296.1
1,365.0
1,492.5
1, 634.9
1,561.0
1,509.7
1,195.8
1,321.9
1,545.4
1,499.5
1,274.0
1,336.8
1,468.7
1,614.8
1,534.0
1,487.5
1,172.8
1,298.8
1,521.4
1,482.3
1970
1971
1972 »
1,469.0
2,084. 5
2,377. 7
O)
8
1,517.6
1,234.6
283.0
328.2
186.9
229.1
216.5
250.9
268.7
183.4
150.1
270.3
307.0
1,252.2
1,313.0
1,462.9
1,603.2
1,528.8
1,472.8
1,164.9
1,291.6
1,507.6
1,466.8
994.7
974.3
991.4
1,012.4
970.5
963.7
778.6
843.9
899.4
810.6
257.4
338.7
471.5
590.8
558.3
509.1
386.3
447.7
608.2
656.2
225.7
198.8
197.3
166.2
154.0
159.9
129.1
141.9
147.7
153.6
812.9
620.7
1,433.6
901.2
2,052.2 1,151.0
2, 355. 5 1,310.0 1,045.5
£33.5
301.2
See footnotes at end of table.
238
74.6
83.3
77.8
71.0
59.2
49.4
36.8
52.5
56.1
51.2
TABLE O-39.—New housing starts and applications for financing, 1929-72—Continued
[Thousands of units]
Housing starts
Private and
public i
Proposed
home construction «
Private i
Total (farm and nonfarm)
Year or month
Total
(farm
and
nonfarm)
Type of
structure*
Nonfarm
Government
home programs
(nonfarm) 3
Total
One
family
Two or
more
families
FHA<
VA
New
private
housing
Appliunits
author- cations
for
ized 5
FHA
commitments «
Requests
for
VA
appraisals
Seasonally adjusted annual rates
1971: J a n . . .
Feb...
Mar...
Apr...
May..
June..
114.8
104.6
169.3
203.6
203.5
196.8
July..
Aug...
Sept..
Oct...
Nov...
Dec...
197.0
205.9
175.6
181.7
176.4
155.3
Jan..
Feb...
MarApr...
May..
June.
150.9
153.6
205.8
213.2
227.9
226.2
July..
Aug..
Sept..
Oct...
207.5
231.0
204.4
218.2
186.3
152.7
1972:
NOVP
Dec p.
(8
<•
88
((8
(8 8)
t)
&
i)
i)
t
I)
(
(
(J
1,810
1,794
1,938
1,951
2,046
2,008
2,091
2,219
2,029
2,038
2,228
2,457
2,487
2,682
2,369
2,109
2,350
2,330
2,218
2,484
2,399
2,462
2,388
2,392
1,007
1,005
1,080
1,122
1,152
1,150
,162
1,198
1,172
1,155
1,242
1,347
L,415
1,325
1,302
1,167
1,344
1,296
1,289
1,410
1,383
1,308
1,307
1,240
803
789
858
829
894
858
929
1,021
857
882
985
1,110
1,072
1,357
1,067
942
1,006
1,034
929
1,074
1,016
1,154
1,081
1,152
384
286
266
280
271
290
288
325
294
299
293
383
378
287
262
219
189
177
173
179
173
150
126
75
73
82
93
96
91
99
103
98
98
105
104
116
118
125
104
98
98
106
103
106
97
93
86
1,668
1,572
1,722
1,721
1.971
1,913
2,079
2,046
1,987
2,027
2,092
2,191
2,204
2,056
2,007
1,991
1,955
2,121
2,108
2.237
2,265
2,216
2,139
2,372
366
349
344
348
375
378
392
359
343
351
291
450
333
326
260
221
217
217
223
206
163
150
162
189
175
186
206
221
250
234
218
253
231
207
228
232
224
207
248
197
219
203
199
193
191
207
192
1
Units in structures built by private developers for sale upon completion to local public housing authorities under the
Department of Housing and Urban Development "Turnkey" program are classified as private housing. Military housing
starts, including those financed with mortgages insured by FHA under Section 803 of the National Housing Act, ars included in publicly financed starts but excluded from total private starts and from FHA starts.
2 Not available prior to 1959 except for nonfarm for 1929-44.
3 Data are not available for new homes started under the Department of Agriculture, Farmers Home Administration
program.
4
Units are for 1- to 4-family housing.
« Data beginning 1967 cover approximately 13,000 permit-issuing places. Data for 1963-66 are based on 12,000 places
and 1959-62,10,000 places. The addition of approximately 1,000 permit-issuing places in 1967 contributed an increase of
3 percent in total permit authorizations.
« Units in mortgage applications or appraisal requests for new home construction.
i Monthly estimates for September 1945-May 1950 were prepared by Housing and Home Finance Agency.
" Not available separately beginning January 1970.
Sources: Department of Commerce, Department of Housing and Urban Development, and Veterans Administration
(except as noted).
239
TABLE C-40.—Business expenditures for new plant and equipment, 1947-73l
[Billions of dollars]
Manufacturing
Year
or quarter
Total
Total
Transportation
Durable
goods
Nondurable
goods
Mining
Railroad
Air
Other
Public
utilities
Communication
Commercial
and
other 2
1947
1948
1949
19.33
21.30
18.98
8.44
9.01
7.12
3.25
3.30
2.45
5.19
5.71
4.68
0.69
.93
.88
0.91
1.37
1.42
0.17
.10
.12
1.13
1.17
.76
1 54
2.54
3.10
1.40
1.74
1.34
5 05
4.42
4.24
1950
1951
1952.
1953
1954
20.21
25.46
26.43
28.20
27.19
7.39
10.71
11.45
11.86
11.24
2.94
4.82
5.21
5.31
4.91
4.45
5.89
6.24
6.56
6.33
.84
1.11
1.21
1.25
1.28
1.18
1.58
1.50
1.42
.93
.10
.14
.24
.24
.24
1.09
1.33
1.23
1.29
1.22
3.24
3.56
3.74
4.34
3.99
1.14
1 37
1.61
1.78
1.82
5.22
5 67
5.45
6.02
6.45
1955
1956
1957
1958
1959
29.53
35.73
37.94
31.89
33.55
11.89
15.40
16.51
12.38
12.77
5.41
7.45
7.84
5.61
5.81
6.48
7.95
8.68
6.77
6.95
1.31
1.64
1.69
1.43
1.36
1.02
1.37
1.58
.86
1.02
.26
.35
.41
.37
.78
1.30
1.31
1.30
1.06
1.33
4.03
4.52
5.67
5.52
5.14
2.11
2.82
3.19
2.79
2.72
7.63
8.32
7.60
7.48
8.44
1960
1961
1962
1963
1964
36.75
35.91
38.39
40.77
46.97
15.09
14.33
15 06
16.22
19.34
7.23
6.31
6.79
7.53
9.28
7.85
8.02
8.26
8.70
10.07
1.30
1.29
1.40
1.27
1.34
1.16
.82
1.02
1.26
1.66
.66
.73
52
.40
1.02
1.30
1.23
1.65
1.58
1.50
5.24
5.00
4.90
4.98
5.49
3.24
3.39
3.85
4.06
4.61
8.75
9.13
9.99
10.99
12.02
1965
1966
1967
1968
1969
54.42
63.51
65.47
67.76
75.56
23.44
28 20
28 51
28.37
31.68
11.50
14.06
14.06
14.12
15.96
11.94
14.14
14.45
14.25
15.72
1.46
1.62
1.65
1.63
1.86
1.99
2.37
1.86
1.45
1.86
1.22
1.74
2.29
2.56
2.51
1.68
1.64
1.48
1.59
1.68
6.13
7.43
8.74
10.20
11.61
5.30
6.02
6 34
6.83
8.30
13.19
14.48
14.59
15.14
16.05
1970
1971
1972 3
79 71
81.21
88.54
31 95
29.99
31.16
15 80
14.15
15.52
16.15
15.84
15.65
1.89
2.16
2.45
1.78
1.67
1.80
3 03
1.88
2.52
1.23
1.38
1.41
13.14
15.30
17.11
10.10
10.77
11.90
16.59
18.05
20.18
19733
99.99
35.42
18.11
17.31
2.88
1.98
2.41
1.43
19.73
. ..
.. .
36 14
Seasonally adjusted annual rates
1970: 1
IL —
III
IV
78.22
80.22
81.88
78.63
32.44
32.43
32.15
30.98
16.40
16.32
15.74
14.92
16.05
16.11
16.40
16.05
1.92
1.84
1.86
1.94
1.74
1.88
1.96
1.56
2.94
2.88
3.24
3.08
1.37
1.12
1.22
1.22
12.14
12.72
13.84
13.68
9.14
10.38
10.62
10.20
16.52
16.98
17.00
15.97
1971: 1
IL —
III...
IV....
79.32
81.61
80.75
83.18
30.46
30.12
29.19
30.35
14.21
14.06
13.76
14.61
16.25
16.06
15.43
15.74
2.04
2.08
2.23
2.30
1.46
1.88
1.72
1.64
1.29
2.28
1.68
2.26
1.33
1.40
1.48
1.33
14.64
14.91
15.87
15.74
10.70
11.21
10.73
10.44
17.39
17.72
17.85
19.10
1972: I
IL —
III...
IV 3 . .
86.79
87.12
87.67
92.36
30.09
30.37
30.98
32.96
15.06
14.77
15.67
16.44
15.02
15.60
15.31
16.52
2.42
2.38
2.40
2.61
2.10
1.88
1.50
1.70
1.96
2.89
2.67
2.57
1.48
1.53
1.41
1.28
16.92
16.60
17.01
17.94
11.71
20.10
11.59
19.88
11.56
20.16
33730
1973:
96.66
97.93
35.11
35.57
17.98
18.00
17.14
17.57
2.66
1.96
2.14
1.50
62.36
19.48
|3._..
IM...
33.80
* Excludes agricultural business; real estate operators; medical, legal, educational, and cultural service; and nonprofit
organizations. These figures do not agree precisely with the nonresidential fixed investment data in the gross national
product estimates, mainly because those data include investment by farmers, professionals, institutions, and real estate
firms, and certain outlays charged to current account.
2 Commercial and other includes trade, service, construction, finance, and insurance.
3 Estimates based on expected capital expenditures reported by business in October-December 197?. Includes adjustments when necessary for systematic tendencies in expectations data.
Note.—Annual total is the sum of unadjusted expenditures; it does not necessarily coincide with the average of seasonally adjusted figures.
Source: Department of Commerce, Bureau of Economic Analysis.
240
TABLE C-41.—Sales and inventories in manufacturing and trade; 1947-72
[Amounts in millions of dollars]
Total manufacturing
and trade
Manufacturing
Merchant wholesalers
Retail trade
Year or month
Inven- Ratio 3
Sales i tories
Sales
2
InvenInven- Ratios
Inven- Ratio s
Sales i tories
tories 2 Ratio 3 Sales i tories 2
2
1947...
1948...
1949...
35,260 52,507
33,788 49,497
15,513 25,897
1.42 17,316 28,543
1.53 16,126 26,321
1950...
1951...
1952...
1953...
1954...
38,596
43,356
44,840
47,987
46,443
59,822
70,242
72,377
76,122
73,175
1.36
1.55
1.58
1.58
1.60
18,634
21,714
22, 529
24,843
23,355
1955...
1956...
1957...
1958...
1959...
51,694
54,063
55,879
54,233
59,661
79,516
87,304
89,052
86,922
91,891
1.47
1.55
1.59
1.60
1.50
1960...
1961*_
1962...
1963...
1964...
60,746
61,133
65,417
68,969
94,747
95,648
101,090
105,477
1965...
1966...
1967...
1968...
1969...
1970...
1971...
1972*.
58
57
75
6,808
6,514
31,078
39,306
41,136
43,948
41,612
48
66
78
76
81
7,695 9,284
8,597 9,886
8,782 10,210
9,052 10,686
8,993 10,637
26,480
27, 740
28,736
27,280
30, 219
45,069
50,642
51,871
50,070
52, 707
62
73
80
84
70
9,893
10,513
10,475
10,257
11,491
1.56
1.54
1.51
1.49
1.47
30,796
30,896
33,113
35,032
37,335
53,814
54,939
58,213
60,043
63, 386
76
74
72
69
64
80, 276 120, 900
87,178 136,
136,729
89,698 145,108
97,100 155; 336
103,104 166,694
1.45
1.47
1.57
1.55
1.56
41,003
44,869
46,449
50, 282
53, 555
68, 221
77,965
84, 599
90,835
96,955
60
62
76
74
76
104,407 174,942
111,931 182,842
123,816 192,282
1,64 52,560 101,712
__
1.60 55,580 101 ,665
1.51 62,069 106;i, 371
10, 200 14,241
1.13 11,135 16,007
1.19 11,149 15,470
1.26
1.39
1.41
1.07
1.16
1.12
1.17
1.18
12,268
13,046
13,529
14,091
14, 095
19,460
21,050
21,031
21,488
20,926
1.38
1.64
1.52
1.53
1.51
11,678
13,260
12, 730
12, 739
13,879
1.13
1.19
1.23
1.24
1.15
15,321
15,811
16,667
16,696
17,951
22,769
23,402
24,451
24,113
25,305
1.43
1.47
1.44
1.43
1.40
11,656
11,988
12,674
13,382
14, 527
14,120
14,488
14, 936
16,048
16,977
1.22
1.20
.16
.15
.13
18, 294
18,249
19,630
20, 556
21,823
26,813
26,221
27,941
29,386
31,094
1.45
1.43
1.38
1.39
1.40
15,595
16,979
17,099
18,329
19, 726
18, 274
20,691
21,557
22,528
24,363
14
14
21
20
19
23,677
25,330
26,151
28, 490
29, 824
34,405
38,073
38,952
41,973
45,376
1.39
1.44
1.46
1.43
1.46
23 31, 294 46,626
23 34,071 52, 261
21 37,085 54, 658
1.47
1.47
1.43
7,957
7,706
1.90 20,554 26,604
1.83 22,280 28,916
1.67 24, 663 31, 253
Seasonally adjusted
1971:Jan
Feb
Mar
Apr....
May...
June...
1972:
175,740
176,472
177,390
178,037
111,458 178,827
112,647 179,155
1.65
.63
.62
.61
.60
.59
53,139
54,017
54,802
54,978
55,507
56,104
101,901
101,757
101,782
101,643
101,866
101,614
1.92
1.88
1.86
1.85
1.84
1.81
21,338
21,334
21,676
21,897
22,449
22,716
26,646
26,806
26, 788
27,046
27,140
27,333
25
26
24
24
21
20
32,290
32,850
33,274
33, 578
33, 502
33,827
47,193
47,909
48.820
49,348
49.821
50,208
July....
Aug....
Sept...
Oct....
Nov....
Dec...
111,791 179,612
.
113,910 180, 298
113,450 181,331
113,191 181,747
115,757 181,852
.
115,630 182,842
61
58
.60
61
.57
.58
55,482
56,650
55,682
55,943
57,444
57,740
101,317
101,280
101,413
101,736
101,699
101,665
1.83
1.79
1.82
1.82
1.77
1.76
22,621
22,605
22,549
22, 284
22,739
22,994
27,866
27, 795
27,814
27,928
28,237
28,916
23
23
23
25
24
26
33,688
34,655
35, 219
34,964
35, 574
34,896
50,429
51,223
52,104
52,083
51,916
52,261
Jan....
Feb....
Mar...
Apr....
May...
June...
118,426 183,303
118,077 183,826
120,669 184,
.. ,263
121,685 184,816
122,814 185i
185,953
122,283 186,439
55
56
53
52
51
52
59,189
59,199
60,335
61,219
61,413
61,231
101,796
102,161
102,450
102,428
102,822
103, 505
1.72
1.73
1.70
1.67
1.67
1.69
24,351
23,533
23,884
24,170
24,260
24, 230
29,049
29,181
29,174
29,574
29,729
29,641
19
24
22
22
23
22
34,886
35,345
36,450
36, 296
37,141
36,822
52,458
52,484
52,639
52,814
53,402
53, 293
July...
Aug...
Sept...
Oct....
Nov*»_.
Dec*...
123,371 186,884
„..
126,458 188,
1,409
127,056 189,), 759
129,609 190,i,974
131,529 192,1,282
.51
.49
1.49
1.47
1.46
61,635 103,888
63,352 105,138
63,903 105,441
64,725 106,008
66, 553 106,371
1.69
1.66
1.65
1.64
1.60
24,394
25,137
25,407
25,779
26,148
30,056
30,164
30,657
31,032
31, 253
1.23
1.20
1.21
1.20
1.20
37,342
37,969
37,746
39,105
38, 828
38,944
52,940
53,107
53,661
53,934
54,658
106,767
108,201
109,752
110,453
12 Monthly average for year and total for month.
Seasonally adjusted, end of period.
~ Inventory/sales ratio. For annual periods, ratio of weighted average inventories to average monthly sales; for monthly
" of
if inventories
ii
data, ratio
at end of month to sales for month.
:a. See Department of Commerce, Bureau
* Manufacturing data prior to 1961 not com
of the Census, "Series M3-1.1," September l l _ _ .
« Based on seasonally adjusted data through November.
Note.—The inventory figures in this table do not agree with the estimates of change in business inventories included
in the gross national product since these figures cover only manufacturing and trade rather than all business, and show
inventories in terms of current book value without adjustment for revaluation.
Source: Department of Commerce (Bureau of Economic Analysis and Bureau of the Census).
241
C-42.—Manufacturers* shipments and inventories, 1947-72
[Millions of dollars]
Shipments l
Year or month
Total
Inventories 2
DuraNonble
durable
goods goods
indus- industries
tries
Durable goods industries
Total
Total
MateFinrials Work
ished
and
in
sup- process goods
plies
1947
1948
1949
15,513
17,316
16,126
1950
1951
1952..
1953
1954.
18,634
21,714
22,529
24,843
23,355
8,845
9,789 31,078 15,539
10,493 .11,221 39,306 20,991
11,313 11,216 41,136 23,731
13,349 11,494 43,948 25,878
11,828 11,527 41,612 23,710
1955
1956. .
1957....
1958.
1959
26,480
27,740
28,736
27.280
30;219
14,071
14,715
15,237
13,571
15,545
12,409
13,025
13,499
13,708
14,674
45,069
50,642
51,871
50,070
52,707
26,405 9,194 10,756
30,447 10,417 12,317
31,728 10,608 12,837
30,095 9,847 12,294
31,839 10,585 12,952
1960
1961s
1962
1963....
1964
30,796
30,896
33,113
35,032
37,335
15,817
15,544
17,103
18,247
19,634
14,979
15,352
16,010
16,786
17,701
53,814
54,939
58,213
60,043
63,386
32,360
32,509
34,605
35,813
38,436
10,286
10,242
10,798
11,001
11,927
12,780 9,190
13,211 9,056
14,205 9,602
14,997 9,815
16,253 10,256
1965
1966
1967.
1968.
1969
41,003
44,869
46,449
50,282
53,555
22,216
24,633
25,212
27,694
29,459
18,788
20,236
21,236
22,588
24,096
68,221
77,965
84,599
90,835
96,955
42,227
49,818
54,893
59,053
63, 254
13,299
15, 501
16,437
17,411
18,643
18,152
21,978
24,997
27,557
29,105
1970
1971
1972*
52, 560 28,061
55,580 29,886
62,069 33,956
6,694
7,579
7,191
8,819 25,897 13,061
9,738 28,543 14,662
8,935 26,321 13,060
Nondurable goods industries
Total
MateFinrials Work
ished
and
in
sup- process goods
plies
12,836
13,881
13 261
8,966 10,720
7,894 9,721
15 539
18,315
17 405
6,206 18,070 8,317
6,040 17,902 8,167
2,472
2,440
7,409
7,415
6,348
7,565
8,125
7,749
8,143
2,571
2,721
2,864
2,800
2,928
7,666
8,622
8,624
8,498
8,857
10,776
12,339
13,459
14,085
15, 506
18,664
20,195
20,143
19,975
20,868
8,556
8,971
8,775
8,671
9,089
21,454 9,113
22,430 9,464
23,608 9,841
24,230 10,003
24,950 10,185
25,994
28,147
29,706
31, 782
33,701
10,488
11,220
11,735
12, 304
12,817
24,499 101,712 66,829 19,063 30,332 17, 434 34,883 13,172
25,694 101,665 65,874 19,146 29,645 17,083 35,791 13,526
28,113 106,371 69,641 19,812 32,321 17,508 36,730 13,736
2,935 9,353
3,193 9,773
3,304 10,463
3,410 10,817
3,519 11,246
3,823
4,237
4,428
4,849
5,151
11,683
12,690
13,543
14,629
15,733
5,239 16,472
5,340 16,925
5,600 17,394
Seasonally adjusted
1971: Jan
Feb
Mar
Apr
May....
June
53,139
54,017
54,802
54,978
55,507
56,104
28,501
28,961
29,628
29,517
29,990
30,370
24,638
25,056
25,174
25,461
25,517
25,734
101,901
101,757
101,782
101,643
101,866
101,614
66,808
66,715
66,743
66,698
66,780
66,400
19,109
19,093
19,043
19,396
19,632
19, 702
30,211
30,038
29,982
29,785
29,741
29,427
17,488
17,584
17,718
17,517
17,407
17,271
35,093
35,042
35,039
34,945
35,086
35, 214
13,158
13,168
13,083
13,081
13,070
13,189
5,245
5,241
5,264
5,240
5,292
5,277
16,695
16,633
16,692
16,624
16,724
16,748
July
Aug
Sept....
Oct
Nov....
Dec
55,482
56,650
55, 682
55,943
57,444
57,740
29,798
30,835
29,799
30,033
30,792
30,913
25,684
25,815
25,883
25,910
26,652
26,827
101,317
101,280
101,413
101,736
101,699
101,665
66,178
66,093
66,117
66,025
65,877
65,874
19,908
19,732
19,367
19,208
19,118
19,146
29, 216
29,292
29,543
29,564
29,648
29,645
17,054
17,069
17,207
17,253
17,111
17,083
35,139
35,187
35,296
35,711
35,822
35,791
13,156
13,189
13, 243
13,398
13,462
13,526
5,282
5,265
5,282
5,302
5,322
5,340
16,701
16,733
16,771
17,011
17,038
16,925
59,189
59,199
60,335
61,219
61,413
61,231
31,965
32,041
32,683
33,581
33,705
33,129
27,224 101,796
27,158 102,161
27,652 102,450
27,638 102,428
27,708 102,822
28,102 103,505
66,187
66,422
66,604
66,575
67,035
67,427
19,138
19,098
18,979
18,939
18,995
18,804
29,863
30,058
30,231
30,240
30,562
30,982
17,186
17,266
17,394
17,396
17,478
17,641
35,609
35,739
35,846
35,853
35,787
36,078
13,526
13,659
13,468
13,499
13,464
13,635
5,354
5,363
5,555
5,462
5,381
5,412
16,729
16,717
16,823
16,892
16,942
17,031
61,635
63,352
63,903
64,725
66, 553
33,825
34,710
35,037
36,086
36,750
36,200
27,810
28,642
28,866
28,639
29,803
67,645
68,542
68,834
69,330
69,641
19,256
19,519
19,468
19,701
19,812
30,786
31,153
31,529
32,070
32,321
17,603
17,870
17,837
17,559
17,508
36,243
36,596
36,607
36,678
36,730
13,596
13,671
13,711
13,678
13,736
5,433
5,492
5,552
5,605
5,600
17, 214
17,433
17,344
17,395
17,394
1972: Jan
Feb
Mar
Apr
May
June
July....
Aug
Sept-...
Oct.....
Nov *»___.
Dec ?
103,888
105,138
105,441
106,008
106,371
1 Monthly average for year and total for month.
> Book value, seasonally adjusted, end of period, except as noted.
3 Data prior to 1961 not completely comparable with later data. See Department of Commerce, Bureau of the Census,
"Series M3-1.1," September 1968.
4 Based on seasonally adjusted data through November.
Source: Department of Commerce, Bureau of the Census.
242
TABLE C-43.—Manufacturers*
new and unfilled orders, 1947-72
(Amounts in millions of dollars]
New orders i
Unfilled orders'
Unfilled ordersshipments ratio 3
Durable goods
industries
Year or month
Total
Total
1947.
1948.
1949.
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
I960..
19614.
1962..
1963..
1964..
1965..
1966..
1967..
1968..
1969..
1970..
1971..
1972 5.
Capital
goods
industries,
nondefense
Nondurable
goods
industries
28,532
26,601
20,018
36,838
65,835
72,480
58,637
45,250
5,883
4,116
4,488
56,241
63,880
50,352
45,739
50,654
46,133
48,395
47,307
50,940
58,506
43,401
45,241
44,485
47,958
55,623
3,763
3,495
2,831
3,143
3,840
2,732
3,154
2,822
2,982
2,883
18,817 68,146
20, 224 81,029
21, 238 84, 576
22, 577 84, 283
24, 097 85,315
24, 500 74, 322
25, 705 73, 004
28,185 83,947
64,920
77,964
81, 488
81, 348
82, 372
71,361
69,901
80,047
6,388
8,126
6,633
10,165
12,841
12,061
12,105
10,743
8,868
9,566
8,981
9,945
11,066
11,142
11,428
11,570
27,423
28, 383
27,514
26,901
30,679
30,115
31,086
33,005
35,322
37,952
14,954
15,381
14,073
13,170
15,951
15,223
15,699
17,025
18,521
20,258
12,469
13,002
13,441
13,731
14,728
14,892
15,387
15,980
16,801
17,694
22,986
25,720
25, 526
27,690
29, 548
27,162
29, 768
34,878
51,663
55, 473
63,062
6,971
7,694
6,822
7,398
9,020
Nondurable
goods
industries
34,415
30,717
24,506
43,055
69,785
75,649
61,178
48,266
60,004
67,375
53,183
48,882
54,494
15,256
17,692
15,614
20,110
23,907
23,203
23,533
22,313
41, 803
45,944
46, 763
50, 267
53,645
Total
Durable
goods
industries
6,217
3,950
3,169
2,541
3,016
Total
Durable
goods
industries
3.42
3.63
3.87
3.35
2.60
2.85
2.58
2.52
2.46
2.40
2.49
4.12
4.27
4.55
4.00
3.49
3.44
3,226
3,065
3,088
2,935
2,943
2,961
3,103
3,900
2.62
2.93
2.80
2,72
2.60
2.37
2.13
2.11
3.12
3.51
3.36
3.28
3.14
2.88
2.57
2.51
2,986
2,965
3,018
3,012
2,975
2,998
3,018
2,990
2,943
3,002
3,048
3.103
3,196
3,364
3,481
3,523
3,524
3,544
3,574
3,613
3,674
3,732
3,900
2.39
2.38
2.32
2.29
2.22
2.15
2.17
2.22
2.20
2.18
2.15
2.13
2.09
2.10
2.08
2.06
2.06
2.14
2.14
2.12
2.14
2.12
2.11
2.90
2.88
2.80
2.76
2.67
2.58
2.62
2.71
2.68
2.65
2.60
2.57
2.52
2.54
2.51
2.46
2.47
2.58
2.58
2.54
2.57
2.52
2.51
3.21
3.01
2.95
2.89
2.99
Nondurable
goods
industries
0.96
1.12
1.04
.85
.55
.88
.63
.72
.65
.63
.57
.60
.56
.52
.47
.45
.45
.44
.49
Seasonally adjusted
1971: J a n . . .
Feb...
Mar...
Apr...
May...
June..
July...
Aug...
Sept..
Oct...
Nov...
Dec...
1972: J a n . . .
Feb...
Mar...
May"!
June..
July...
Aug...
Sept..
Oct...
NOVP.
53,742
54, 281
54, 793
54, 206
54, 454
54,728
55,190
57,122
55, 489
56,290
57,992
57, 883
59, 871
59, 792
61,097
61,685
62,012
63, 734
62, 270
64, 409
65,776
65,454
67,587
Dec*.
29,079
29, 246
29, 566
28,751
28,974
28,971
29,486
31,335
29,653
30,321
31, 294
31,001
32, 554
32, 466
33,328
34,005
34,302
35,613
34, 430
35,727
36, 851
36,759
37,619
36,879
6,882
6,810
7,121
7,009
7,256
7,516
7,213
7,492
7,471
7,859
7,932
8,131
8,166
8,196
8,528
8,785
9,036
9,228
9,100
9,211
9,519
9,694
9,762
9,944
24,663
25,035
25, 227
25,455
25, 480
25, 757
25, 704
25, 787
25, 836
25,969
26,698
26, 882
27,317
27, 326
27,769
27,680
27, 710
28,121
27, 840
28,682
28,925
28,695
29,968
74,925
75.189
75,180
74, 408
73, 355
71,979
71,687
72,159
71,966
72, 313
72, 861
73,004
73,686
74, 279
75, 039
75, 506
76,103
78,608
79, 241
80, 299
82,180
82,906
83,947
71,939
72, 224
72,162
71, 396
70,380
68,981
68,669
69,169
69,023
69,311
69, 813
69,901
70,490
70,915
71, 558
71,983
72, 579
75,064
75,667
76,686
78, 506
79,174
80,047
80, 726
0.46
.45
.45
.45
.44
.44
.45
.43
.43
.43
.44
.44
.44
.46
.46
.47
.47
.46
.47
.47
.48
.49
.49
* Monthly average for year and total for month.
2 Seasonally adjusted, end of period.
3 Ratio of unfilled orders at end of period to shipments for period; excludes industries with no unfilled orders. Annual
figures relate to seasonally adjusted data for December, except as noted.
< Data prior to 1961 not completely comparable with later data. Comparable data for new orders (total, durable, and
nondurable) are available for 1958, 1959, and 1960 only. See Department of Commerce, Bureau of the Census, "Series
M3-1.1," September 1968, for these data.
* Based on seasonally adjusted data through November.
Source: Department of Commerce, Bureau of the Census.
243
PRICES
TABLE C—44.—Consumer price indexes by expenditure classes, 1929—72
For urban wage earners and clerical workers
[1967=1001
Housing
Year or month
All
items
Food
Total
Rent
Apparel
and
upkeep
Transportation
Medical
care
Reading Other
•ersonal and
goods
care
recreaand
tion
services
1929..
51.3
48.3
76.0
48.5
1933..
38.8
30.6
54.1
36.9
1939..
41.6
34.6
52.2
56.0
42.4
43.0
36.7
40.3
45.3
46.9
1940..
1941..
1942..
1943..
1944..
1945..
1946,.
1947..
1948..
1949..
42.0
44.1
48.8
51.8
52.7
53.9
58.5
66.9
72.1
71.4
35.2
38.4
45.1
50.3
49.6
50.7
58.1
70.6
76.6
73.5
52.4
53.7
56.2
56.8
58.1
59.1
60.6
65.2
69.8
70.9
56.2
57.2
58.5
58.5
58.6
58.8
59.2
61.1
65.1
68.0
42.8
44.8
52.3
54.6
58.5
61.5
67.5
78.2
83.3
80.1
42.7
44.2
48.1
47.9
47.9
47.8
50.3
55.5
61.8
66.4
36.8
37.0
38.0
39.9
41.1
42.1
44.4
48.1
51.1
52.7
40.2
41.2
45.2
49.9
53.4
55.1
59.0
66.0
68.5
68.3
46.1
47.7
50.0
54.1
60.0
62.4
64.5
68.7
72.2
74.9
48.3
49.2
50.7
53.3
54.7
56.9
58.8
63.8
66.8
68.7
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
72.1
77.8
79.5
80.1
80.5
80.2
81.4
84.3
86.6
87.3
74.5
82.8
84.3
83.0
82.8
81.6
82.2
84.9
88.5
87.1
72.8
77.2
78.7
80.8
81.7
82.3
83.6
86.2
87.7
88.6
70.4
73.2
76.2
80.3
83.2
84.3
85.9
87.5
89.1
90.4
79.0
86.1
85.3
84.6
84.5
84.1
85.8
87.3
87.5
88.2
68.2
72.5
77.3
79.5
78.3
77.4
78.8
83.3
86.0
89.6
53.7
56.3
59.3
61.4
63.4
64.8
67.2
69.9
73.2
76.4
68.3
74.7
75.6
76.3
76.6
77.9
81.1
84.1
86.9
88.7
74.4
76.6
76.9
77.7
76.9
76.7
77.8
80.7
83.9
85.3
69.9
72.8
76.6
78.5
79.8
79.8
81.0
83.3
84.4
86.1
I960..
1961..
1962..
1963..
1964..
1965..
1966..
1967..
1968.
1969.
88.7
89.6
90.6
91.7
92.9
94.5
97.2
100.0
104.2
109.8
88.0
89.1
89.9
91.2
92.4
94.4
99.1
100.0
103.6
108.9
90.2
90.9
91.7
92.7
93.8
94.9
97.2
100.0
104.2
110.8
91.7
92.9
94.0
95.0
95.9
96.9
98.2
100.0
102.4
105.7
89.6
90.4
90.9
91.9
92.7
93.7
96.1
100.0
105.4
111.5
89.6
90.6
92.5
93.0
94.3
95.9
97.2
100.0
103.2
107.2
79.1
81.4
83.5
85.6
87.3
89.5
93.4
100.0
106.1
113.4
90.1
90.6
92.2
93.4
94.5
95.2
97.1
100.0
104.2
109.3
87.3
89.3
91.3
92.8
95.0
95.9
97.5
100.0
104.7
108.7
87.8
88.5
89.1
90.6
92.0
94.2
97.2
100.0
104.6
109.1
1970.
1971.
1972.
116.3
121.3
125.3
114.9
118.4
123.5
118.9
124.3
129.2
110.1
115.2
119.2
116.1
119.8
122.3
112.7
118.6
119.9
120.6
128.4
132.5
113.2
116.8
119.8
113.4
119.3
122.8
116.0
120.9
125.5
1971: Jan...
Feb..
Mar..
Apr..
May..
June.
119.2
119.4
119.8
120.2
120.8
121.5
115.5
115.9
117.0
117.8
118.2
119.2
122.7
122.6
122.4
122.5
123.2
124.0
112.9
113.6
113.9
114.4
114.7
115.2
117.6
118.1
118.6
119.1
120.2
120.1
117.5
117.5
117.8
118.1
118.8
119.6
124.9
125.8
126.8
127.5
128.1
128.6
115.3
115.4
115.8
116.3
116.5
116.8
117.3
117.5
117.7
118.4
118.9
119.3
118.9
119.1
119.4
119.7
119.9
120.3
July..
Aug..
Sept.
Oct..
Nov..
Dec
121.8
122.1
122.2
122.4
122.6
123.1
119.8
120.0
119.1
118.9
119.0
120.3
124.5
125.1
125.5
125.9
126.4
126.8
115.4
115.8
116.1
116.4
116.6
116.9
119.3
119.0
120.6
121.6
121.9
121.8
119.4
119.3
118.6
119.3
118.7
118.5
129.3
130.0
130.4
129.6
129.7
130.1
117.1
117.5
117.6
117.9
117.9
117.9
119.6
119.7
120.5
120.5
120.8
121.1
121.2
121.8
122.4
122.6
122.8
123.0
1972: Jan..
Feb..
Mar..
Apr..
MayJune-
123.2
123.8
124.0
124.3
124.7
125.0
120.3
122.2
122.4
122.4
122.3
123.0
127.3
127.6
127.9
128.2
128.5
129.0
117.5
117.8
118.0
118.4
118.6
119.0
120.2
120.7
121.3
121.8
122.5
122.1
118.9
118.3
118.4
118.6
119.5
119.8
130.5
131.0
131.4
131.7
132.0
132.4
118.1
118.4
118.7
119.1
119.7
120.0
121.4
121.5
121.7
122.3
122.5
122.9
123.5
124.3
124.6
125.1
125.4
125.6
July..
Aug..
Sept.
Oct...
Nov..
Dec.
125.5
125.7
126.2
126.6
126.9
127.3
124.2
124.6
124.8
124.9
125.4
126.0
129.5
129.9
130.2
130.4
130.8
131.2
119.2
119.6
119.9
120.3
120.5
121.0
121.1
120.8
123.1
124.3
125.0
125.0
120.2
120.5
121.0
121.2
121.4
121.3
132.7
132.9
133.1
133.9
134.1
134.4
120.0
120.2
120.5
120.8
121.0
121.5
123.0
123.0
123.7
124.0
124.1
124.0
125.8
126.0
126.2
126.4
126.4
126.5
Source: Department of Labor, Bureau of Labor Statistics.
244
TABLE C-45.—Consumer price indexes by commodity and service groups, 1939-72
For urban wage earners and clerical workers
[1967=100]
Commodities
Year or
month
All
items
Commodities less food
All
commodities
Food
Special indexes
Services
Alt
Durable
Nondurable
All
ervices
Rent
Services
less
rent
All
items
less
food
All
items
less
shelter
Nondurable
commodities
1939
41.6
40.2
34.6
47.7
48.5
44.3
43.5
56.0
38.1
47.2
39.7
38.4
1940
1941
1943
1944
1945.
1946.
1947
1948
1949
42.0
44.1
48.8
51.8
52.7
53.9
58.5
66.9
72.1
71.4
40.6
43.3
49.6
54.0
54.7
56.3
62.4
75.0
80.4
78.3
35.2
38.4
45.1
50.3
49.6
50.7
58.1
70.6
76.6
73.5
48.0
50.4
56.0
58.4
61.6
64.1
68.1
76.8
82.7
81.5
48.1
51.4
58.4
60.3
65.9
70.9
74.1
80.3
86.2
87.4
44.7
46.7
51.6
53.8
56.6
58.6
62.9
72.2
77.8
76.3
43.6
44.2
45.6
46.4
47.5
48.2
49.1
51.1
54.3
56.9
56.2
57.2
58.5
58.5
58.6
58.8
59.2
61.1
65.1
68.0
38.1
38.6
40.3
42.1
44.2
45.1
46.7
49.0
51.9
54.5
47.3
48.7
52.1
53.6
55.7
56.9
59.4
64.9
69.6
70.3
39.9
42.4
47.7
51.3
52.2
53.6
59.0
68.5
73.9
72.6
38.9
41.6
47.6
51.8
52.2
53.7
59.6
71.9
77.2
74.9
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
72.1
77.8
79.5
80.1
80.5
80.2
81.4
84.3
86.6
87.3
78.8
85.9
87.0
86.7
85.9
85.1
85.9
88.6
90.6
90.7
74.5
82.8
84.3
83.0
82.8
81.6
82.2
84.9
88.5
87.1
81.4
87.5
88.3
88.5
87.5
86.9
87.8
90.5
91.5
92.7
95.1
96.4
95.7
93.3
91.5
91.5
94.4
95.9
97.3
76.2
82.0
82.4
83.1
83.5
83.5
85.3
87.6
88.2
89.3
58.7
61.8
64.5
67.3
69.5
70.9
72.7
75.6
78.5
80.8
70.4
73.2
76.2
80.3
83.2
84.3
85.9
87.5
89.1
90.4
56.0
59.3
62.2
64.8
66.7
68.2
70.1
73.3
76.4
79.0
71.1
75.7
77.5
79.0
79.5
79.7
81.1
83.8
85.7
87.3
73.1
79.2
80.8
81.0
81.0
80.6
81.7
84.4
86.9
87.6
75.4
82.5
83.4
83.2
83.2
82.5
83.7
86.3
88.6
88.2
1960
1961
1962.
1963
1964
1965
1966
1967
1968
1969
88.7
89.6
90.6
91.7
92.9
94.5
97.2
100.0
104.2
109.8
91.5
92.0
92.8
93.6
94.6
95.7
98.2
100.0
103.7
108.4
88.0
89.1
89.9
91.2
92.4
94.4
99.1
100.0
103.6
108.9
93.1
93.4
94.1
94.8
95.6
96.2
97.5
100.0
103.7
108.1
96.7
96.6
97.6
97.9
98.8
98.4
98.5
100.0
103.1
107.0
90.7
91.2
91.8
92.7
93.5
94.8
97.0
100.0
104.1
108.8
83.5
85.2
86.8
88.5
90.2
92.2
95.8
100.0
105.2
112.5
91.7
92.9
94.0
95.0
95.9
96.9
98.2
100.0
102,4
105.7
81.9
83.9
85.5
87.3
89.2
91.5
95.3
100.0
105.7
113.8
89.7
90.8
92.0
93.2
94.5
96.7
100.0
104.4
110.1
88.9
89.9
90.9
92.1
93.2
94.6
97.4
100.0
104.1
109.0
89.4
90.2
90.9
92.0
93.0
94.6
98.1
100.0
103.9
108.9
1970.
1971.
1972
116.3
121.3
125.3
113.5
117.4
120.9
114.9
118.4
123.5
112.5
116.8
119.4
111.8
116.5
118.9
113.1
117,0
119.8
121.6
128.4
133.3
110.1
115.2
119.2
123.7
130.8
135.9
116.7
122.1
125.8
114.4
119.3
122.9
114.0
117.7
121.7
1971: J a n . . .
Feb...
Mar...
Apr...
May...
June..
119.2
119.4
119.8
120.2
120.8
121.5
115.4
115.5
116.1
116.6
117.2
117.9
115.5
115.9
117.0
117.8
118.2
119.2
115.2
115.2
115.5
115.8
116.6
117.1
115.2
115.0
115.2
115.7
116.6
117.4
115.3
115.4
115.7
116.0
116.6
116.9
126.3
126.6
126.6
126.8
127.5
128.2
112.9
113.6
113.9
114.4
114.7
115.2
128.7
129.0
128.9
129.1
129.8
130.6
120.3
120.4
120.6
120.9
121.6
122.2
117.0
117.4
118.0
118.6
119.2
119.8
115.4
115.7
116.4
116.9
117.4
118.1
July...
Aug...
Sept..
Oct._.
Nov...
Dec...
121.8
122.1
122.2
122.4
122.6
123.1
118.1
118.2
118.1
118.4
118.5
118.9
119.8
120.0
119.1
118.9
119.0
120.3
117.0
117.1
117.4
118.0
118.1
118.1
117.5
116.9
116.4
117.1
117.4
117.2
116.7
117.2
118.2
118.7
118.7
118.8
128.8
129.3
129.8
129.9
130.3
130.7
115.4
115.8
116.1
116.4
116.6
116.9
131.2
131.8
132.3
132.4
132.8
133.3
122.4
122.7
123.1
123.5
123.7
123.9
120.0
120.2
120.2
120.3
120.4
120.9
118.3
118.6
118.7
118.8
118.9
119.5
1972: Jan._.
Feb...
Mar...
Apr...
May...
June..
123.2
123.8
124.0
124.3
124.7
125.0
118.7
119.4
119.7
119.9
120.3
120.7
120.3
122.2
122.4
122.4
122.3
123.0
117.7
117.8
118.2
118.5
119.2
119.4
117.3
117.1
117.3
117.7
118.4
119.2
118.1
118.4
118.9
119.1
119.7
119.5
131.5
131.8
132.1
132.4
132.7
133.1
117.5
117.8
118.0
118.4
118.6
119.0
134.1
134.4
134.6
135.0
135.3
135.7
124.0
124.2
124.5
124.9
125.4
125.7
120.9
121.5
121.8
122.0
122.4
122.7
119.2
120.3
120.6
120.7
121.0
121.2
July—
Aug...
Sept..
Oct__.
Nov...
Dec...
125.5
125.7
126.2
126.6
126.9
127.3
121.2
121.4
122.0
122.3
122.7
122.9
124.2
124.6
124.8
124.9
125.4
126.0
119.4
119.5
120.3
120.8
121.0
121.1
119.6
119.7
119.8
120.1
120.3
120.3
119.3
119.4
120.8
121.3
121.7
121.7
133.5
133.8
134.1
134.6
134.9
135.4
119.2
119.6
119.9
120.3
120.5
121.0
136.1
136.4
136.7
137.2
137.6
138.0
125.9
126.1
126.7
127.1
127.4
127.6
123.1
123.2
123.8
124.2
124.6
124.8
121.7
122.0
122.8
123.1
123.5
123.8
1942..
Source: Department of Labor, Bureau of Labor Statistics.
245
T A B L E C—46.—Consumer price indexes, selected commodities and services, 1939—72
For urban wage earners and clerical workers
[1967=1001
Nondurable commodities less food
Durable commodities
Year or month
Used
cars
Household
durables
Total
Apparel
commodities
Services less rent
Nondurables
Total
less
food
and
apparel
House- Transhold
serv- portation
ices
servless
ices
rent
Medical
care
services
Total i
New
cars
1939
48.5
43.2
56.6
44.3
43.0
46.3
38.1
36.1
32.5
1940
1941
1942
1943
1944
1945
1946 .
1947
1948
1949
48.1
51.4
58.4
60.3
65.9
70.9
74.1
80.3
86.2
87.4
43.3
46.6
69.2
75.6
82.8
55.9
59.8
66.9
69.5
76.0
81.8
86.5
95.6
101.7
99.0
44.7
46.7
51.6
53.8
56.6
58.6
62.9
72.2
77.8
76.3
43.5
45.8
53.5
55.9
59.8
63.0
69.5
80.4
85.4
82.0
46.8
48.4
51.1
53.2
54.7
55.8
58.2
66.2
72.3
72.4
38.1
38.6
40.3
42.1
44.2
45.1
46.7
49.0
51.9
54.5
36.1
36.3
38.2
38.2
38.2
38.2
39.0
40.3
44.9
50.0
32.5
32.7
33.7
35.4
36.9
37.9
40.1
43.5
46.4
48.1
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
88.4
95.1
96.4
95.7
93.3
91.5
91.5
94.4
95.9
97.3
83.4
87.4
94.9
95.8
94.3
90.9
93.5
98.4
101.5
105.9
100.2
109.8
106.9
105.7
102.9
100.1
99.7
101.4
102.1
102.0
76.2
82.0
82.4
83.1
83.5
83.5
85.3
87.6
88.2
89.3
81.1
88.7
87.7
86.7
86.3
85.8
87.3
88.2
88.2
89.0
72 9
77.5
79.0
81.0
81.8
82.1
84.1
87.4
88 3
89.6
56.0
59.3
62.2
64.8
66.7
68.2
70.1
73.3
76.4
79.0
71.2
75.4
79.4
81.6
53.3
58.362.4
66.4
69.2
69.4
70.5
73.8
78.5
81.2
49.2
51.7
55.0
57.0
58.7
60.4
62.8
65.5
68.7
72.0
71.1
73.9
76.2
78.0
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
96.7
96.6
97.6
97.9
98.8
98.4
98.5
100.0
103.1
107.0
104.5
104.5
104.1
103.5
103.2
100.9
99.1
100.0
102.8
104.4
83.6
86.9
94.8
96.0
100.1
99.4
97.0
100.0
103.1
101.9
100.7
100.6
100.3
100.2
98.7
98.6
100.0
103.3
107.4
90.7
91.2
91.8
92.7
93.5
94.8
97.0
100.0
104.1
108.8
90.3
90.8
91.2
92.0
92.8
93.6
96.0
100.0
105.6
111.9
90.9
91.3
92.1
93.1
93.9
95.5
97.5
100.0
103 3
107.0
81.9
83.9
85.5
87.3
89.2
91.5
95.3
100.0
105.7
113.8
85.0
86.0
87.1
89.0
90.4
92.1
95.7
100.0
105.9
115.3
83.3
85.3
86.6
87.5
89.6
92.9
96.8
100.0
104.0
111.3
74.9
77.7
80.2
82.6
84.6
87.3
92.0
100.0
107.3
116.0
80.8
83.4
85.6
87.7
90.1
92.6
96.2
100.0
105.6
110.6
.
. . 111.8
116.5
118.9
107.6
112.0
111.0
104.3
110.2
110.5
110.2
112.9
115.0
113.1
117.0
119.8
116.5
120.1
122.7
111.2
115.2
118.2
123.7
130.8
135.9
126.8
132.6
139.2
123.1
133.0
136.0
124.2
133.3
138.2
116.7
122.5
125.8
1971: Jan
Feb
Mar
Apr
May
June
115.2
115.0
115.2
115.7
116.6
117.4
115.4
115.2
114.3
113.8
113.9
113.9
107.0
105.5
106.8
109.8
112.8
114.1
111.5
111.8
112.1
112.4
112.7
113.1
115.3
115.4
115.7
116.0
116.6
116.9
117.8
118.3
118.8
119.3
120.5
120.4
113.8
113.8
114.0
114.0
114.3
114.9
128.7
129.0
128.9
129.1
129.8
130.6
131.6
131.0
130.1
129.7
130.7
131.6
129.5
131.3
131.9
132.9
133.0
134.0
129.3
130.2
131.4
132.2
132.9
133.5
120.7
120.9
121.2
121.5
122.0
122.5
117.5
116.9
116.4
117.1
117.4
117.2
113.8
109.3
105.6
109.1
109.6
110.4
113.5
112.5
111.6
111.7
110.2
107.2
113.2
113.4
113.5
113.6
113.6
113.7
116.7
117.2
118.2
118.7
118.7
118.8
119.5
119.1
120.9
122.0
122.4
122.2
115.1
116.2
116.6
116.8
116.5
116.8
131.2
131.8
132.3
132.4
132.8
133.3
132.5
133.5
134.1
134.6
135.3
136.0
134.2
134.0
133.7
133.8
133.9
134.1
134.4
135.1
135.6
134.6
134.8
135.3
122.6
122.8
123.7
123.8
124.0
124.0
1972: Jan
Feb
Mar
Apr
May
June
117.3
117.1
117.3
117.7
118.4
119.2
112.2
111.9
111.7
111.7
111.4
111.3
105.3
103.0
103.9
106.4
110.0
112.0
113.7
113.6
114.1
114.4
114.8
115.1
118.1
118.4
118.9
119.1
119.7
119.5
120.3
120.9
121.6
122.1
122.9
122.4
116.8
117.0
117.3
117.4
117.9
117.9
134.1
134.4
134.6
135.0
135.3
135.7
136.9
137.3
137.6
138.0
138.4
138.8
135.6
135.6
135.4
135.6
135.8
136.0
135.8
136.4
136.9
137.3
137.6
138.0
124.3
124.5
124.7
125.1
125.3
125.6
July
Aug
Sept
Oct.
Nov
Dec
119.6
119.7
119.8
120.1
120.3
120.3
111.0
110.6
109.6
110.1
110.2
110.6
112.7
112.4
113.6
115.2
116.0
115.0
115.3
115.4
115.6
115.8
116.0
116.2
119.3
119.4
120.8
121.3
121.7
121.7
121.3
120.9
123.5
124.9
125.6
125.5
118.2
118.6
119.3
119.3
119.4
119.5
136.1
136.4
136.7
137.2
137.6
138.0
139.5
140.0
140.3
140.7
141.3
141.9
136.3
136.3
136.3
136.2
136.3
136.4
138.4
138.6
138.9
139.9
140.1
140.5
125.8
125.9
126.7
127.0
127.4
127.7
1970
1971
1972
July
Aug.. .
Nov
Dec
89.2
75.9
71.8
69.1
77.4
80.2
89.5
Other 3
i Includes certain items not shown separately.
s Includes the services components of apparel, personal care, reading and recreation, and other goods and services.
3 Not available.
Source: Department of Labor, Bureau of Labor Statistics.
246
T A B L E C—47.—Consumer price indexes, seasonally adjusted, 1970—72
(1967=100, seasonally adjusted]
Special indexes
Year and month
1970: Jan
Feb.
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov.
Dec
1971: Jan
Feb.
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov..
Dec
1972:Jan
Feb
Mar
Apr
May
June
July.
Aug...
Sept
Oct
Nov
Dec
Selected expenditure classes
Commodity groups
All
All
All items All
items items less comless less med- modfood shelter ical
ities
care
Food
113.4
114.1
114.7
115.4
116.0
116.5
112.2
112.6
112.9
113.5
113.9
114.2
113.2
113 9
114.4
115.1
115.6
115.9
111.4
112 0
112.2
112.7
113.1
113.3
117.0
117.3
118.0
118 7
119.4
120.1
114.6
114.8
115.4
116.0
116.4
116.8
116.3
116.7
117.2
117 8
118.3
118.7
120.4
120.6
120.7
120.9
121.6
122.1
117.2
117.6
118.1
118.5
119.1
119.6
122.4
122.8
123 1
123.3
123.5
123.8
Commodities less
food
Durable
Nondurable
ter
Total
utilities
Apparel Trans- Medand por- ical
up- tation care
keep
113.6
114.4
114.4
114.7
115.0
114.9
110.2
110.6
110.8
111.5
112.0
112.4
109.0
109 3
109.8
110.2
111.0
111.6
111.0
111 5
111.7
112.4
112.7
112.9
118.5
119.7
121.1
122.0
122.8
123.6
105.0
105 3
105.9
106.5
106.8
106.8
114.2
114 6
114.8
115.1
115.4
115.9
109.5
110.0
109.9
111.2
111.9
112.4
116.5
117.2
118.0
118.9
119.5
120.4
113.6
113.7
114.2
114 7
115 0
115.5
115.0
115.1
115.6
115 6
115.7
115.5
112.6
112.9
113.5
114 0
114 5
115.3
111.9
112.3
113.1
113 7
114 2
115.1
113.3
113.3
113.9
114 4
114.8
115.4
124.0
124.8
125.8
126.4
127.0
127.8
107.6
108.0
108.6
109.5
110.6
111.2
116.0
116.4
117.0
117.4
117.9
118.4
113.2
112.9
113.8
115.0
115.9
116.9
121.2
121.8
122.4
123.2
123.8
124.6
119.0
119.3
119.5
119.9
120.4
121.0
115 6
115.8
116.3
116.6
117.2
117.7
115.6
116.2
117.2
117.9
118.3
118.8
115 4
115.5
115.7
115.9
116.6
116.9
115 2
115.3
115.7
115.9
116.5
116.9
115 6
115.7
115.9
116.1
116.6
116.9
128.1
127.7
126.6
126.5
127.5
128.4
112.0
113.0
113.6
113.9
114.3
114.8
118.4
118.7
118.8
119.2
119.8
119.9
117.1
117.6
118.0
118.2
118.6
119.1
125.2
125.9
126.5
127.2
127.8
128.5
119.8
120.1
120.2
120.3
120.5
120.9
121.3
121.6
121.7
121.9
122.2
122.6
117.9
118.1
118 2
118 3
118.5
118.8
119.0
119.3
119.0
118.9
119.8
120.5
117.1
117.5
117 5
117.5
117.5
117.7
117.3
117.0
117.0
116.9
116.9
117.0
117.1
117.7
118 0
118 1
118 1
118.4
128.8
129.4
129.9
130.5
131.0
131.5
115.6
116.0
116.3
116.5
116.3
117.4
120.0
120.1
120.4
120.6
120.7
121.0
119.2
119.5
119.6
119.1
118.7
118.4
129.0
129.7
130.1
130.0
130.2
130.5
124.1
124.4
124.6
124.9
125.4
125.6
121.1
121.7
121.9
121.9
122.3
122.5
122.9
123.6
123.7
124.0
124.3
124.5
118.9
119.8
119.9
119.9
120.3
120.5
120.4
122.6
122.6
122.5
122.4
122.6
117.9
118.2
118.4
118.6
119.2
119.2
117.3
117.5
117.8
117.9
118.3
118.7
118.5
118.8
119.1
119.2
119.7
119.5
132.5
133.0
132.7
133.1
133.8
134.2
118.3
118.9
119.1
119.4
119.7
120.0
121.0
121.3
121.5
121.9
122.1
121.9
118.5
118.4
118.6
118.7
119.3
119.3
130.8
131.1
131.1
131.4
131.7
132.3
125.9
126.2
126.7
126.8
127.1
127.5
122.9
123.1
123.8
124.2
124.7
124.8
125.0
125.3
125.9
126.1
126.6
126.8
121.0
121.3
122.1
122.2
122.7
122.8
123.3
123.9
124.7
124.9
126.3
126.3
119.5
119.9
120.4
120.3
120.4
120.7
119.4
119.8
120.4
119.9
119.8
120.1
119.7
119.9
120.6
120 7
121.1
121.3
135.0
135.4
135.6
135.9
135.9
136.7
120.1
120.1
120.8
121.1
121.5
121.7
121.8
121.9
122.9
123.3
123.8
124.1
120.0
120.7
122.0
121.0
121.4
121.2
132.4
137.6
132.8
134.3
134.6
134.8
Source: Department of Labor, Bureau of Labor Statistics.
247
Fuel
TABLE C-48.—Wholesale price indexes by major commodity groups, 1929-72
[1967=1001
Farm products and processed
foods and feeds
Year or month
All commodities
Total
Farm
products
Processed
foods
and
feeds
Industrial commodities
Total
Textile
products
and
apparel
Hides,
Fuels
skins,
and
leather, related Chemicals
allied
and
products, and
products
related
and
products power
1929
49 1
64 1
48.6
48 9
59 4
1933
34.0
31.4
37.8
36.3
47.6
47.4
1939 .
39.8
40.0
43.3
42.8
52.3
51.5
1940
1941....
1942
1943
1944....
1945
1946
1947
1948 .
1949
40.5
45.1
50.9
53.3
53.6
54.6
62.3
76.5
82.8
78.7
94.3
101.5
89.6
41.4
50.3
64.8
75.0
75.5
78.5
90.9
109.4
117.5
101.6
82.9
88.7
80.6
44.0
47.3
50.7
51.5
52.3
53.0
58.0
70.8
76.9
75.3
103.6
108.1
98.9
45.2
48.4
52.8
52.7
52.2
52.9
61.1
83.3
84.2
79.9
51.4
54.6
56.2
57.8
59.5
60.1
64.4
76.9
90.5
86.2
52.4
57.0
63.3
64.1
64.8
65.2
70.5
93.7
95.9
87.6
1950
1951
1952...
1953
1954
1955 .
1956
1957
1958
1959
81.8
91 1
88.6
87.4
87.6
87.8
90.7
93.3
94.6
94.8
93.9
106 9
102.7
96.0
95.7
91.2
90.6
93.7
98.1
93.5
106.7
124.2
117.2
106.2
104.7
98.2
96.9
99.5
103.9
97.5
83.4
92.7
91.6
87.4
88.9
85.0
84.9
87.4
91.8
89.4
78.0
86.1
84.1
84.8
85.0
86.9
90.8
93.3
93.6
95.3
102.7
114.6
103.4
100.8
98.6
98.7
98.7
98.8
97.0
98.4
86.3
99.1
80.1
81.3
77.6
77.3
81.9
82.0
82.9
94.2
87.1
90.3
90.1
92.6
91.3
91.2
94.0
99.1
95.3
95.3
88.9
101.7
96.5
97.7
98.9
98.5
99.1
101.2
102.0
101.6
I960
1961
1962 .
1963
1964
1965
1966 .
1967
1968
1969
94.9
94.5
94.8
94.5
94.7
96.6
99.8
100.0
102.5
106.5
93.7
93.7
94.7
93.8
93.2
97.1
103.5
100.0
102.4
108.0
97.2
96.3
98.0
96.0
94.6
98.7
105.9
100.0
102.5
109.1
89.5
91.0
91.9
92.5
92.3
95.5
101.2
100.0
102.2
107.3
95.3
94.8
94.8
94.7
95.2
96.4
98.5
100.0
102.5
106.0
99.5
97.7
98.6
98.5
99.2
99.8
100.1
100.0
103.7
106.0
90.8
91.7
92.7
90.0
90.3
94.3
103.4
100.0
103.2
108.9
96.1
97.2
96.7
96.3
93.7
95.5
97.8
100.0
98.9
100.9
101.8
100.7
99.1
97.9
98.3
99.0
99.4
100.0
99.8
99.9
1970
1971
1972
110.4
113.9
119.1
111.6
113.8
122.4
111.0
112.9
125.0
112.0
114.3
120.8
110.0
114.0
117.9
107.2
108.6
113.6
110.1
114.0
131.3
105.9
114.2
118.6
102.2
104.2
104.2
1971: Jan
Feb.
Mar
111.8
112.8
113.0
113.3
113.8
114.3
110.7
113.6
113.4
113.3
114.3
115.4
108.9
113.9
113.0
113.0
114.0
116.0
111.8
113.3
113.7
113.5
114.5
114.9
112.2
112.5
112.8
113.3
113.7
113.9
106.9
106.7
106.9
107.5
107.8
108.5
111.7
112.4
112.5
114.0
114.4
114.2
113.5
113.0
112.8
113.0
114.2
114.4
103.8
104.2
104.5
104.5
104.3
104.4
114.6
114.9
114.5
114.4
114.5
115.4
115.0
114.6
113.0
113.0
113.6
115.9
113.4
113.2
110.5
111.3
112 2
115.8
116.0
115.4
114.6
114.1
114.4
115.9
114.5
115.1
115.0
115.0
114.9
115.3
109.2
109.7
109.7
109.6
109.8
110.6
114.2
114.4
114.7
114.7
115.1
116.2
114.4
114.8
115.3
114.8
114.7
115.0
104 4
104.3
104.3
104.2
103.8
103.4
May.. .
June
116.3
117.3
117.4
117.5
118.2
118.8
117.4
119.6
119.1
118.3
120.0
121.3
117.8
120.7
119.7
119.1
122.2
124.0
117.2
118.8
118.6
117.7
118.6
119.6
115.9
116.5
116.8
117.3
117.6
117.9
111.3
112.0
112.1
112.6
113.3
113.6
117.8
119.1
123.0
127.2
129.5
130.9
116.0
116.1
116.5
116.9
117.5
118 2
103.4
103.5
103.4
104.1
104.4
104.3
July...
Aug.. _
Sept.
Oct.
Nov .
Dec
119.7
119.9
120.2
120.0
120.7
122.9
124.0
123.8
124.5
123.3
125.3
132.6
128.0
128.2
128.6
125.5
128.8
137.5
121.5
121.0
121.8
121.8
123.1
129.4
118.1
118.5
118.7
118.8
119.1
119.4
114.0
114.1
114.3
114.8
115.1
115.6
131.6
134.6
135.7
139.8
144.0
142.2
118.6
119.7
120.3
120.6
121.3
121.9
104.2
104.4
104.4
104.4
104.7
104.8
,_
. .
Apr
May
June
July
Aug
Sept
Oct . .
Nov
Dec
1972: Jan
Feb
Mar
Apr
See footnote at end of table.
248
TABLE C-48.—Wholesale price indexes by major commodity groups,
1929-72—Continued
(1967=100]
Industria! commodities—Continued
Pulp,
paper,
and
allied
products
Furniture and
household
durables
Transportation
equipment:
NonmeMotor
tallic
mineral vehicles
products
and
equipment i
Rubber
and
plastic
products
Lumber
and
wood
products
1929
59.4
25.0
40.2
55.8
51.2
41.9
1933
40.2
19.0
30 7
44 6
47.2
34 8
1939
61.2
24.8
37.6
41.3
52.6
49.1
39.1
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
57.1
61.5
71.6
73.6
72.7
70.5
70.8
70.5
72.8
70.5
27.4
32.7
35.6
37.7
40.6
41.2
47.2
73.4
84.0
77.7
72.5
75.7
72.4
37.8
38.5
39.1
39.0
39 0
39.6
44.3
54 9
62.5
63.0
41.4
42.1
42.8
42.4
42.1
42.2
46.4
53 7
58.2
61.0
53.8
57.2
61.8
61.4
63 1
63.2
67.1
77 0
81 6
82.9
49.1
50.2
52.3
52.4
53.5
55.7
59.3
66 3
71.6
73.5
40.4
43.2
47 2
47.2
47 5
48 3
56.0
64 1
70.8
75.7
85.9
105.4
95.5
89.1
90.4
102.4
103.8
103.4
103.3
102.9
89.3
97.2
94 4
94.3
92.6
97.1
98.5
93.5
92.4
98.8
74.3
88.0
85 7
85.5
85.5
87.8
93.6
95.4
96.4
97.3
66 3
73.8
73 9
76 3
76.9
82.1
89 2
91.0
90.4
92.3
63.1
70.5
70 6
72 2
73.4
75.7
81 8
87.6
89.4
91.3
84 7
91.8
90 1
91 9
92.9
93.3
95 8
98.3
99.1
99.3
75 4
80.1
80 1
83.3
85.1
87.5
91 3
94.8
95.8
97.0
75.3
79.4
84 0
83.6
83.8
86.3
91 2
95.1
98.1
100.3
79.2
83.9
83.4
85.6
86.4
86.5
87.6
90.2
92.0
92.2
I960
1961
1962
1963
1964
1965
1966
1967
1968
1969
103.1
99.2
96.3
96.8
95.5
95.9
97.8
100.0
103.4
105.3
95.3
91.0
91.6
93.5
95.4
95.9
100 2
100.0
113.3
125.3
98.1
95.2
96.3
95.6
95.4
96.2
98 8
100.0
101.1
104.0
92.4
91 9
91.2
91.3
93 8
96.4
98 8
100 0
102.6
108.5
92.0
91 9
92.0
92.2
92 8
93 9
96 8
100.0
103.2
106.5
99.0
98 4
97.7
97.0
97.4
96.9
98 0
100.0
102.8
104.9
97.2
97 6
97.6
97.1
97.3
97.5
98 4
100.0
103.7
107.7
98.8
98 6
98.6
97.8
98.3
98.5
98 6
100.0
102.8
104.8
93.0
93.3
93.7
94.5
95.2
95.9
97.7
100.0
102.2
105.2
1970
1971
1972
108.6
109.2
109.3
113.7
127.0
144.3
108.2
110.1
113.4
116.7
119 0
123.5
111.4
115.5
117.9
107.5
109.9
111.4
113.3
122.4
126.1
108.5
114.7
118.0
109.9
112.8
114.6
108.4
109.1
109 1
109.0
108.7
108.7
112.2
117.5
123 4
124.6
124.9
126.1
109.0
109.3
109 3
109.6
109.9
110.2
116.5
116.4
116 5
117.8
118.5
118.5
114.2
114.6
114 9
115.0
115.3
115.5
109.3
109.7
109.6
109.7
109.9
109.8
118.8
119.0
120 9
121.6
121.8
122.2
113.9
114.1
113.8
114.1
114.2
114.4
112.3
112.6
112.8
112.7
112.5
112.6
109.7
109.8
109.7
109 5
109 5
109.4
130.6
134.6
134.3
131 8
131.3
132.7
110.5
110.6
110.6
110 6
110.6
110.7
119.4
121.1
121.1
121.0
120.9
120.8
115.7
116.1
116.0
116.0
115.9
116.2
110.0
110.2
110.2
110.2
110.2
110.2
123.3
124.2
124.2
124.1
124.0
124.2
114.7
114.9
113.8
115.2
115.3
117.5
112.8
113.0
113.0
113.0
113.1
113.2
109 5
109.2
108.9
108.7
108.8
108.9
134 9
137.7
139.5
141.1
142.7
144.2
110.8
111.6
112.3
112.8
113.2
113.5
121.4
122.6
123.4
123.5
123.6
123.6
116.5
117.1
117.3
117.6
117.9
118.1
110.2
110.8
110.9
111.0
111.1
111.2
124.3
124.6
124.8
125.6
125.9
125.8
117.9
118.0
118.0
118.0
118.1
118.5
113.7
114.0
114.2
114.1
114.1
114.2
109.2
109.5
109.5
109.5
109.8
109.8
146.1
148.1
148.5
149.2
149.4
149.8
113.7
114.1
114.3
114.7
115.0
115.1
123.5
123.7
124.0
124.1
124.1
124.4
118.3
118.3
118.3
118.4
118.5
118.6
111.4
111.7
112.0
112.0
112.3
112.4
126.2
126.7
126.9
127.3
127.3
127.4
118.4
118.5
118.5
116.9
117.0
118.4
114.9
115.1
115.2
115.0
115.0
115.1
Year or month
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
. .
1971- Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
.
..
1972- Jan
Feb
Mar
Apr
May
June
_
July
Aug
Sept
Oct
..
..
Nov
Dec.
._
Metals
and
metal
products
Machinery and
equipment
i Index for total transportation equipment is not shown but is available beginning December 1968.
Source: Department of Labor, Bureau of Labor Statistics.
249
Miscellaneous
products
73.5
76.5
78.0
TABLE C-49.— Wholesale price indexes by stage of processing, 1947-72
[1967=1001
Intermediate materials, supplies, and componentsl
Crude materials
Materials and components for
manufacturing
Year or month
All
commodities
Materials
and
components
For
For
For
Com- for connon- durable
food durable
ponents struction
manu- manu- manufactur- facturfacturing
ing
ing
rMaterials
Total
Foodstuffs
and
feedstuffs
Nonfood
materials
except
fuel
Fuel
Total
Total
1947
1948
1949
76.5
82.8
78.7
101.2
110.9
96.0
111.7
120.8
100.3
90.6
100.7
91.6
66.6
78.7
78.3
72.4
78.3
75.2
72.1
77.8
74.5
94.0
96.9
83.3
95.2
100.8
91.9
54.4
61.4
63.1
58.3
63.0
64.2
66.0
73.1
73.2
1950
1951
1952
1953
1954
81.8
91.1
88.6
87.4
87.6
104.6
120.1
110.3
101.9
101.0
107.6
124.5
117.2
104.9
104.9
104.7
120.7
104.6
100.1
98.2
77.9
79.4
79.9
82.7
79.0
78.6
88.1
85.5
86.0
86.5
78.1
88.5
84.8
86.2
86.3
86.7
96.6
92.9
93.0
92.2
96.5
111.8
100.6
99.8
98.2
66.7
74.1
74.3
77.6
79.3
66.6
75.6
75.7
77.1
77.5
77.0
84.3
83.7
85.1
85.5
1955
1956
1957
1958
1959
87.8
90.7
93.3
94.6
94.8
97.1
97.6
99.8
102.0
99.4
95.1
93.1
97.2
103.0
96.2
103.8
107.6
106.2
102.2
105.8
78.8
84.4
89.2
90.3
91.9
88.1
92.0
94.1
94.3
95.6
88.4
92.6
94.8
95.2
96.5
89.3
89.7
91.3
93.4
90.0
98.6
100.1
101.4
100.4
102.1
83.3
88 5
91.4
92.0
94.2
80.9
88.3
91.8
92.5
93.6
88.9
93.5
94.0
94.0
96.6
I960
1961
1962
1963
1964
94.9
94.5
94.8
94.5
94.7
97.0
96.5
97.5
95.4
94.5
95.1
93.8
95.7
92.9
90.8
101.4
102.5
102.0
100.7
102.4
92.8
92.6
92.1
93.2
92.8
95.6
95.0
94.9
95.2
95.5
96.5
95.3
94.7
94.9
95.9
91.1
94.0
92.0
96.6
95.2
102.1
99.9
99.3
98.4
99.1
94.3
93.0
92.9
93.0
94.8
93.1
92.2
91.5
91.5
92.3
95.9
94.6
94.2
94.5
95.4
96.6
99.8
1C0.0
102.5
106.5
99.3
105.7
100.0
101.6
108.4
97.1
105.9
100.0
101.3
109.3
104.5
106.7
100.0
102.1
106.9
93.5
96.3
100.0
102.3
106.6
96.8
99.2
100.0
102.3
105.9
97.4
99.3
100.0
102.2
105.7
97.6
101.9
100.0
101.5
107.1
100.0
100.8
100.0
101.3
102.4
96.8
98.6
100.0
103.3
109.1
93.8
97.1
100.0
102.3
105.6
96.2
98.8
100.0
104. S
110.7
1970
1971
1972
110.4
113.9
119.1
112.2
115.0
127.6
112.1
114.2
127.5
109.8
110.5
121.9
122.3
138.5
148.7
109.8
114.0
118.7
110.0
113.0
117.0
112.9
116.2
119.9
104.0
105.6
109.4
115.1
118.8
123.8
111.1
114.7
117.6
112.6
119.5
126.2
1971:Jan.
Feb
Mar
Apr
May
June
111.8
112.8
113.0
113.3
113.8
114.3
110.7
115.9
114.3
115.2
115.8
116.9
108.9
116.4
114.0
114.4
115.4
117.1
108.9
109.8
109.4
110.6
110.3
110.1
134.4
133.4
134.5
138.5
139.0
139.4
111.5
111.8
112.6
113.1
113.6
114.0
110.6
110.9
111.4
112.1
112.6
112.8
113.2
114.9
115.5
115.2
116.2
116.3
104.0
104.4
104.8
105.4
105.5
105.9
114.7
114.8
115.9
117.2
118.0
118.1
113.6
113.6
113.6
113.8
114.1
114.5
114.1
115.4
117.3
118.0
118.5
119.2
July
Aug
Sept
Oct
Nov
Dec
114.6
114.9
114.5
. . . 114.4
114.5
115.4
116.6
115.2
113.9
114.3
114.3
117.0
116.6
114.5
112.1
112.6
112.7
115.8
110.4
110.2
111.1
111.1
111.1
112.8
139.7
139.3
140.3
140.6
140.6
142.7
114.8
115.6
115.4
115.0
115.0
115.4
113.6
114.6
114.4
114.2
114.2
114.4
117.5
118.3
117.1
116.6
116.8
117.3
106.1
106.3
106.2
105.9
105.9
106.3
119.6
121.7
121.6
121.4
121.2
121.0
114.9
115.5
115.6
115.4
115.6
115.8
120.8
122.5
122.5
121.9
121.8
122.3
1972: Jan
Feb
Mar
Apr
May
June
116.3
117.3
117.4
117.5
118.2
118.8
120.2
123.1
123.1
123.0
125.5
127.2
119.3
122.9
122.0
121.0
124.0
126.7
115.4
117.3
119.5
121.3
123.2
122.7
145.4
145.6
146.2
146.9
147.3
147.2
115.9
116.7
117.2
117.7
118.2
118.5
114.9
115.7
115.9
116.4
116.9
117.1
117.9
119.4
118.6
117.8
118.5
119.2
107.0
107.4
107.5
108.7
109.3
109.6
121.5
122.7
123.3
123.7
123.9
123.8
116.0
116.5
116.6
117.0
117.6
118.0
123.1
124.2
124.9
125.5
125.9
126.3
July
Aug
Sept
Oct
Nov
Dec
119.7
119.9
120.2
120.0
120.7
122.9
130.1
130.3
130.3
129.2
130.4
138.3
131.2
130.7
131.4
129.6
129.9
140.7
122.6
124.2
122.2
122.3
124.7
127.2
147.5
148.5
149.1
149.9
154.4
156.3
118.8
119.2
119.7
119.9
120.6
122.3
117.3
117.5
117.7
118.0
118.2
118.8
120.1
119.8
120.3
121.2
120.9
125.1
109.7
110.0
110.2
110.7
111.3
111.8
123.8
124.3
124.6
124.6
124.6
124.7
118.1
118.2
118.1
118.1
118.2
118.2
126.7
127.2
127.4
127.7
127.8
127.9
1965
1966
1967
1968
1969
. -
See footnotes at end of table.
250
TABLE C-49.—Wholesale price indexes by stage of processing, 1947-72—Continued
11967=100]
Finished goods
Special groups of industrial
products
Consumer finished goods
Year or month
Total
Total
Foods
Other
nondurable
goods
Durable
goods
Producer
finished
goods
Crude
materials a
InterConmediate
sumer
materials, finished
supplies,
goods
and com- excluding
ponents 3
foods
1947
1948
1949
74.0
79.9
77.6
80.5
86.5
82.5
82.8
90.4
83.1
80.7
85.8
82.3
74.6
79.7
81.8
55.4
60.4
63.4
79.2
92.5
84.0
70.0
76.1
74.2
79.0
84.0
82.2
1950
1951
1952
1953
1954
79.0
86.5
86.0
85.1
85.3
83.9
91.8
90.7
89.2
89.1
84.7
95.2
94.3
89.4
88.7
83.6
90.0
87.8
88.6
88.9
82.7
88.2
88.9
89.6
90.3
64.9
71.2
72.4
73.6
74.5
93.6
102.9
93.1
92.4
88.0
77.7
87.0
84.3
85.3
85.7
83.5
89.5
88.3
89.1
89.4
1955,
1956
1959
85.5
87.9
91.1
93.2
93.0
88.5
89.8
92.4
94.4
93.6
86.5
86.3
89.3
94.5
90.1
89.4
91.1
93.2
92.6
94.0
91.2
94.3
97.1
98.4
99.6
76.7
82.4
87.5
89.8
91.5
96.6
102.3
100.9
96.9
102.3
88.3
92.6
95.0
94.8
96.4
90.1
92.3
94.6
94.7
95.9
1960
1961
1962
1963
1964
93.7
93.7
94.0
93.7
94.1
94.5
94.3
94.6
94.1
94.3
92.1
91.7
92.5
91.4
91.9
94.7
94.7
94.8
95.1
94.8
99.2
98.8
98.3
97.8
98.2
91.7
91.8
92.2
92.4
93.3
98.3
97.2
95.6
94.3
97.1
96.8
95.5
95.3
95.0
95.6
96.3
96.2
96.0
96.0
95.9
1965
1966
1967
1968
1969
95.7
98.8
100.0
102.9
106.6
96.1
99.4
100.0
102.7
106.6
95.4
101.6
100.0
103.7
110.0
95.9
97.8
100.0
102.2
105.0
97.9
98.5
100.0
102.2
104.0
94.4
96.8
100.0
103.5
106.9
100.9
104.5
100.0
102.0
110.6
96.9
98.9
100.0
102.6
106.1
96.6
98.1
100.0
102.1
104.6
1970
1971
1972
110.4
113.5
117.2
109.9
112.7
116.6
113.4
115.2
121.7
108.2
111.3
113.6
107.1
110.9
113.2
111.9
116.6
119.5
118.8
122.7
131.1
110.0
114.3
118.9
107.7
111.2
113.5
1971:Jan..
Feb.
Mar.
Apr.
May.
June
112.2
112.8
112.9
112.9
113.5
113.8
111.3
112.0
112.1
112.0
112.7
113.1
112,3
113.9
114.6
114.5
115.6
116.4
110.9
110.8
110.7
110.5
111.0
111.2
110.5
110.8
110.4
110.5
110.7
110.7
115.6
115.9
116.0
116.1
116.3
116.5
121.4
121.8
121.4
124.1
123.5
122.8
111.5
112.0
112.7
113.3
113.8
114.1
110.7
110.8
110.6
110.5
110.9
111.0
July.
Aug.
Sept.
Oct.
Nov.
Dec.
113.8
114.1
113.6
113.8
114.0
115.0
113.0
113.3
112.7
112.9
113.1
114.2
115.6
116.1
114.9
115.0
115.7
117.7
111.6
111.8
111.9
111.7
111.7
111.8
111.0
111.1
110.4
111.3
111.3
112.6
116.8
117.1
116.9
117.1
117.0
117.8
122.7
122.3
123.0
122.9
122.6
123.4
114.9
115,9
115.9
115.7
115.6
115.8
111.4
111.5
111.3
111.6
111.6
112.1
1972:Jan..
Feb.
Mar.
Apr.
May.
June.
115.5
116.3
116.1
115.8
116.4
116.9
114.7
115.6
115.2
114.8
115.5
116.1
118.7
120,6
119.4
118.0
119.5
120.7
112.0
112.1
112.4
112.7
113.1
113.5
112.9
113.2
113.1
113.2
113.1
113.2
118.4
118.8
119.0
119.3
119.4
119.6
125.6
127.0
129.1
129.3
129.9
129.8
116.4
117.2
117.6
118.2
118.6
119.0
112.3
112.5
112.7
112.9
113.1
113.4
July.
Aug.
Sept.
Oct._
Nov.
Dec.
117.8
117.9
118.2
117.6
118.3
119.5
117.3
117.4
117.7
117.1
117.9
119.3
123.3
123.1
123.6
122.3
124.1
127.1
113.8
114.2
114.5
114.7
115.0
115.2
113.5
113.6
113.7
112.7
112.8
113.7
119.7
119.8
119.9
119.7
119.9
120.3
130.2
132.3
132.6
133.8
136.3
136.8
119.2
119.5
119.8
120.1
120.3
120.5
113.7
114.0
114.2
113.9
114.1
114.6
1957
1958
12 Includes, in addition to subgroups shown, processed fuels and lubricants, containers, and supplies.
Excludes crude foodstuffs and feedstuffs, plant and animal fibers, oilseeds, and leaf tobacco.
3
Excludes intermediate materials for food manufacturing and manufactured animal feeds.
Note.—For a listing of the commodities included in each sector, see monthly report, "Wholesale Prices and Price
Indexes," January-February 1967.
Source: Department of Labor, Bureau of Labor Statistics.
251
TABLE C-50.—Percent changes in consumer price indexes, major groups, 1948-72
[Percent change from preceding period i]
All items
Food
Commodities less food Services 2
Year or month
Unadjusted
Seasonally
adjusted
Unadjusted
2.7
1948
1949
.4
..
1965
1966
1967
1968
1969
.
1970
1971
1972
.
3.0
1.8
—.9
3.1
2.8
2.2
2.2
.8
15
— 8
15
1.5
.7
3.1
-.9
1 2
15
1.6
1.9
-.3
.6
.7
1.2
4
1 2
1 4
1.9
3.4
3.4
3.9
3 0
12
4.7
6.1
4.3
7.2
5.5
2.2
.
1970: July .
Nov.. . .
^5
3
0.3
.3
.6
.5
.4
Dec
.5
.4
.1
.3
.3
Aug
Sept
Oct
1971: Jan
Feb...
Mar .
Apr
.5
.1
2.7
1.9
17
2 3
18
26
4.9
4 0
6.1
7.4
8.2
4.8
2.3
2.5
4.7
3.4
4.5
27
37
.7
1.9
3.1
3.7
4.5
4 3
3 4
.
Unadjusted
-1.1
-1.3
-1.6
29
1960
1961
1962
1963
1964
Seasonally
adjusted
9.6
7.4
5.8
5.9
.9
.6
1955
1956
1957
1958
1959
Unadjusted
-0.8
-3.7
-1.8
1950
1951
1952
1953
1954
Seasonally
adjusted
0.1
.0
.1
4 1
3.6
0.2
'A
-.5
.3
.0
1
2
.3
.7
.2
.1
-.3
1
.3
.9
.7
.3
.8
.5
.9
.6
.3
.4
.0
.3
.3
.7
.4
.5
.2
-.8
.2
.3
-.3
—.1
!5
[4
4
.5
.6
.7
.5
.6
.6
July
Aug
Sept
Oct
2
.2
.1
.3
.3
.1
.2
.2
-.2
.1
.4
.3
1.1
.6
.0
.2
.3
.1
.3
.0
-.1
.2
.6
.5
.6
.0
1.6
.2
1:8
.0
-.3
.3
.2
.2
!l
.0
-.1
.6
-.1
-.1
.2
1.0
.6
EJ1CO
.6
-
-..
May
ftov
Dec
1972: Jan .
Feb..
.
.7
.1
.7
.4
.2
.1
.0
.2
.6
.3
.5
.2
.3
.0
.0
.0
'.5
.0
.3
.3
.4
—.1
.1
.2
.5
'A
.1
.3
.2
CO
1.1
.0
.3
\l
CMCMCO
'.5
'.S
.5
.1
a
.4
.2
.5
.3
CO CM
Nov
Dec
.2
.4
.3
CM CO
Oct
"«t
July
Aug
Sept
-. -.
-.1
.8
COCOCM
May
June
CMCOCM
Mar
Apr
COCM»-<
June
.2
.2
.3
.5
.4
.2
.2
.4
.2
.4
1 Annual changes are from December to December.
2 Percent changes for services are based on unadjusted indexes since these prices have little seasonal movement.
Note.—The seasonally adjusted changes for the all items index are based on seasonal adjustment factors and seasonally
adjusted indexes carried to two decimal places.
Source: Department of Labor, Bureau of Labor Statistics.
252
TABLE C-51.—Percent changes in wholesale price indexes, major groups, 1948-72
[Percent change from preceding periodl)
All
commodities
Year
or
month
Industrial
commodities
Consumer
Farm products
and processed finished goods,
total
foods and feeds
Consumer
finished foods
Consumer
finished goods
excluding foods
SeaSeaSeaSeaSeaSeaUnad- sonally Unad- sonally Unad- sonally Unad- sonally Unad- sonally Unad- sonally
adjusted
justed
adadjusted
adjusted
adjusted
adjusted
justed
justed
justed
justed
justed
justed
1948
1949
1.5
-6.1
5.0
-5.0
-6.8
-8.9
1.2
-5.6
-2.4
-7.4
4.0
-4.5
1950
1951
1952
1953
1954
14.7
1.2
-3.4
-.6
14.0
.4
-1.4
14
2
17.0
3.5
-8.2
-2 3
-2.6
10.2
2.7
-3.1
_ i
— 6
13.3
5.3
-5.9
-2.2
-1.9
8.2
.9
-1.1
1.6
.3
1.6
4.5
2.0
.5
-.3
4 3
4.2
1.1
.9
12
-6 4
6.0
4.2
-.2
-4 4
_ i
3.1
3.0
.2
_ 7
-2.9
3.6
5.3
-3.7
1.7
2.5
1.7
.2
.8
.5
—.2
.0
-.1
.4
— 6
— 1
-.2
.5
.6
39
— 6
6
-2.1
.0
2.1
- 8
1
4
.2
52
-1.8
.5
-1.3
.4
4
- 3
-.1
.1
.1
1965
1966
1967
1968
1969
3.4
1.7
1.0
2.8
4.8
1.4
22
1.9
2.7
3.9
9.5
2
—1 8
3.5
7.5
4.0
16
12
3.1
4.9
9.1
1.4
-.4
4.8
8.2
.9
17
2.1
2.0
2.9
1970
1971
1972
2.2
4.0
6.5
3.6
3.2
3.6
-1.4
6.0
14.4
1.4
3.3
45
-2.5
6.0
8.0
4.0
1.7
22
1955
1956 . . .
1957
1958
1959 .
1960
1961
1962
1963
1964
.
.
.
1970: July
Aug
Sept
Oct
Nov
Dec
.5
-.4
.5
.0
-.1
.1
1971: Jan
Feb
Mar
Apr
May
June
0.5
.1
.5
-A
-.1
.2
.2
.2
.8
.0
.4
0.3
2
.2
.6
.2
.3
1.5
-1 9
1.3
-2.0
4
-.5
1.2
- 4
1.3
-.9
5
-i!i
.6
_ 7
.8
-.3
.4
0
0.5
0
.5
.1
.3
- 1
1.4
-2.1
1.4
-2.5
.6
-.9
0.6
- 4
.6
-.6
.0
-1.3
.2
2
.3
1.3
.2
.5
0.2
.3
.5
.8
.3
.5
.7
.9
.2
.3
.4
.4
.5
.6
.2
.5
.3
.4
.4
.3
.3
.4
.4
.2
3
.1
.3
4
.5
3
1 3
2.6
-.2
-.1
.9
1.0
8
1.9
-.1
.5
.2
.4
7
.6
.1
-.1
.6
4
5
.5
.2
3
.4
1
1 2
1.4
.6
-.1
1.0
.7
8
1.3
.6
8
.2
2
5
.1
-.1
.4
.l
.5
.1
.0
.4
.0
July
Aug
Sept
Oct
Nov
Dec
.3
.3
-.3
-.1
.1
.8
.2
.7
-.3
.1
.1
.6
.5
.5
-.1
.0
-.1
.3
.6
.5
-.1
2
.1
.2
-.3
-.3
-1.4
.0
.5
2.0
-.7
1.2
-1.2
1 l
.3
1.4
-.1
.3
-.5
2
.2
1.0
-.4
1.1
-.8
4
.1
.9
-.7
.4
-1.0
.1
.6
1.7
-1.5
2.0
-1.8
21
1.5
.4
.1
-.2
3
.0
.4
.4
.2
.0
-.2
.1
.4
1972: Jan
Feb
Mar
Apr
May
June
.8
.9
.1
.1
.6
.5
.5
.5
.5
.3
.4
.3
.3
.4
.4
.3
.4
.4
.4
1.3
1.9
-.4
-.7
1.4
1.1
.9
1.2
-.3
-.1
.8
.5
.4
.8
-.3
-.3
.6
.5
.3
.7
-.3
.0
.3
.3
.8
1.6
-1.0
-1.2
1.3
1.0
.4
1.5
-1.0
-.3
.5
.5
.2
.2
.2
.2
.2
.3
.2
.3
.3
.2
.2
.8
.2
.3
.7
.6
.3
.1
.6
1.6
.2
.3
.2
.4
.2
-.1
.4
.1
2.2
-.2
.6
-1.0
1.6
5.8
1.8
1.4
.8
1.0
.1
.3
L4
5.2
'.7
1.2
.8
.9
-.1
-.2
2.2
-.2
.4
-1.1
1.5
2.4
1.3
1.4
-.3
.9
.6
2.2
.3
.3
.2
2
\l
.4
.3
.4
.4
-.7
.3
July
Aug
Sept
Oct
Nov. . .
Dec
1
!6
1.8
".1
.3
.5
.5
!l
.3
.3
l'.l
Annual changes are from December to December.
Note.—The seasonally adjusted changes for all commodities and industrial commodities are based on seasonal adjustment factors and seasonally adjusted indexes carried to two decimal places.
Source: Department of Labor, Bureau of Labor Statistics.
490-000 O - 73 - 17
253
MONEY STOCK, CREDIT, AND FINANCE
TABLE C-52.—Money stock measures, 1947-72
[Averages of daily figures; billions of dollars, seasonally adjusted]
Overall measures
Year and
month
Components and related items
M2
M3
(M i plus
Mi
(M 2 plus
time
(Currency deposits
deposits
plus
at nonat comdemand
bank
mercial
deposits)
thrift
banks
instituother than
arge CD's) tions)
1947: Dec . . . .
1948: Dec
1949: Dec
1950: Dec . . . .
1951: Dec
1952: Dec
1953: Dec
1954- Dec
1955: Dec
1956: Dec
1957: Dec
1958' Dec
1959: Dec
1960: Dec
1961: Dec
1962: Dec
1963: Dec
1964: Dec
1965: Dec
1966: Dec
1967: Dec
1968: Dec
1969: Dec
19j7O: Dec
1971: Dec
1972: Dec p . . . .
1971: Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec
1972: Jan
Feb
Mar
Apr
May . . . .
June
July
Aug
Sept
Oct
Nov...
Deep
113.1
111.5
111.2
116.2
122.7
127.4
128.8
132.3
135.2
136.9
135.9
141.1
142.6
141.7
146.0
148.1
153.6
160.5
168.0
171.7
183.1
197.4
203.7
214.8
228.2
246.9
215.3
217.7
219.7
221.2
223.8
225.5
227.4
228.0
227.6
227. 7
227.7
228.2
228.8
231.2
233.5
235.0
235.5
236.6
239.4
240.5
241.6
242.3
243.6
246.9
273.8
298.1
314.0
345.7
378.0
386.8
418.2
464.7
514.5
423.1
430.4
437.1
441.5
446.6
450.6
453.4
454.5
455.6
458.3
460.8
464.7
469.9
475.5
480.1
483.0
486.1
490.4
495.0
498.3
501.8
505.0
508.2
514.5
422.9
459.4
481.3
528.8
572.6
588.3
633.9
718.1
810.2
642.2
653.4
663.9
672.5
681.0
687.8
693.8
697.6
701.2
706.5
711.6
718.1
727.3
737.4
745.9
752.7
758.8
766.1
774.7
781.6
788.4
795.2
801.2
810.2
Deposits at commercial banks
Currency l
Time and savings3
Demand 2
Total
26.4
25.8
25.1
25.0
26.1
27 3
27.7
27.4
27.8
28.2
28.3
28.6
28.9
28.9
29 6
30.6
32 5
34.2
36.3
38.3
40.4
43.4
46.0
49.0
52.5
56.9
49.3
49.7
50.0
50.5
50.8
51.1
51.6
51.7
51.9
52.2
52.2
52.5
52.8
53.2
53.7
54.0
54.4
54.7
54.9
55.0
55.5
55.9
56.3
56.9
86.7
85.8
86.0
91.2
96.5
100.1
101.1
104.9
107.4
108.7
107.6
112.6
113.7
112.8
116.5
117.6
121 1
126.3
131.7
133.4
142.7
154.0
157.7
165.8
175.7
190.0
166.0
168.0
169.7
170.7
173.0
174.5
175.8
176.3
175.7
175.5
175.5
175.7
176.0
178.0
179.9
180.9
181.1
181.9
184.5
185.5
186.1
186.5
187.3
190.0
35.4
36.0
36.4
36.7
3S.2
41.1
44.5
48.3
50.0
51.9
57.4
65.4
67.4
72.9
82.7
97.8
112.2
126.6
146.8
158.1
183.4
204.2
194.1
228.9
269.9
311.2
234.4
240.2
245.4
248.1
251.3
254.4
256.4
257.3
259.6
263.3
265.3
269.9
274.4
278.1
279.9
282.8
287.0
290.9
293.7
297.1
300.5
303.4
305.9
311.2
Large
CD's*
13.3
16.7
15.9
20.8
23.6
11.0
25.5
33.4
43.7
26.6
27.5
28.1
27.8
28.5
29.4
30.4
30.8
31.6
32.7
32.2
33.4
33.2
33.8
33.4
34.7
36.3
37.1
38.1
39.3
40.3
40.7
41.3
43.7
Other
113.3
130.1
142.2
162.6
180.6
183.2
203.4
236.4
267.6
207.8
212.7
217.4
220.3
222.8
225.0
225.9
226.5
228.0
230.6
233.1
236.4
241.2
244.3
246.5
248.1
250.7
253.8
255.6
257.7
260 2
262.7
264.6
267.6
Deposits
at nonbank
thrift
institutions «
149.2
161.3
167.4
183.1
194.6
201.5
215.7
253.4
295.8
219.2
223.0
226.8
231.0
234.4
237.2
240.4
243.1
245.6
248.3
250.8
253.4
257.4
261.8
265.8
269.7
272.6
275.7
279.7
283.3
286.6
290.1
293.1
295.8
U.S.
Government
demand
deposits
(unadjusted)*
1.0
1.8
2.8
2.4
2.7
4.9
3.8
5.0
3,4
3.4
3.5
3.9
4.9
4.7
4.9
5.6
5.1
5.5
4.6
3.4
5.0
5.0
5.6
7.3
6.7
7.2
6.8
8.4
5.5
5.5
7.8
5.3
6.8
6.8
7.5
5.3
3.9
6.7
7.2
7.2
7.7
7.6
10.4
6.8
7.2
5.3
5.8
6.6
6.1
7.2
1
Currency outside the Treasury, the Federal Reserve System, and the vaults of all commercial banks.
2 Demand deposits other than those due to domestic commercial banks and the U.S. Government, less cash items in
process of collection and Federal Reserve float, plus foreign demand balances at Federal Reserve Banks.
3 Time and savings deposits other than those due to domestic commercial banks and the U.S. Government. Effective
June
1966, excludes balances accumulated for payment of personal loans (about $1.1 billion).
4
Negotiable time certificates of deposit issued in denominations of $100,000 or more by large weekly reporting commercial
banks.
5
Average of the beginning- and end-of-month deposits of mutual savings banks and savings and loan shares.
6
Deposits at all commercial banks.
Note.—The effects of the implementation on November 9, 1972 of revised Regulation J have been eliminated from
data for November-December 1972 to avoid a discontinuity in the series. The upward adjustment of demand deposits
resulting from that implementation will be incorporated into the various series at a later time.
Source: Board of Governors of the Federal Reserve System.
254
TABLE C-53.—Commercial bank loans and investments, 1930-72
[Billions of dollars]
Loans
End of year
or month 1
Total loans
and investments 2
Total 2
Investments
Commercial
and
industrial
U.S. Government securities
Other
securities
1930:June
48.9
34.5
5.0
9.4
1933:June
30.4
16.3
7.5
6.5
1939 . .
40.7
17.2
16.3
7.1
43.9
50.7
67.4
85.1
105.5
124.0
114.0
116.3
114.2
18.8
21.7
19.2
19.1
21.6
26.1
31.1
38.1
42.4
17.8
21.8
41.4
59.8
77.6
90.6
74.8
69.2
62.6
7.4
7.2
6.8
6.1
6.3
7.3
8.1
9.0
9.2
.
1940
1941
1942...
1943
1944
1945 .
1946.
1947
1948
Loans plus
loans sold to
bank affiliates 2
Seasonally adjusted
1948
1949...
113.0
118.7
41.5
42.0
62.3
66.4
9.2
10.3
1950
1951 .
1952...
1953
1954
1955...
1956
1957
1958 . .
1959 3
124.7
130.2
139.1
143.1
153.1
157.6
161.6
166.4
181.2
188.7
51.1
56.5
62.8
66.2
69.1
80.6
88.1
91.5
95.6
110.5
39.4
61.1
60.4
62.2
62.2
67.6
60.3
57.2
56.9
65.1
57.7
12.4
13.4
14.2
14.7
16.4
16.8
16.3
17.9
20.5
20.5
I960...
1961
1962
1963
1964
1965
1966-..
1967
1968
1969 s_.
197.4
212.8
231.2
250.2
272.4
300.1
* 316.1
352.0
390.6
402.1
116.7
123.6
137.3
153.6
172.9
198.2
< 213.9
231.3
258.2
279.4
42.1
43.9
47.6
52.1
58.4
69.5
78.6
86.2
95.9
105.7
59.8
65.3
64.7
61.7
60.8
57.1
53.5
59.3
61.0
51.5
20.8
23.9
29.2
35.0
38.7
44.8
M8. 7
61.4
71.4
71.2
283.3
435.9
485.7
554.2
292.0
« 320 6
376.6
109.6
115.5
129.1
58.0
60.7
62.0
85.9
« 104. 5
115.6
294.9
«323. 4
379.2
491.4
496.6
505.0
507.4
516.1
517.5
325.7
328 5
333.8
335.9
341.9
343.7
116.4
117.3
118.4
119.9
121.2
7120.7
59.7
61 0
62.3
62.6
63.1
63.2
106.0
107 1
108.9
108.9
111.1
110.6
328.7
331.5
336.6
338.5
344.4
346.0
521.9
529.8
535.3
540.4
549.4
554.2
348.4
356.2
360.0
367.2
373 6
376.6
121.4
123.9
124.6
126.7
128 2
129.1
62.3
6L4
62.0
59.9
60 6
62.0
111.2
112.3
113.3
113.3
115.1
115.6
350.7
358.6
362.3
369.4
376.1
379.2
1970
1971
1972*
. ..
.
1972:Jan. .
Feb
Mar
Apr
.
May
June
July
Aug
Sept»».
Octp
Nov p
Dec v
1
2
3
Data are for last Wednesday of month (except June 30 and December 31 call dates).
Adjusted to exclude all interbank loans beginning 1948 and domestic bank loans only beginning January 1959.
Beginning January 1959, loans and investments are reported gross, without valuation reserves deducted, rather than
net of valuation reserves, as in earlier periods.
* Effective June 1966, balances accumulated for payment of personal loans (about $1.1 billion) are excluded from loans
at all commercial banks, and certain certificates of CCC and Export-Import Bank totaling about $1 billion are included in
other securities rather than in loans.
* Beginning June 1969, data include all bank-premises subsidiaries and other significant majority-owned domestic
subsidiaries; earlier data include commercial banks only.
« Beginning June 1971, Farmers Home Administration insured notes totaling about $0.7 billion are classified as other
securities
rather than as loans.
7
Excludes $0.4 billion due to loan reclassification.
Source: Board of Governors of the Federal Reserve System.
255
TABLE C-54.—Total funds raised in credit markets by nonfinancial sectors, 1964-72
[Billions of dollars]
Item
Total funds raised
U.S. Government.
1964
1965
1966
1967
1968
67.8
70.4
68.7
83.4
13.0
6.3
Public debt securities..
Budget agency issues..
All other sectors..
Corporate equity shares.
Debt instruments
Debt capital instruments..
State and local government securities...
Corporate and foreign bonds
Mortgages
_.
Home
Other residential..
Commercial
Farm
Other private credit-
1969
1970
97.8
91.7
101.6
13.4
-3.6
12.8
-1.3
-2.4
12.9
-.1
1.8
3.6
5.4
.9
1.3
2.3
1.3
8.9
4.1
10.3
3.1
61.5
68.6
65.0
70.4
84.4
95.3
88.8
1.6
59.9
.3
68.3
.9
64.1
2.4
68.0
-.7
85.1
4.8
90.6
6.8
81.9
36.3
38.8
39.0
46.2
51.3
49.0
60.8
5.7
4.5
26.1
25.6
5.7
11.0
22.3
8.3
15.9
22.0
10.1
14.0
27.3
7.9
13.1
27.9
13.8
21.1
25.8
15.6
4.5
3.8
2.1
15.4
3.6
4.4
2.2
11.4
3.1
5.7
2.1
11.6
3.6
4.7
2.1
15.2
3.5
6.6
2.1
15.7
4.8
5.5
1.9
12.8
5.9
5.4
1.8
23.7
7.3
5.9
29.5
25.1
21.8
33.8
41.6
21.1
9.4
8.5
.7
5.1
14.1
10.0
l!7
10.4
7.2
1.0
6.4
9.9
4.6
2.1
5.2
13.8
11.1
1.6
7.3
16.8
9.3
3.3
12.2
5.0
4.3
3.8
8.0
61.5
68.6
65.0
70.4
84.4
95.3
88.8
5.1
6.0
27.9
22.6
2.5
7.6
28.8
29.6
1.3
6.4
23.2
34.1
4.0
8.5
19.7
38.1
3.1
10.4
31.9
39.1
3.3
8.7
3.0
13.9
22.3
49.5
2.6
5.3
14.6
3.3
5.7
3.5
5.5
3.5
5.0
2.7
5.7
3.2
7.4
3.2
6.4
20.6
25.2
29.7
30.7
40.2
39.8
67.8
70.4
68.7
83.4
97.8
91.7
101.6
43.5
46.0
41.2
50.9
61.3
45.6
36.5
40.7
23.1
51.5
48.6
7.4
29.1
2.8
32.7
20.3
12.2
39.3
14.6
34.0
At commercial banks...
At savings institutions.
13.3
15.8
19.6
13.2
13.0
7.3
22.6
16.7
21.0 -10.2
8.0
13.0
Credit market instruments, net..
7.0
5.3
18.1
-.6
12.7
40.2
5.9
1.0
6.0
-.1
-.2
2.3
5.3
-1.9
.3
8.8
10.2
-1.0
-1.3
7.1
-4.2
2.2
7.7
14.0
-7.6
1.4
16.0
26.7
-4.1
-1.6
-7.6
14.6
-2.6
-1.4
Foreign funds.
3.1
.5
1.8
4.9
5.1
10.6
2.4
At banks.
Direct....
2.5
.6
.8
-.3
3.7
-1.9
2.3
2.7
2.6
2.5
9.3
1.3
-8.4
10.9
.2
2.8
13.9
4.4
-1.0
2.8
15.6
6.6
-.4
4.9
17.6
3.5
1.2
4.6
18.0
3.8
-1.1
4.9
18.6
9.1
.4
2.9
19.1
13.1
2.7
2.8
22.2
1.6
Bank loans n.e.c
Consumer credit
Open-market paperOther
By borrowing sector:
Total funds raised.
Foreign
State and local governments
Households
Nonfinancial business
Farm
Nonfarm noncorporate
Corporate
Total funds advanced to nonfinancial sectors
32.6
50.8
Financed directly or indirectly by:
Private domestic nonfinancial sectors
Deposits
Demand deposits and currency...
Time and savings accounts....
U.S. Government securities
Private credit market instruments.
Corporate equities
Less security debt
7.9
69.8
5.3
63.9
7.6
7.7
56.2
-2.2
39.3
17.0
Other sources:
Change in U.S. Government cash
balance
U.S. Government loans
Private insurance and pension reserves.
Other
See footnote at end of table.
256
TABLE G-54.—Total funds raised in credit markets by nonfinancial sectors, 1964-72—Continued
[Billions of dollars]
1972 unadjusted
quarterly flows
1972 seasonally
adjusted annual rates
Item
Total funds raised
U.S. Government
Public debt securities.
Budget agency issues
All other sectors
Corporate equity shares
Debt instruments
Debt capital instruments
State and local government securities
Corporate and foreign bonds
Mortgages
Home
Other residential
Commercial
Farm
_
III
1
II
29.5
39.9
39.5
146.5
166.8
163.0
4.3
-5.6
5.3
6.6
16.3
10.6
3.7
.6
-6.0
.4
4.6
4.3
2.2
14.8
1.5
3.0
25.2
45.5
34.1
139.9
150.5
152.4
2.6
22.6
4.0
41.5
2.8
31.3
10.3
129.6
15.9
134.6
11.3
141.1
19.7
25.0
25.4
84.1
94.7
101.7
4.5
3.0
12.2
4.0
4.4
16.6
4.1
3.0
18.3
16.7
12.9
54.4
14.3
14.7
65.8
17.6
13.3
70.9
6.7
9.6
11.0
1.9
2.9
.6
_
Other private credit
Bank loans n.e.c
Consumer credit.
Ooen-market paper
Other
III
II
I
2.5
3.6
.9
7.7
30.2
38.1
2.6
3.9
.7
12.9
14.9
42.1
10.6
15.3
8.7
9.9
2.8
2.6
2.9
3.0
16.5
5.9
45.5
39.8
39.4
.1
-1.1
1.5
2.4
9.1
6.1
-.5
1.8
2.5
4.3
-.7
-.2
20.1
13.9
2.9
8.6
17.7
17.5
.3
4.2
22.2
18.6
-5.5
4.1
25.2
45.5
34.1
139.9
150.5
152.4
.9
4.8
6.1
13.4
.4
4.1
18.2
22.8
.0
4.2
15.5
14.3
4.2
17.8
50.7
67.2
1.5
14.7
60.9
73.3
1.0
18.0
69.1
64.4
1.3
1.9
10.3
2.1
3.2
17.5
.6
2.8
10.9
3.9
11.8
51.5
4.9
10.9
57.5
4.1
10.2
50.0
29.5
39 9
39.5
146.5
166.8
163.0
By borrowing sector:
Total funds raised
Foreign
State and local governments
Households
Nonfinancial business
Farm
Nonfarm noncorporate
Corporate
Total funds advanced to nonfinancial sectors _
Financed directly or indirectly by:
Private domestic nonfinancial sectors
Deposits
Demand deposits and currency
Time and savings accounts .
At commercial banks __
At savings institutions.__
_
17.6
25.5
27.8
97.2
114.4
120.0
18.3
25.3
24.2
119.1
90.6
108.3
-6.3
24.7
4.5
20.8
2.2
22.0
24.9
94.2
4.0
86.6
17.3
91.0
10.5
14.2
9.7
11.1
11.7
10.2
37.3
56.9
45.0
41.6
45.9
45.2
-.8
.1
3.6
-21.8
23.8
11.7
-1.0
-2.2
3.8
12.5
18.6
-1.4
.9
9.9
12.4
-7.3
1.7
-1.3
2.0
-20.8
14.6
-8.8
6.9
8.1
3.4
Foreign funds
4.7
1.6
5.5
18.2
4.6
16.2
At banks
Direct
.3
1.8
1.3
1.3
16.9
7.3
-2.6
5.0
11.1
-10.8
.7
1.4
-3.6
3.2
16.8
21.8
29.1
16.5
3.2
Credit market instruments, net
U.S. Government securities
Private credit market instruments
Corporate equities
Less security debt
2.4
5.6
2.1
.8
Other sources:
Change in U.S. Government cash balance
U.S. Government loans
_ _
Private insurance and pension reserves
Other
-.3
4.2
-3.3
1.5
.3
-.3
.9
6.1
.8
4.1
5.5
Source: Board of Governors of the Federal Reserve System.
4.3
257
6.9
4.0
3.3
24.0
TABLE C-55.—Private liquid asset holdings, nonfinancial investors, 1965-72
[Averages of daily figures; billions of dollars, seasonally adjusted]
Currency and deposits
Time deposits
Year
and
month
Total
liquid
assets
Total
Currency
Demand
deposits
U.S. Government
securities
Commercial
banks
Nonbank
thrift
institutions
Savings
bonds
Shortterm
marketable
securities
Negotiable
certificates
of deposit
Commercial
paper
557.7
588.2
637.5
692.1
719.2
447.4
469.6
516.0
559.7
576.3
36.3
38.3
40.4
43.4
46.0
115.5
117.3
125.2
135.2
138.1
125.2
136.8
156.2
174.2
177.1
170.4
177.3
194.2
206.8
215.2
49.5
50.1
51.0
51.4
51.1
38.2
43.3
39.5
44.2
61.9
15.5
15.0
19.5
22.6
9.1
7.1
10 2
11.5
14.2
20.9
1970: Dec
1971: Dec
1972: Dec » „
766.8
850.2
961.4
623.4
710.0
803.3
49.0
52.5
56.8
144.8
153.5
166.9
198.5
232.4
262.3
231.1
271.7
317.3
51.3
53.7
56.9
49.4
38.6
42.6
23.2
30.1
39.9
19.5
17 7
18.6
1970: Jan
Feb
720.9
721.6
725.3
729.9
733.5
736.7
577.3
576.6
580.4
584.9
588.7
591.6
46.2
46.4
46.7
47.1
47.7
47.8
139.3
138.3
139.8
141.1
141.4
141.6
176.7
176.7
178.0
179.6
181.3
182.9
215.1
215.2
215.9
217.1
218.2
219.3
51.0
51.0
50.9
50.9
50.9
50.9
63.0
63.6
62.7
60.4
58.9
58.8
8.3
8.1
8.3
9.9
10.4
10.7
21.2
22.4
23 0
23.9
24.6
24.7
743.9
749.8
754.7
759.6
761.9
766.8
596.8
602.6
608 1
613.1
617.2
623.4
48.0
48.1
48.3
48.5
48.7
49.0
142.0
143.2
144.1
144.0
144.1
144.8
185.7
188.2
191.0
193.8
195.6
198.5
221.2
223.1
224.8
226.8
228.8
231.1
50.9
50.9
51.0
51.1
51.2
51.3
58.0
56.5
54.8
54.4
52.2
49.4
14.1
16.5
18.7
20.2
21.2
23.2
24.1
23.3
22 0
20.8
20.1
19.5
774.6
784.6
792.7
799.9
808.8
816.9
631.7
643.0
653.7
662.6
671 5
678.6
49.3
49 7
50.0
50.5
50 8
51.1
144.5
146.2
147.9
148.8
151 2
152.8
203.2
208.3
213.0
216.0
218.6
220.7
234.7
238.8
242.8
247.3
250.9
254.0
51.4
51.6
51.8
52.0
52.2
52.5
48.3
46.4
43.8
42.7
42.2
43.0
24.5
25.6
26.2
25.7
26.1
26.7
18.7
18 0
17.2
16.9
16.8
16.2
823.6
827.9
831.7
838.0
841.9
850.2
684.7
688.6
692.4
698.0
703.0
710.0
51.6
51.7
51.9
52.2
52.2
52.5
154.0
154.2
153 5
153.3
153.0
153.5
221.7
222.3
223.8
226.4
228.9
232.4
257.5
260.4
263.1
266.1
268.9
271.7
52.7
52.9
53 1
53.3
53.5
53.7
43.1
43.3
42.0
40.8
39.7
38.6
27.4
27.5
28.1
29.2
28.8
30.1
15.7
15.6
16 1
16.7
16.9
17.7
858.2
867.8
876.6
886.0
894.2
904.0
719.7
729.6
738.3
745.2
751.0
758.0
52.8
53.2
53.7
54.0
54.4
54.7
153.8
155 6
157.4
158.4
158.2
158.5
237.2
240 2
242.3
243.7
246.2
249.2
275.8
280.5
284.9
289.1
292.2
295.6
53.9
54.2
54.5
54.8
55.1
55.3
36.6
35.9
36.0
36.5
37.1
38.5
29.9
30.5
30.2
31.6
33.2
34.0
18.1
17 7
17.7
17.9
17.9
18.1
913.9
921.5
929.7
938.1
947.3
961.4
766.6
773.4
780.4
787.4
794.0
803.3
54.9
55.0
55.5
55.9
56.3
56.8
160.8
161.7
162.2
162.6
163.8
166.9
251 0
253.0
255.4
257 8
259.6
262.3
299 8
303.6
307.3
311.1
314.3
317.3
55 6
55.9
56.1
56.4
56.7
56.9
38.2
37.7
37.5
38.4
40.3
42.6
35.0
36.3
37.1
37.3
37.6
39.9
18.5
18.4
18.5
18.6
18.6
18.6
1965:
1966:
1967:
1968:
1969:
Dec
Dec
Dec
Dec
Dec
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
. .
Dec
1971: Jan
Feb
Mar
Apr
.
..
-
.-
May
June
._
July
Aug
Sept
Oct
.
Nov
Dec
1972: Jan
Feb
Mar
Apr
May
June
July
Aug.
Sept
Oct
Nov »
Dec v
. . .
Source: Board of Governors of the Federal Reserve System.
258
TABLE C-56.—Federal Reserve Bank credit and member bank reserves, 1929-72
[Averages of daily figures; millions of dollars]
Reserve Bank credit outstanding
Year and month
Total
U.S.
Government securities
Member
bank
borrowings
Member bank reserves
All
other,
mainly
float
Total
Required
Excess
Member
bank free
reserves
(excess
reserves
less borrowings)
1,643
446
801
396
2,395
2,347
48
2,669
2,432
95
142
2,588
11,822
1766
671
2,612
2,510
3
99
11,473
6,462
5,011
5,008
2,305
2,404
6,035
11,914
19,612
24,744
24,746
22,858
23,978
19, 012
2,188
2,219
5,549
11,166
18,693
23,708
23, 767
21,905
23, 002
18, 287
3
5
4
90
265
334
157
224
134
118
114
180
482
658
654
702
822
729
842
607
14, 049
12,812
13,152
12,749
14,168
16, 027
16,517
17, 261
19,990
16,291
7,403
9,422
10, 776
11,701
12,884
14, 536
15,617
16,275
19,193
15,488
6,646
3,390
2,376
1,048
1,284
1,491
900
986
797
803
6,643
3,385
2,372
958
1,019
1,157
743
762
663
685
21,606
25,446
27,299
27,107
26,317
26,853
27,156
26,186
28,412
29,435
20,345
23,409
24, 400
25, 639
24,917
24,602
24, 765
23,982
26,312
27, 036
142
657
1,593
441
246
839
688
710
557
906
1,119
1,380
1,306
1,027
1,154
1,412
1,703
1,494
1,543
1,493
17,391
20,310
21,180
19,920
19,279
19,240
19, 535
19,420
18, 899
2 18,932
16,364
19,484
20,457
19,227
18, 576
18,646
18, 883
18,843
18,383
18,450
1,027
826
723
693
703
594
652
577
516
482
885
169
-870
252
457
-245
-36
-133
-41
-424
29,060
31,217
33,218
36,610
39,873
43, 853
46, 864
51,268
56,610
64,100
27, 248
29,098
30, 546
33, 729
37,126
40,885
43, 760
48, 891
52, 529
57, 500
87
149
304
327
243
454
557
238
765
1,086
1,725
1,970
2,368
2,554
2,504
2,514
2,547
2,139
3,316
5,514
19,283
20,118
20, 040
20, 746
21, 609
22,719
23, 830
25, 260
27, 221
28, 031
18, 527
19,550
19,468
20,210
21,198
22, 267
23,438
24,915
26, 766
27, 774
756
568
572
536
411
452
392
345
455
257
669
419
268
209
168
-165
107
-310
-829
66,708
74,255
76,845
61,688
69,158
71,094
321
107
1,050
4,699
4,990
4,701
29, 265
31,329
3 31,351
28,993
31,164
31,151
272
165
3 200
-49
58
s-850
67,363
66, 797
66, 691
67, 747
68, 926
68,834
62,068
62, 350
62, 719
63,371
64,714
64, 642
370
328
319
148
330
453
4,925
4,119
3,653
4,228
3,882
3,739
30,488
29, 880
29, 686
29, 885
30,419
30, 023
30, 209
29, 679
29,487
29, 745
30,107
29,892
279
201
199
140
312
131
-19
-127
-120
-8
-18
-322
71,052
70, 749
71,568
72,349
72,694
74, 255
66, 001
66, 324
67,106
67,690
68, 052
69,158
820
804
501
360
407
107
4,231
3,621
3,961
4, 299
4,235
4,990
30, 547
30, 455
30, 802
30,860
30, 953
31,329
30, 385
30, 257
30, 596
30, 653
30,690
31,164
162
198
206
207
263
165
-658
-606
-295
-153
-144
58
75, 415
73,994
73,181
75,171
75, 705
76,108
70,687
69, 966
69,273
70,939
71,428
71,632
20
33
99
109
119
94
4,708
3,995
3,809
4,123
4,158.
4,382
32,865
31,922
31,921
32, 565
32,812
32, 539
32,692
31,798
31,688
32,429
32, 708
32, 335
173
124
233
136
104
204
153
91
134
27
-15
110
77, 035
76,676
75, 451
77, 331
75,959
76,845
72,089
71,858
70, 252
71,359
71,112
71,094
202
438
514
574
606
1,050
4,744
4,380
4,685
5,398
4.241
4,701
33,021
33,148
33, 003
33, 803
3 31,774
3 31,351
32,874
32,893
32, 841
33, 556
31, 460
31,151
147
255
162
247
3 314
3 200
-55
-183
-352
-327
3-292
3-850
1
2
3
-753
Data are for licensed banks only.
Beginning December 1959, total reserves held include vault cash allowed.
Daily figures beginning November 9, 1972 adjusted to include $450 million of certain reserve deficiencies on which
penalties can be waived for a transition period in connection with bank adaptation to Regulation J (as amended effective
November 9, 1972). Daily figures beginning December 28, 1972 adjusted to include $279 million in lieu of $450 million.
Source: Board of Governors of the Federal Reserve System.
259
TABLE C-57.—Bondyields and interest rates, 1929-72
[Percent per annum]
U.S . Government securities
Corporate
bonds
(Moody's)
Year or month
3-mo nth
9-12
Treasmonth
ury
2
issues
bills i
3-5
Taxable
year
4
issues 3 bonds
1929
1933
1939
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
1950 .
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
0.515
.
2.66
Aaa
Baa
Average
rate on
HighPrime
shortgrade
comterm
municmerbank
ipal
cial
loans
bonds
(Stand- to busi»?!•
ard & n e s s Poor's) selected months
cities
FedFHA
eral
new
Reserve
home
Bank
mortdisgage
count
yields*
rate
4.73
5.90
4.27
5.85
5.16
4.49
7.76
4.71
1.73
2.56
.023
.59
3.01
4.96
2.76
2.1
.59
1.00
.014
.103
.326
.373
.375
0.75
.79
.50
.73
1.46
1.34
1.33
2.46
2 47
2.48
2 84
2.77
2.83
2.73
2.72
4.75
4.33
4.28
3.91
3.61
2 50
2.10
2.36
2.06
1.86
2.1
2.0
2.2
2.6
2.4
.56
.53
.66
.69
.73
1.00
1.00
U.00
6 1.00
8 1.00
.
.375
.375
.594
1.040
1.102
.81
.82
.88
1.14
1.14
1.18
1.16
1.32
1.62
1.43
2 37
2.19
2 25
2.44
2.31
2.62
2.53
2.61
2.82
2.66
3.29
3.05
3 24
3.47
3.42
1.67
1.64
2.01
2.40
2.21
2.2
2.1
2.1
2.5
2.68
.75
.81
1.03
1.44
1.49
«1.00
6 1.00
1.00
1.34
1.50
4.34
. .
1.218
1.552
1.766
1.931
.953
1.26
1.73
1.81
2.07
.92
1.50
1.93
2.13
2.56
1.82
2.32
2.57
2 68
2.94
2.55
2.62
2.86
2.96
3.20
2.90
3.24
3.41
3.52
3.74
3.51
1.98
2.00
2.19
2.72
2.37
2.69
3.11
3.49
3.69
3.61
1.45
2.16
2.33
2.52
1.58
1.59
1.75
1.75
1.99
1.60
4.17
4.21
4.29
4.61
4.62
1.753
2.658
3.267
1.839
3.405
1.89
2.83
3.53
2.09
4.11
2.50
3.12
3.62
2.90
4.33
2 84
3.08
3.47
3.43
4.08
3 06
3.36
3.89
3.79
4.38
3.53
3.88
4.71
4.73
5.05
2.53
2.93
3.60
3.56
3.9S
3.70
4.20
4.62
4.34
7 5.00
2.18
3.31
3.81
2.46
3.97
1.89
2.77
3.12
2.15
3.36
4.64
4.79
5.42
5.49
5.71
2.928
2.378
2.778
3.157
3.549
3.55
2.91
3.02
3.28
3.76
3.99
3.60
3.57
3.72
4.06
4.02
3 90
3.95
4.00
4.15
4.41
4.35
4.33
4.26
4.40
5.19
5.08
5.02
4.86
4.83
3.73
3.46
3.18
3.23
3.22
5.16
4.97
5.00
5.01
4.99
3.85
2.97
3.26
3.55
3.97
3.53
3.00
3.00
3.23
3.55
6.18
5.80
5.61
5.47
5.45
3.954
4.881
4.321
5.339
6.677
4.09
5.17
4.84
5.62
7.06
4.22
5.16
5.07
5.59
6.85
4.21
4.65
4.85
5.26
6.12
4.49
5.13
5.51
6.18
7.03
4.87
5.67
6.23
6.94
7.81
3.27
3.82
3.98
4.51
5.81
5.06
6.00
7 6.00
6.68
8.21
4.38
5.55
5.10
5.90
7.83
4.04
4.50
4.19
5.17
5.87
5.46
6.29
6.55
7.13
8.19
6.458
4.348
4.071
6.90
4.75
4.86
7.37
5.77
5.85
6.58
5.74
5.64
8.04
7.39
7.21
9.11
8.56
8.16
6.51
5.70
5.27
8.48
7 6.32
5.90
7.72
5.11
4.69
5.95
4.88
4.50
9.05
7.78
7.53
.
.
.
..
. .
. .
..
. ._
1965
1966
1967
1968
1969
1970
1971
1972
.
See footnotes at end of table.
260
TABLE C-57.—Bond yields and interest rates,
1929-72—Continued
[Percent per annum]
Corporate
bonds
(Moody's)
U.S. Government securities
Year or month
3-month
Treasury
bills i
9-12
3-5
Taxable
month
year
4
issues 2 issues 3 bonds
Aaa
Baa
Highgrade
municipal
bonds
(Standard &
Poor's)
7.914
7.164
6.710
6.480
7.035
6.742
8.22
7.60
6.88
6.96
7.69
7.50
8.14
7.80
7.20
7.49
7.97
7.86
6.86
6.44
6.39
6.53
6.94
6.99
7.91
7.93
7.84
7.83
8.11
8.48
8.86
8.78
8.63
8.70
8.98
9.25
6.80
6.57
6.14
6.55
7.02
7.06
6.468
6.412
6.244
5.927
5.288
4.860
7.00
6.92
6.68
6.34
5.52
4.94
7.58
7.56
7.24
7.06
6.37
5.86
6.57
6.75
6.63
6.59
6.24
5.97
8.44
8.13
8.09
8.03
8.05
7.64
9.40
9.44
9.39
9.33
9.38
9.12
6.69
6.33
6.45
6.55
6.20
5.71
1971: Jan
Feb
Mar
Apr
May
June
4.494
3.773
3,323
3.780
4.139
4.699
4.29
3.80
3.66
4.21
4.93
5.57
5.72
5.31
4.74
5.42
6.02
6.36
5.92
5.84
5.71
5.75
5.96
5.94
7.36
7.08
7.21
7.25
7.53
7.64
8.74
8.39
8.46
8.45
8.62
8.75
5.70
5.55
5.44
5.65
6.14
6.22
July
Aug
Sept
Oct
Nov
Dec
5.405
5.078
4.668
4.489
4.191
4.023
5.89
5.67
5.31
4.74
4.50
4.38
6.77
6.39
5.96
5.68
5.50
5.42
5.91
5.78
5.56
5.46
5.48
5.62
7.64
7.59
7.44
7.39
7.26
7.25
8.76
8.76
8.59
8.48
8.38
8.38
6.31
5.95
5.52
5.24
5.30
5.36
3.403
3.180
3.723
3 723
3.648
3.874
3.99
4.07
4.54
4.84
4.58
4.87
5.33
5.51
5.74
6.01
5.69
5.77
5.62
5.67
5.66
5.74
5.64
5.59
7.19
7.27
7.24
7.30
7.30
7.23
8.23
8.23
8.24
8.24
8.23
8.20
4.059
4.014
4.651
4.719
4.774
5.061
4.89
4.91
5.49
5.41
5.22
5.46
5.86
5.92
6.16
6.11
6.03
6.07
5.59
5.59
5.70
5.69
5.51
5.63
7.21
7.19
7.22
7.21
7.12
7.08
8.23
8.19
8.09
8.06
7.99
7.93
1970" Jan
Feb
Mar
Apr
May
June
July
Aug
Sept .
Oct .
Nov
Dec
..
. .
1972: Jan
Feb
Mar.
Apr
May
June
July....
Aug
Sept
Oct
Nov
Dec
Average
rate on
shortterm
bank
loans
to businessselected
cities
Prime
commercial
paper,
Federal
Reserve
Bank
discount
rate
months
FHA
new
home
mortgage
yields«
8.62
8.78
8.55
8.33
8.06
8.23
8.21
6.00
6.00
6.00
6.00
6.00
6.00
9.29
9.20
9.10
9.11
8.29
7.90
7.32
6.85
6.30
5.73
6.00
6.00
6.00
6.00
5.85
5.52
9.16
9.11
9.07
9.01
8.97
8.90
5.11
4.47
4.19
4.57
5.10
5.45
5.23
4.91
4.75
4.75
4.75
4.75
8.40
5.75
5.73
5.75
5.54
4.92
4.74
4.88
5.00
5.00
5.00
4.90
4.69
7.89
7.97
7.92
7.84
7.75
7.62
5.25
5.33 ' " 5 : 5 2
5.30
5.45
5.26
5.59
5.37
4.08
3.93
4.17
4.58
4.51
4.64
4.50
4.50
4.50
4.50
4.50
4.50
7.59
7.49
7.46
7.45
7.50
7.53
5.39
5.29
5.36
5.20
5.03
5.03
4.85
4.82
5.14
5.30
5.25
5.45
4.50
4.50
4.50
4.50
4.50
4.50
7.54
7.54
7.55
7.56
7.57
7.57
8.86
8.49
8.50
8.07
7 6.59
6.01
6.51
6.18
5.84
6.33
7.32
7.37
7.75
1 Rate on new issues within period. First issued in December 1929.
2 Certificates of indebtedness and selected note and bond issues.
3 Selected note and bond issues.
* First issued in 1941. Series includes bonds which are neither due nor callable before a given number of years as follows: April 1953 to date, 10 years; April 1952-March 1953,12 years; October 1941-March 1952,15 years.
6 Data for first of the month, based on the maximum permissible interest rate (7 percent beginning February 18,1971).
Through July 1961, computed on 25-year mortgages paid in 12 years and thereafter, 30-year mortgages prepaid in 15 years.
« From October 30,1942, to April 24,1946, a preferential rate of 0.50 percent was in effect for advances secured by
Government securities maturing in 1 year or less.
' Series revised. Not strictly comparable with earlier data.
Note.—Yields and rates computed for New York City except for short-term bank loans.
Sources: Department of Housing and Urban Development, Treasury Department, Board of Governors of the Federal
Reserve System, Moody's Investors Service, and Standard & Poor's Corporation.
490-000 O - 73 - 18
261
TABLE G-58.—Short- and intermediate-term consumer credit outstanding, 1929-72
[Millions of dollars]
Instalment credit
End of year or
month
Total
Total
Automobile
paper
Noninstalment credit
Home
Other
repair
conand
sumer
goods modernization
paper
loans 1
1929..
7,116
3,524
1,384
1,544
27
1933..
3,885
1,723
493
799
15
298
371
376
255
130
119
182
405
718
853
1940..
1941..
1942..
1943..
1944..
1945..
1946..
1947..
1948..
1949..
4,503
8,338 5,514
9,172 6,085
5,983 3,166
4,901 2,136
5,111 2,176
5,665 2,462
8,384 4,172
11,598 6,695
14,447 8,996
17, 364 11, 590
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
21,471
22,712
27, 520
31,393
32,464
38, 830
42,334
44,971
45,129
51, 544
14,703
15, 294
19,403
23,005
23,568
28,906
31, 720
33,868
33,642
39,247
I960..
1961..
1962..
1963..
1964..
1965..
1966..
1967..
1968..
1969..
1971: Jan..
Feb..
Mar.
Apr..
Ap
Ma
Way..
June..
56,141
57,982
63, 821
71,739
80, 268
89,883
96, 239
100, 783
110,770
121,146
127,163
138,394
156,400
125,811
125,447
125,643
127,009
128,066
129,336
July..
Aug..
Sept..
Oct...
Nov..
Dec...
1972: Jan...
Feb..
Mar..
Apr..
May..
June.
7,222
1939..
1970..
1971..
1972 4.
July..
Aug..
Sept..
Oct...
Nov..
Dec 4.
1,497
1,620
1,827
1,929
1,195
819
791
816
1,290
2,143
2,901
3,706
4,799
4,880
6,174
6,779
6,751
7,641
8,606
8,844
9,028
10,631
1,016
1,085
1,385
1,610
1,616
1,693
1,905
2,101
2,346
2,809
42,968
43, 891
48, 720
55,486
62,692
70,893
76, 245
79,428
87, 745
97,105
102,064
111,295
126,900
100,929
100,467
100,602
101,581
102,409
103,694
2,071
2,458
742
355
397
455
981
1,924
3,018
4,555
6,074
5,972
7,733
9,835
9,809
13,460
14,420
15,340
14,152
16,420
17,658
17,135
19, 381
22, 254
24,934
28,437
30, 010
29,796
32,948
35, 527
35,184
38,664
43,900
34,878
34,859
35,089
35,603
35,979
36,593
11, 545
11,862
12,627
14,177
16,333
18,483
20,732
22,389
24,626
28,313
31,465
34,353
39,900
30,889
30, 530
30,389
30, 590
30,813
31,163
3,148
3,221
3,298
3,437
3,577
3,736
3,841
4,008
4,239
4,613
130,062
131, 593
132,968
133, 755
135,415
138,394
104, 572
105,924
107,073
107, 775
109,088
111,295
37,066
37,497
37,812
38,193
38, 576
38,664
31, 250
31,569
32,045
32,189
32,740
34,353
5,234
5,314
5,364
5,400
5,417
5,413
137,426
136,941
137,879
139,410
141,450
143,812
145,214
147,631
148,976
150,576
152,968
156,400
110,757
110,510
111,257
112,439
114,183
116,365
38,450
38, 516
38,853
39, 348
40,063
41,019
34,046
33, 579
33,695
33,981
34,439
35,041
5,399
5,403
5,437
5,504
5,604
5,717
117,702
119,911
121,193
122,505
124, 325
126,900
41,603
42,323
42, 644
43,162
43,674
43,900
35,470
36,188
36, 745
37,216
38,064
39,900
5,797
5,950
6,049
6,124
6,174
6,200
5,070
5,413
6,200
5,028
5,016
5,012
5,035
5,097
5,173
Personal
loans
569
416
1,088
1,245
1,322
974
832
869
1,009
1,496
1,910
2,224
2,431
2,814
3,357
4,111
4,781
5,392
6,112
6,789
7,582
8,116
9,386
Total
Charge
accounts
3,592
1,996
2,162
1,286
2,719
2,824
3,087
2,817
2,765
2,935
3,203
4,212
4,903
5,451
5,774
Other 2
Addendum:
Policy
loans by
life insurance
companies *
3,769
1,414
1,596
876
1,305
1,471
1,645
1,444
1,440
1,517
1,612
2,076
2,381
2,722
2,854
1,353
1,442
1,373
1,325
1,418
1,591
2,136
2,522
2,729
2,920
3,091
2,919
2,683
2,373
2,134
1,962
1,894
1,937
2,057
2,240
6,768
7,418
8,117
8,388
8,896
9,924
10,614
11,103
11,487
12, 297
3,367
3,700
4,130
4,274
4,485
4,795
4,995
5,146
5,060
5,104
3,401
3,718
3,987
4,114
4,411
5,129
5,619
5,957
6,427
7,193
2,413
2,590
2,713
2,914
3,127
3,290
3,519
3,869
4,188
4,618
10,617
11,673
13, 414
15,618
17,848
20, 237
21,662
23,235
25,932
28,652
30,345
32,865
36,900
30,134
30, 062
30,112
30,353
30, 520
30,765
13,173
14,091
15,101
16, 253
17,576
18,990
19,994
21,355
23, 025
24,041
5,329
5,324
5,684
5,903
6,195
6,430
6,686
7,070
7,193
7,373
5,231
5,733
6,234
6,655
7,140
7,678
9,117
10,059
11,306
13,825
25,099
27,099
29, 500
24, 882
24,980
25,041
25,428
25,657
25,642
7,968
8,350
8,400
7,524
7,303
7,239
7,485
7,675
7,650
7,844
8,767
9,417
10, 350
11,381
12, 560
13,308
14, 285
15,832
16, 668
17,131
18, 749
21,100
17,358
17,677
17, 802
17,943
17,982
17,992
31,022
31,544
31,852
31,993
32,355
32,865
32, 862
33,012
33,272
33, 606
34, 077
34,588
34,832
35,450
35, 755
36, 003
36,413
36,900
25,490
25,669
25,895
25, 980
26,327
27,099
7,554
7, 595
7,744
7,778
7,948
8,350
17,936
18,074
18,151
18, 202
18,379
18, 749
16,609
16,704
16,812
16,887
16,948
17,027
26, 669
26,431
26,622
26,971
27,267
27,447
27, 512
27, 720
27, 783
28, 071
28,643
29,500
7,630
6,987
6,963
7,179
7,464
7,610
19, 039
19,444
19,659
19,792
19,803
19,837
19,868
20,003
20,090
20, 291
20,633
21,100
17,074
17,132
17, 212
17,360
17,441
17,528
17,605
17,689
17,773
17,854
7,644
7,717
7,693
7,780
8,010
8,400
2,379
3,248
16,064
17,065
16,144
16, 220
16,296
16, 376
16,444
16,531
12 Holdings of financial institutions only; holdings of retail outlets are included in other consumer goods paper.
Single-payment loans and service credit.
3
Year-end figures are annual statement asset values; month-end figures are book value of ledger assets. These loans
are not included in consumer credit series.
* Preliminary; by Council of Economic Advisers.
Sources: Board of Governors of the Federal Reserve System and Institute of Life Insurance (except as noted).
262
TABLE C-59.—-Instalment credit extended and repaid, 1946-72
[Millions of dollars]
Automobile
paper
Total
Other consumer
goods paper
Home repair and
modernization
loans
Extended
Year or month
Extended
Repaid
Extended
Repaid
Extended
Repaid
Repaid
Personal
loans
Extended
Repaid
1946
1947
1948.
1949.
6,785
8,495
12,713 10,190
15, 585 13, 284
18,108 15, 514
1,969
3,692
5,217
6,967
1,443
2,749
4,123
5,430
3,077
4,498
5,383
5,865
2,603
3,645
4,625
5,060
423
704
714
734
200
391
579
689
3,026
3,819
4,271
4,542
2,539
3,405
3,957
4,335
1950.
1951.
1952.
1953.
1954
21,558 18,445
23, 576 22,985
29,514 25,405
31,558 27,956
31,051 30, 488
8,530
8,956
11,764
12,981
11,807
7,011
9,058
10,003
10, 879
11,833
7,150
7,485
9,186
9,227
9,117
6,057
7,404
7,892
8,622
9,145
835
841
1,217
1,344
1,261
717
772
917
,119
,255
5,043
6,294
7,347
8,006
8,866
4,660
5,751
6,593
7,336
8,255
1955.
1956.
1957
1958
1959
38, 972
39, 866
42, 019
40,110
48, 048
33, 634
37,056
39, 870
40, 339
42,603
16,734
15,515
16, 465
14,226
17,779
13, 082
14, 555
15, 545
15,415
15, 579
10,642
11,721
11,810
11,738
13,981
9,752
10,758
11, 574
11, 557
12,402
1,393
1,582
1,674
1,871
2,222
,316
,370
,477
,626
,765
10, 203
11,051
12.069
12, 275
14.070
9,484
10,373
11,276
11,741
12, 857
I960
1961
1962
1963
1964
49,793
49, 048
56,191
63, 591
70,670
46,073
48,124
51, 360
56, 825
63, 470
17,657 16,419
16,029 16, 552
19,694 17,447
22,126 19, 254
24, 046 21, 369
14, 525
14, 551
15, 701
17,920
20, 821
13,613
14, 235
14,935
16,369
18,666
2,215
2,092
2,084
2,186
2,225
1,876
2,015
2,010
2,046
2,086
15,396
16,377
18,710
21, 359
23, 578
14,165
15,319
16,969
19,156
21, 349
1965
1966
1967
1968
1969
78,661
82, 83(2
87,171
99,984
109,146
70,463
77,480
83,988
91,667
99, 786
27,208
27,192
26,320
31,083
32, 553
23,706
25,619
26,534
27,931
29, 974
22,857
26,329
29,504
33,507
38,332
20,707
24,080
27,847
31,270
34,645
2,270
2,223
2,369
2,534
2,831
2,112
2,118
2,202
2,303
2,457
26.326
27,088
28,978
32,860
35,430
23,938
25, 663
27,405
30,163
32,710
1970
1971
1972
112,158 107,199
124,281 115,050
143,500 127,900
29,794
34,873
40,400
30,137
31,393
35,200
43,873
47,821
55,800
40,721
44,933
50,200
2,963
3,244
4,000
2,506
2,901
3,200
35,528
38,343
43,300
33,835
35,823
39,300
Seasonally adjusted
1971: Jan..
Feb..
Mar..
Apr..
May.
June.
9,312
9,737
9,984
10,266
10,173
10,249
9,085
9,217
9,354
9,455
9,606
9,670
2,585
2,724
2,855
2,874
2,778
2,845
2,482
2,532
2,621
2,531
2,593
2,657
3,559
3,812
3,818
3,947
3,949
3,972
3,555
3,589
3,610
3,673
3,736
3,786
229
250
272
259
258
281
219
230
251
241
236
244
2,939
2,951
3,039
3,186
3,188
3,151
2,829
2,866
2,872
3,010
3,041
2,983
July.
Aug.
Sept.
Oct..
Nov.
Dec.
10,108
10,610
10,827
10,718
11,157
10,866
9,416
9,709
9,725
9,843
9,965
9,976
2,813
3,006
3,123
3,016
3,121
3,051
2,527
2,669
2,689
2,673
2,676
2,715
3,879
4,048
4,188
4,135
4,254
4,153
3,749
3,822
3,804
3,871
3,875
3,891
111
283
282
283
274
294
239
245
251
248
252
244
3,144
3,273
3,234
3,284
3,508
3,368
2,901
2,973
2,981
3,051
3,162
3,126
1972: Jan..
Feb..
Mar..
Apr..
May.
June.
11,116
10,952
11,741
11,374
11,687
12,057
10,015
10,069
10,427
10,384
10,355
10,671
3,089
3,100
3,176
3,162
3,274
3,412
2,795
2,776
2,831
2,867
2,819
2,922
4,258
4,052
4,453
4,370
4,393
4,577
3,905
3,878
3,944
3,986
3,981
4,164
309
296
323
331
334
351
256
253
262
268
287
283
3,460
3,504
3,789
3,511
3,686
3,717
3,059
3,162
3,390
3,263
3,268
3,302
July.
Aug.
Sept.
Oct..
Nov..
DecV
11,687
12,484
11,953
12,404
12,846
13,200
10, 593
10,841
10,667
10,908
11,128
11,600
3,298
3,491
3,368
3,504
3,620
3,700
2,917
2,896
2,873
3,041
3,023
3,200
4,684
4,990
4,772
4,971
5,118
5,350
4,249
4,395
4,303
4,354
4,444
4,700
328
371
340
335
327
350
279
270
263
263
271
300
3,377
3,632
3,473
3,594
3,781
3,800
3,148
3,280
3,228
3,250
3,390
3,400
1
Preliminary; December by Council of Economic Advisers.
Source: Board of Governors of the Federal Reserve System (except as noted).
263
TABLE C-60.—Mortgage debt outstanding by type of property and of financings 1939-72
[Billions of dollars]
Nonfarm properties by type of mortgage
Nonfarm properties
FHA-VA underwritten
End of year
or quarter
All
properties
Farm
properties
Total
Multi- Com1- to 4- family
mercial
family
houses propproperties erties i
Conventional *
1- to 4-family houses
Total
Total
FHA
insured
VA
guaranteed
Total
1- to 4family
houses
35.5
6.6
28.9
16.3
5.6
7.0
1.8
1.8
1.8
27.1
14.5
36.5
37.6
36.7
35.3
34.7
6.5
6.4
6.0
5.4
4.9
30.0
31.2
30.8
29.9
29.7
17.4
18.4
18.2
17.8
17.9
5.7
5.9
5.8
5.8
5.6
6.9
7.0
6.7
6.3
6.2
2.3
3.0
3.7
4.1
4.2
2.3
3.0
3.7
4.1
4.2
2.3
3.0
3.7
4.1
4.2
27.7
28.2
27.1
25.8
25.5
15.1
15.4
14.5
13.7
13.7
35.5
41.8
48.9
56.2
62.7
4.8
4.9
5.1
5.3
5.6
30.8
36.9
43.9
50.9
57.1
18.6
23.0
28.2
33.3
37.6
5.7
6.1
6.6
7.5
8.6
6.4
7.7
9.1
10.2
10.8
4.3
6.3
9.8
13.6
18.1
4.3
6.1
9.3
12.5
15.0
4.1
3.7
3.8
5.3
6.9
0.2
2.4
5.5
7.2
8.1
26.5
30.6
34.1
37.3
39.0
14.3
16.9
18.9
20.8
22.6
72.8
82.3
91.4
101.3
113.7
6.1
6.7
7.2
7.7
8.2
66.7
75.6
84.2
93.6
105.4
45.2
51.7
58.5
66.1
75.7
10.1
11.5
12.3
12.9
13.5
11.5
12.5
13.4
14.5
16.3
22.1
26.6
29.3
32.1
36.2
18.9
22.9
25.4
28.1
32.1
8.6
9.7
10.8
12.0
12.8
10.3
13.2
14.6
16.1
19.3
44.6
49.0
54.9
61.5
69.2
26.3
28.8
33.1
38.0
43.6
129.9
144.5
156.5
171.8
190.8
9.0
9.8
10.4
11.1
12.1
120.9
134.6
146.1
160.7
178.7
88.2
99.0
107.6
117.7
130.9
14.3
14.9
15.3
16.8
18.7
18.3
20.7
23.2
26.1
29.2
42.9
47.8
51.6
55.1
59.3
38.9
43.9
47.2
50.1
53.8
14.3
15.5
16.5
19.7
23.8
24.6
28.4
30.7
30.4
30.0
78.0
86.8
94.6
105.5
119.4
49.3
55.1
60.4
67.6
77.0
206.8
226.2
248.6
274.3
300.1
12.8
13.9
15.2
16.8
18.9
194.0
212.3
233.4
257.4
281.2
141.3
153.0
166.5
182.2
197.6
20.3
22.9
25.8
29.0
33.6
32.4
36.4
41.1
46.2
50.0
62.3
65.6
69.4
73.4
77.2
56.4
59.1
62.2
65.9
69.2
26.7
29.5
32.3
35.0
38.3
29.7
29.6
29.9
30.9
30.9
131.7
146.7
164.1
184.0
204.0
84.8
93.8
104.3
116.3
128.3
325.8
347.4
370.2
397.5
425.3
21.2
23.3
25.5
27.5
29.5
304.6
324.1
344.8
370.0
395.9
212.9
223.6
236.1
251.2
266.8
37.2
40.3
43.9
47.3
52.2
54.5
60.1
64.8
71.4
76.9
81.2
84.1
88.2
93.4
100.2
73.1
76.1
79.9
84.4
90.2
42.0
44.8
47.4
50.6
54.5
31.1
31.3
32.5
33.8
35.7
223.4
240.0
256.6
276.6
295.7
139.8
147.6
156.1
166.8
176.6
451.7
499.9
564 5
31.2
32.9
35 6
420.5
467.0
528 9
280.2
307.8
345 4
58.0
66.8
76 5
82.3
92.4
107.0
109.2
120.7
97.2
105.2
59.9
65.7
37.3
39.5
311.3
346.3
182.9
202.6
429.4
435.6
443.4
451.7
29.8
30.3
30.8
31.2
399.6
405.2
412.5
420.5
268.5
271.7
276.0
280.2
53.2
54.5
56.1
58.0
77.8
79.0
80.4
82.3
101.9
103.2
106.8
109.2
91.6
92.2
95.1
97.2
55.6
56.1
58.1
59.9
36.0
36.0
37.0
37.3
297.6
302.0
305.7
311.3
176.9
179.6
181.0
182.9
III*...
IV*___
459.0
471.1
485.6
499.9
31.8
31.9
32.4
32.9
427.2
439.3
453.2
467.0
283.6
290.9
299.7
307.8
59.7
62.1
64.3
66.8
83.9
86.3
89.2
92.4
111.0
114.4
117.5
120.7
98.3
100.4
102.9
105.2
61.0
62.8
64.4
65.7
37.3
37.6
38.5
39.5
316.2
324.9
335.7
346.3
185.3
190.5
196.8
202.6
1972:1 "
II *_._
Ill p . .
IV P...
511.7
529.1
546.9
564.5
33.5
34.4
35.1
35.6
478.2
494.8
511.9
528.9
314.1
324.6
335.1
345.4
68.8
71.3
73.8
76.5
95.3
98.9
102.8
107.0
123.7
126.9
107.5
109.6
66.8
67.6
40.7
42.0
354.5
368.1
206.6
215.1
1939 . . .
1940
1941
1942
1943
1944
.
.
..
.
1945
1946
1947
1948
1949
1950
1951
1952 . . .
1953
1954
.
1955
1956
1957
1958
1959
1960 .
1961
1962
1963
1964
. .
1965
1966
1967
1968
1969
1970
1971 P
1972 P
._
1970:1
II
Ill
IV
1971:1
p....
UP...
» Includes negligible amount of farm loans held by savings and loan associations.
2 Derived figures.
Source: Board of Governors of the Federal Reserve System, estimated and compiled from data supplied by various
Government and private organizations.
264
TABLE C-61.—Mortgage debt outstanding by lender, 1939-72
[Billions of dollars]
Selected financial institutions
End of year
or quarter
otal
Total
Savings
and
loan
associations
Mutual
savings
banks
Commercial
banksi
Other lenders
Life
U.S.
insurance
agencies 2
companies
Individuals
and
others
1939
35.5
18.6
3.8
4.8
4.3
5.7
5.0
11.9
1940
1941
1942... .
1943
1944
36.5
37.6
36.7
35.3
34.7
19.5
20.7
20.7
20.2
20.2
4.1
4.6
4.6
4.6
4.8
4.9
4.8
4.6
4.4
4.3
4.6
4.9
4.7
4.5
4.4
6.0
6.4
6.7
6.7
6.7
4.9
4.7
4.3
3.6
3.0
12.0
12.2
11.7
11.5
11.5
1945
1946
1947
1948
1949
35.5
41.8
48.9
56.2
62.7
21.0
26.0
31.8
37.8
42.9
5.4
7.1
8.9
10.3
11.6
4.2
4.4
4.9
5.8
6.7
4.8
7.2
9.4
10.9
11.6
6.6
7.2
8.7
10.8
12.9
2.4
2.0
1.8
1.9
2.4
12.1
13.8
15.3
16.5
17.4
1950...
1951
1952
1953
1954
72.8
82.3
91.4
101.3
113.7
51.7
59.5
66.9
75.1
85.7
13.7
15.6
18.4
22.0
26.1
8.3
9.9
11.4
12.9
15.0
13.7
14.7
15.9
16.8
18.6
16.1
19.3
21.3
23.3
26.0
2.7
3.4
4.0
4.4
4.6
18.4
19.4
20.5
21.8
23.4
1955
1956
1957..
1958.. I'..'
1959
129.9
144.5
156.5
171.8
190.8
99.3
111.2
119.7
131.5
145.5
31.4
35.7
40.0
45.6
53.1
17.5
19.7
21.2
23.3
25.0
21.0
22.7
23.3
25.5
28.1
29.4
33.0
35.2
37.1
39.2
5.2
6.0
7.4
7.8
10.0
25.4
27.3
29.3
32.5
35.4
1960
1961
1962
1963
1964
206.8
226.2
248.6
274.3
300.1
157.6
172.6
192.5
217.1
241.0
60.1
68.8
78.8
90.9
101.3
26.9
29.1
32.3
36.2
40.6
28.8
30.4
34.5
39.4
44.0
41.8
44.2
46.9
50.5
55.2
11.2
11.8
12.2
11.2
11.4
38.0
41.8
44.0
45.9
47.7
1965
1966
1967
1968
1969
325.8
347.4
370.2
397.5
425.3
264.6
280.8
298.8
319.9
339.2
110.3
114.4
121.8
130.8
140.3
44.6
47.3
50.5
53.5
56.1
49.7
54.4
59.0
65.7
70.7
60.0
64.6
67.5
70.0
72.0
12.4
15.8
18.4
21.7
26.8
48.7
50.9
53.0
55.8
59.4
1970
1971 »___
1972*
451.7
499.9
564.5
355.9
394.4
449.2
150.3
174.4
206.0
57.9
62.0
67.6
73.3
82.5
98.9
74.4
75.5
76.7
33.0
39.4
46.0
62.8
66.1
69.3
1970: I . . . .
II...
IllIV..
429.4
435.6
443.4
451.7
340.7
344.5
349.7
355.9
140.8
143.1
146.4
150.3
56.4
56.9
57.4
57.9
70.9
71.3
72.4
73.3
72.7
73.2
73.6
74.4
28.6
30.0
31.7
33.0
60.1
61.1
61.9
62.8
1971: I *_.
II *..
III *.
IV »_
459.0
471.1
485.6
499.9
361.8
372.0
383.5
394.4
154.2
161.2
168.2
174.4
58.7
59.6
60.6
62.0
74.4
76.6
79.9
82.5
74.5
74.5
74.8
75.5
33.6
35.2
37.4
39.4
63.5
63.9
64.6
66.1
1972: I p . .
ll»>.
III p.
IV P..
511.7
529.1
546.9
564.5
404.2
418.9
434.2
449.2
180.1
188.9
197.9
206.0
63.0
64.4
65.9
67.6
85.6
90.1
94.6
98.9
75.4
75.5
75.8
76.7
41.2
42.7
44.3
46.0
66.4
67.5
68.4
69.3
1
2
Includes loans held by nondeposit trust companies, but not bank trust departments.
Includes former FNMA and new GNMA, as well as FHA, VA, PHA, Farmers Home Administration and in earlier years
RFC, HOLC, and FFMC. Also includes U.S.-sponsored agencies such as new FNMA, Federal Land Banks, GNMA (Pools),
and FHLMC. Other U.S. agencies (amounts small or current separate data not readily available) included with "individuals
and others."
Source: Board of Governors of the Federal Reserve System, based on data from various Government and private
organizations.
265
TABLE C-62.—Net public and private debt, 1929-711
[Billions of dollars]
Private
Public
Individual and noncorporate
End of year
Total
FedFederal
eral
finanGovcial
ernagenment 2 cies 3
State
and
local
governments
Total
Nonfarm
Corporate
Total
Farm*
Total
Mortgage
Commercial
Conand
sumer
financial *
1929
191.9
16.5
13.6
161.8
88.9
72.9
12.2
60.7
31.2
22.4
7.1
1933
168.5
24.3
16.3
127.9
76.9
51.0
9.1
41.9
26.3
11.7
3.9
183.3
42.6
16.4
124.3
73.5
50.8
8.8
42.0
25.0
9.8
7.2
1940
1941
1942
1943
1944
189.8
211.4
258.6
313.2
370.6
44.8
56.3
101.7
154.4
211.9
16.4
16.1
15.4
14.5
13.9
128.6
139.0
141.5
144.3
144.8
75.6
83.4
91.6
95.5
94.1
53.0
55.6
49.9
48.8
50.7
9.1
9.3
9.0
8.2
7.7
43.9
46.3
40.9
40.5
42.9
26.1
27.1
26.8
26.1
26.0
9.5
10.0
8.1
9.5
11.8
8.3
9.2
6.0
4.9
5.1
1945
1946
1947
1948 . .
1949
405.9
396.6
415 7
431 3
445.8
252.5
229.5
221.7
215.3
217.6
0 7
.6
.7
13.4
13.7
15.0
17.0
19.1
140.0
153.4
178.3
198.4
208.4
85.3
93.5
108.9
117.8
118.0
54.7
59.9
69.4
80.6
90.4
7.3
7.6
8.6
10.8
12.0
47.4
52.3
60.7
69.7
78.4
27.0
31.8
37.2
42.4
47.1
14.7
12.1
11.9
12.9
13.9
5.7
8.4
11.6
14.4
17.4
1950
1951
1952
1953 . . .
1954
486.2 217.4
519 2 216 9
550 2 221.5
581.6 226.8
605.9 229.1
.7
1 3
1 3
1.4
1.3
21.7
24.2
27.0
30.7
35.5
246.4
276.8
300.4
322.7
340.0
142.1
162.5
171.0
179.5
182.8
104.3
114.3
129.4
143.2
157.2
12.3
13.7
15.2
16.8
17.5
92.0
100.6
114.2
126.4
139.7
54.8
61.7
68.9
76.7
86.4
15.8
16.2
17.8
18.4
20.8
21.5
22.7
27.5
31.4
32.5
1955...
1956
1957..
1958 _ .
1959 . . .
665.8
698.4
728.3
769.6
833.0
229.6
224.3
223.0
231.0
241.4
2.9
2.4
2.4
2.5
3.7
41.1
44.5
48.6
53.7
59.6
392.2
427.2
454.3
482.4
528.3
212.1
231.7
246.7
259.5
283.3
180.1
195.5
207.6
222.9
245.0
18.7
19.4
20.2
23.2
23.8
161.4
176.1
187.4
199.7
221.2
98.7
109.4
118.1
128.1
141.0
24.0
24.4
24.3
26.5
28.7
38.8
42.3
45.0
45.1
51.5
1960
1961
1962 .
1963
1964 .
874.2
930.3
996.0
1,070.9
1,151.6
239.8
246.7
253.6
257.5
264.0
3.5
4.0
5.3
7.2
7.5
64.9
70.5
77.0
83.9
90.4
566.1
609.1
660.1
722.3
789.7
302.8
324.3
348.2
376.4
409.6
263.3
284.8
311.9
345.8
380.1
25.1
27.5
30.2
33.2
36.0
238.2
257.3
281.7
312.6
344.1
151.3
164.5
180.3
198.6
218.9
30.8
34.8
37.6
42.3
45.0
56.1
58.0
63.8
71.7
80.3
1965 . .
1966
1967 _
1968
1969 _
1, 244.1
1,341.4
1,443.1
1,585.3
1,723.2
266.4
271.8
286.5
291.9
289.3
8.9
11.2
9.0
21.4
30.6
870.4
98.3
104.8
953.5
113.4 1,034.3
123.9 1,148.2
132.6 1, 270.8
454.3
506.6
553.7
628.0
714.8
416.1
446.9
480.6
520.3
556.0
39.3
42.4
48.3
51.8
55.5
376.8
404.5
432.3
468.5
500.5
236.8
251.6
266.9
284.9
303.9
49.7
55.4
63.3
70.4
74.2
90.3
97.5
102.1
113.2
122.5
1970
1971
1, 843.9
1,996.4
301.1
325.9
38.8
39.8
146.8 1, 357.3
167.7 1,463.0
773.6
827.3
583.7
635.7
58.7
63.1
525.0
572.6
320.8
352.3
77.4
83.0
126.8
137.2
1939
.
1 Net public and private debt is a comprehensive aggregate of the indebtedness of borrowers after eliminating certain
types of duplicating governmental and corporate debt.
2 Net Federal Government and agency debt is the outstanding debt held by the public, as defined in the "Budget of the
United States Government, for the Fiscal Year ending June 30,1974."
3 This comprises the debt of federally sponsored agencies, in which there is no longer any Federal proprietary interest.
The obligations of the Federal Land Banks are included beginning with 1947, the debt of the Federal Home Loan Banks
is included beginning with 1951, and the debts of the Federal National Mortgage Association, Federal Intermediate Credit
Banks, and Banks for Cooperatives are included beginning with 1968.
• Farm mortgages and farm production loans. Farmers' financial and consumer debt is included in the nonfarm categories,
s Financial debt is debt owed to banks for purchasing or carrying securities, customers'debt to brokers, and debt owed
to life insurance companies by policyholders.
Sources: Department of Commerce (Bureau of Economic Analysis), Treasury Department, Department of Agriculture,
Board of Governors of the Federal Reserve System, Federal Home Loan Bank Board, Federal Land Banks, and Federal
National Mortgage Association.
266
GOVERNMENT FINANCE
TABLE C-63.—Federal budget receipts and outlays,fiscalyears 1929-74
[Millions of dollars]
Receipts
Fiscal year
Outlays
Surplus or
deficit ( - )
Administrative budget:
1929
3,862
3,127
734
1933
1,997
4,598
-2,602
1939
4,979
8,841
-3,862
1940
1941
1942
1943
1944
6,879
9,202
15,104
25,097
47,818
9,589
13,980
34, 500
78,909
93,956
-2,710
-4,778
- 1 9 , 396
-53,812
-46,138
1945
1946
1947
1948
1949
50,162
43,537
43,531
45,357
41,576
40,940
53,390
68,011
71,495
95,184
61,738
36,931
36,493
40,570
-45,022
-18,201
6,600
8,864
1,006
43,147
45,797
67,962
76,769
-2,207
7,593
49
-5,274
69,719
65,469
74,547
79,990
79,636
79,249
70,890
68,509
70,460
76,741
82, 575
92,104
-3,041
4,087
3,249
-2,939
-12,855
92,492
94,389
99,676
106, 560
112,662
116,833
130,856
149,552
153,671
187,784
193,743
188,392
208,649
224, 984
255, 982
92,223
97,795
106,813
111,311
118,584
269
- 3 , 406
-7,137
-4,751
-5,922
118,430
134,652
158,254
178,833
184,548
196,588
211,425
231,876
249, 796
268, 665
-1,596
-3,796
-8, 702
-25,161
3,236
-2,845
-23,033
-23,227
-24, 812
-12,683
Consolidated cash statement:
1950
1951
1952
1953
Unified budget:
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
_
1965
1966
1967
1968
1969
1970
1971
1972
19731.
19741
-1,170
i Estimate.
Note.—Certain interfund transactions are excluded from receipts and outlays starting in 1932. For years prior to 1932 the
amounts of such transactions are not significant.
Refunds of receipts are excluded from receipts and outlays.
Sources: Treasury Department and Office of Management and Budget.
267
TABLE C-64.—Federal budget receipts, outlays,financing,and debt,fiscalyears 1963-74
[Millions of dollars; fiscal years]
Actual
Description
1963
1964
1965
1966
1967
BUDGET RECEIPTS AND OUTLAYS:
Total receipts
Federal funds
Trus* funds
Intragovernmental transactions.
Total outlays
Federal funds
Trust funds
Intragovernmental transactions.
Total surplus or deficit ( - ) .
Federal funds..
Trust funds...
83, 550
25,799
-2,788
112,662
87, 205
28, 518
-3,061
116,833
90,943
29, 230
-3,339
130,856
101,427
32, 997
-3, 568
149,552
111,835
42, 935
-5,218
111,311
118,584
95,761
25,884
-3,061
118,430
94,807
26, 962
-3,339
134,652
90,141
23,958
-2,788
158,254
126,779
36,693
-5, 218
-4,751
-5,922
-8,702
-8, 556
2,634
-1, 596
-3,864
2,268
-3,796
- 6 , 591
1,841
-5,085
1,289
-14,944
6,242
4,751
5,922
1,596
3,796
8,702
6,088
-1,337
3,092
2,830
4,061
-2,465
3,076
720
2,838
5,863
310,807
316,763
59, 210
257, 553
323,154
329,474
56,345
254,461
34,794
222, 759
64,784
264,690
42,169
222,521
341,348
73,819
267,529
32.027
222,434
61, 540
261,614
39,100
222, 514
106, 560
112,662
48,697
23,493
22,012
13, 731
2,394
1,252
116, 833
48,792
25,461
22, 258
14, 570
2,716
1,442
130,856
55,446
30,073
25, 567
13,062
3,066
1,767
149,552
1,372
222
118,430
49, 578
4,340
5,091
4,805
2,056
7,399
288
2,284
1,704
25,702
5,722
10,357
2,210
1,713
162
134,652
1,805
303
158, 254
24,084
5,520
9,215
1,810
947
138
118,584
53, 591
4,117
4,170
5,184
1,966
6,511
-185
1,751
1,716
25,110
5,681
9,810
2,040
56,785
4,490
5,933
3,676
2,036
7,171
2,644
4,258
2,509
29,016
5,920
11, 285
2,292
70,081
4,547
5,423
4,373
1,878
7,594
2,616
5,853
6,667
31,164
6,897
12, 588
2,510
-1,159
-1,485
-1,256
-1,621
-1,329
-1,780
-1,447
- 1 , 917
-1,661
- 2 , 275
106,560
106, 512
31, 708
-3, 568
BUDGET FINANCING:
Total means of financing.
Net borrowing from the public or
repayment of borrowing (—)
Other means of financing
OUTSTANDING DEBT, END OF YEAR:
Gross Federal debt..
Held by Government agencies..
Held by the public
Federal Reserve System.
Others
BUDGET RECEIPTS.
Individual income taxes
Corporation income iaxes
Social insurance taxes and contributions...
Excise taxes.
Estate and gift taxes
Customs duties
Miscellaneous receipts:
Deposit of earnings by Federal Reserve System
Allother
BUDGET OUTLAYS.
National defense
International affairs and finance
Space research and technology
Agriculture and rural development
Natural resources and environment
Commerce and transportation
Community development and housing
Education and manpower
Health
Income security
Veterans benefits and services
Interest
General government
General revenue sharing
Allowances
Undistributed intragovernmental transactions:
Employer share, employee retirement.
Interest received by trust funds
47,588
21, 579
19,804
13,194
2,167
1,205
828
194
111,311
52, 257
4,115
2,552
5,138
1,498
5,765
-880
1,502
1,379
See footnotes at end of table.
268
46,719
220,810
61, 526
33,971
33,349
13,719
2,978
1,901
1968
TABLE G—64.—Federal budget receipts, outlays,financing,and debt,fiscalyears 1963—74—Con.
[Millions of dollars; fiscal years]
Actual
Estimate
Description
BUDGET RECEIPTS AND OUTLAYS:
Total receipts
Federal funds
Trust funds
,
I ntragovernmental transactions
Total outlays
1969
1970
1971
1972
1973
187,784
143,321
52,009
-7,547
193,743
143,158
59,362
-8,778
188,392
133,785
66,193
-11,586
208,649
148,846
72,959
-13,156
224,984
154,250
91,952
-21,218
255,982
171,308
105,471
-20,797
184,548
196,588
211,425
231,876
249,796
268,665
148,811
43, 284
-7,547
3,236
-5,490
8,725
156,301
49,065
-8,778
-13,143
10,297
163,651
59,361
-11,586
-23,033
-29,866
6,832
177,959
67,073
-13,156
-23,227
-29,114
5,886
188,390
82,624
-21, 218
-24,812
-34,140
9,328
199,108
90,354
-20,797
-12,683
-27,800
15,117
12,845
23,033
23,227
24,812
12,683
3,814
19,448
3,585
19,442
3,785
25,000
-188
16,500
-3,817
382,603
97,723
284,880
57,714
227,166
409,467
105,140
304,328
65,518
238,810
437,328
113,559
323,770
71,427
252,343
473,325
124,555
348,770
505,453
140,183
365,270
187,784
87,249
36,678
39,918
15, 222
3,491
2,319
193,743
90,412
32,829
45,298
15,705
3,644
2,430
188,392
86,230
26,785
48,578
16,614
3,735
2,591
208,649
94,737
32,166
53,914
15,477
5,436
3,287
224,984
99,400
33,500
64,540
15, 970
4,600
3,000
255,982
111,600
37,000
78,162
16, 798
5,000
3,300
2,662
247
184,548
81,232
3,785
4,247
6,218
2,169
7,921
1,961
6,525
11,611
37,699
7,640
15, 791
2,866
3,266
158
196,588
80,295
3,570
3,749
6,201
2,568
9,310
2,965
7,289
12,907
43,790
8,677
18,312
3,336
3,533
325
211,425
77,661
3,095
3,381
5,096
2,716
11,310
3,357
8,226
14, 463
56,140
9,776
19,609
3,970
3,252
381
231,876
78,336
3,726
3,422
7,063
3,761
11,201
4,282
9,751
17,112
64,876
10, 731
20,582
4,891
3,350
625
249,796
76,435
3,341
3,061
6,064
876
12,543
3,957
10,500
17,991
75,889
11,795
22,808
5,631
6,786
500
3,700
422
268,665
81,074
3,811
3,135
5,572
3,663
11,580
4,931
10,110
21,730
81,976
11,732
24, 672
6,025
6,035
1,750
-2,018
-3,099
-2,444
-3,936
-2,611
- 4 , 765
-2,768
-5,089
-2,980
-5,401
-3,157
-5,974
Federal funds
Trust funds
I ntragovernmental transactions
Total surplus or deficit ( - )
Federal funds
Trust funds
1-3,236
BUDGET FINANCING:
payment
of borrowing ( — ) .
-1,044
Total means
of financing
Other means of financing.
Net borrowing from the public or re- -2,192
OUTSTANDING DEBT, END OF YEAR:
367,144
Gross Federal debt
Held by Government agencies.
87,661
Held by the public
279,483
Federal Reserve System.
54,095
Others
225,388
BUDGET RECEIPTS.
Individual income taxes
Corporation income taxes
Social insurance taxes and contributions..
Excise taxes
Estate and gift taxes
Customs duties
Miscellaneous receipts:
Deposit of earnings by Federal Reserve
System
Allother
BUDGET OUTLAYS.
National defense
International affairs and finance
Space research and technology
_
Agriculture and rural development
Natural resources and environment
Commerce and transportation
Community development and housing
Education and manpower
Health
Income security
Veterans benefits and services
Interest
General government
General revenue sharing
Allowances
Undistributed i ntragovernmental transactions:
Employer share, employee retirement..
Interest received by trust funds
-2,845
1974
1
Excludes changes due to ^classification and to conversion of mixed-ownership enterprises to private ownership. (See
footnotes to Table 9, "Budget of the United States Government for the Fiscal Year Ending June 30,1971," and footnotes
to Table 10, "Budget of the United States Government for the Fiscal Year Ending June 30,1972.")
Sources: Treasury Department and Office of Management and Budget.
269
TABLE C-65.—Relation of the Federal budget to the Federal sector of the national income and
product accounts,fiscalyears 1971-74
[Billions of dollars; fiscal years]
Actual
Estimate
Receipts and expenditures
1972
1971
1973
1974
RECEIPTS
Total receipts, budget
188.4
208.6
225.0
256.0
3 3
3.6
4.0
-1.2
-.2
3.6
-.6
Government contribution for employee retirement (grossing)
Other netting and grossing
Adjustment to accruals .
Other
.1
-.1
Federal sector, national income and product accounts,
receipts
193.0
211.9
233.3
263.0
211.4
231.9
249.8
268.7
-3.2
-2.4
-.9
-1.5
3.1
1.5
-.4
.3
3.3
1.3
4.0
1.7
-l'.3
3.6
1.7
2.8
2.9
212.8
233.1
259.9
275.5
3 1
1.5
1.3
1.7
1.7
1.7
EXPENDITURES
Total outlays, budget
Lending and financial transactions
Government contribution for employee retirement
(grossing)
Other netting and grossing
Defense timing adjustment
Other.
" ' I ""."
'"Federal sector, national income and product accounts,
expenditures...
2.'3
Note.—See Special Analysis A, "Budget of the United States Government for the Fiscal Year Ending June 30,1974,"
for description of these categories.
Sources: Treasury Department, Office of Management and Budget, and Department of Commerce (Bureau of Economic
Analysis).
270
TABLE C-66.—Receipts and expenditures of the Federal Government sector of the national income
and product accounts, 1949-74
[Billions of dollars]
1Receipts
Year or quarter
Total
Fiscal year:
1949
1950
1951
1952.
.
1953
1954
1955
1956
1957
1958
1959 . . .
1960
1961
1962
1963
1964
1965
1966.. . .
1967
1968
1969
1970
1971
1972 P
1973 2
1974»
Calendar year:
1949
1950
1951
1952
1953
1954.. . .
1955
1956
1957
1958
1959
1960
1961.
1962
1963.
1964
1965
1966.
1967
1968. .
1969
1970
1971.. . .
1972 »
Expenditures
Indirect
Per- Cor- busi- ConPursonal
ness tribuchases
potax
tax
of
rate
tions
and
and
for Total i goods
non- profits
non- social
and
tax
tax
tax
servacinsurreacices
ance
ceipts cruals cruals
Transfer
payments
To
persons
GrantsNet
in-aid
into State terTo
and
est
forlocal
eign- govern- paid
ers
ments
(net)
Surplus
or
Subsi- defidies
cit
less
current
surplus
of
government
enterprises
na-'
tional income
and
product
accounts
40.0 16.3
42.0 16.5
60.8 23.2
65.1 28.8
69.3 31.4
65.8 30.3
67.2 29.7
75.8 33.6
80.7 36.7
77.9 36.3
85.4 38.2
94.8 42.5
95.3 43.6
104.2 47.3
110.2 49.6
115.5 50.7
120.5 51.3
132.8 57.6
147.2 64.5
160.6 71.4
190.4 90.0
195.0 93.7
193.0 87.1
211.9 100.1
233.3 104.2
263.0 116.6
11.0
11.9
21.5
19.3
19.7
17.3
18.7
21.1
20.6
17.8
21.5
22.3
20.3
22.9
23.5
25.7
27.7
31.0
31.2
33.7
37.4
33.1
32.0
33.5
38.7
41.6
8.0
8.2
9.5
9.7
10.7
10.4
10.0
10.8
11.7
11.6
11.9
13.2
13.3
14.2
15.0
15.6
16.9
15.7
15.8
17.1
18.6
19.2
20.1
20.1
20.5
21.6
4.8
5.5
6.6
7.3
7.5
7.8
87
10.2
11.7
12.2
13.8
16.7
18.1
19.9
22 1
23.5
24 6
28.5
35.7
38.3
44.4
49.0
53.8
58.3
69 8
83.2
19.3
19.0
25.1
46.6
56.1
53.2
43 9
45.2
47.7
50 7
54.7
52.7
55.5
60.9
63 4
65.7
64 4
71.7
85.3
94 9
99.4
98.3
95.8
103.1
105 8
111.5
8.1
11.3
8.1
8.5
9.3
10.5
12.1
12.8
14.4
17.8
19.8
20.6
23.6
25.1
26.4
27.3
28.3
31.8
37.2
42.7
48.5
54.8
67.5
75.8
88.9
99.1
4.3
3.1
2.6
2.1
1.7
2 1
8
q
7
8
8
2.1
2.1
2.1
2.2
22
2.3
2.2
2.1
2.2
2.0
2.3
2.8
27
2.8
5.0
2.1
2.4
2.4
2.5
2.8
2.9
3.0
3.2
3.7
4.7
6.2
6.8
6.9
7.6
8.4
9.8
10.9
12.7
14.8
17.8
19.2
22.6
27.0
32.7
41.6
41.6
4.3
4.4
4.6
4.8
4.8
5.0
4.9
5.1
5.5
5.7
5.9
7.0
6.8
6.8
7.5
8.1
8.5
9.0
9.9
10.9
12.3
14.0
14.3
13.5
14.6
15.8
0.8
1.0
1.3
1.1
.9
1.0
1.3
1.7
2.8
2.5
2.4
2.3
3.2
3.8
3.6
3.8
4.1
4.5
5.1
4.1
4.1
4.7
5.8
5.2
6.3
4.8
0.4
-.5
16.2
-1.0
-6.5
-8.5
— 1
6.0
4.7
-5 1
-5.5
3.5
-2.7
-2.1
-1 2
-1.4
20
.9
-7.3
-11 9
4.7
-1.3
-19.7
-21.1
-26 6
-12.5
38.9 16.1
49.9 18.1
64.0 26.1
67.2 31.0
70.0 32.2
63.8 29.0
72.1 31.4
77.6 35.2
81.6 37.4
78.7 36.8
89.7 39.9
96.5 43.6
98.3 44.7
106.4 48.6
114.5 51.5
115.0 48.6
124.7 53.8
142.5 61.7
151.2 67.5
175.0 79.7
197.3 94.8
191.6 92.4
199.1 89.6
228.3 108.8
9.8
17.0
21.5
18.5
19.5
17.0
20.6
20.6
20.2
18.0
22.5
21.7
21.8
22.7
24.6
26.4
29.3
32.1
30.7
36.7
36.6
30.4
33.1
36.0
8.0
8.9
9.4
10.3
10.9
9.7
10.7
11.2
11.8
11.5
12.5
13.5
13.6
14.6
15.3
16.1
16.5
15.7
16.3
18.0
19.0
19.3
20.5
20.1
4.9
41.3
20.1
59
40.8
18 4
57.8
7.1
37.7
74
71 0
51 8
77.0
7.4
57.0
69.7
8.1
47.4
9.3
68.1
44 1
10 6
71 9
45 6
12.2
79.6
49.5
12 4 88.9
53 6
91 0
14 8
53 7
93.0
53.5
17.7
18.2 102.1
57.4
63.4
20.5 110.3
23.1 113.9
64.2
23 8 118 1 65 2
25.1 123.5
66.9
33.0 142.8
77.8
36 7 163 6 90 7
40.7 181.5
98.8
46.9 189.2
98.8
49.5 204.5
96.5
55.9 220.8
97.8
63.3 246.8 105.9
8.7
10.8
8.5
88
9.5
11.5
12.4
13 4
15.7
19.5
20 1
21.5
24.9
25.5
27.0
27.8
30.3
33.4
40 0
46.1
50.3
61.1
72.4
80.8
5.1
3.6
3.1
21
2.0
1.8
2.0
19
1.8
1.8
18
1.9
2.1
2.2
2.2
22
2.2
2.3
22
2.1
2.1
2.2
2.6
2.7
2.2
2.3
2.5
26
2.8
2.9
3.1
33
4.2
5.6
68
6.5
7.2
8.0
9.1
10.4
11.1
14.4
15 8
18.7
20.3
24.5
29.3
37.7
4.4
4.5
4.7
11.7
13.1
14.6
13.6
13.6
.8
1.2
1.3
10
.8
1.1
1.5
2.4
2.6
2.7
21
2.5
3.8
4.0
3.6
4.2
4.3
5.4
4.6
4.1
4.6
5.5
5.2
6.1
-2.4
91
6.2
-3 8
-7.0
-5.9
40
57
2.1
-10 2
-1 2
3.5
-3.8
-3.8
.7
-3 0
1.2
-.2
-12.4
-6.5
8.1
-12.9
-21.7
-18.5
33.9
34.4
33.2
31.1
34.0
35.2
36.7
20.9
20.2
20.0
20.8
19.9
19.7
20.2
20.5
55.0
55.6
56.1
57.0
61.7
62.6
63.8
65.2
27.1
29.5
29.8
30.8
32.4
38.1
34.4
45.9
14.0
13.6
13.6
13.3
13.1
13.8
13.6
13.7
6.0
5.1
4.6
5.0
5.6
6.0
6.2
6.6
-16.0
-23.0
-23.1
-24.7
-14.8
-21.6
-11.8
39.6
42.4
44.6
66.0
75.8
74.2
67.3
69.8
76.0
83.1
90.9
91.3
98.0
106.4
111.4
116.9
118 5
131.9
154.5
172.5
185.7
196.3
212.8
233.1
259 9
275.5
4.7
4.9
5.0
4.9
5.3
5.7
5.6
6.4
7.1
6.6
7.2
7.7
8.3
8.7
9.5
Seasonally adjusted annual rates
. 196.4
1971: 1
11
III.
...
IV
1972: 1
IL
III
IV p
.
.
198.2
199.1
202.8
221.4
224.9
229.8
86.6
88.1
89.8
93.8
105.8
107.3
109.1
113.1
212.4
221.2
222.2
227.5
236.3
246.5
241.6
262.9
96.2
96.3
97.9
100.7
105.7
108.1
105.4
104.5
66.9
74.3
73.6
74.9
76.6
77.6
79.4
89.6
2.2
2.5
2.7
2.9
2.8
2.8
2.6
2.6
1
Wage accruals less disbursements have been subtracted from total. These were (in billions of dollars at seasonally
adjusted annual rates) .0, .0, .0, and .1 in the 4 quarters of 1971 and .0, — . 1 , .0, and .0 in the 4 quarters of 1972, respectively.
> Estimates.
Sources: Department of Commerce (Bureau of Economic Analysis) and Office of Management and Budget.
271
TABLE C-67.—Public debt securities by kind of obligation, 1946-72
[Billions of dollars]
Interest-bearing public debt
Total
public
debt
securities
End of year or
month
Marketable public issues
by maturity class
Within
1 yea-
1 to 10
years
10
years
and
over
Nonmarketable public
issues
U.S.
savings
bonds
and
notes
Foreign
and
international
Other
Special
issues
Matured
public
debt
and
debt
bearing no
interest
1946
1947
1948
1949
259.1
256 9
252.8
257.1
54.8
49 6
44.6
49.4
61.7
56.1
55.1
51.8
60.1
60.0
57.7
53.9
49.8
52.1
55.1
56.7
6.7
7.4
6.3
9.3
24.6
29 0
31 7
33.9
15
27
22
2.1
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
256.7
259.4
267.4
275 2
278 7
280.8
276 6
274 9
282.9
290.8
49.4
47.1
57.7
73 9
62.8
61.7
68 6
75 3
72.6
79.9
50.5
56.7
62.2
50.4
64.7
68.6
58 9
56.9
71.0
83.7
52.5
38.8
28.7
30.3
30.2
32.9
32 9
32.0
32.0
24.6
58.0
57.6
57.9
57.7
57.7
57.9
56.3
52.5
51.2
48.2
10.1
20.9
19.6
19 3
17.7
12.7
11 9
10.4
9.2
7.8
33 7
35 9
39.1
41 2
42 6
43 9
45 6
45 8
44 8
43.5
24
23
2.1
23
30
30
24
20
21
3.1
I960
1961
1962
1963
1964
1965
1966
1967
1968
1969
290.2
296.2
303.5
309.3
317.9
320.9
329.3
344.7
358.0
368.2
75.3
85.9
87.3
89.4
88.5
93.4
105.2
104.4
108.6
118.1
89.5
84.7
95.6
94.2
100.4
95.6
87.5
97.0
103.4
93.3
24.2
25.4
20.1
24.0
23.6
25.6
25.4
25.1
24.8
24.4
47.2
47.5
47.5
48.8
49.7
50.3
50.8
51.7
52.3
52.2
0.5
.7
1.3
1.8
2.4
1.5
3.2
4.4
4.7
6.3
5.3
4.6
3.8
3.5
2.9
2.7
2.6
2.6
2.5
44 3
43.5
43.4
43 7
46 1
46.3
52 0
57.2
59.1
71.0
3 4
3.5
4.3
41
44
4.4
43
3 5
2.9
2 C
1970
1971
1972
389 2
424.1
449.3
123 4
119.1
130.4
104 9
123.0
117.7
19 4
19.9
21.4
52.5
54.9
58.1
6.5
17.4
21.3
2.4
2.4
2.4
78 1
85.7
95.9
19
1.8
2.0
388.3
390 7
391.7
391 9
396.8
398.1
123.4
115 5
114.9
113.5
114.0
112.8
104.9
113 2
113.2
113 2
112.5
113.6
19.4
19 4
19.3
19 2
19.2
19.1
52.6
52.8
53.0
53.2
53.4
53.6
6.1
65
6.9
8.9
11.7
12.0
2.4
2.4
2.4
2.4
2.4
2.4
77.7
78 9
80.0
79 7
81.7
82.8
1.9
20
1.9
1.9
1.9
1.8
405.3
414.6
412.3
411.9
414.6
424.1
115.0
116.7
117.7
118.0
108.9
119.1
113.6
114.0
113.3
115.3
125.5
123.0
19.1
19.0
19.0
18.9
20.0
19.9
53.8
54.0
54.2
54.4
54.7
54.9
15.0
19.7
17.9
16.8
16.9
17.4
2.4
2.4
2.4
2.4
2.4
2.4
84.7
87.0
86.0
84.3
84.4
85.7
1.8
1.8
1.8
1.8
l.S
1.8
422.9
424.0
427.3
425 3
427.9
427.3
119.2
122.1
126.3
122 3
126.6
121.9
123 0
119.4
119.5
121 2
115 9
115.9
19.8
19.7
19.6
19 5
19.4
19.4
55.1
55.3
55.6
55 9
56.2
56.5
17.6
17.5
17.2
19 1
18.9
19.7
2.4
2.4
2.4
2 4
2.4
2.4
84.2
85.6
84.9
83 1
86.6
89.6
1.8
1.9
1.1
1.8
1.8
1.9
432 4
435.4
433.9
439 9
444.2
449.3
122 5
121.6
121.3
122 4
128.6
130.4
115 9
114.9
114.9
116 9
115 6
117.7
19 3
21.6
21.6
21 5
21.4
21.4
56 7
57.0
57.2
57 5
57.8
58.1
22 7
22.4
22.5
21 9
21.7
21.3
2 4
2.4
2.4
2 4
2.4
2.4
91 0
93.6
92.3
95 4
94.9
95.9
1.8
1.9
1.8
1.8
1.8
2.C
.
.
1971: Jan
Feb
Mar
Apr
May
June
July . .
Aug
Sept
Oct
Nov .
Dec
1972:Jan
Feb
Mar
Apr
May . .
June.
July
Aug
SeptOct
Nov
Dec . . .
.
._.
Source: Treasury Department.
272
TABLE C-68.—Estimated ownership of public debt securities, 1946-72
[Par values,i billions of dollars}
Total public debt securities3
Held by private investors
End of year or
month
1946
1947
1948
1949
1950
1951
1952
1953
1954
1955...
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
1971:Jan
Feb..
Mar..
Apr..
May..
June.
July..
Aug..
Sept..
Oct...
Nov..
Dec.
1972:Jan...
Feb..
Mar..
"::::::::::
June.
July..
Aug..
Sept..
Oct...
Nov..
Dec.
Held
Total
Held by
Federal
Govern- Reserve
ment Banks
accounts
259.1
256.9
252.8
257.1
256.7
259.4
267.4
275.2
278.7
280.8
276.6
274.9
282.9
290.8
290.2
296.2
303.5
309.3
317.9
320.9
329.3
344.7
358.0
368.2
389.2
424.1
449.3
388.3
390,7
391.7
391.9
396.8
398.1
405.3
414.6
412.3
411.9
414.6
424.1
422.9
424.0
427.3
425.3
427.9
427.3
432.4
435.4
433.9
439.9
444.2
449.3
27.4
30.8
33.7
35.9
36.0
39.3
42.9
45.4
46.7
49.0
51.2
52.8
52.1
51.4
52.8
52.5
53.2
55.3
58.4
59.7
65.8
73.1
76.6
89.0
97.1
106.0
116.9
96.7
98.0
98.8
99.1
101.8
102.9
104.9
107.3
106.5
104.7
104.7
106.0
104.4
106.2
105.5
105.5
109.1
111.5
112.8
115.4
113.5
116.7
116.1
116.9
23.3
22.6
23.3
18.9
20.8
23.8
24.7
25.9
24.9
24.8
24.9
24.2
26.3
26.6
27.4
28.9
30.8
33.6
37.0
40.8
44.3
49.1
52.9
57.2
62.1
70.2
69.9
61.8
62.5
64.2
63.7
64.8
65.5
65.8
66.9
67.6
67.2
67.8
70.2
69.6
67.7
69.9
70.3
71.6
71.4
70.8
70.7
69.7
70.1
69.5
69.9
Total
Mutual
savings
State
MiscelOther
banks
Comlaneous
local Indimercial and in- corpo- and
viduals
<
invesgovernbanks' surance rations* ments s
tors?
companies
208.3
203.6
195.8
202.4
199.9
196.3
199.8
203.8
207.1
207.0
200.5
197.9
204.5
212.7
210.0
214.8
219.5
220.5
222.5
220.5
219.2
222.4
228.5
222.0
229.9
247.9
262.5
229.9
230.2
228.7
229.1
230.2
229.7
234.6
240.4
238.2
240.0
242.1
247.9
248.9
250.2
251.9
249.5
247.2
244.4
248.8
249.3
250.7
253.1
258.6
262.5
74.5
68.7
62.4
66.8
61.8
61.5
63.4
63.7
69.1
62.0
59.5
59.5
67.5
60.3
62.1
67.2
67.1
64.2
63.9
60.7
57.4
63.8
66.0
56.8
62.7
65.3
63.3
61.7
61.3
61.8
60.5
59.4
61.0
60.5
59.5
60.0
60.9
61.5
65.3
62.8
62.1
63.3
61.9
60.8
59.9
57.6
57.9
58.5
58.8
61.1
63.3
36.7
35.9
32.7
31.5
29.6
26.2
25.5
25.1
24.1
23.1
21.2
20.1
19.8
19.4
18.1
17.4
17.4
16.8
16.5
15.6
14.1
12.7
11.6
10.0
9.8
9.3
8.8
10.0
10.1
9.6
9.6
9.7
9.4
9.6
9.5
9.3
9.3
9.2
9.3
9.2
9.2
9.2
9.1
9.1
8.9
8.8
8.6
8.9
8.6
8.7
8.8
15.3
14.1
14.8
16.8
19.7
20.7
19.9
21.5
19.1
23.2
18.7
17.7
18.1
21.4
18.7
18.5
18.6
18.7
18.2
15.8
14.9
12.2
14.2
11.7
9.4
12.4
12.7
9.8
fr.O
9.6
9.2
9.5
10.1
11.1
10.8
10.2
11.0
11.9
12.4
11.8
12.1
11.6
10.5
11.3
10.3
10.0
9.5
8.8
10.4
12.0
12.7
6.3
7.3
7.9
8.1
8.8
9.6
11.1
12.7
14.4
15.4
16.3
16.6
16.5
18.0
18.7
19.0
20.1
21.1
21.2
22.9
24.3
24.1
24.4
25.9
25.2
25.0
28.8
25.4
26.3
26.0
25.6
25.7
25.5
26.1
25.4
25.3
25.2
24.7
25.0
25.5
26.2
25.8
25.7
25.5
25.9
26.5
26.5
27.2
28.0
27.9
28.8
64.1
65.7
65.5
66.3
66.3
64.6
65.2
64.8
63.5
65.0
65.9
64.9
63.7
69.4
66.1
65.9
66.0
68.2
69.8
72.1
74.6
74.0
75.8
81.4
81.9
74.0
74.9
81.2
80.1
79.1
78.5
77.2
76.2
75.9
75.6
75.3
75.0
74.2
74.0
73.6
73.6
74.7
74.6
74.4
74.0
74.3
74.2
74.0
74.1
74.5
74.9
11.4
11.9
12.5
12.9
13.6
13.7
14.7
16.1
16.9
18.3
18.9
19.1
18.9
24.3
26.5
26.9
30.2
31.6
33.0
33.4
33.9
35.7
36.7
36.2
41.0
61.9
74.0
41.7
43.4
42.6
45.7
48.8
47.6
51.3
59.5
58.2
58.7
60.5
61.9
66.0
67.0
67.4
67.7
66.2
65.5
71.6
72.6
73.3
73.2
74.4
74.0
i U.S. savings bonds, series A-F and J, and U.S. savings notes are included at current redemption value.
s Not all of total shown is subject to statutory debt limitation.
»Includes commercial banks, trust companies, and stock savings banks in the United States and Territories and island
« Exclusive of banks and insurance companies.
«Includes trust, sinking, and investment funds of State and local governments and their agencies, and of Territories
and
possessions.
6
Includes partnerships and personal trust accounts.
7
Includes savings and loan associations, nonprofit institutions, corporate pension trust funds, dealers and brokers,
Federal oriented agencies not included in Government accounts, and investments of foreign balances and international
accounts in this country. Beginning with December 1946, the international accounts include investments by the I nternational
Bank for Reconstruction and Development, the International Monetary Fund, the International Development Association,
the Inter-American Development Bank, and various United Nations' funds, in special non-interest-bearing notes and
bonds issued by the U.S. Government.
Source: Treasury Department.
490-000 O - 73 - 19
273
TABLE C-69.—Average length and maturity distribution of marketable interest-bearing
public debt, 1946-72
Maturity class
End of year or month
Amount
outstanding
Within
1 year
Ito5
years
5 to 10
years
10 to 20
years
Average length
20 years
Millions of dollars
Fiscal year:
1946...
1947...
1948...
1949—
189,606
168,702
160,346
155.147
61,974
51,211
48,742
48,130
155,310
137,917
140,407
147,335
150,354
155,206
154,953
155,705
166,675
178,027
1970...
1971—
1972—
183,845
187.148
196,072
203,508
206,489
208,695
209,127
210,672
226,592
226,107
232,599
245,473
257,202
1971: Jan..
Feb..
Mar..
Apr..
May..
June.
41,807
35,562
32,264
16,746
17,461
18,597
16,229
22; 821
43,599
41,481
41,481
34,888
42,338
43,908
46,367
65,270
62,734
24,763
21,851
21,630
32,562
51,292
46,526
47,814
36,161
29,866
7,792
8,707
13,933
15,651
27,515
28,035
29,979
25,700
28,662
28,634
25,853
8,797
6,594
1,592
1,606
49,703
58,714
71,952
67,782
72,958
39,107
34,401
40,669
42, 557
58,304
34,253
28,908
12,328
21,476
17,052
28,613
28,578
26,407
27,652
21,625
70,467
81,120
88,442
85,294
81,424
20,246
26,435
26,049
37,385
34,929
12,630
10,233
9,319
8,360
8,355
39,169
33,596
24,378
30,754
34,837
15,882
24,503
26,852
8,449
8,439
8,425
8,407
8,374
10,524
8,455
9,343
17,241
17,023
16,797
16, 553
16,217
105,530
112,772
121,944
72,844
58,400
57,041
58,026
65,453
56,198
60,933
71,424
64,470
62,770
89,615
89,074
89,004
3,530
4,351
4,349
7,208
8,088
7,658
10,960
15,221
14,444
16,328
247,667
248,092
247,457
245,888
245,635
245,473
123,418
115,534
114,940
113,466
113,959
112,772
82,316
86,011
86,025
85,990
88,004
89,074
22,553
27,197
27,199
27,199
24, 502
24, 503
8,542
8,529
8,513
8,491
8,472
8,455
10,839
10,821
10,780
10, 742
10,699
10,670
July..
Aug..
Sept..
Oct..
Nov..
Dec.
247,649
249,654
249,931
252, 240
254,456
262,038
115,014
116,664
117,662
118, 007
108,911
119,141
89,077
92,865
90,915
92,940
96,204
93,648
24, 503
21,115
22, 397
22,397
29, 321
29,321
8,435
8,420
8,404
8,385
9,566
9,530
10,622
10,590
10,553
10, 511
10,454
10,397
Jan..
Feb..
Mar_.
Apr..
May..
June.
261,918
261, 215
265,380
262,989
261,924
257,202
119,152
122,067
126,315
122,263
126,617
121,944
29,318
26,347
26,349
26,348
26, 853
26,852
9,484
9,459
9,419
9,392
9,363
9,343
10,317
10, 253
10,191
10,137
10,086
10,059
July..
Aug..
Sept.
Oct..
Nov..
Dec.
257,717
258,095
257,720
260,863
265,621
269,509
122, 528
121,589
121,260
122,442
128,569
130,422
93,646
93,089
93,106
94,849
89,005
89, 004
89,004
85,730
85,730
87,762
86,464
88,564
26,852
29,149
29,148
29,147
29,146
29,143
9,318
15,419
15,394
15,363
15, 330
15,301
10,015
6,208
6,188
6,151
6,112
6,079
1950...
1951...
1952...
1953...
1954...
1955...
1956...
1957...
1958—
1959...
1960...
1961—
1962.,.
1963—
1964...
1965...
1966...
1967...
1968...
1969—
1972:
Years
87,637
89,136
89,648
106,407
103,910
11,048
10,670
10,059
Note.—All issues classified to final maturity except partially tax-exempt bonds, which were classified to earliest call
date (the last of these bonds were called on August 14,1962, for redemption on December 15,1962).
Source: Treasury Department.
274
TABLE C-70.—Receipts and expenditures of the government sector of the national income and product
accounts, 1929-72
[Billions of dollars]
Total government
Federal Government
Surplus or
deficit
Calendar year or quarter
Receipts
Expenditures
national
income
and
product accounts
State and local
government
Receipts
Expenditures
Surplus or
deficit
(->,
national
income
and
product accounts
-0.2
Surplus or
deficit
Receipts
Expenditures
national
income
and
product accounts
11.3
10.3
1.0
3.8
2.6
1.2
7.6
7.8
9.3
10.7
-1.4
2.7
4.0
-1.3
7.2
7.2
1939
15.4
17.6
-2.2
6.7
8.9
-2.2
9.6
9.6
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
17.7
25.0
32.6
49 2
51.2
53 2
50.9
56.8
58.9
56.0
18.4
28.8
64.0
93 3
103.0
92 7
45.5
42.4
50.3
59.1
—.7
—3.8
-31.4
-44 1
-51.8
—39 5
5.4
14.4
8.5
-3.2
86
15.4
22.9
39 3
41.0
42 5
39.1
43.2
43.3
38.9
10.0
20.5
56.1
85 8
95.5
84.6
35.6
29.8
34.9
41.3
—1.3
-5.1
-33.1
—46 6
-54.5
—42 1
3.5
13.4
8.4
-2.4
10.0
10.4
10.6
10 9
11.1
11 6
12.9
15.3
17.6
19.3
9.3
9.1
8.8
84
8.5
90
11 0
14.3
17 4
20.0
.6
1.3
1.8
2.5
2.7
2.6
1.9
1.0
.1
-.7
1950
1951
1952
1953
1954
1955...
1956
1957
1958
1959
68.7
84.8
89.8
94.3
89.7
100 4
109.0
115.6
114 7
128.9
60 8
79.0
93.7
101 2
96.7
97 6
104.1
114.9
127 2
131.0
7 9
5.8
-3.8
—6 9
-7.0
27
4.9
.7
-12.5
-2.1
49 9
64.0
67.2
70.0
63.8
72 1
77.6
81.6
78.7
89.7
40.8
57.8
71.0
77.0
69.7
68.1
71.9
79.6
88.9
91.0
9.1
6.2
-3.8
-7.0
-5.9
4.0
5.7
2.1
—10.2
-1.2
21.1
23.3
25.2
27.2
28.8
31.4
34.7
38.2
41.6
46.0
22 3
23.7
25.3
27.0
29.9
32 7
35.6
39.5
44.0
46.8
-1.2
—.4
(2)
.1
-1.1
-1.3
-.9
-1.4
-2.3
-.8
1960
1961
1962
1963
1964
1965
1966 .
1967
1968...
1969
139.8
144.6
157.0
168.8
174 1
189 1
213 3
228.9
263.5
296.7
136.1
149.0
159 9
166.9
175 4
186 9
212 3
242.9
270.3
287.9
3.7
-4.3
-2.9
1.8
-1 4
2.2
1 l
-13.9
-6.8
8.8
96.5
98.3
106 4
114.5
115 0
124 7
142 5
151.2
175.0
197.3
93.0
102.1
110.3
113.9
118 1
123 5
142 8
163.6
181.5
189.2
3.5
-3.8
—3.8
.7
-3 0
12
—.2
-12.4
-6.5
8.1
49.9
53.6
58.6
63.4
69 5
75 5
85 2
93.5
107.1
119.7
49.6
54.1
57.6
62.2
67 8
74 5
83 9
95.1
107.5
119.0
.2
.9
1.2
1.7
10
1.3
-1.6
-.3
.7
1970
1S71 .
1972 v
302.0
321.6
365.7
312.1
338.5
372.0
-10.1
-16.9
-6.2
191.6
199.1
228.3
204.5
220 8
246.8
-12.9
-21.7
-18.5
135.0
151.8
175.2
132.1
147.0
162.9
2.8
4.8
12.3
1929
1933...
"
"
. .
-.1
0)
Seasonally adjusted annual rates
1970: 1
II
Ill
IV
1971: 1
II
III
IV
.
1972: 1
II
Ill
IV *
299.0
303.7
303.0
302.4
299.1
313.2
314.7
321.2
-0.2
-9.6
-11.8
-18.8
192.2
194.2
190.9
189.1
195.9
207.5
205 6
208.8
-3.8
-13.4
-14.7
-19.7
130.1
133.6
137 1
139.1
126.5
129.8
134.1
138.2
3.6
3.8
2.9
.9
313.5
318.8
323.3
330.7
327.5
336.9
340.2
349.4
-14.0
-18.0
—16.9
-18.7
196.4
198.2
199.1
202.8
212.4
221.2
222.2
227.5
-16.0
-23.0
-23.1
-24.7
144.2
150.1
154.0
158.7
142.2
145.2
147.8
152.7
2.0
5.0
6.2
6.0
353.8
361.4
368.8
361.6
368.3
371.2
386.9
-7.7
-6.9
-2.4
221.4
224.9
229.8
236.3
246.5
241.6
262.9
-14.8
-21.6
-11.8
164.8
174.6
173.4
157.7
159.9
164.0
169.9
7.1
14.8
9.4
i Surplus of $32 million.
'Deficit of $41 million.
Note.—Federal grants-in-aid to State and local governments are reflected in Federal expenditures and State and local
receipts and expenditures. Total government receipts and expenditures have been adjusted to eliminate this duplication.
Source: Department of Commerce, Bureau of Economic Analysis.
275
T A B L E C-71.—Receipts and expenditures of the State and local government sector of the national
income and product accounts, 1946-72
[Billions of dollars]
Receipts
Calendar
year or
quarter
Total
Expenditures
ndirect
PerCorbusisonal porate
ness
tax
tax
jrofits
and
and
tax
nontax ccruals nontax
ccruals
eceipts
Contributions
for
social
insurance
Purchases
Fedof
eral
Total * goods
grantsand
n-aid
services
TransLess:
fer
Current
payurplus
Net
ments nterest of govto
paid
ernperment
sons
enter-
Surplus
or
deficit
national
income
and
product accounts
prises
1946
1947
1948
1949
12.9
15.3
17.6
19.3
1.5
1.8
2.1
2.4
0.5
.6
.7
.6
9.3
10 6
12.1
13.3
0.5
.6
1950
1951..
1952..
1953
1954..
21.1
23.3
25.2
27.2
28.8
2.6
2.9
3.1
34
3.7
.8
.9
.8
8
.8
14.5
15.8
17.3
18 7
19.7
1955..
1956
1957
1958.
1959.
31.4
34.7
38.2
41.6
46.0
4.1
4.7
5.2
5.6
6.3
1.0
10
1.0
1.0
1.2
1960
1961.
1962.
1963
1964.
49.9
53.6
58.6
63.4
69.5
7.3
7.7
8.7
9.4
10.8
1965
1966.
1967
1968.
1969-
75.5
85.2
93.5
107.1
119.7
1970
1971.
1972 «>
135.0
151.8
175.2
11.0
14.3
17.4
20.0
9.8
12 6
15.0
17.7
1.7
23
2.9
2.9
0.3
.8
1.1
1.7
2.0
2.2
1.0
1.2
1.3
15
1.7
2.3
2.5
2.6
28
2.9
22.3
23.7
25.3
27 0
29.9
19.5
21.5
22.9
24 6
27.4
3.5
3.0
3.2
3.3
3.4
21.4
23 6
25.5
27.0
28.9
1.8
20
23
2.5
2.7
3.1
33
4.2
5.6
6.8
32.7
35.6
39.5
44.0
46.8
30.1
33 0
36 6
40.6
43.3
1.3
1.4
1.4
1.7
1.9
31.7
34.1
36.9
39.4
42.3
3.0
3.2
3.5
3.8
4.1
6.5
7.2
8.0
9.1
10.4
49.6
54.1
57.6
62.2
67.8
11.8
13.7
15.5
18.3
21.7
2.1
2.2
24
3.2
3.4
45.9
49.9
54 1
60.6
67.0
4.5
5.0
57
6.4
7.3
11.1
14.4
15 8
18.7
20.3
24.3
27.4
31.9
3.8
4.2
5.0
74.1
81.4
90.0
8.3
9.4
10.6
24.5
29.3
37.7
0.7
8
.8
.9
1.9
10
.1
-.7
.3
.3
.3
9
1.1
1.1
1 2
1.4
-1 2
-.4
C)
3.7
3.8
4.2
4.6
4.8
.5
.5
.5
.6
.7
1.6
17
1.8
1.8
2.0
-1.3
- 9
-1 4
-2.3
-.8
46.1
50.2
53.7
58.2
63.5
5.1
5.5
5.7
6.0
6.5
.7
.8
.8
.8
2.2
2.3
2.6
2.8
2.9
.2
-.5
9
?
74.5
83.9
95 1
107.5
119.0
70.1
79.0
89 4
100.8
111.2
6.9
7.7
8.7
10.0
11.6
.5
.3
.2
.0
-.2
3.0
3.1
32
3.4
3.5
n
-.3
.7
132.1
147.0
162.9
122.5
135.0
148.9
14.1
16.6
18.3
-.5
-.1
-.1
4.0
4.3
4.4
2.8
4.8
12.3
3.7
3.9
4.1
4.3
3.6
3.8
2.9
.9
.3
.3
-1.1
.7
Seasonally adjusted annual rates
1970- |
II
Ill
IV
130,1
133.6
137.1
139.1
23.7
24.1
24.6
24.9
3.8
3.8
3.9
3.5
71.4
73.4
75.2
76.2
7.9
8.1
8.4
8.6
23.3
24.1
25.0
25.8
126.5
129.8
134.1
138.2
117.6
120.5
124.3
127.6
13.1
13.7
14.5
15.2
-0.5
1971: I
II
Ill
IV
144.2
150.1
154.0
158.7
25.8
27.1
27.7
29.2
4.2
4.3
4.3
4.1
78.3
80.1
82.6
84.8
9.0
9.2
9.5
9.8
27.1
29.5
29.8
30.8
142.2
145.2
147.8
152.7
130.8
133.3
135,7
140.2
16.0
16.3
16.7
17.2
-.2
-!l
-.1
4.3
4.3
4.3
4.3
2,0
5.0
6.2
6.0
1972 1
II
Ill . . . .
IV*
164.8
174.6
173.4
30.6
32.1
32.0
32.8
4.7
4.9
5.1
86.8
89.0
91.2
92.9
10.2
10.5
10.7
11.0
32.4
38.1
34.4
45.9
157.7
159.9
164.0
169.9
143.7
146.0
150.2
155.8
17.8
18.1
18.4
18.8
.0
.0
-.1
-.3
4.4
4.4
4.4
4.5
7.1
14.8
9.4
-!6
-.4
1
Wage accruals less disbursements have been subtracted from total. These were (in billions of dollars, at seasonally
adjusted annual rates) .0 in each of the 4 quarters of 1970, and .0, .0, .3, and .4 in the 4 quarters of 1971 and —.6, — . 1 , .0,
and . 0 in the 4 quarters of 1972. respectively.
2 Deficit of $41 million.
Source: Department of Commerce, Bureau of Economic Analysis.
276
TABLE C-72.—State and local government revenues and expenditures^ selectedfiscalyears\ 1927-71
[Millions of dollars)
General expenditures by function 3
General revenues by source*
Fiscal year *
Total
Property
taxes
Sales
and
gross
receipts
taxes
ReveIndi- Corponue
All
other
vidual ration
from
net
income
Federal revetaxes income Govern- nues 3
taxes
ment
92
Total
2,235
1,809
151
3,015
2,311
1,831
2,177
2,491
1,741
1,509
1,425
1,650
827
1,069
3,269
2,952
3,215
3,547
224
276
342
422
543
788
998
1,065
1,127
156
272
451
447
592
945
858
954
855
1,861
1,872 9,229
2,123 9,190
2,269 8,863
2,661 11,028
3,685 17,684
593
846
817
778
2,486
2,566
2,870
2,966
4,541
5,763
6,252
6,897
10,735
11,749
12,864
14,047
14,983
7,643 1,237
8,691 1,538
9,467 1,754
9,829 1,759
10,437 1,994
744
890
984
018
001
3,131 7,584
3,335 8,465
3,843 9,250
4,865 9,699
6,377 10,516
22,787
26,098
27,910
30,701
33,724
36,711
40,375
44,851
48,887
16,405
18,002
19,054
20,089
11,849
12,463
13,494
14,456
2,463
2,613
3,037
3,269
,180
,266
,308
1,505
11,634
12,563
13,489
14,850
51,876
56,201
60,206
64,816
62,269 19,833 14,446
68,443 21,241 15,762
74,000 22,583 17,118
3,267
3,791
4,090
24,670
26,04"
27,74;
30,673
34,054
4,760
5,826
7,308
8,908
10,812
4,730
7,267
7,678
8,395
9,228
4,487
4,076
4,093
4,440
470
752
1,008
1,484
1,794
70
74
80
153
218
1940...
1942...
1944...
1946...
1948...
9,1
10,418
10,908
12,356
17,250
4,430
4,537
4,604
4,986
6,126
1,982
2,351
2,289
2,986
4,442
1950...
1952...
1953...
1954...
20,911
25,181
27,307
29,012
7,349
8,652
9,375
9,967
5,154
6,357
6,927
7,276
1955...
1956...
1957...
1958...
1959...
31,073
34,667
38,164
41,219
45,306
1960...
1961..
1962...
1963...
50,505
54,037
58,252
62,890
1962-63«
1963-64 8...
1964-65*...
19,085
20,530
22,911
26,519
30,322
1965-66«...
1966-67*...
1967-68*...
1968-69*
1969-70*
83,036
91,197
101,264
114,550
130,756
1970-71*...
144,927 37,852 33,233 11,900
Public
All
wel- other*
fare
7,765
7,181
7,644
8,757
116 1,793
232 1,643
1,016 1,449
948 1,604
800 1,811
7,271
1932...
1934...
1936...
1938...
Highways
7,210
79
49
113
165
1927—
Education
2,638 1,573 1,156
2,586 1,490 1,225
2,793 1,200 1,133
3,356 1,672 1,409
5,379 3,036 2,099
7,177 3,803 2,940
8,318 4,650 2,788
9,390 4,987 2,914
10,557 5,527 3,060
11,907
13,220
14,134
15,919
17,283
18,719
20,574
22,216
23,776
6,452
6,953
7,816
8,567
9,592
3,168
3,139
3,485
3,818
4,136
9,428
9,844
10,357
11,136
4,404
4,720
5,084
5,481
1,505 8,663 14,556 63,977 23,729 11,150
1,695 10,002 15,951 69,302 26,286 11,664
1,929 11,029 17,250 74,546 28,563 12,221
5,420
5,766
6,315
2,038
2,227
2,518
3,180
3,738
6,974
7,131
7,871
8,722
13,214
15,370
17,181
19,153
21,857
19,269 82,843
21,197 93,350
23,598 102,411
26,118 116,728
29,971 131,332
33,287
37,919
41,158
47,238
52,718
12,770 6,757
13,932 8,218
14,481 9,857
15,417 12,110
16,427 14,679
3,862
3,889
3,737
4,591
7,170
8,867
10,342
10,619
11,557
12,197
13,399
14,940
16,547
17,876
19,325
21,063
22,549
24,423
23,678
25,586
27,447
30,029
33,281
36,915
41,963
47,508
3,424 26,146 32,374 150,674 59,413 18,095 18,226 54,940
i Fiscal years not the same for all governments. See footnote 5.
3
Excludes revenues or expenditures of publicly owned utilities and liquor stores, and of insurance-trust activities.
Intergovernmental receipts and payments between State and local governments are also excluded.
3 Includes licenses and other taxes and charges and miscellaneous revenues.
* Includes expenditures for health, hospitals, police, local fire protection, natural resources, sanitation, housing and
urban renewal, local parks and recreation, general control, financial administration, interest on general debt, 2nd unallocable expenditures.
* Data for fiscal year ending in the 12-month period through June 30. Data for 1963 and earlier years include local government amounts grouped in terms of fiscal years ended during the particular calendar year.
Note.—Data are not available for intervening years.
See Table C-62 for net debt of State and local governments.
Source: Department of Commerce, Bureau of the Census.
277
CORPORATE PROFITS AND FINANCE
TABLE C-73.—Profits before and after taxes, all private corporations, 1929-72
[Billions of dollars]
Corporate profits (before taxes) and
inventory valuation adjustment
Corporate profits
after taxes
All
other
industries
Corporate
profits
before
taxes
Corporate
tax
liability i
Manufacturing
Year or
quarter
1929
All
industries
Transportation,
Dur- Noncomable durmuniable cation,
goods goods
Total
inand
indus- duspublic
tries tries utilities
Total
10.5
5.2
2.6
2.6
1.8
3.4
10.0
1.4
8.6
-1.2
-.4
-.4
.0
.0
-.8
1.0
.5
.4
6.3
3.3
1.7
1.7
1.0
2.0
7.0
1.4
1940
1941
1942
1943
1944 . .
1945
1946
1947
1948
1949 .
9.8
15.2
20.3
24.4
23.8
19.2
19.3
25.6
33.0
30.8
5.5
9.5
11.8
13.8
13.2
9.7
9.0
13.6
17.6
16.2
3.1
6.4
7.2
8.1
7.4
4.5
2.4
5.8
7.5
8.1
2.4
3.1
4.6
5.7
5.9
5.2
6.6
7.8
10.0
8.1
1.3
2.0
3.4
4.4
3.9
2.7
1.8
2.2
3.0
3.0
3.0
3.7
5.1
6.2
6.7
6.7
8.5
9.9
12.5
11.6
10,0
17.7
21.5
25.1
24.1
19.7
24.6
31.5
35.2
28.9
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
37.7
42.7
39.9
39.6
38.0
46.9
46.1
45.6
41.1
51.7
20.9
24.6
21.6
22.0
19.9
26.0
24.7
24.0
19.3
26.3
12.0
13.2
11.7
11.9
10.5
14.3
12.8
13.3
9.3
13.6
8.9
11.4
9.9
10.1
9.4
11.8
11.9
10.7
10.0
12.7
4.0
4.6
4.9
5.0
4.7
5.6
5.9
5.8
5.9
7.0
12.7
13.5
13.3
12.6
13.4
15.2
15.6
15.8
15.9
18.4
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
49.9
50.3
55.7
58.9
66.3
76.1
82.4
78.7
84.3
79.8
24.4
23.3
26.6
28.8
32.7
39.3
42.6
38.7
41.7
36.6
12.0
11.4
14.1
15.8
17.8
22.8
24.0
20.7
22.4
18.8
12.4
11.9
12.5
13.0
14.9
16.6
18.6
18.0
19.3
17.7
7.5
7.9
8.5
9.5
10.1
11.1
11.9
10.8
10.6
10.1
1970
1971
1972 P
69.9
78.6
87.7
27.7
30.9
37.6
11.0
14.1
18.7
16.7
16.8
18.9
7.6
8.2
8.8
1933
..
1939
UndisDivi- tribdends uted
profits
Corpo- Profits
rate
plus
capital capital
conconsump- sumption
tion
allowallowances 2 ances 3
2.8
4.2
2.0 - 1 . 6
3.8
4.2
5.6
3.8
1.8
3.7
9.3
2.8
7.6
11.4
14.1
12.9
10.7
9.1
11.3
12.5
10.4
7.2
10.1
10.1
11.1
11.2
9.0
15.5
20.2
22.7
18.5
4.0
4.4
4.3
4.4
4.6
4.6
5.6
6.3
7.0
7.2
3.2
5.7
5.9
6.6
6.5
4.4
9.9
13.9
15.6
11.3
3.8
4.2
5.0
5.4
6.1
6.4
4.7
5.8
7.0
7.9
11.0
14.4
15.2
16.4
17.2
15.4
20.2
26.0
29.7
26.5
42.6
43.9
38.9
40.6
38.3
48.6
48.8
47.2
41.4
52.1
17.8
22.3
19.4
20.3
17.7
21.6
21.7
21.2
19.0
23.7
24.9
21.6
19.6
20.4
20.6
27.0
27.2
26.0
22.3
28.5
8.8
8.6
8.6
8.9
9.3
10.5
11.3
11.7
11.6
12.6
16.0
13.0
11.0
11.5
11.3 |
16.5
15.9
14.2
10.8
15.9
8.8
10.3
11.5
13.2
15.0
17.4
18.9
20.8
22.0
23.5
33.7
31.8
31.0
33.5
35.5
44.4
46.1
46.8
44.3
52.0
17.9
19.1
20.5
20.6
23.5
25.6
27.9
29.1
32.0
33.1
49.7
50.3
55.4
59.4
66.8
77.8
84.2
79.8
87.6
84.9
23.0
23.1
24.2
26.3
28.3
31.3
34.3
33.2
39.9
40.1
26.7
27.2
31.2
33.1
38.4
46.5
49.9
46.6
47.8
44.8
13.4
13.8
15.2
16.5
17.8
19.8
20.8
21.4
23.6
24.3
13.2
13.5
16.0
16.6
20.6
26.7
29.1
25.3
24.2
20.5
24.9
26.2
30.1
31.8
33.9
36.4
39.5
43.0
46.8
51.9
51.6
53.5
61.3
64.8
72.3
82.9
89.5
89.6
94.6
96.8
34.6
39.5
41.3
74.3
83.3
93.7
34.1
37.3
41.0
40.2
45.9
52.6
24.8
25.4
26.4
15.4
20.5
26.3
55.2
60.3
67.7
95.3
106.2
120.3
5.8
12.8
Seasonally adjusted annual rates
1970: 1
II
III
IV
69.3
71.5
72.0
66.9
29.4
29.9
28.9
22.6
13.1
13.0
U. 7
6.2
16.4
17.0
17.2
16.4
8.0
7.4
7.8
7.2
31.9
34.1
35.3
37.0
75.8
75.2
76.6
69.6
34.3
34.6
35.4
32.2
41.4
40.6
41.2
37.4
24.8
24.7
24.9
24.7
16.6
15.8
16.3
12.7
54.4
54.8
55.2
56.1
95.8
95.4
96.5
93.5
1971: 1
II
III
IV
76.6
80.1
78.3
79.4
30.9
31.2
30.1
31.2
14.3
14.4
13.3
14.3
16.6
16.8
16.9
16.9
7.8
8.8
8.5
7.6
37.8
40.1
39.6
40.6
81.3
84.5
84.1
83.2
38.0
38.6
37.5
35.3
43.2
45.8
46.6
48.0
25.5
25.4
25.5
25.2
17.7
20.4
21.0
22.7
57.5
59.4
61.2
63.0
100.7
105.2
107.8
110.9
81.8
1972: 1
II
86.1
Ill .... 89.6
IV v
35.4
37.0
37.9
17.7
19.4
18.4
17.7
17.6
19.5
7.8
8.8
9.6
38.5
40.3
42.1
88.2
91.6
95.7
38.8
40.1
41.8
49.5
51.5
53.9
26.0
26.2
26.5
26.7
23.5
25.3
27.3
64.8
68.0
68.4
69.5
114.3
119.5
122.2
i Federal and State corporate income and excess profits taxes.
> Includes depreciation and accidental damages.
3
Corporate profits after taxes plus corporate capital consumption allowances.
Source: Department of Commerce, Bureau of Economic Analysis.
278
TABLE C-74.—Sales, profits, and stockholders9 equity, all manufacturing corporations, 1947-72
[Billions of dollars]
All manufacturing
corporations i
Profits
Profits
Year or
quarter
Sales
(net)
Nondurable goods
industries 1
Durable goods industries
Profits
Stock- Sales
StockStockBefore After holders' Sales Before After holders'
Before After holders'
Federal Federal equity 2 (net) Federal Federal equity 2 (net) Federal Federal equity *
income income
income incomi
income income
taxes taxes
taxes taxes
taxes taxes
1947
1948
1949
150.7
165.6
154.9
16.6
18.4
14.4
10.1
11.5
9.0
65.1
72.2
77.6
66.6
75.3
70.3
7.6
8.9
7.5
4.5
5.4
4.5
31.1
34.1
37.0
84.1
90.4
84.6
9.0
9.5
7.0
5.6
6.2
4.6
34.0
38.1
40.6
1950
1951
1952
1953
1954
181.9
245.0
250.2
265.9
248.5
23.2
27.4
22.9
24.4
20.9
12.9
11.9
10.7
11.3
11.2
83.3
98.3
103.7
108.2
113.1
86.8
116.8
122.0
137.9
122.8
12.9
15.4
12.9
14.0
11.4
6.7
6.1
5.5
5.8
5.6
39.9
47.2
49.8
52.4
54.9
95.1
128.1
128.0
128.0
125.7
10.3
12.1
10.0
10.4
9.6
6.1
5.7
5.2
5.5
5.6
43.5
51.1
53.9
55.7
58.2
1955
1956
1957
1958
1959
278.4
307.3
320.0
305.3
338.0
28.6
29.8
28.2
22.7
29.7
15.1
16.2
15.4
12.7
16.3
120.1
131.6
141.1
147.4
157.1
142.1
159.5
166.0
148.6
169.4
16.5
16.5
15.8
11.4
15.8
8.1
8.3
7.9
5.8
8.1
58.8
65.2
70.5
72.8
77.9
136.3
147.8
154.1
156.7
168.5
12.1
13.2
12.4
11.3
13.9
7.0
7.8
7.5
6.9
8.3
61.3
66.4
70.6
74.6
79.2
1960
1961
1962
1963
1964
345.7
356.4
389.9
412.7
443.1
27.5
27.5
31.9
34.9
39.6
15.2
15.3
17.7
19.5
23.2
165.4
172.6
181.4
189.7
199.8
173.9
175.2
195.5
209.0
226.3
14.0
13.6
16.7
18.5
21.2
7.0
6.9
8.6
9.5
11.6
82.3
84.9
89.1
93.3
98.5
171.8
181.2
194.4
203.6
216.8
13.5
13.9
15.1
16.4
18.3
8.2
8.5
9.2
10.0
11.6
83.1
87.7
92.3
96.3
101.3
1965
1966
1967
1968
1969
492.2
554.2
575.4
631.9
694.6
46.5
51.8
47.8
55.4
58.1
27.5
30.9
29.0
32.1
33.2
211.7
230.3
247.6
265.9
289.9
257.0
291.7
300.6
335.5
366.5
26.2
29.2
25.7
30.6
31.5
14.5
16.4
14.6
16.5
16.9
105.4
115.2
125.0
135.6
147.6
235.2
262.4
274.8
296.4
328.1
20.3
22.6
22.0
24.8
26.6
13.0
14.6
14.4
15.5
16.4
106.3
115.1
122.6
130.3
142.3
1970
19713....
708.8
751.4
48.1
53.2
28.6
31.3
306.8 363.1
320.9 382.5
23.0
26.5
12.9
14.5
155.1 345.7
160.6 368.9
25.2
26.7
15.7
16.7
151.7
160.3
1970: I . . .
II...
III..
IV..
170.4
181.3
176.7
180.4
12.1
13.7
11.7
10.7
6.9
8.0
7.0
6.7
300.9
306.0
309.5
310.8
87.2
95.4
89.7
90.8
5.9
7.3
5.3
4.5
3.2
4.0
2.9
2.8
152.2
155.1
156.6
156.6
83.2
86.0
87.0
89.6
6.2
6.4
6.4
6.2
3.7
4.0
4.0
4.0
148.7
151.0
152.9
154.2
1971: I . . .
II—
III..
IV 3.
177.5
191.4
185.6
196.9
12.1
14.5
12.8
13.7
7.0
8.5
7.5
8.2
314.0
319.0
323.2
327.3
90.7
99.8
92.6
99.4
6.0
7.8
5.8
6.9
3.2
4.3
3.2
3.8
158.0
160.3
161.2
162.8
86.9
91.6
93.1
97.4
6.1
6.8
7.0
6.8
3.8
4.2
4.3
4.4
156.0
158.7
162.0
164.6
1972: I . . .
II...
III..
197.5
213.5
210.9
13.9
16.7
15.1
7.9
9.6
8.8
333.3
341.1
348.1
100.0
111.6
106.2
7.3
9.6
7.5
3.9
5.3
4.2
165.9 97.5
170.8 101.9
174.1 104.7
6.6
7.2
7.6
4.1
4.3
4.6
167.4
170.3
174.1
1 Includes newspapers beginning 1969.
2 Annual data are average equity for the year (using four end-of-quarter figures).
3 Data for fourth quarter and year 1971 are for industry classifications prior to the reclassifications made during the fourth
quarter.
Note.—For explanatory notes concerning compilation of the series, see "Quarterly Financial Report for Manufacturing
Corporations," Federal Trade Commission.
Data are not necessarily comparable from one period to another due to changes in accounting procedures, industry
classifications, sampling procedures, etc. Specific information about the effects of the more significant changes and revisions is contained in the following issues of the "Quarterly Financial Report": third quarter 1953, third quarter 1956,
first quarter 1959, and first quarter 1965.
Source: Federal Trade Commission.
279
T A B L E C—75.—Relation of profits after taxes to stockholders9 equity and to sales, all manufacturing corporations, by industry group,
1950-72
Durable goods industries
Year or
quarter
ElecAll
trical
manMoMama- chinufactor
turery
Total vehi- Air- chinery,
ing
cles craft
(exdurand equip- cept
cor- able 2 and
poraequip- parts ment, elecand trical)
tions !
ment
supplies
Fabricated
metal
products
Primary
iron
and
steel
industries
Primary
nonferrous
metal
industries
Lumber
Stone, Furni- and
clay,
wood
ture
and
and prodglass
ucts
fixprod- tures (exucts
cept
furniture)
Instruments
and
related
products
Ratio of profits after Federal income taxes (annual rate) to stockholders' equity—percent3
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
15.4
12.1
10.3
10.5
9.9
12.6
12.3
10.9
8.6
10.4
16.9
13.0
11.1
11.1
10.3
13.8
12.8
11.3
8.0
10.4
25.3
14.3
13.9
13.9
14.1
21.7
13.1
14.2
8.2
14.5
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
9.2
8.9
9.8
10.3
11.6
13.0
13.4
11.7
12.1
11.5
8.5
8.1
9.6
10.1
11.7
13.8
14.2
11.7
12.2
11.4
1970
1971
9.3
9.7
17.7
13.2
8.1
20.9
14.0
13.7
13.1
12.4
12.3
11.4
12.5
10.2
12.5
14.1
13.0
11.3
9.8
8.6
10 3
12.6
10.7
6.9
9.7
16.0
13.4
10.1
9.8
7.6
10.0
10.7
9.3
7.3
8.0
14.3
12.3
8.5
10.7
8.1
13.5
12.7
11.4
7.2
8.0
15.1
13.8
11.6
11.1
10.4
15.5
16.4
9.3
6.0
7.9
17.7
14.2
11.7
11.8
12.5
15.6
14.9
12.4
10.2
12.7
15.2
11.3
8.6
8.2
6.0
9.2
11.6
8.5
6.3
8.9
17.5
11.9
8.5
7.1
6.3
11.1
8.7
4.7
5.7
9.4
16.7
13.2
11.6
11.4
12.3
12.5
12.4
12.0
10.6
13.1
13.5
11.4
16.3
16.7
16.9
19.5
15.9
11.7
15.1
12.6
7.3
9.8
12.7
11.3
12.2
15.2
14.4
12.9
14.2
10.6
9.5
8.9
10.0
10.1
11.2
13.5
14.8
12.8
12.2
11.1
7.5
7.8
9.1
9.6
12.5
14.1
15.0
12.9
12.3
12.2
5.6
5.9
7.9
8.3
10.1
13.2
14.7
12.7
11.7
11.3
7.2
6.1
5.4
7.0
8.8
9.8
10.2
7.7
7.6
7.6
7.1
7.1
7.5
7.6
9.8
11.9
14.8
10.9
10.8
12.2
9.9
8.9
8.9
8.7
9.6
10.3
9.9
8.2
9.2
9.2
6.5
4.9
7.9
8.3
10.1
13.4
14.2
12.1
12.2
12.6
3.6
4.1
5.6
8.2
9.9
10.1
10.0
8.6
14.6
13.0
11.6
10.6
12.0
12.1
14.4
17.5
20.9
18.0
16.6
15.6
8.3
9.0
6.1
13.1
6.8
5.8
9.1
9.5
9.8
8.7
8.5
8.3
4.3
4.5
10.6
5.1
6.9
9.2
7.9
9.5
5.6
11.4
14.3
13.6
8.9
10.7
9.3
9.8
9.5
11.3
10.1
8.0
10.8
8.1
9.3
9.3
12.4
9.6
14.8
15.6
7.0
14.7
16.2
18.7
5.5
5.4
6.7
6.5
4.4
6.4
9.1
6.8
,8.0
9.7
9.4
10.8
8.5
11.1
10.2
7.5
9.3
8.4
9.6
9.5
12.0
11.3
7.1
10.2
9.4
6.4
9.4
12.3
12.0
5.0
8.5
.5
4.1
4.0
7.5
5.0
6.7
8.1
2.1
3.3
5.7
7.5
4.9
3.1
12.5
12.1
8.8
5.0
12.7
13.4
4.9
10.5
11.5,
11.0
9.8
14.3
13.2
6.7
12.4
14.0
12.2
12.3
18.6
18.7
10.2
14.2
15.0
14.7
12.8
14.2
15.1
1950.
1951
1952
1953
1954
1955
1956
1957
1958
1959
7.1
4.8
4.3
4.3
4.5
5.4
5.3
4.8
4.2
4.8
7.7
5.3
4.5
4.2
4.6
5.7
5.2
4.8
3.9
4.8
8.3
4.7
4.7
3.9
5.1
6.9
5.2
5.4
4.0
6.3
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
4.4
4.3
4.5
4.7
5.2
5.6
5.6
5.0
5.1
4.8
4.0
3.9
4.4
4.5
5.1
5.7
5.6
4.8
4.9
4.6
1970
1971
4.0
4.1
1971: I . . . .
II...
III..
IV..
1972: I . . .
II...
III....
3.9
4.5
4.1
4.1
4.0
4.5
4.2
1971: I . .
II.
III.
IV.
1972: I . .
II.
III.
Profits after Federal income taxes per dollar of sales—cents
"2.9"
2.4
1.6
7.2
5.0
4.5
4.1
4.5
4.4
3.8
4.2
3.8
4.4
7.3
5.5
4.8
4.2
4.4
5.1
5.4
4.8
3.7
4.8
6.8
5.0
4.0
3.6
3.1
3.8
4.0
3.6
3.1
3.2
7.9
5.8
4.7
5.3
5.3
7.2
6.7
6.6
5.4
5.4
10.2
7.8
6.7
6.3
6.6
8.3
9.3
6.6
4.7
5.8
10.1
7.1
6.6
6.5
7.4
8.6
8.2
7.5
6.8
7.9
5.1
3.4
2.7
2.6
2.1
2.9
3.4
2.6
2.0
2.7
9.4
5.5
4.1
3.5
3.4
5.4
3.9
2.3
2.8
4.2
8.6
6.1
4.8
4.6
5.5
6.0
5.8
5.7
5.4
6.5
5.9
5.5
6.9
6.9
7.0
7.2
6.2
4.9
5.7
4.7
1.4
1.8
2.4
2.3
2.6
3.3
3.0
2.7
3.2
3.0
3.5
3.5
3.7
3.8
4.2
4.8
4.8
4.4
4.3
3.9
3.9
4.1
4.5
4.7
5.8
6.2
6.4
5.7
5.5
5.4
2.4
2.5
3.1
3.2
3.7
4.5
4.9
4.5
4.1
3.8
5.1
4.6
3.9
4.8
5.6
5.7
5.8
4.8
4.6
4.4
5.4
5.3
5.5
5.3
6.5
7.3
8.2
6.8
6.2
6.6
6.6
5.8
5.6
5.3
5.6
5.9
5.6
4.8
5.2
4.7
2.1
1.6
2.3
2.4
2.9
3.7
3.9
3.5
3.4
3.5
1.7
1.9
2.5
3.3
3.9
4.0
3.8
3.4
5.3
4.8
5.9
5.4
5.9
6.0
7.2
8.6
9.5
8.5
8.1
7.8
3.5
3.8
2.6
4.6
2.0
1.8
3.3
3.5
4.6
4.2
3.0
2.9
2.5
2.6
6.2
3.3
3.6
4.5
2.5
3.0
2.5
4.4
7.3
7.2
3.5
4.3
3.5
3.8
3.9
4.7
4.0
5.2
5.4
2.8
4.9
5.4
5.8
2.1
1.7
1.9
2.2
1.4
2.1
2.9
2.3
3.1
3.7
3.6
3.8
3.2
4.0
3.8
3.8
4.3
4.1
4.6
4.7
5.4
5.3
2.6
3.5
3.3
2.1
3.1
3.8
3.9
2.9
4.1
.3
2.5
2.3
3.7
2.6
4.4
4.8
1.4
2.3
3.7
4.5
3.2
1.8
5.8
5.4
4.3
2.7
5.8
5.9
1.7
3.3
3.6
3.3
3.0
3.9
3.6
3.0
4.7
5.2
4.5
4.4
5.8
5.7
5.7
7.4
8.0
7.7
7.3
7.6
8.0
See footnotes at end of table.
280
TABLE C-75.—Relation of profits after taxes to stockholders* equity and to sales, all manufacturing corporations, by industry group, 1950—72—Continued
Nondurable goods industries
Year or
quarter
Total
nondurable 12
Food
and
kindred
products
Tobacco
manufactures
Textile
mill
products
Apparel
and
related
products
Paper
and
allied
products
Printing
and
publish-1
ing
Chemicals
and
allied
products
Petroleum
refining
Rubber
and
miscellaneous
plastic
products
Leather
and
leather
products
Ratio of profits after Federal income taxes (annual rate) to stockholders' equity—percent3
1950....
1951....
1952....
1953....
1954....
1955....
1956
1957
1958
1959
1960
1961
1962....
1963
1964
1965
1966....
1967....
1968....
1969....
1970
1971....
1971:1
II.
III.
IV.
1972: L .
II.
III.
14.1
11.2
9.7
9.9
9.6
11.4
11.8
10.6
9.2
10.4
9.8
9.6
9.9
10.4
11.5
12.2
12.7
11.8
11.9
11.5
10.3
10.3
9.8
10.6
10.6
10.2
9.8
10.2
10.5
12.3
8.1
7.6
8.1
8.1
8.9
9.3
8.7
8.7
9.3
8.7
8.9
8.8
9.0
10.0
10.7
11.2
10.8
10.8
10.9
10.8
11.0
10.2
11.5
11.7
10.6
10.1
11.7
11.4
11.5
9.5
8.4
9.4
10.2
11.4
11.7
12.5
13.5
13.4
13.4
13.6
13.1
13.4
13.4
13.5
14.1
14.4
14.4
14.5
15.7
15.8
14.8
15.7
17.1
15.3
15.1
15.9
15.3
1950....
1951....
1952....
1953....
1954....
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964....
1965....
1966....
1967....
1968....
1969....
1970....
1971....
1971:1..
II.
III.
IV.
1972:1..
II.
III.
6.5
4.5
4.1
4.3
4.4
5.1
5.3
4.9
4.4
4.9
4.8
4.7
4.7
4.9
5.4
5.5
5.6
5.3
5.2
5.0
4.5
4.5
4.4
4.6
4.6
4.3
4.2
4.3
4.4
3.4
2.0
1.9
2.0
2.1
2.3
2.4
2.2
2.2
2.4
2.3
2.3
2.3
2.4
2.7
2.7
2.7
2.6
2.6
2.6
2.5
2.6
2.5
2.7
2.8
2.5
2.4
2.7
2.6
4.9
3.8
3.2
3.7
4.2
4.8
5.0
5.2
5.4
5.4
5.5
5.7
5.7
5.9
5.9
5.9
5.9
5.9
5.5
5.2
5.8
6.1
6.0
6.0
6.5
6.0
5.9
6.2
6.0
12.7
8.2
4.2
4.6
1.8
5.7
5.8
4.2
3.5
7.5
5.8
5.0
6.2
6.1
8.5
10.9
10.1
7.6
8.8
7.9
5.1
6.7
4.6
7.2
6.5
8.2
6.4
7.3
7.3
10.1
2.9
4.4
5.1
4.5
6.1
8.1
6.3
4.9
8.6
7.7
7.2
9.3
7.7
11.7
12.7
13.3
12.0
13.0
11.9
9.3
11.2
5.5
10.9
12.5
15.1
10.9
9.3
12.4
16.2
13.9
10.5
10.1
9.9
11.5
11.6
8.9
8.1
9.5
8.5
7.9
8.1
8.1
9.3
9.4
10.6
9.1
9.7
10.1
7.0
4.8
4.9
5.9
5.3
2.9
6.5
10.5
8.6
11.5
10.3
9.1
9.4
9.2
10.2
13.0
11.7
9.0
11.4
10.6
8.5
10.3
9.2
12.6
14.2
15.6
13.0
12.5
12.6
11.2
10.7
7.9
10.8
10.4
13.6
7.6
12.6
12.6
17.8
12.2
10.9
10.7
11.6
14.7
14.2
13.3
11.4
13.7
12.2
11.8
12.4
12.9
14.4
15.2
15.1
13.1
13.3
12.8
11.4
11.8
11.7
12.8
11.8
11.0
12.8
12.9
12.9
15.2
13.3
13.4
12.7
13.4
13.9
12.5
10.0
9.8
10.1
10.3
10.1
11.3
11.4
11.8
12.4
12.5
12.3
11.7
11.0
10.3
11.0
9.9
10.6
9.8
8.8
7.4
8.6
16.9
14.8
11.1
11.3
10.6
13.2
12.2
11.1
9.1
11.0
9.1
9.3
9.6
9.2
10.6
11.7
12.2
10.3
12.3
10.3
7.1
9.6
7.6
10.9
9.3
10.5
10.2
12.1
10.0
10.9
2.1
5.8
6.0
5.9
8.5
7.2
7.0
5.7
8.5
6.3
4.4
6.9
6.9
10.5
11.6
12.9
11.9
13.0
9.3
9.4
8.2
8.3
8.1
7.9
8.3
10.2
6.3
10.6
5.8
4.5
3.6
3.8
4.0
4.4
4.4
4.2
3.5
4.0
3.6
3.8
3.7
3.6
4.1
4.3
4.4
3.9
4.5
3.8
2.7
3.6
3.1
3.9
3.5
3.9
4.0
4.3
3.7
3.7
.6
1.8
1.8
1.9
2.5
2.1
2.0
1.7
2.2
1.6
1.1
1.8
1.8
2.6
2.8
3.0
3.0
3.3
2.6
2.5
2.2
2.3
2.3
2.1
2.2
2.8
1.7
2.8
Profits after Federal income taxes per dollar of sales—cents
5.8
3.4
1.9
2.2
1.0
2.6
2.6
1.9
1.6
3.0
2.5
2.1
2.4
2.3
3.1
3.8
3.6
2.9
3.1
2.9
1.9
2.4
1.7
2.6
2.4
2.9
2.3
2.5
2.6
2.8
.6
1.0
L2
L.I
1.3
1.6
L3
L.O
L.5
1.4
1.3
1.6
L.4
2.1
2.3
2.4
2.3
2.4
2.3
1.9
2.4
1.3
2.4
2.6
3.0
2.3
2.0
1.3
8.8
6.6
5.7
5.4
5.6
6.1
6.1
5.0
4.7
5.2
5.0
4.7
4.6
4.5
5.1
4.9
5.4
4.7
4.7
4.8
3.4
2.3
2.5
2.8
2.5
1.4
3.0
4.6
3.8
4.5
3.7
3.3
3.4
3.4
3.6
4.2
3.7
3.1
4.0
3.6
2.8
3.4
3.2
4.3
4.8
5.1
4.4
4.1
4.7
4.2
4.1
3.1
4.1
4.0
5.0
3.0
4.8
4.9
10.3
6.5
6.1
6.1
6.8
8.3
8.0
7.6
7.0
7.9
7.5
7.3
7.4
7.5
7.9
7.9
7.8
6.9
6.8
6.5
5.9
6.1
6.2
6.4
6.1
5.7
6.4
6.3
6.5
11.1
10.1
10.4
10.6
11.1
11.6
10.6
9.5
9.5
9.9
10.3
9.7
10.8
10.9
11.1
11.2
11.0
10.7
10.1
9.3
8.3
8.9
8.0
8.7
7.5
6.8
5.8
6.8
i Includes newspapers beginning 1969.
s Includes certain industries not shown separately.
3 Annual ratios based on average equity for the year (using four end-of-quarter figures). Quarterly ratios based on equity
at end of quarter only.
Note.—For explanatory notes concerning compilation of the series, see "Quarterly Financial Report for Manufacturing
Corporations," Federal Trade Commission. See also Note, Table C-74.
Source: Federal Trade Commission.
281
TABLE C-76.—Sources and uses of funds, nonfarm nonfinancial corporate business, 1946-72
[Billions of dollars]
Sources
Uses
Externa
Period
Credit market funds
Total Internal
Total
Total
Longterm 2
Shortterm 3
3.3
3.1
In-
Discrepancy
(uses
less
sources)
Total
Purchase
of
physical
assets^
crease
in
financial
assets
16.5
25.5
25.3
18.8
17.9
17.2
20.3
15.3
-1.4
8.3
5.1
3.5
-1.8
-2.5
-3.7
-1.6
Other
1946
1947
1948
1949
18.3
28.1
29.0
20.4
7.8
12.6
18.7
19.1
10.5
15.5
10.4
1.3
6.8
8.7
6.3
3.1
3.5
5.6
6.4
5.1
-1.9
3.7
6.8
4.0
-1.8
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
41.8
37.6
29.4
29.3
29.6
53.4
46.5
39.4
46.5
57.3
17.9
19.9
21.2
21.1
23.3
29.2
28.9
30.6
29.5
35.0
23.8
17.6
8.2
8.2
6.3
24.3
17.6
8.8
17.0
22.3
7.2
10.0
8.7
5.7
6.1
10.4
12.7
12.0
10.2
11.9
3.9
5.9
7.9
6.0
6.7
6.6
7.5
10.4
10.7
8.2
3.3
4.1
.8
-.3
-.6
3.8
5.2
1.6
-.4
3.7
16.7
7.7
-.5
2.5
.2
13.8
4.8
-3.1
6.8
10.4
40.5
37.2
29.0
26.9
26.5
48.0
39.9
38.9
37.9
51.2
24.1
29.9
24.4
24.6
21.6
31.5
35.9
34.7
27.3
36.9
16.4
7.3
4.6
2.2
4.8
16.5
4.0
4.2
10.6
14.2
-1.3
-.4
-.3
-2.4
-3.2
-5.4
-6.6
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
48.2
55.1
62.6
67.5
74.4
94.4
100.2
98.7
109.8
117.6
34.4
35.6
41.8
43.9
50.5
56.6
61.2
61.5
61.7
60.8
13.8
19.5
20.7
23.6
23.9
37.8
39.1
37.3
48.1
56.9
11.4
12.5
12.4
12.3
14.6
20.6
25.2
29.7
30.7
40.3
7.6
11.1
9.7
8.5
9.0
9.3
15.6
21.5
17.9
21.2
3.8
1.5
2.7
3.8
5.7
11.3
9.5
8.2
12.9
19.1
2.4
7.0
8.4
11.4
9.3
17.2
13.9
7.6
17.4
16.6
41.6
49.1
55.1
59.7
65.5
83.0
89.7
88.8
99.5
105.2
39.0
36.7
44.0
45.6
52.1
62.8
77.1
72.0
76.2
84.0
2.6
12.5
11.1
14.2
13.4
20.2
12.6
16.8
23.3
21.1
-6.6
-5.9
-7.5
-7.8
-9.0
-11.4
-10.6
-9.9
-10.3
-12.5
1970
1971
102.5
126.7
59.1
67.1
43.4
59.6
39.8
48.5
32.3
44.0
7.5
4.6
3.6
11.0
95.5
106.9
84.6
85.2
10.9
21.7
-6.9
-19.8
-8.6
-6.1
Seasonally adjusted annual rates
106.1
112.6
92.7
98.2
58.3
60.2
59.8
58.2
47.8
52.4
33.0
40.0
36.4
45.8
32.8
44.2
24.8
31.2
32.8
40.6
11.6
14.6
.0
3.6
11.3
67
.2
-4.2
102.0
107.3
84.1
88.3
80.8
85.2
88.2
84.3
21.2
22.2
-4.1
4.0
-4.1
-5.2
-8.6
-10.0
1971: 1
II
III
IV
118.2
122.2
135.2
130.4
62.1
66.6
67.2
72.4
56.1
55.6
68.0
57.9
45.6
48.5
57.4
42.8
41.8
46.9
45.2
42.2
3.8
1.6
12.2
.6
10.6
7.1
10.5
15.2
105.9
110.8
108.5
101.7
82.4
87.6
83.2
87.7
23.6
23.2
25.3
14.0
-12.3
-11.4
-26.7
-28.6
1972: 1.
II
III 9
x
137.2
139.7
144.3
72.5
77.7
81.0
64.7
62.0
63". 3
51.5
57.6
50.0
36.0
44.9
40.8
15.5
12.7
9.2
13.1
4.5
13.2
128.1
125.8
129.9
94.8
100.1
102.8
33.3
25.6
27.1
-9.1
-13.9
-14.4
1970:1
||
III
IV
.
1
2
Undistributed profits (after inventory valuation adjustment) and capital consumption allowances.
Stocks, bonds, and mortgages.
s4 Bank loans, commercial paper, finance company bans, bankers' acceptances, and Government loans.
Plant and equipment, residential structures, and inventory investment.
Source: Board of Governors of the Federal Reserve System.
282
TABLE C-77\—Current assets and liabilities of U.S. corporations, 1939-72
[Billions of dollars]
Current assets
End of year
or quarter
Cash
on
Total hand
and
in
banks*
U.S.
Government
securities 2
1.4
30.0
23.9
0.1
.6
27.4
4.0
23.3
5.0
21.9
4.7
21.8
2.7
23.2
30.0
.7
38.3
42 .4
4C.0
19.8
25.6
27.3
27.6
26.8
26.3
37.6
44.6
48.9
45.3
1.5
1.4
1.3
1.3
1.4
2.4
1.7
1.6
1.6
1.4
32.8
40.7
47.3
51.6
51.7
45.8
51.9
61.5
64.4
60.7
19.7
20.7
19.9
21.5
19.2
23.5
19.1
18.6
18.8
22.8
1.1
2.7
2.8
2.6
2.4
2.3
2.6
2.8
2.8
2.9
55.7
58.8
64.6
65.9
71.2
86.6
95.1
99.4
106.9
117.7
55.1
64.9
65.8
67.2
65.3
72.8
80.4
82.2
81.9.
88.4
1.7
2.1
2.4
20.1
20.0
3.1
3.4
126.1
135.8
91.8
95.2
10.8
. 60.3
72.9
83.6
93.8
97.2
97.4
108.1
. . 123.6
133.0
133.1
13.1
13.9
17.6
21.6
21.6
21.7
22.8
25.0
25.3
26.5
2.0
4.0
10.1
16.4
20.9
21.1
15.3
14.1
14.8
16.8
1950
1951
1952 .
1953
1954
1955
1956
1957
1958
1959
161.5
179.1
186.2
190.6
194.6
224.0
237.9
244.7
255.3
277.3
28.1
30.0
30.8
31.1
33.4
34.6
34.8
34.9
37.4
36.3
1960
1961
289.0
306.8
37.2
41.1
1940 .
1941
1942
1943
1944
1945
1946
1947 .
1948
1949
.
.
AdNet
Revances
FedOther
and
Notes
ceiv- Notes
eral Other working
curand
Inpreand
inables
current Total payacacvencome rent capifrom
tal
ments, counts tax
liaU.S. counts tories assets*
U.S.
pay- liabili- biliGov- receivable
Govable
ties
ties
ernernment3
ment3
All corporations s
18.0
54.5
1939
Current liabilities
22.1
2.2
21.9
1.2
6.9
24.5
0.6
22.6
.8
25.6
2.0
24.0
2.2
24.1
1.8
25.0
.9
24.8
.1
31.5
37.6
39.3
37.5
2.5
7.1
12.6
16.6
15.5
10.4
8.5
10.7
11.5
9.3
7.1
7.2
8.7
8.7
9.4
9.7
11.8
13.2
13.5
14.0
27.5
32.3
36.3
42.1
45.6
51.6
56.2
62.1
68.6
72.4
79.8
92.6
96.1
98.9
99.7
121.0
130.5
133.1
136.6
153.1
.4
1.3
2.3
2.2
2.4
2.3
2.4
2.3
1.7
1.7
47.9
53.6
57.0
57.3
59.3
73.8
81.5
84.3
88.7
99.3
16.7
21.3
18.1
18.7
15.5
19.3
17.6
15.4
12.9
15.0
14.9
16.5
18.7
20.7
22.5
25.7
29.0
31.1
33.3
37.0
81.6
86.5
90.1
91.8
94.9
103.0
107.4
111.6
118.7
124.2
10.6 160.4
11.4 171.2
1.8
1.8
105.0
112.8
13.5
14.1
40.1
42.5
128.6
135.6
123.7
132.4
145.5
156.6
178.8
199.4
211.3
244.1
287.8
1.8
2.0
2.5
2.7
3.1
4.4
5.8
6.4
7.3
82.6
86.7
94.5
102.2
118.4
133.1
141.3
162.4
191.9
13.3
14.3
15.7
16.2
18.3
17.4
13.2
14.3
12.6
26.0
29.4
32.8
35.5
39.0
44.5
51.0
61.0
76.0
131.0
137.3
142.7
149.0
157.2
164.6
174.9
182.4
185.7
3.1
4.2
5.9
6.7
7.5
9.1
Nonfinancial corporations9
1961
1962
1963
1964
1965
1966
1967
1968
1969
254.7
269.7
288.2
305.6
336.0
364.0
386.2
426.5
473.5
34.8
37.1
39.8
40.5
42.8
41.9
45.5
48.2
47.9
16.5
16.8
16.7
15.8
14.4
13.0
10.3
11.5
10.6
3.4
3.7
3.6
3.4
3.9
4.5
5.1
5.1
4.8
94.5
99.5
106.9
116.5
130.2
142.1
150.2
168.8
192.2
1970
1971 .
490.5
516.6
49.7
55.3
7.6
10.4
4.2
3.5
200.6 196.0
207.5 203.1
32.4 302.6
36.8 311.9
6.6
4.9
200.5
202.8
11.8
14.5
83.7
89.7
187.9
204.7
1971- 1
II
III
IV
494.1
498.3
507.1
516.6
48.5
51.1
52.4
55.3
7.8
7.7
7.8
10.4
4.2
3.9
3.9
3.5
201.3
203.3
206.5
207.5
33.8
33.1
34.9
36.8
302.1
301.8
306.3
311.9
6.1
5.3
5.0
4.9
195.7
195.8
197.4
202.8
13.7
12.4
13.8
14.5
86.6
88.3
90.1
89.7
192.0
196.5
200.8
204.7
1972: 1
II
III.
526.1
534.3
545.3
55.3
55.7
57.3
9.9
8.7
7.6
3.4
2.8
2.9
211.4 207.2
216.3 210.7
222.5 215.2
38.9 316.4
40.1 319.1
39.8 326.2
4.9
4.9
4.7
202.5
204.0
207.6
15.7
13.4
15.0
93.3
96.8
98.9
209.7
215.2
219.1
95.0
100.5
106.8
113.1
126.6
142.8
153.1
166.0
186.4
198.5
199.2
201.6
203.1
10.5
12.1
14.4
16.3
18.1
19.7
22.0
26.9
31.6
1 Includes time certificates of deposit.
2 Includes Federal agency issues.
3
Receivables from and payables to U.S. Government do not include amounts offset against each other on corporations'
books or amounts arising from subcontracting which are not directly due from or to the U.S. Government. Wherever possible,
adjustments have been made to include U.S. Government advances offset against inventories on corporations' books.
* Includes marketable investments (other than Government securities and time certificates of deposit) as well as sundry
current
assets.
5
Excludes banks, savings and loan associations, and insurance companies.
6
Excludes banks, sayings and loan associations, insurance companies, investment companies, finance companies
(personal and commercial), real estate companies, and security and commodity brokers, dealers, and exchanges.
Note.—Year-end data through 1969 are based on "Statistics of Income" (Treasury Department), covering virtually
all corporations in the United States. "Statistics of Income" data may not be strictly comparable from year to year because
of changes in the tax laws, basis for filing returns, and processing of data for compilation purposes. All other figures shown
are estimates based on data compiled from many different sources, including data on corporations registered with the
Securities and Exchange Commission.
Source: Securities and Exchange Commission.
283
TABLE C-78.—State and municipal and corporate securities offered, 1934-72
[Millions of dollars]
Corporate securities offered for cash
Year or quarter
State and
municipal
securities
offered
for cash
(principal
amounts)
Total
corporate
offerings
Industry of corporate issuer
Type of corporate security
Common
stock
Preferred
stock
Bonds
and
notes
Manufacturing 1
Electric,
gas
and
water 2
Transportation 3
Communication
Other
1934
939
397
19
371
67
133
176
21
1939
1,128
2,164
87
1,980
604
1,271
186
103
1940
1941
1942
1943
1944
1,238
956
524
435
661
2,677
2,667
1,062
1,170
3,202
108
110
34
56
163
183
167
112
124
369
2,386
2,390
917
990
2,669
992
848
539
510
1,061
1,203
1,357
472
477
1,422
324
366
48
161
609
159
96
1945
1946
1947
1948
1949
795
1,157
2,324
2,690
2,907
6,011
6,900
6,577
7,078
6,052
397
891
779
614
736
758
1,127
762
492
425
4,855
4,882
5,036
5,973
4,890
2,026
3,701
2,742
2,226
1,414
2,319
2,158
3,257
2,187
2,320
1,454
711
286
755
800
902
571
211
329
293
1,008
946
1950
1951
1952
1953
1954
3,532
3,189
4,401
5,558
6,969
6,361
7,741
9,534
8,898
9,516
811
1,212
1,369
1,326
1,213
631
838
564
489
816
4,920
5,691
7,601
7,083
7,488
1,200
3,122
4,039
2,254
2,268
2,649
2,455
2,675
3,029
3,713
813
494
992
595
778
399
612
760
882
720
1,300
1,058
1,068
2,138
2,037
1955
1956
1957
1958
1959
5,977
5,446
6,958
7,449
7,681
10,240
10,939
12,884
11,558
9,748
2,185
2,301
2,516
1,334
2,027
635
636
411
571
531
7,420
8,002
9,957
9,653
7,190
2,994
3,647
4,234
3,515
2,073
2,464
2,529
3,938
3,804
3,258
893
724
824
824
967
1,132
1,419
1,462
1,424
717
2,757
2,619
2,426
1,991
2,733
1960
1961
1962
1963
1964
7,230
8,360
8,558
10,107
10,544
10,154
13,165
10,705
12,211
13,957
1,664
3,294
1,314
1,011
2,679
409
450
422
343
412
8,081
9,420
8,969
10, 856
10,865
2,152
4,077
3,249
3,514
3,046
2,851
3,032
2,825
2,677
2,760
718
694
567
957
982
1,050
1,834
1,303
1,105
2,189
3,383
3,527
2,761
3,957
4,980
1965
1966
1967
1968
1969
11,148
11,089
14, 288
16,374
11,460
15,992
18,074
24,798
21,966
26,744
1,547
1,939
1,959
3,946
7,714
725
574
885
637
682
13, 720 5,417
7,070
15,561
21,954 11,058
17,383
6,979
18,348
6,356
2,936
3,665
4,935
5,281
6,736
1,013
1,972
2,067
1,875
2,146
947
2,003
1,979
1,766
2,188
5,680
3,364
4,759
6,064
9,319
1970
1971
1972 P . .
17, 762
24,370
22,903
38,945
44,921
40,106
7,240
9,193
9,649
1,390
3,679
3,462
30,315
32,049
26,994
10,513
11,672
6,957
11,017
11,787
11,259
2,260
2,450
1,668
5,136
5,820
4,739
10,020
13,192
15, 483
1971: I . .
II.
III
IV
6,540
5,961
5,845
6,024
12,133
11,687
10, 336
10,765
1,779
2,628
2,119
2,667
489
702
1,963
525
9,865
8,357
6,254
7,573
3,749
3,265
2,205
2,453
3,215
2,894
2,637
3,041
437
959
480
574
1,606
897
2,263
1,054
3,126
3,672
2,751
3,643
1972: I . .
II.
III
IV
5,865
6,109
5,383
5,546
9,804
11,214
9,345
9,743
2,070
2,792
2,420
2,367
780
1,006
839
837
6,953
7,416
6,086
6,539
1,525
2,108
1,749
1,575
2,261
3,495
2,701
2,802
534
530
334
270
1,476
1,369
856
1,038
4,008
3,712
3,705
4,058
21
109
1
Prior to 1948, also includes extractive, radiobroadcasting, airline companies, commercial, and miscellaneous company
issues.
2
Prior to 1948, also includes telephone, street railway, and bus company issues.
3 Prior to 1948, includes railroad issues only.
Note.—Covers substantially all new issues of State, municipal, and corporate securities offered for cash sale in the United
States in amounts over $100,000 and with terms to maturity of more than 1 year; excludes notes issued exclusively to
commercial banks, intercorporate transactions, investment company issues, and issues to be sold over an extended period,
such as employee-purchase plans.
Sources: Securities and Exchange Commission, "The Commercial and Financial Chronicle," and "The Bond Buyer."
284
TABLE C-79.—Common stock prices, earnings, and yieldsand stock market credit
Standard & Poor's common stock data
Price indexes l
Year or month
Total
(500
stocks)
Industrials
(425
stocks)
Public
utilities
(55
stocks)
Regulated 5
Railroads
(20
stocks)
Dividend
yield
(percent) 2
Price/
earnings
ratio3
Total
1949
15.23
15.00
17.87
12.83
6.59
6.49
18.40
22.34
24.50
24.73
29.69
40.49
46.62
44.38
46.24
57.38
18.33
22.68
24.78
24.84
30.25
42.40
49.80
47.63
49.36
61.45
19.96
20.59
22.86
24.03
27.57
31.37
32.25
32.19
37.22
44.15
15.53
19.91
22.49
22.60
23.96
32.94
33.65
28.11
27.05
35.09
6.57
6.13
5.80
5.80
4.95
4.08
4.09
4.35
3.97
3.23
7.15
8.57
10.57
9.77
11.75
12.59
13.25
12.73
16.33
17.32
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
55.85
66.27
62.38
69.87
81.37
88.17
85.26
91.93
98.70
97.84
59.43
69.99
65.54
73.39
86.19
93.48
91.08
99.18
107. 49
107.13
46.86
60.20
59.16
64.99
69.91
76.08
68.21
68.10
66.42
62.64
30.31
32. 83
30.56
37.58
45.46
46.78
46.34
46.72
48.84
45.95
3.47
2.98
3.37
3.17
3.01
3.00
3.40
3.20
3.07
3.24
16.98
21.68
17. 39
18.20
18.81
17.92
15.15
17.48
17.66
16.48
1970
1971
1972
83.22
98 29
109.20
91.29
108 35
121.79
54.48
59.33
56.90
32.13
41.94
44.11
3.83
3.14
2.84
15.69
18.50
93.49
97.11
99.60
103. 04
101.64
99.72
102. 22
106.62
109. 59
113 68
112.41
110.26
63.43
62.49
62.42
62.06
59.20
57.90
36.64
38.78
39.70
42.29
42.05
42.12
3.32
3.18
3.10
2.99
3.04
3.10
19.22
99.00
97.24
99.40
97.29
92.78
99.17
109. 09
107.26
109. 85
107. 28
102. 21
109.67
60.08
57.51
56.48
57.41
55.86
57.07
42.05
43.55
47.18
44.58
41.19
43.17
3.13
3.18
3.09
3.16
3.31
3.10
18.11
1972: Jan.
Feb
Mar
Apr
May
June
103.30
105.24
107.69
108.81
107.65
108.01
114.12
116.86
119.73
121.34
120.16
120.84
60.19
57.41
57.73
55.70
54.94
53.73
45.16
45.66
46.48
47.38
45.06
43.66
2.96
2.92
2.86
2.83
2.88
2.87
18.45
July
Aug
Sept
Oct
Nov
Dec
107.21
111.01
109.39
_ 109.56
115.05
117. 50
119.98
124.35
122.33
122.39
128.29
131.08
53.47
54.66
55.36
56.66
61.16
61.73
42.00
43.28
42.37
41.20
42.41
44.62
2.90
2.80
2.83
2.82
2.73
2.70
..
1971: Jan
Feb
Mar
Apr
May
June
..
July
Aug _
Sept
Oct
Nov
Dec .
Brokers
Banks
Unregulated ;
nonmargin
stock
credit
at
banks e
Other
security
credit
at
banks7
Millions of dollars
1941-43=10
1950.
1951
1952
1953
1954
1955
1956
1957
1958
1959
1949-72
Margin credit at brokers and banks«
18.74
17.91
17.95
18.00
5,044
5,174
5,392
5,598
5,701
5,783
4,224
4,311
4,531
4,776
4,874
4,976
820
863
861
822
827
807
1.104
5,860
5,917
5,990
6,016
5,995
6,535
5,050
5,121
5,208
5,238
5,198
5,700
810
796
782
778
797
835
1,091
1,208
1,182
1,194
1,193
1,197
6,850
7,427
7,847
8,250
8,472
"8,860
5,989
6,477
6,896
7,283
7,478
7,792
861
950
951
967
994
"1,068
1,182
,170
,158
,150
,141
,253
"9,042
"9, 217
"9, 213
"9,138
7,945
8,060
8,083
8,081
8,166
"1,097 p ,334 P ,??9
"1,156 P .348 p ?1R
"1,130 "1,403 "1, 278
"1,057 "1,406 "1,368
1,121
1,137
1,122
1,122
1,228
1.220
1 ?05
M83
235
1,263
183
1706
1,237
1 ?f)4
,?09
1,298
3?7
,294
,?78
,296
,258
12 Monthly data are averages of daily figures and annual data are averages of monthly figures.
Aggregate cash dividends (based on latest known annual rate) divided by aggregate market value based on Wednesday closing prices. Monthly data are averages of weekly figures; annual data are averages of monthly figures.
3 Ratio of price index for last day of quarter to earnings for 12 months ending with that quarter. Annual ratios are
averages of quarterly data.
* Margin credit includes all credit extended to purchase or carry stocks or related equity instruments and secured at
least in part by stock. Credit extended by brokers is end-of-month data for member firms of the New York Stock Exchange. June data for banks are universe totals; all other data for banks represent estimates for all commercial banks,
which
accounted for 60 percent of security credit outstanding at banks on June 30,1971.
6
In addition to assigning a current loan value to margin stock generally, Regulations T and U permit special loan values
for8 convertible bonds and stock acquired through exercise of subscription rights.
Nonmargin stocks are those not listed on a national securities exchange and not included in the Board of Governors
of the Federal Reserve System's list of over-the-counter margin stocks. At banks, loans to purchase or carry nonmargin
stocks
are unregulated; at brokers, such stocks have no loan value.
7
1 ncludes loans to purchase or carry margin stock if these are unsecured or secured entirely by unrestricted collateral.
Sources'. Board of Governors of the Federal Reserve System, New York Stock Exchange, and Standard & Poor's Corporation.
285
TABLE C-80.—Business formation and business failures
1929-72
Business failures *
Index
of net
business
formation
(1967=100)
Year or month
1929
19333
19393
1940..
1941
1942
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952
1953.. . .
1954
1955
1956
1957
1958.
1959 .
1960...
1961....
1962
1963.
1964.
1965....
1966
1967
1968
1969
1970....
1971
1972.
New
business
incorporations
(number)
Amount of current
liabilities (millions
of dollars)
Number of failures
Business
failure
rates
132,916
112,897
112.5
96,346
87.9
85,640
93.1
93,092
98.2
83,778
98.1
92,946
94.4
102,706
91.3
117,411
98.9
139,915
95.0
141,163
90.3
137,112
89.4
150,781
96.7
193,067
92.4
182,713
88.4
181,535
90.7
182,057
93.3
186,404
97.2
197, 724
98.5
203,897
98.2
200,010
100.0
206,569
109.8
233,635
116.2
274,267
108.1
264,209
111.2
287,567
* 118.1 4 291,041
103.9
100.3
69.6
63.0
54.4
44.6
16.4
6.5
4.2
5.2
14.3
20.4
34.4
34.3
30.7
28.7
33.2
42.0
41.6
48.0
51.7
55.9
51.8
57.0
64.4
60.8
56.3
53.2
53.3
51.6
49.0
38.6
37.3
43.8
41.7
38.3
Liability size
class
Total
Under $100,000
and
$100,000 over
22,909 22,165
19,859 18,880
14,768 14,541
13,619 13,400
11,848 11,685
9,282
9,405
3 155
3,221
1,222
1,176
759
809
1 003
1 129
3 103
3 474
4,853
5,250
8,708
9,246
8,746
9,162
7,626
8,058
7,081
7,611
8 075
8 862
11,086 10,226
10,969 10,113
12,686 11,615
13 739 12 547
14 964 13 499
14,053 12,707
15 445 13 650
17,075 15,006
15,782 13,772
14 374 12 192
13 501 11 346
13 514 11 340
13,061 10,833
12 364 10 144
7, 829
9,636
7,192
9 154
8,019
10,748
7 611
10 326
7,040
9,566
Liability size
class
Total
Under $100,000
and
$100,000 over
744
979
227
219
163
123
66
46
50
126
371
397
538
416
432
530
787
860
856
1,071
1 192
1 465
1,346
1 795
2,069
2,010
2 182
2 155
2,174
2,228
2 220
1,807
1,962
2,729
2 715
2,526
483.3
457.5
182.5
166.7
136.1
100.8
45.3
31.7
30.2
67.3
204.6
234.6
308.1
248.3
259.5
283.3
394.2
462.6
449.4
562.7
615.3
728.3
692.8
938.6
1,090.1
1,213.6
1,352.6
1,329.2
1,321.7
1,385.7
1,265.2
941.0
1,142.1
1,887.8
1,916.9
2,000.2
261.5
215.5
132.9
119.9
100.7
80.3
30.2
14.5
11.4
15.7
63.7
93.9
161.4
151.2
131.6
131.9
167.5
211.4
206.4
239.8
267.1
297.6
278.9
327.2
370.1
346.5
321.0
313.6
321.7
321.5
297.9
241.1
231.3
269.3
271.3
258.8
242
240
299
243
236
255
180
227
218
193
190
192
197
233
314
216
186
202
202
246
179
162
225
164
168.8
150.9
224.6
153.8
249.5
165.8
147.0
155.6
115.8
144.7
129.0
111.3
101.6
191.3
220.7
148.5
190.1
127.9
204.6
253.6
113.5
153.0
208.6
86.8
23.6
22.4
26 8
26.2
24.5
22.5
21.8
22.1
20.0
20.6
21.2
19.6
20.1
23.0
24.4
28.5
23.3
18.1
19.2
21.0
19.6
21.4
21.0
19.1
221.8
242.0
49.7
46.8
35.4
20.5
15.1
17.1
18.8
51.6
140.9
140.7
146.7
97.1
128.0
151.4
226.6
251.2
243.0
322.9
348.2
430.7
413.9
611.4
720.0
867.1
1,031.6
1,015.6
1,000.0
1,064.1
967.3
699.9
910.8
1,618.4
1,645.6
1,741.5
Seasonally adjusted
1971:Jan
Feb . .
Mar
Apr
May
June
July
Aug..
Sept
Oct
Nov
Dec
1972:Jan
Feb
Mar
Apr . .
May
June
July
Aug
Sept
Oct
Nov
Dec
.
105.8
105.4
108.7
108.8
109.9
111.9
112.3
112.8
111.8
114.7
116.7
115.6
114.7
113.9
116 7
117.6
118.8
117.8
118.7
117 8
118.9
120.6
123.7
22,338
20,923
23, 220
22, 770
24,168
24,691
25,073
25,142
23,278
25, 050
25, 828
25, 529
24, 685
24,743
27,399
26,372
26,396
26,277
26,893
26,612
26, 795
27,169
* 27,700
43.3
41.8
43 9
42.9
42.8
44.3
39 6
43.6
40.1
38.1
41.6
37.5
35.7
40.8
41 2
36.5
38.2
34.2
38.5
40 5
39.1
38.8
38.5
37.4
905
860
1 042
989
912
935
786
848
741
759
319
730
750
880
986
808
856
730
740
824
730
755
799
708
663
620
743
746
676
680
606
621
523
566
629
538
553
647
672
592
670
528
538
578
551
593
574
544
145.2
128.6
197.8
127.9
224.6
143.3
125.2
133.4
95.9
124.1
107.7
91.8
81.5
168.3
196.3
120. C
166. £
109.8
185.4
232. €
93. i
131. e
187. i
67."
1 Commercial and industrial failures only. Excludes failures of banks and railroads and, beginning 1933, of real estate,
insurance, holding, and financial companies, steamship lines, travel agencies, etc.
2 Failure rate per 10,000 listed enterprises.
3
Series revised; not strictly comparable with earlier data.
' Preliminary; based on seasonally adjusted data through November.
Sources: Department of Commerce (Bureau of Economic Analysis) and Dun & Bradstreet, Inc.
286
AGRICULTURE
TABLE C-81.—Income of farm people and farmers,
1929-72
Income received from farming
Personal income
received by total
farm population
Net to farm
operators
Realized gross
Year or
quarter
From
From
From
farm 1 nonTotal«
farm
all
sources sources sources 2
ProducCash tion ex- Exclud- Includreceipts penses ing net ing net
from
inven- invenmarkettory
tory
ings
change change4
Billions of dollars
1933
7.1
1967
dollars s
Dollars
6.3
6.2
945
1,969
4.4
2.7
2.6
379
1,115
4.3
4.4
685
1 851
1939
7.4
4.8
2.6
10.6
Oi
r««.
7.7
CO
in
13.9
Current
dollars
CO
•-4
1929
Net income per
farm, including
net inventory
change
6.3
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
7.6
10.1
14.1
16.5
16.6
17.2
20.0
21.1
23.8
19.5
4.8
6.8
10.1
12.1
12.2
12.8
15.5
15.8
18.0
13.3
2.8
3.3
3.9
4.4
4.4
4.4
4.6
5.3
5.8
6.2
11.1
13.9
18.8
23,4
24.4
25.8
29.5
34.1
34.7
31.6
8.4
11.1
15.6
19.6
20.5
21.7
24.8
29.6
30.2
27.8
6.9
7.8
10.0
11.6
12.3
13.1
14.5
17.0
18.8
18.0
4.2
6.1
8.8
11.8
12.1
12.8
15.0
17.1
15.9
13.6
4.5
6.5
9.9
11.7
11.7
12.3
15.1
15.4
17.7
12.8
706
1,031
1 588
1 927
1 950
2,063
2 543
2 615
3 044
2,233
1,858
2,578
3 452
3 706
3,611
3,619
4 037
3 534
3 903
2,977
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
20.4
22.7
22.1
19.8
18.4
17.6
17.8
17.7
19.5
18.1
14.1
16.2
15.4
13.4
12.5
11.4
11.2
11.0
12.8
11.0
6.3
6.5
6.7
6.4
5.9
6.2
6.6
6.6
6.7
7.0
32.3
37.1
36.8
35.0
33.6
33.1
34.3
34.0
37.9
37.5
28.5
32.9
32.5
31.0
29.8
29.5
30.4
29.7
33.5
33.5
19.4
22.3
22.6
21.3
21.6
21.9
22.4
23.3
25.2
26.1
12.9
14.8
14.1
13.7
12.0
11.2
11.9
10.7
12.7
11.4
13.7
16.0
15.1
13.1
12.5
11.5
11.4
11.3
13.5
11.5
2 421
2 946
2 896
2 626
2,606
2,463
2 535
2 590
3 189
2,795
3 186
3 549
3 448
3,126
3,102
2,932
2 982
2 943
3,583
3,140
1960.
1961
1962 .
1963
1965
1966
1967
1968
1969
18.7
19.7
20.4
20.6
20.6
23.6
24.9
24.0
25.1
27.6
11.5
12.2
12.3
12.1
11.3
13.5
14.4
13.1
13.2
14.9
7.2
7.5
8.2
8.5
9.3
10.0
10.5
10.9
11.9
12.7
38.1
39.8
41.3
42.3
42.6
44.9
49.7
49.0
50 9
55.6
34.2
35.1
36.4
37.4
37.2
39.3
43.3
42 7
44.1
48.1
26.4
27.1
28.6
29.7
29.5
30.9
33.4
34 8
36.2
38.8
11.7
12.6
12.6
12.6
13.1
14.0
16.3
14 2
14 7
16.8
12.1
13.0
13.2
13.2
12.3
15.0
16.3
14 9
14 8
16.9
3 049
3,399
3,586
3 708
3 564
4,487
5,019
4 730
4 854
5,674
3,388
3,777
3,941
4 030
3,832
4,723
5,121
4 730
4 667
5,206
1970
1971
1972'
28.2
29.5
33.2
15.0
15.6
17.7
13.2
13.9
15.5
57.9
60.1
66.4
50.5
53.1
58.5
41.1
44.0
47.2
16.8
16.1
19.2
16.8
17.4
19.8
5 754
6,049
7,000
5,047
5,083
5,645
18.0
17.1
16.4
15.8
16 8
16 9
17 7
18.2
19.3
18.9
19.2
21.7
6,160
5,850
5,610
5,400
5,840
5,880
6,150
6,330
6,820
6,680
6,780
7,660
5,500
5,180
4,920
4,700
4,990
4,980
5,130
5,280
5,590
5,390
5,420
6,080
.
.
Seasonally adjusted annual rates
1970: 1
II
Ill
IV
1971: 1
II
III
IV
1972: 1
II...
Ill
IV
58.4
58.0
57.7
57.6
59 0
59 1
60 4
61.8
64 1
64.8
66.1
70.6
51.0
50 6
50.3
50.2
51 9
52 1
53 4
54.9
56 5
56.9
58.1
62.5
1
40.4
40 9
41.3
41.8
43 2
43 7
44 3
44.9
45.6
46.5
47.3
49.4
18.0
17 1
16.4
15.8
15 8
15 4
16.1
16.9
18.5
18.3
18.8
21.2
Net income to farm operators including net inventory change, less net income of nonresident operators, plus wages and
salaries and other labor income of farm resident workers, less contributions of farm resident operators and workers to
social
insurance.
2
Consists of income received by farm residents from nonfarm sources, such as wages and salaries from nonfarm employment, nonfarm business and professional income, rents from nonfarm real estate, dividends, interest, royalties,
unemployment compensation, and social security payments.
3 Cash receipts from marketings, Government payments, and nonmoney income furnished by farms (excluding net
inventory change).
< Includes net value of physical change in inventory of crops and livestock valued at average prices for the year.
' Income in current dollars divided by the index of prices paid bv farmers for family living items on a 1967 base.
Source: Department of Agriculture.
287
TABLE C-82.—Farm production indexes, 1929-72
[1967=100]
Crops
Livestock and products
Farm
output i
Total 2
1929...
53
62
50
69
50
65
67
200
77
8
54
52
76
32
1933...
50
56
45
60
35
65
68
175
70
6
57
58
80
32
1939...
58
64
52
65
47
72
85
160
97
17
59
59
83
35
1940...
1941...
1942...
1943 ...
1944...
60
62
69
68
70
66
68
76
71
75
53
70
66
60
63
75
74
81
79
78
52
59
62
53
66
74
75
80
86
82
83
88
87
75
87
170
145
173
155
166
74
64
71
71
99
20
22
33
35
29
60
64
71
77
73
60
63
73
81
73
85
89
92
91
93
36
39
45
52
51
1945...
1946...
1947...
1948...
1949...
69
71
69
75
74
73
76
73
83
79
61
66
50
73
64
81
76
73
73
72
68
71
83
80
69
84
93
82
87
84
79
94
90
82
87
122
117
160
202
217
100
117
107
100
100
31
30
32
39
36
73
71
70
68
72
70
68
67
66
69
95
94
93
90
93
54
50
49
48
54
1950...
1951...
1952...
1953...
1954...
73
75
78
79
79
76
65
60
64
62
66
77
80
78
80
80
64
63
81
74
66
85
80
81
84
83
87
89
86
87
88
135
205
205
222
185
103
118
114
105
114
41
38
37
37
41
75
78
78
79
82
74
79
79
78
81
93
92
92
97
98
56
59
59
61
63
1955...
1956...
1957...
1958...
1959...
82
82
80
86
88
82
69
69
75
82
85
85
81
88
88
84
62
65
61
90
72
86
91
88
90
89
88
92
84
91
93
199
180
148
154
196
111
110
84
88
91
46
54
53
65
58
84
84
83
85
88
86
83
80
82
88
99
101
102
101
100
62
68
69
73
76
1960...
1961...
1962...
1963...
1964...
90
90
91
95
94
92
91
92
95
93
88
79
80
87
76
89
89
92
92
93
86
78
73
76
84
91
96
94
94
90
87
91
92
89
90
192
193
200
207
206
99
104
117
119
113
61
71
72
75
75
87
91
92
95
97
85
89
90
95
98
101
104
105
104
105
75
81
81
83
87
1965___
1966...
1967...
1968...
1969...
97
96
100
102
103
98
95
100
103
104
89
89
100
95
99
97
96
100
100
100
87
87
100
105
97
96
97
100
103
103
95
97
100
93
113
202
129
100
148
135
94
95
100
87
91
90
96
100
112
115
95
97
100
100
101
92
96
100
102
102
104
101
100
99
99
90
%
100
98
101
1970...
1971...
1972 P..
102
111
112
100
112
113
90
118
112
99
105
104
91
106
101
101
101
101
107
116
104
137
140
181
97
87
89
117
120
129
105
108
109
108
112
112
100
101
103
106
107
110
Year
77
81
81
79
82
80
89
89
Hay Food Vege- Fruits
Feed
and
and grains
grains forage
tables nuts
Cotton
Oil
Tobacco crops Total 3
Meat
animals
Dairy Poultry
prod- and
ucts eggs
* Farm output measures the annual volume of farm production available for eventual human use through sales from
farms or consumption in farm households. Total excludes production of seeds and of feed for horses and mules. The
Department of Agriculture also estimates net farm output, which excludes all quantities used for feed.
2 Includes production of seeds and of feed for horses and mules and certain items not shown separately.
3 Includes certain items not shown separately.
Source: Department of Agriculture.
288
TABLE C-83.—Farm population, employment', and productivity, 1929-72
Farm population
(Aprill)i
Year
Farm employment
(thousands) 3
Farm output
Per man-hour
Number
(thousands)
As percent of
total
population a
Total
Hired
Family
workers workers
Per
unit of
total
input
Total
Crops
Livestock
and
products
Crop
production
per
acre <
Index, 1967=100
1929..
30,580
25.1
12,763
9,360
3,403
53
17
17
26
57
1933..
32,393
25.8
12,739
9,874
2,865
54
16
17
25
50
1939..
30,840
23.5
11,338
8,611
2,727
59
20
21
27
61
1940..
1941..
1942..
1943..
1944..
30,547
30,118
28,914
26,186
24,815
23.1
22.6
21.4
19.2
17.9
10,979
10,669
10,504
10,446
10,219
8,300
8,017
7,949
8,010
7,988
2,679
2,652
2,555
2,436
2,231
61
63
69
67
68
21
22
24
24
25
23
24
26
26
27
27
28
30
32
31
62
63
70
64
68
1945..
1946..
1947..
1948..
1949..
24,420
25,403
25,829
24,383
24,194
17.5
18.0
17.9
16.6
16.2
10,000
10,295
10,382
10,363
9,964
7,881
8,106
8,115
8,026
7,712
2,119
2,189
2,267
2,337
2,252
69
72
70
75
73
27
29
29
32
33
29
31
31
35
36
32
32
33
34
36
67
70
67
75
70
1950..
1951..
1952..
1953.
1954..
23,048
21,890
21,748
19.874
19,019
15.2
14.2
13.9
12.5
11.7
9,926
9,546
9,149
8,864
8,651
7,597
7,310
7,005
6,775
6,570
2,329
2,236
2,144
2,089
2,081
73
73
76
77
78
35
36
39
41
43
39
38
42
43
45
37
39
40
41
43
69
69
73
73
71
1955..
1956..
1957..
1958..
1959.
19,078
18,712
17,656
17,128
16, 592
11.5
11.1
10.3
9.8
9.4
8,381
7,852
7,600
7,503
7,342
6,345
5,900
5,660
5,521
5,390
2,036
,952
,940
,982
,952
80
82
83
89
90
47
50
53
59
62
48
52
56
65
66
46
48
50
55
59
74
77
77
86
I960..
1961.
1962.
1963.
1964..
15,635
14,803
14,313
13,367
12,954
8.7
8.1
7.7
7.1
6.8
7,057
6,919
6,700
6,518
6,110
5,172
5,029
4,873
4,738
4,506
,885
,,890
1,827
1,780
1,604
93
94
95
98
96
67
70
73
80
83
71
73
77
82
85
62
67
71
77
83
92
95
97
95
1965.
1966.
1967.
1968.
1969.
12,363
11,595
10.875
10,454
10,307
6.4
5.9
5.5
5.2
5.1
5,610
5,214
4,903
4,749
4,596
4,128
3,854
3,650
3,536
3,419
1,482
1,360
1,253
1,213
1,176
99
97
100
101
101
91
94
100
106
112
92
95
100
106
112
87
93
100
105
112
100
99
100
104
107
9,712
9,425
9,500
4.7
4.6
4.5
4,523
4,446
4,392
3,348
3,281
3,240
1,175
1,165
1,152
100
109
109
113
125
122
110
122
122
119
129
128
102
113
116
1970...
1971...
1972 *._
i Farm population as defined by Department of Agriculture and Department of Commerce, i.e., civilian population
living on farms, regardless of occupation.
> Total population of United States as of July 1 including Armed Forces overseas.
3 Includes persons doing farm work on all farms. These data, published by the Department of Agriculture, Statistical
Reporting Service, differ from those on agricultural employment by the Department of Labor (see Table C-24) because of
differences in the method of approach, in concepts of employment, and in time of month for which the data are collected.
See monthly report on "Farm Labor."
* Computed from variable weights for individual crops produced each year.
Sources: Department of Agriculture and Department of Commerce (Bureau of the Census).
490-000 O - 73 - 20
289
TABLE C-84.—Indexes of prices received and prices paid by farmers, and parity ratio,
1929-72
[Index, 1967=100]
Prices received by farmers
Year or month
All farm
products
Crops
Prices paid by farmers
Livestock
and
products
All items,
interest,
taxes, and
wage rates
Family
living
items
Parity ratio»
Production
items
Actual
1929
58
65
57
92
1933
28
31
25
64
1939
37
42
39
77
1940
1941
1942
1943.
1944
1945...,
1946
1947
1948
1949....
39
49
63
76
78
81
93
109
113
98
44
55
70
85
87
92
104
122
127
111
39
50
62
71
71
76
87
104
114
98
81
93
105
113
108
109
113
115
110
100
1950
1951
1952
1953
1954.
1955.
1956
1957
1958
1959.
102
119
113
100
97
91
91
92
98
95
103
117
118
106
107
102
104
99
99
98
101
121
110
97
90
84
82
88
99
93
1960
1961
1962
1963....
1964
1965
1966
1967..
1968
1969...
94
94
96
96
93
98
105
100
103
108
99
100
103
106
106
103
105
100
101
97
91
91
92
89
85
94
105
100
104
117
90
91
92
94
98
100
104
109
90
90
91
92
93
95
98
100
104
109
92
93
94
95
94
96
99
100
102
106
1970
1971
1972
110
112
126
100
107
116
118
116
133
114
120
127
114
119
124
110
115
122
1971: Jan 15..
Feb 15..
Mar 15.
Apr 15..
May 15.
June 15.
107
112
112
111
112
113
102
105
108
108
110
113
110
117
115
114
114
113
117
118
118
119
120
120
116
117
117
117
118
119
112
113
114
115
115
116
July 15.
Augl5_
Sept 15.
Octl5_.
Nov 15.
Dec 15..
112
113
111
114
115
116
109
107
104
106
109
108
114
117
117
118
119
122
120
120
121
121
122
122
119
120
120
120
120
121
116
116
116
116
117
117
1972: Jan 15..
Feb 15..
Mar 15.
Apr 15..
May 15.
June 15.
119
122
120
119
123
125
111
110
108
112
115
116
126
131
129
125
129
131
123
124
124
125
125
126
121
123
123
123
124
124
118
118
119
120
120
121
July 15.
Aug 15.
Sept 15.
Octl5_.
Nov 15.
Dec 15.
127
128
128
129
130
137
116
119
117
116
120
127
136
135
137
138
138
145
127
127
128
129
130
131
125
125
126
125
127
127
122
122
124
125
126
129
95
95
89
89
87
87
90
92
93
Adjusted 2
101
107
100
92
89
84
83
82
85
81
1 Percentage ratio of index of prices received by farmers to index of prices paid, interest, taxes, and wages rates on
1910-14=100 base.
2 The adjusted parity ratio reflects Government payments made directly to farmers.
Source: Department of Agriculture.
290
1929-72
T A B L E G-85.—Selected measures offarm resources and inputs
Index numbers of inputs (1967=100)
Crops
harvested
(millions
of
acres) i
Farm
labor
Feed,
Fertiseed,
lizer
and
Taxes Misceland
liveand
liming stock
laneous
interest
mapurterials chases
3
23.2
100
302
103
39
11
31
69
53
340
22.6
94
294
97
32
6
28
71
52
331
20.7
97
270
101
40
12
41
67
50
341
344
348
357
362
20.5
20.0
20.6
20.3
20.2
98
98
101
102
103
269
265
271
267
265
103
102
100
42
44
50
53
55
14
15
17
19
23
43
46
49
68
68
69
72
74
354
352
355
356
360
18.8
18.1
17.2
16.8
16.2
100
99
99
100
102
249
239
226
220
212
102
103
56
55
61
75
76
76
104
68
75
23
24
28
29
31
51
52
49
52
54
53
54
54
1950
1951
1952
1953
1954
345
344
349
348
346
15 1
15.2
14.5
14 0
13.3
101
104
104
103
102
199
200
191
184
176
105
106
105
105
105
79
84
88
90
90
32
36
39
42
43
1955
1956
1957
1958.
1959
340
324
324
324
324
12 8
12.0
11.1
10.5
10 3
102
100
97
97
98
170
160
149
143
139
106
91
91
90
91
1960
1961
1962
1963
1964
324
303
295
300
301
9.8
9.4
9.0
8.7
97
96
96
97
98
134
129
123
120
115
99
99
98
99
100
298
295
308
303
294
7.8
7.4
109
101
100
96
94
100
99
100
100
100
96
100
6.7
98
99
100
101
102
297
310
298
6.5
6.5
6.5
102
102
103
89
89
89
100
99
98
1939
. .
1940
1941
1942
1943
1944
1945
1946 .
1947
1948
1949
. .
. .
8.2
7.3
7.0
104
COCMO
1970
1971
1972 p
. .
ooc
1965
1966
1967.
1968
1969
...
100
enen
coco
365
1933
toto
0000
1929
in
tn
Total
Mechanical
Farm
real
power
estate 2 and
machinery
10
to
Year
Manhours
of
farm
work
(billions)
54
56
57
62
291
59
62
64
68
70
70
72
77
77
79
80
80
63
67
67
65
64
45
44
46
48
54
73
76
75
80
84
82
8?
81
82
86
68
70
69
74
54
58
62
70
76
84
87
89
89
90
87
89
90
92
94
91
97
100
101
105
95
98
100
103
105
101
98
103
80
90
100
107
110
102
102
103
113
119
122
109
109
109
107
104
107
107
109
113
92
91
90
91
92
93
100
102
1 Acreage harvested (excluding duplication) plus acreages in fruits, tree nuts, and farm gardens.
2 Includes service buildings and improvements on land.
3 Nonfarm portion of feed, seed, and livestock purchases.
Source: Department of Agriculture.
74
77
79
80
84
89
94
99
100
108
110
TABLE C-86.—Comparative balance sheet of the farming sector, 1929-73
[Billions of dollars]
Assets
Claims
Other physical assets
Beginning of
year
Financial assets
MaHouseDeReal Live- chinhold
Total estate
stock^ ery
equip- posits
and Crops * ment
and
motor
curand
vehifurnish- rency
cles
ings
ProReal Other prieInvest- Total estate
tors'
ment
U.S.
debt debt equisavings in coties
bonds operatives
1929
48.0
6.6
3.2
1933
30.8
3.0
2.5
8.5
1939
34.1
5.1
3.2
6.8
52.9
55.0
6?. 9
73.7
84.6
33.6
34.4
37.5
41.6
48.2
5.1
5.3
7.1
9.6
9.7
3.1
3.3
4.0
4.9
5.4
2.7
3.0
3.8
5.1
6.1
4.2
4.2
4.9
5.0
5.3
3.2
3.5
4.2
5.4
6.6
0.2
.4
.5
1.1
2.2
0.8
.9
.9
0
1
52.9
55.0
62.9
73.7
84.6
6.6
6.5
6.4
6.0
5.4
3.4
3.9
4.1
4.0
3.5
42.9
44.6
52.4
63.7
75.7
1945 .
1946.. .
1947
1948
1949
94.2
103.5
116.4
127.9
134.9
53.9
61.0
68.5
73.7
76.6
9.0
9.7
11.9
13.3
14.4
6.5
5.4
5.3
7.4
10.1
6.7
6.3
7.1
9.0
8.6
5.6
6.1
7.7
8.5
9.1
7.9
9.4
10.2
9.9
9.6
3.4
4.2
4.2
4.4
4.6
?
L.4
5
7
1.9
94.2
103.5
116.4
127.9
134.9
4.9
4.8
4.9
5.1
5.3
3.4
3.2
3.6
4.2
6.1
85.9
95.5
107.9
118 6
123.5
1950
1951
1952
1953
1954
132.5
151.5
167.0
164.3
161.2
75.3
86.6
95.1
96.5
95.0
12.9
17.1
19.5
14.8
11.7
12.2
14.1
16.7
17.4
18.4
7.6
7.9
8.8
9.0
9.2
8.6
9.7
10.3
9.9
9.9
9.1
9.1
9.4
9.4
9.4
4.7
4.7
4.7
4.6
4.7
2.1
2.3
2.5
2.7
2.9
132.5
151.5
167.0
164.3
161.2
5.6
6.1
6.7
7.2
7.7
6.8
7.0
8.0
8.9
9.2
120 1
138.4
152.3
148.2
144.3
1955
1956
1957
1958
1959
165.1
169.6
177.9
185.8
202.1
98.2
102.9
110.4
115.9
124.4
11.2
10.6
11.0
13.9
17.7
18.6
19.3
20.2
20.2
21.8
96
8.4
8.3
7.6
9.3
10 0
10.5
10.0
9.9
9.8
94
9.5
9.4
9.5
10.0
tt
5.1
5.1
5.2
31
3.2
3.5
3.7
3.9
165 1 8 2
169.6
9.0
177.9
9.8
185.8 10.4
202.1 11.1
9.4
9.8
9.5
10.0
12.5
147 5
150.8
158.6
165.4
178.5
1960
..
1961
1962
_
1963_._,
1964
203.5
204.2
212.8
221.4
229.2
130.2
131.8
138.0
143.8
152.1
15.2
15.5
16.4
17.3
15.8
22.7
22.2
22.5
23.4
23.9
7.7
8.0
8.8
9.3
9.8
9.6
8.9
9.1
9.0
8.8
9.2
8.7
8.8
9.2
9.2
4.7
4.6
4.4
4.4
4.2
4.2
4.5
4.8
5.0
5.4
203.5
204.2
212.8
221.4
229.2
12.1
12.8
13.9
15.2
16.8
12.7
13.4
14.8
16.5
18.1
178.7
178.0
184.1
189.7
194.3
1965 . . . .
1966
1967_
1968
1969.
237.2
253.8
266.8
280.1
294.8
160.9
172.2
181.8
192.0
201.5
14.4
17.6
18.9
18.8
20.2
24.7
25.8
27.3
29.5
30.9
9.2
9.7
10.0
9.6
10.6
8.6
8.6
8.4
9.0
9.6
9.6
10.0
10.3
10.9
11.5
4.2
4.0
3.9
3.8
3.7
5.6
5.9
6.2
6.5
6.8
237.2
253.8
266.8
280.1
294.8
18.9
21.2
23.3
25.5
27.1
18.7
20.4
22.4
24.9
27.5
199.6
212.2
221.1
229.7
240.2
305.8
314.9
339.2
1973 * . „ . . . „ 370.6
207.1
213.0
228.6
251.4
23.5
23.7
27.3
31.8
10.9
33.8
10.7
36.4
11.8
93.2
9.7
10.1
10.3
11.9
12.4
13.1
3.7
3.6
3.7
26.0
7.2 305.8
7.6 314.9
8.6 339.2
370.6
28.4
29.5
31.3
33.9
29.7
31.6
35.6
38.1
247.7
253.8
272.3
298.6
1940
1941.
1942
1943
1944
.
1970.
1971
1972_
9.8
1 Beginning with 1961, horses and mules are excluded.
2 Includes all crops held on farms and crops held off farms by farmers as security for Commodity Credit Corporation
loans. The latter on January 1,1973 totaled approximately $0.4 billion.
Source: Department of Agriculture.
292
INTERNATIONAL STATISTICS
TABLE C-87.— U.S. balance of payments, 1946-72
[Millions of dollars]
Merchandise i 2
Year or
quarter
ExImports
ports
Military transactions
Net
balance
Direct
expend- Sales
itures
-5,067 6,697
- 5 , 9 7 3 10,124
- 7 , 557 5,708
- 6 , 8 7 4 5,339
-493
-455
-799
-621
(8)
(8)
(8)
(8)
- 9 , 081
-11,176
-10,838
-10,975
-10,353
1,122
3,067
2,611
1,437
2,576
-576
-1,270
- 2 , 054
-2,615
-2,642
(8)
(8)
14,424
17, 556
19, 562
16,414
16, 458
-11,527
-12,803
-13,291
- 1 2 , 952
-15,310
2,897
4,753
6,271
3,462
1,148
1960
1961
1962
1963
1964
19,650
20,107
20,779
22,252
25,478
-14,744
-14,519
-16,218
-17,011
-18,647
1965
1966
1967
1968
1969
26,438
29,287
30,638
33,576
.- 36,417
-21,496
-25,463
-26,821
-32,964
- 3 5 , 796
1946
1947
1948
1949
11,764
16,097
13, 265
12,213
1950
1951
1952.
1953
1954
10,203
14, 243
13, 449
12,412
12, 929
1955
1956
1957
1958
1959
1970
1971
197212
Net
balance
Net investment income
Privates
Net
travel
Other
and
trans- servU.S. porta- ices,
Gov- tion ex- net
pendiernment tures
RemitBal- tances,
penBalance
sions, ance
on
and
on
goods other
curand
uni- rent acserv- lateral
ices i trans- count
fers i
-493
-455
-799
-621
750
997
1,177
1,200
6
50
85
73
733
946
374
230
-576
-1,270
-2,054
-2,423
182 - 2 , 460
1,382
1,569
1,535
1,566
1,899
78
151
140
166
213
-120
298
83
-238
-269
6
2
41
24
0
1,892
3,817
2,356
532
1,959
-4,017 -2,125
- 3 , 515
302
- 2 , 531 - 1 7 5
-2,481 -1,949
-2,280
-321
-2,901
- 2 , 949
- 3 , 216
- 3 , 435
-3,107
200
161
375
300
302
-2,701
- 2 , 788
- 2 , 841
-3,135
- 2 , 805
2,117
2,454
2,584
2,416
2,658
180
40
4
168
68
-297
-361
-189
-633
-821
-43
47
72
78
62
2,153
4,145
5,901
2,356
310
-345
-2,498
- 2 , 423 1,722
- 2 , 345 3,556
- 2 , 361
-5
-2,448 -2,138
4,906
5,588
4,561
5,241
6,831
-3,087
-2,998
-3,105
-2,961
-2,880
335
402
656
657
747
-2,752
-2,596
-2,449
-2,304
-2,133
2,825
3,451
3,920
4,056
4,872
16
103
132 - 1 , 1 5 5
97 - 1 , 3 1 2
3 -1,149
77
30
115
178
142
4,107
5,599
5,126
5,957
8,568
-2,292
- 2 , 513
-2,631
-2,742
-2,754
4,942
3,824
3,817
612
621
830 - 2 , 1 2 2
-2,952
829 - 2 , 9 3 5
-3,764
- 4 , 378 1,240 - 3 , 1 3 8
- 4 , 535 1,392 - 3 , 1 4 3
- 4 , 8 5 6 1,512 - 3 , 3 4 4
5,274
5,331
5,847
6,157
5,820
21
44
40
63
155
-1,318
-1,380
-1,763
-1,565
-1,784
301
286
334
302
442
7,098
5,170
5,136
2,425
1,911
- 2 , 8 3 5 4,263
- 2 , 8 9 0 2,280
- 3 , 0 8 1 2,055
-2,909 -484
- 2 , 946 - 1 , 0 3 5
41,963 -39,799 2,164 - 4 , 8 5 2
42,770 -45,459 - 2 , 6 8 9 - 4 , 8 1 6
47,391 -54,355 - 6 , 9 6 4 - 4 , 7 1 6
1,478 - 3 , 3 7 4 6,376 - 1 1 5 - 2 , 0 6 1
1,922 - 2 , 8 9 4 8,952 - 9 5 7 - 2 , 4 3 2
1,153 - 3 , 5 6 3 9,211 -1,803 - 2 , 5 8 9
114 7,807 - 2 , 9 2 2
- 4 5 11,617 - 2 , 6 2 5
-27
6,518 - 4 , 525
-3
6,218 - 5 , 6 3 8
4,885
8,992
1,993
580
1,815
3,086
2,495
3,215
5,814
574 3,563 - 3 , 2 0 8
356
748
727 - 3 , 5 7 4 - 2 , 8 4 7
795 - 4 , 9 1 3 - 3 , 7 3 7 - 8 , 6 5 1
Seasonally adjusted
1970: 1
II....
III...
IV...
10,231
10,565
10,705
10,462
-9,731
-9,831
-9,968
-10,269
500
734
737
193
-1,180
-1,259
-1,210
-1,203
273
441
329
436
-907
-818
-881
-767
33
-1
-66
-81
-428
-533
-599
-501
141
127
153
154
898
967
989
712
1971: 1
II....
III...
IV...
11,017
10,710
11,479
9,564
289
-10,728
-11,722 - 1 , 0 1 2
-11,951 - 4 7 2
-11,058 - 1 , 4 9 4
-1,175
-1,214
-1,198
-1,230
510
516
474
423
- 6 6 5 1,899 - 1 0 1
- 6 9 8 2,352 - 1 6 1
- 7 2 4 2,038 - 3 2 7
- 8 0 7 2,663 - 3 6 8
-498
-625
-606
-703
212
180
182
172
1,136
36
91
-537
-791
345
-846
-810
-946
-855
-992 -1,529
1972: 1
II. .
Ill P..
IV*__
11,791
11,445
12,307
13,185
-13,478
-13,393
-13,895
-14,857
-1,687 -1,218
-1,948 -1,239
-1,588 -1,080
-1,672
334
281
250
- 8 8 4 2,232 - 3 7 0
- 9 5 8 2,196 - 4 2 6
- 8 3 0 2,480 - 5 5 6
-679
-657
-606
200 - 1 , 1 8 8
192 - 1 , 6 0 1
204 - 8 9 6
-990 -2,178
-918 -2,519
-895 -1,791
See footnotes at end of table on next page.
293
1,559
1,458
1,645
1,714
-765
-773
-821
-849
133
194
168
-137
TABLE C-87.—U.S. balance of payments, 1946-72— Continued
[Millions of dollars]
Balance
on current
account
and
longterm
Private^ capital
Long-term
capital
flows,
net
Year or
quarter
U.S.
Government <
AlloNoncaliquid tions
shortof
term
speprivate cial
capital drawflows,
ing
nets rights
Liquid
Errors Net
and liquid- private
omiscapital
sions, &
net
ance flows,
net 8
Changes
in liaOfficial bilities Changes
to
reserve
in U.S.
trans- foreign official
actions official reserve
agen- assets,
balcies,
ance
net 7
net«
U.S.
official
reserve
assets,
net
(end of
period)
1946
1947
1948
1949 , . .
-253
-236
-131
158
155
861
1 115
717
1950 .
1951
1952
1953
1954
75
-227
-41
183
-556
-124
354
497
220
60
1,758
-33
-415
1,256
480
24,265
24,299
24,714
23,458
22,978
1955
1956
1957
1958
1959
-328
-479
-174
-145
-89
371
390
1,012
361
260
182
-869
-1,165
2,292
1,035
22,797
23,666
24,832
22,540
21,504
2,145
606
1,533
377
171
19,359
18,753
17, 220
16, 843
16,672
1,188 -1,289
67 1,222
2,370
219 - 7 8 7
568
1,265 - 3 , 418 3,366
52
3,251 1,641
-761 -880
8,824 2,702 - 1 , 5 1 5 -1,187
15, 450
14,882
14, 830
15,710
•016,964
1960
1961
1962
1963.
1964
_.
-889
-901
-892
-1,150
-1,349
- 2 , 1 0 0 -1,174 9-1,405
4 fl-1,200
-2,181
-2,607 -1,003 9 - 6 5 7
-3,357 - 1 , 292 9 - 9 6 8
- 4 -1,642
- 4 , 470
1965
1966
1967
1968
1969
- 1 , 532 - 4 , 577
-1,469 - 2 , 555
- 2 , 424 - 2 , 9 1 2
-2,159 1,198
-1,926
-50
1970
1971
197213..
- 2 , 018 - 1 , 3 9 8 - 3 , 059 - 4 8 2
- 2 , 378 -4,079 - 9 , 304 - 2 , 3 8 6
-959 - 6 3 2 -10, 243 - 6 1 1
- 1 , 846
-1,744
- 3 , 280
- 1 , 444
-3,011
- 6 2 3 20,706
- 3 , 3 1 5 24,021
- 1 , 7 3 6 25,758
- 2 6 6 26,024
- 1 , 0 9 8 9-3,676
- 1 , 054 9-2,251
- 1 , 206 9-2,864
- 4 5 5 9-2,713
- 1 , 0 4 8 -2,696
-154
-104
-522
230
-640
-476
-302
-881
-399
- 2 , 470
- 2 , 477
-2,151
-4,683
-1,610
-6,122
9 273 - 3 , 4 0 3
9 903 - 1 , 3 4 8
9 214 -2,650
9 779 -1,934
1,162 - 1 , 534
1,258
742
1,117
1,557
1,363
867 -1,174 - 3 , 851 - 5 , 9 8 8 - 9 , 839 7,362
717 -11,031 -22,002 - 7 , 763 -29,765 27, 417
710 -2,951 -13,093 1,461 -11,632 11,441
2,477 14, 487
2,348 "12,167
191 13,150
Unadjusted
Seasonally adjusted
1970: 1 . . .
II
Ill
IV
-462
-563
-324
-670
-922 -1,251
-236 -605
-191 -347
- 4 9 -856
-247
-56
42
-221
217
217
217
216
1971: 1 . . .
II.......
Ill
IV
-702 -922
-584 - 1 , 6 0 5
-558 -1,883
-533
330
1972: 1
II
Ill v
- 5 1 -1,332
-410 -854
-677 - 7 6 5
-37 -898
- 1 , 279
-2,999
- 3 , 296
-1,732
-534
-315
-883
-654
180 - 9 4 4
179 - 2 , 586
179 - 5 , 380
179 - 2 , 1 2 2
-343 -1,081 -3,602
-95
750 - 1 , 8 6 4
- 2 8 1 - 1 4 4 - 2 , 216
-508
592
-542
800 -3,132
178
178 - 1 , 1 4 1 - 2 , 235
177 - 1 , 872 - 4 , 453
-1,461
-1,211
-1,104
- 2 , 212
-2,793
- 2 , 065
- 1 , 869
-3,110
2,529
1,260
1,285
2,286
264
805
584
824
17,350
16, 328
15, 527
14, 487
- 2 , 577 - 2 , 848 - 5 , 425 4,743
- 5 , 721 - 7 4 5 - 6 , 466 5,807
- 9 , 380 - 2 , 551 -11,931 10,737
- 4 , 3 2 9 -1,619 - 5 , 9 4 8 6,135
682 14,342
659 13, 504
1,194 12,131
- 1 8 7 "12,167
2,822
1,080
4,679
429 12, 270
—231 1313,339
- 5 5 13, 217
-119 - 3 , 251
1,386 -849
- 1 7 1 -4,624
i Excludes military grants.
s Adjusted from Census data for differences in timing and coverage.
> Includes fees and royalties from U.S. direct investments abroad or from foreign direct investments in the United States.
* Excludes liabilities to foreign official reserve agencies.
* Private foreigners exclude the International Monetary Fund (IMF), but include other international and regional organizations.
6
Includes liabTities to foreign official agencies reported by U.S. Government and U.S. banks and U.S. liabilities to the
IMF
arising from reversible gold sales to, and gold deposits with, the United States.
7
Official reserve assets include gold, special drawing rights, convertible currencies, and the U.S. gold tranche position
in the IMF.
s9 Not available separately.
Coverage of liquid banking claims for 1960-63 and of nonliquid nonbanking claims for 1960-62 is limited to foreign
currency
deposits only; other liquid items are not available separately and are included with nonliquid claims.
10
Includes gain of $67 million resulting from revaluation of the German mark in October 1969.
i Includes $28 million increase in dollar value of foreign currencies revalued to reflect market exchange rates as of
December
31,1971.
i2 First 3 quarters on a seasonally adjusted annual rates basis (except reserve assets are end of December).
» Includes increase of $1,016 million resulting from change in par value of the U.S. dollar on May 8,1972.
Sources: Department of Commerce (Bureau of Economic Analysis) and Treasury Department.
294
TABLE G-88-—U.S. merchandise exports and imports by commodity groups, 1958-72
[Millions of dollars]
Merchandise imports
Merchandise exportsi
Gross
merchandise
trade
Total 3
Year or quarter
balCrude
ManFood,
Crude
Food,
SeaManbever- mate- ufac- ance,
seasonally Unad- Total 2 3 bever- mate- ufacrials
tured
ages,
rials tured Seaages,
sonally
adjusted
and to- and goods«
sonally Unad- and to- and goods« adjusted
bacco fuels *
justed bacco fuels *
adjusted 7
justed
Total, including reexports 2
General imports «
Domestic exports
1958
1959
16,375 16,211
16,426 16,243
2,688
2,852
3,052 11,547
2,996 11,179
13, 392
15,690
3,550
3,580
4,164
4,615
5,311
7,117
2,983
736
1960
1961
1962
1963
1964
19,659
20,226
20,986
22,467
25,832
19,459
19,982
20,717
22,182
25,479
3,167
3,466
3,743
4,188
4,637
3,942
3,864
3,356
3,775
4,337
12,583
12,784
13,668
14,297
16,529
15,073
14,761
16,464
17,207
18,749
3,392
3,455
3,674
3,863
4,022
4,418
4,334
4,691
4,755
5,029
6,863
6,537
7,649
8,070
9,106
4,586
5,465
4,522
5,260
7,083
1965
1966
1967
1968
1969
26,742
29,490
31,030
34,063
37,332
26,399
29,054
30,646
33,626
36,788
4,519
5,186
4,710
4,592
4,446
4,273
4,404
4,726
4,865
5,006
17,433
19,218
20,844
23,818
26,785
21,427
25,618
26,889
33,226*
36,043
4,013
4,590
4,701
5,365
5,308
5,440
5,718
5,367
6,031
6,391
11,244
14,446
15, 756
20,624
23,011
5,315
3,872
4,141
837
1,289
42,659 42,025
43,549 42,911
49,116 48, 316
5,058
5,076
6,573
6,692 29,343
6,441 30,443
7,090 33,650
39,952
45, 563
55, 555
6,230
6,404
7,371
6,542 25,906
2,708
7,268 30,414 -2,014
8,839 37, 748 -6,439
1970 . . .
1971
1972..
.
1970: 1
II
III
IV..
10,327
10,798
10,848
10,757
10,194 10, 060
11,219 11, 055
10,153 9,989
11,094 10,922
1,117
1,145
1,264
1,532
1,489
1 725
1,608
1,870
7,246 9,721 9,455
7,932 9,864 10,069
6,872 10,023 9,873
7,294 10,328 10,555
1, 512
1,580
1,496
1,640
1,667
1,600
1,617
1,657
5,998
6,574
6,422
6,913
1971: 1
II
Ill
IV
11,239
10,966
11,675
9,726
11,116 10,962
11,406 11,222
10,924 10,777
10,103 9,950
1,295
1,219
1,336
1,225
1,689
1,674
1,569
1,509
7,738
8,046
7,648
7,010
10,799
11,747
11,958
11,030
10,518
12,003
11,778
11,264
1,492
1,706
1,895
1,311
1,626
1,836
1,928
1,879
440
7,051
-782
8,084
-283
7,589
7,690 -1,304
1972: 1
II.
III
IV . .
11,903
11,575
12,365
13,300
11,891
12, 040
11, 558
13,626
11, 725
11,826
11,359
13,406
1,417
1,432
1,628
2,097
1,703
1,688
1,536
2,163
8,340
8,431
7,995
8,885
13,418
13,420
13, 896
14, 837
13,301
13, 736
13, 526
14, 992
1,809
1,762
1,808
1,993
2,130 8,985
2,105 9,478
2,196 9,128
2,407 10,157
1
2
606
933
825
429
-1,515
- 1 , 845
-1,531
- 1 , 537
Beginning 1960, data have been adjusted for comparability with the revised commodity classifications effective in 1965.
Totals exclude Department of Defense shipments of grant-aid military supplies and equipment under the M ilitary
Assistance
Program.
8
Total includes commodities and transactions not classified according to kind.
* Includes fats and oils.
' includes machinery, transportation equipment, chemicals, metals, and other manufactures. Export data for these items
in elude military grant-aid shipments.
«7 Total arrivals of imported goods other than intransit shipments.
Exports, excluding military grant-aid, less general imports; quarterly data seasonally adjusted.
Note.—Data are as reported by the Bureau of the Census adjusted to include silver ore and bullion reported separately
prior to 1969. Export statistics cover all merchandise shipped from the U.S. customs area, except supplies for U.S. Armed
Forces. Export values are f.a.s. port of export and include shipments under Agency for International Development and
Food for Peace programs as well as other private relief shipments. Import values are defined generally as the market
value in the foreign country, excluding the U.S. import duty and transportation costs such as ocean freight and marine
insurance.
Source: Department of Commerce, Bureau of International Commerce.
295
TABLE C-89.— U.S. merchandise exports and imports by area, 1966-72
[Millions of dollars]
1966
Area
Exports (including reexports and special category
shipments): Total
Developed countries
Developing countries
Canada
Other Western Hemsiphere
Western Europe1
Eastern Europe
Asia
Australia and Oceania
Africa
General imports: Total
Developed countries
Developing countries
Canada
Other Western Hemisphere
Western Europe i
Eastern Europe
Asia
Australia and Oceania
Africa
Unidentified countries2
_
_.
1967
1968
1969
1970
1971
30,430 31,622 34,636 38,006 43,224 44,130
20,120 21,467 23,600
10,112 9,960 10,821
6,679 7,172 80,72
4,769 4,718 5,339
9,891 10,187 11,132
198
195
215
6,740 7,150 7,582
805 1,018 1,026
1,348 1,182 1,269
_. 25,618 26,889 33,226
26,479
11,277
9,137
5,576
12,392
249
8,261
998
1,392
36,043
1972
49,676
30,877
12,993
9,079
6,532
14,463
354
10,028
1,189
1,579
39,952
30,335
13,410
10,365
6,484
14,178
384
9,855
1,168
1,694
45,563
34,211
14, 585
17,632 18,993 24,130 26,460 29,259
7,795 7,709 8,886 9,373 10,442
6,152 7,140 9,005 10,384 11,092
4,737 4,662 5,143 5,163 5,836
7,679 8,052 10,139 10,138 11,169
179
177
198
195
226
5,277 5,349 6,911 8,275 9,621
596
583
697
828
871
992
920 1,122 1,046 1,113
6
6
11
12
24
33,744
11,549
12,691
6,038
12,658
223
11,779
895
1,236
41
40,801
14,350
14,909
7,003
15,420
321
15,111
1,145
1,595
51
12,415
7,280
15,280
819
11,276
1,035
1,572
55, 555
i Includes Finland, Yugoslavia, Greece, and Turkey.
3 Consists of certain low-valued shipments not identified by country.
Note.—Developed countries include Canada, Western Europe, Japan, Australia, New Zealand, and the Republic of
South Africa. Developing countries include rest of the world except Communist areas in Eastern Europe and Asia and
unidentified countries.
Source: Department of Commerce, Bureau of International Commerce.
296
TABLE C-90.—U.S. overseas loans and grants, by type and area,fiscalyears; 1962-72
[Millions of dollars]
Type of program and fiscal
period
Total economic loans and grants
(obligations and loan authorizations) i
1962-71 average
Loans
Grants
1972
Loans
Grants
Economic loans and grants to
less developed countries, by
program 2
Obligations and loan authorizations:
1962-71 average
1972
Repayments and interest:
1962-71 average
1972
Agency for International
Development
Obligations and loan authorizations:
1962-71 average
1972
Repayments and interest:
1962-71 average
1972
Export-Import Bank long-term
loans
Loan authorizations:
1962-71 average _
1972
Repayments and interest:
1962—71 average
1972
Food for Peace
Obligations:
1962-71 average
1972
Repayments and interest:
1962-71 average
1972
Contributions and Subscriptions
to International Lending
Organizations*
Obligations:
1962-71 average
1972
Peace Corps and Other*
Obligations:
1962-71 average
1972
Repayments and interest:
1962-71 average
1972
Total
Near
East
and
South
Asia
Latin
America
East
Asia
and
Vietnam
Africa
Europe
Other
and
nonregional
4,754
2,515
2,238
5,698
3 391
2,307
1,370
1,038
331
1,018
333
1,118
700
419
1,121
819
685
302
1,029
297
732
1,694
1,119
4,477
5,088
1,370
1,018
1,118
1,121
961
384
121
523
1,422
398
512
617
850
1,379
310
476
337
463
75
136
42
85
81
212
5
2,222
2,072
644
451
513
338
571
676
198
175
2
10
293
422
237
313
131
171
33
69
33
30
21
26
17
15
2
442
94
90
194
536
63
242
31
99
58
502
2
1,468
440
720
86
142
273
337
29
52
15
36
37
150
0
1
1,303
1,186
620
457
143
102
297
481
133
104
61
49
42
11
5
51
21
27
47
146
306
88
160
15
27
575
384
171
213
398
265
133
209
220
10
20
81
41
31
23
22
19
26
40
5
4
16
30
2
2
0
1
9
558
47
511
694
91
603
2
114
38
187
104
301
142
295
262
32
773
764
65
115
4
Some data are preliminary.
3
Countries have been classified "less developed" on the basis of the standard list of less developed countries used
by the Development Assistance Committee of the Organization for Economic Cooperation and Development. On this
basis, "less developed" countries include all countries receiving U.S. loans or grants except the following which are
considered "developed": Japan, Australia, New Zealand, Republic of South Africa, Canada, and all of Europe except
Malta, Spain, and Yugoslavia.
3
Includes capital subscriptions and contributions to the Inter-American Development Bank and the International
Development Association.
* Data for certain programs from Department of Commerce, Bureau of Economic Analysis.
Source: Agency for International Development (except as noted).
297
TABLE C-91.—International reserves, 1949, 1953, and 1967-72
[Millions of dollars; end of period]
1972~
Area and country
1967
1969
1970
78,220
92,540
132,345
152,330
63, 241 62,636
74,311
109,222
125,016
1949
1953
All countries
46,116
51,826
74, 290 77,355
Developed areas
37,353
41,478
61,276
United States
1968
1971
November
26,024
23,458
14,830
15,710
16,964
14,487
13,190
13,306
United Kingdom
1,752
2,670
2,695
2,422
2,527
2,827
8,835
5,896
Other Western Europe
Austria
Belgium
France
Germany
Italy
Netherlands
Scandinavian countries
(Denmark, Finland, Norway, and Sweden)
Spain
Switzerland
Other
6,793
92
978
580
196
10,603
325
1,144
829
1,773
768
1,232
36,726
1,478
2,590
6,994
8,153
5,463
2,619
36,168
1,504
2,187
4,201
9,948
5,341
2,463
33,613
1,530
2,388
3,833
7,129
5,045
2,529
44,647
1,751
2,847
4,960
13,610
5,352
3,234
61,794
2,343
3,473
8,253
18,392
6,787
3,796
73, 768
2,753
3,930
10,019
23,570
6,087
4,810
1,026
150
1,768
1,588
2,236
1,100
3,696
2,397
2,316
1,149
4,293
2,766
2,213
1,281
4,425
3,240
2,538
1,817
5,132
3,406
3,701
3,268
6,966
4,815
4,401
4,911
6,440
6,847
1,902
2,717
3,046
3,106
4,679
5,701
6,046
892
2,030
2,906
3,654
4,840
15,360
18,412
Canada.
Japan
Australia, New Zealand, and
South Africa
Less developed areas
Latin America
Middle East
Other Asia
Other Africa
%
537
&
2,284
1,197
(0
1,587
1,953
2,278
2,989
2,772
2,831
4,342
7,587
8,765
10,350
13,015
14,115
15,580
18,230
23,120
27,315
2,800
1,535
3,640
2 639
3,400
1,510
3,740
1,790
3,430
3,310
4,085
2,125
3,910
3,320
4,215
2,505
4,470
3,035
4,825
3,105
5,645
3,120
5,165
4,190
6,590
5,100
5,810
5,500
8,276
6,893
6,190
5,845
i Not available separately.
Estimate.
Note.—International reserves is comprised of monetary authorities' holdings of gold. Special Drawing Rights and
Reserve Positions in the International Monetary Fund, and convertible foreign exchange. Beginning December 1971
gold is valued at 38 U.S. dollars per ounce and foreign exchange balances are expressed in dollars at the cross rates reflecting parities and central rates agreed on December 17, 1971 and subsequently. Data cover all countries except
U.S.S.R., other Eastern European countries, Mainland China, and Cuba (after 1960).
Beginning 1959, when most of the major currencies of the world became convertible, data exclude known holdings of
inconvertible currencies, balances under payments agreements, and the bilateral claims arising from liquidation of the
European Payments Union.
Source: International Monetary Fund, "International Financial Statistics."
3
298
TABLE C-92.—U.S. reserve assets, 1946-72
[Millions of dollars]
End of year or
month
Total reserve
assets
Gold stock 1
Total 2
1946..
1947..
1948..
1949..
20, 706
24, 021
25, 758
26,024
24, 265
24, 299
24,714
23, 458
22,978
22,797
23,666
24,832
22, 540
21, 504
19, 359
18, 753
17, 220
16, 843
16,672
15, 450
14, 882
14, 830
15, 710
16,964
1950..
1951..
1952..
1953..
1954..
1955..
1956..
1957..
1958..
1959..
I960..
1961..
1962..
1963..
1964..
1965..
1966..
1967..
1968..
1969..
1970-.
1971..
1972.
14, 487
812,167
13,150
1971: Jan
14,699
14, 534
14,342
14,307
13, 811
13, 504
Feb....
Mar....
Apr....
May...
June...
July....
Aug....
Sept...
Oct....
Nov....
Dec...
1972: Jan...
Feb...
Mar...
Apr...
MayJune..
13, 283
12,128
12,131
12,146
12,131
«12,167
July..
Aug...
Sept..
Oct...
Nov...
Dec...
13,090
13,124
13,217
13,313
13,307
13,150
12,879
12,330
12, 270
12,285
«13,345
13, 339
20,706
22, 868
24,399
24, 563
22, 820
22, 873
23, 252
22,091
21, 793
21.753
22, 058
22, 857
20, 582
19, 507
17, 804
16,947
16, 057
15, 596
15, 471
«13, 806
13, 235
12, 065
10, 892
11, 859
11,072
10, 206
10,487
11,040
11,039
10,963
10,925
10, 568
10, 507
10, 453
10, 209
10, 207
10, 207
10, 206
10, 206
10,206
9,662
9,662
9,662
»10,490
10,490
10,490
10,488
10, 487
10, 487
10,487
10,487
Treasury
Special
drawing
rights a
Convertible
foreign
currencies*
20, 529
22, 754
24, 244
24, 427
22, 706
22,695
23,187
22, 030
21,713
21,690
21,949
22,781
20, 534
19, 456
17, 767
16, 889
15,978
15, 513
15,388
e 13,733
13,159
11,982
10,367
10, 367
10, 732
10,132
10,410
10, 732
10,732
10,732
10,732
10,332
10,332
851
1,100
1,958
1,468
1,468
1,443
1 443
1,247
1,247
10,332
10,132
10,132
10,132
10,132
10,132
10,132
9,588
9,588
9,588
»10, 410
10, 410
10, 410
10,410
10,410
10, 410
10,410
10,410
1,147
1,097
1,097
1,100
1,100
1,100
1,810
1,810
1,810
1,803
91,958
1,958
1,958
1,958
1,958
1,958
1,958
1,958
116
99
212
432
781
1,321
2,345
3,528
7 2, 781
629
8 276
241
491
327
256
257
318
322
250
248
250
259
243
»276
276
276
212
429
469
457
203
234
323
414
403
241
Reserve
position in
International 5
Monetary Fund
1,153
1,359
1,461
1,445
1,426
1,462
1,367
1,185
1,044
1,608
,975
L, 958
,997
,555
,690
1,064
1,035
769
«863
326
420
1,290
2,324
1,935
585
464
1,700
1,700
1,680
1,682
1,678
1,428
1,433
574
577
580
582
585
587
582
586
391
M28
434
439
444
449
454
459
464
1 From 1956 through January 1972, includes gold sold to the United States by the International Monetary Fund (IMF)
with the right of repurchase, and beginning 1965 also includes gold deposited by the IMF to mitigate the impact on the
U.S. gold stock of purchases by foreign countries for gold subscriptions on increased IMF quotas.
2 Includes gold in Exchange Stabilization Fund.
3 Includes initial allocation on January 1, 1970 of $867 million, second allocation on January 1, 1971 of $717 million,
and third allocation on January 1, 1972 of $710 million of special drawing rights (SDR) in the Special Drawing Account
in the IMF, plus or minus transactions in SDR.
* Includes holdings of Treasury and Federal Reserve System.
«The United States has the right to purchase foreign currencies equivalent to its reserve position in the Fund automatically if needed. Under appropriate conditions the United States could purchase additional amounts equal to the
United States quota.
fl Reserve position includes, and gold stock excludes, $259 million gold subscription to the Fund in June 1965 for a U.S.
quota increase which became effective on February 23,1966. In figures published by the Fund from June 1965 through
January
1966, this gold subscription was included in the U.S. gold stock and excluded from the reserve position.
7
Includes gain of $67 million resulting from revaluation of German mark in October 1969, of which $13 million represents
gain on mark holdings at time of revaluation.
8 Includes $28 million increase in dollar value of foreign currencies revalued to reflect market exchange rates as of
December
31,1971.
9
Includes $1,016 million increase in total reserve assets resulting from the change in par value of the U.S. dollar on
May 8, 1972, consisting of $828 million total gold stock, $822 million Treasury gold stock, $155 million special drawing
rights, and $33 million reserve position in the IMF.
Note.—Gold held under earmark at Federal Reserve Banks for foreign and international accounts is not included in
the gold stock of the United States.
Sources: Treasury Department and Board of Governors of the Federal Reserve System.
299
TABLE C-93.—Price changes in international trade, 1964-72
[1963=100]
1972
Area or commodity class
1964
1965
1966
1967
1968
1969
1970
1971
Third
quarter
Unit value indexes by area
Developed areas
Total:
Exports
Terms of trade i
102
100
103
100
105
100
105
101
104
101
108
101
114
102
119
101
130
102
101
99
104
101
107
101
110
102
111
103
115
103
121
101
125
99
129
94
103
101
102
99
104
101
103
100
103
101
106
101
109
100
114
101
* 117
a 102
107
106
106
103
108
103
105
100
106
99
109
100
115
101
109
90
»111
100
99
101
99
101
100
99
99
97
100
103
103
106
104
108
104
U09
»103
107
117
118
133
121
105
143
114
124
United States:
Exports
Terms of trade »
Developing areas
Total:
Exports
Terms of trade K
Latin America:
Exports
Terms of trade *
ago
Southern and Eastern Asia:
Exports
Terms of trade *
World export price indexes
Primary commodities: Total
Foodstuffs.
Coffee, tea, and cocoa..
Cereals
Other agricultural
commodities <_.
103
105
121
103
104
106
111
106
100
102
111
102
120
102
111
138
99
96
102
88
77
75
96
100
88
74
74
101
101
85
73
98
100
109
84
64
78
107
118
85
56
64
113
105
85
B 61
103
109
102
108
104
114
109
122
127
126
141
137
103
103
111
99
104
105
101
104
113
104
104
135
Rubber
104
102
103
95
Minerals
Metal ores.
102
108
103
114
92
86
97
104
114
Manufactured goods: Total«—
101
103
106
107
107
110
117
124
135
Nonferrous base metals«...
119
135
156
142
150
168
175
154
152
Fats, oils, and oilseeds.
Textile fibers
Wool
102
HI
92
90
91
104
105
* Terms of trade indexes are unit value indexes of exports divided by unit value indexes of imports.
2 Data are for second quarter 1972.
3 Excludes Japan.
* Includes nonfood fish and forest products.
« Data are for first 3 quarters of 1972.
« Data for manufactured goods are unit value indexes.
Note.—Data exclude trade of Communist areas in Eastern Europe (except Yugoslavia) and Asia.
Sources: United Nations and Department of Commerce (Bureau of International Commerce and Bureau of Resources
and Trade Assistance).
300
TABLE G-94.—Consumer price indexes in the United States and other major industrial countries.
1957-72
[1963=1001
Period
United
States
Canada
Japan
France
Germany
Italy
Netherlands
United
Kingdom
1957
1958
1959
91.9
94.4
95.2
91.7
94.1
95.1
79.3
78.9
79.8
69.6
80.1
85.0
88.1
90.0
90.9
83.2
85.5
85.1
88
90
91
86 9
89.5
90.0
1960
1961
1962
1963
1964
96.7
97.7
98.8
100.0
101.3
96.2
97.1
98.3
100.0
101.8
82.6
87.0
93.0
100.0
103.9
88.1
91.0
95.4
100.0
103.4
92.1
94.3
97.1
100.0
102.3
87.1
88.9
93.1
100.0
1D5.9
93
95
97
100
106
90.9
94.0
98.0
100.0
103.3
1965
1966
1967
1968
1969
103.1
106.0
109.1
113.6
119.7
104.3
108.2
112.0
116.6
122.0
110.7
116.4
121.0
127.5
134.1
106.0
108.9
111.8
116.9
124.4
105.8
109.5
111.1
113.1
116.1
110.7
113.3
116.9
118.5
121.6
111.0
117.4
121.4
125.9
135.3
108.2
112.4
115.2
120.6
127.2
1970
1971
19721
126.8
132.3
136.6
126.0
129.6
135.2
144.5
153.3
159.6
131.2
138.6
145.8
120.5
126.7
133.3
127.6
133.9
140.6
141.3
152.0
162.9
135.3
148.0
157.5
1970: 1
II.
III
IV
124.2
126.2
127.6
129.3
125.0
126.1
126.7
126.5
142.1
143.9
143.9
148.2
129.0
130.6
131.9
133.4
119.4
120.4
120.6
121.7
125.4
127.1
128.1
130.1
138.2
140.4
142.5
144.1
131.5
134.6
136,1
139.0
130.3
131.7
133.0
133.8
127.1
128.9
130.8
131.7
150.2
152.7
154.2
156.2
135.3
137.4
139.3
141.3
124.4
126.3
127.3
128.8
131.7
133.2
134.3
136.3
147.3
151.1
153.3
156.3
142.8
147.9
149.9
151.8
134.9
136.0
137.2
138.4
133.3
134.4
137.1
138.0
156.6
159.8
161.1
163.3
143.0
145.0
147.8
150.0
131.3
132.8
134.8
136.4
138.0
139.8
142.4
145.1
159.3
163.3
164.4
168.0
154.1
157.0
159.6
162.8
1971: 1
II
III
IV
1972: 1
II
III
IV a
.
i For United States, 12-month average; for all other countries, January-October average.
» October-December average for United States; October data for all other countries.
Sources: Department of Labor and Organization for Economic Cooperation and Development.
301
U.S. GOVERNMENT PRINTING OFFICE : 1973—O-490-000
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