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- ,ALA > GA l Wl X l ussi I < In ti Atlanta, Georgia August • 1961 Also in this issue: WINDS OF RECESSION IN MISSISSIPPI DISTRICT BUSINESS CONDITIONS SIXTH DISTRICT STATISTICS SIXTH DISTRICT INDEXES A M Iu Review New Horizons for Dairy Manufacturing? Not long ago, as you traveled through this region’s rural areas you would often see a farmer’s daughter methodically hand churning butter. In those times, farmers frequently kept a few cows to provide milk for use on the farm. When they had surplus milk they sold it to a creamery down the road. Now the churn is an item for antique collectors, and on many farms milk from “Bossy” has been replaced with milk from a spe cialized dairy farm. Although many farmers have stopped milking cows altogether, some have enlarged their herds and increased their output per cow. Therefore, even though farmers have cut the District’s dairy herd 615,000 head, production has been maintained in the last fifteen years. Meanwhile, farmers have increased their milk marketings for commercial uses, espe cially for bottling, two-thirds in this period, and their gross receipts from milk have increased 134 percent. With milk sales to bottlers and dairy product manufacturers currently bringing farmers one-fifth of all cash receipts from their livestock and poultry, the dairy enterprise stands tall in the growing livestock industry. True, further expansion in the dairy enterprise on District farms de pends greatly on the growth of local markets for top-grade fluid milk, but it also depends on the dairy manufacturing industry’s ability to pro vide a satisfactory secondary market for milk. If manufacturing firms can economically utilize locally produced milk for making hard cheese, cottage cheese, ice cream, and other dairy products, the base for the District’s dairy enterprise may be broadened and the farm economy strengthened. Milk Marketed by Farmers Sixth District States 1940 and 1958 500 Millions of Pounds 1000 1500 T e n ne ssee Florida M ississip p i Georgia L o u isia n a A la b a m a 1 S o u rce: United States Department of Agriculture. 1 .. 1. 2 000 Whether these firms can broaden the base for the en terprise hinges on their ability to deal with problems con cerning their milk supply and on their skill in adapting operations to new market conditions. Neither challenge is easily met, but there are some hopeful signs that dairy manufacturing firms are rising to the occasion. An Important Industry The dairy manufacturing industry ranks high in the foodprocessing field. According to the 1954 Census of Manu factures, it employed 12,021 people in Alabama, Louisi ana, Mississippi, and Tennessee that year and added $87 million in value to raw materials. Thus, this industry’s im portance exceeded that of the meat packing industry, which employed 7,717 people and added $44 million to raw materials. In 1957, the latest year for which data are available, there were 724 plants making dairy products in all Dis trict states. Plants making hard cheese were most numer ous, but they were concentrated largely in Tennessee and Mississippi, where most of the milk available for manu facturing was being produced. Plants manufacturing ice cream and cottage cheese were more widespread, largely because they are local-market oriented. Few manufactur ing plants were located in Florida since most of the milk there is bottled. Taken altogether, firms manufacturing dairy products provide an important market for locally produced milk. In recent years, from 30 to 40 percent of the milk mar keted by District farmers has been used for making dairy products. That used for hard cheese and evaporated milk, which are relatively low-valued dairy products, is typi cally low-priced milk produced specifically for manufac turing purposes. That used to make ice cream and cottage cheese, two high-valued items, is usually surplus highpriced milk, diverted from bottling. An Industry in Transition Striking structural changes have appeared in the District’s dairy manufacturing industry in recent years as dairy firms adjusted to changes in their milk supply and markets. Many butter plants have closed down; production declined sharply from 20 million pounds in 1945 to 14 million in 1958. Although numerous hard cheese plants have closed their doors, production rose from 49 million pounds in 1945 to 64 million pounds in 1958, as remaining plants enlarged their operations. Dairy firms also have closed many small ice cream plants and consolidated them into centralized ones that distribute over a wide area. Firms boosted ice cream pro duction from 38 million gallons in 1945 to 59 million in 1958, and their ice milk production jumped from 541,000 gallons to 20 million gallons. Supply a Problem To a large extent this transition in the dairy manufacturing industry has been forced by problems of supply. Most important, the stock of lowpriced manufacturing milk— still the principal kind used by firms making butter, evaporated milk, and hard cheese —is dwindling. Typically, manufacturing milk is produced on small farms by older farmers who milk only a few cows. Young men do not choose to produce manufac turing milk because the returns are extremely unattrac tive. According to data collected from a sample of dairy men by the Georgia Agricultural Experiment Station, total production costs in 1958 per 100 pounds of manu facturing milk for a herd of eight or more cows ranged from $2.70 to $14.19, with an average of $6.36. These dairymen, however, received an average price of only $2.73 per 100 pounds, which was $0.42 less than the national average. Whenever local producers can shift to production of fluid milk for bottling, they do so with alacrity, and this further reduces the District’s supply of manufacturing milk. Dairy manufacturing firms are also troubled by a fluc tuating and uncertain supply of milk. Most District firms are users of residual milk, so they cannot always de pend on getting the milk they need. Only when the supply of fluid milk exceeds the needs for bottling does it flow down through the scale of possibilities for manufactur ing— first to its highest-valued use in ice cream, then to cottage cheese, then to hard cheese. This flow is highly erratic, since bottled milk sales are heaviest at week end and surpluses pile up on other days. Moreover, manufac turers are plagued by the wide swings from the AprilAugust milk production peak to the winter low. These fluctuations in supply cause operating costs to rise because plants are alternately overburdened and underworked. Demand a Boon Many District dairy firms have had to realign their manufacturing activities because of the short age of low-priced milk, and they also have been respond ing to changes in demands for milk products. The trend in per capita milk consumption in the nation is down, largely because we use less butter and condensed and evaporated milk, according to the USDA. Butter con sumption per person dropped from 17 pounds in 1940 to eight pounds in 1959. Fluid milk consumption per capita currently exceeds that in 1940. People are eating more hard cheese, ice cream, and cottage cheese now than they were then. Hard cheese consumption rose from about four pounds per capita in 1940 to five pounds in 1959, ice cream consumption rose from 11 to 19 pounds, and cot tage cheese intake increased from two to five pounds. These trends reflect consumers’ changing habits and tastes, but they also reflect rising per capita incomes. When consumers become wealthier they buy more fluid milk, ice cream, and cheeses and less evaporated milk. Dairy specialists found, in a study of consumers in 12 southern cities, that a 10-percent increase in income brought a 2- to 6-percent increase in the quantity of ice cream eaten, the degree of change depending on the con sumer’s level of income. Technology Applied Also in stru m en tal in bringing about major structural changes among dairy manufactur ing firms have been technological advances in the indus try. Not least is improved refrigeration, which reduces the perishability of milk and its products. With this advantage, dairy firms are able to obtain their raw materials more readily and from a wider area and to maintain their prod uct’s quality. Furthermore, dairy firms are giving more punch to their merchandising by improving the packaging • 2 • of their refrigerated products. This has enabled them to market their products through a wider variety of outlets. Advanced technology has been especially influential in reducing the amount of labor required by ice cream and cheese plants. Major ice cream manufacturers now use a “continuous freezing” process, which together with other new techniques enables them to centralize their manufac turing in a single plant. By doing that they can economi cally produce large volumes of ice cream and a wide vari ety of ice cream products with much less labor. Looking Ahead Unquestionably, the District’s dairy manufacturing in dustry has learned to cope with its economic facts of life. By stressing high-valued items, which can absorb relatively high-priced milk, it has established a sound economic base. Dairymen, of course, benefit from improvements in the secondary markets for their milk. Still, the outlook for the industry may not be exceptionally promising. Any future growth will result from a continuation of trends that have been favorably affecting the industry. More Milk In the future, as in the past, the industry’s development will hinge on its milk supply. The upward trend in total milk produced in District states for commer cial sale will probably continue. Undoubtedly the gains will occur in milk for bottling. Some of this milk will not be needed for fluid consumption and will become available for manufacturing purposes. A potential exists for expanding milk production, be cause dairymen now are more skilled than they were fifteen years ago, they are operating larger farms, and they are fairly well financed. For these reasons, dairymen in the District may lift their output per cow from the typical 4,500-pound average to 7,000 or 8,000 pounds. If they do this, the region’s milk should become less costly and therefore more desirable to the dairy industry. Farmers may further spur their output if they continue to receive an attractive return for their high-valued milk sold for both bottling and manufacturing purposes. The possibility ap pears strongest for Alabama, Georgia, Mississippi, and Tennessee. A continual though gradual decline in the pro duction of low-priced manufacturing milk is probable in these states as dairymen further intensify their dairy enter prises. Thus, surplus fluid milk will become a more and more important source for some firms. Because milk production in Tennessee and Mississippi may continue to outrun the amounts needed for manu facturing ice cream and cottage cheese, surplus milk in those states probably will flow to hard cheese plants and condenseries in sufficient volume— especially when milk production is at the April-August peak— to keep many such plants operating in future years. Plants that are un able to maintain economical operations as their supply of low-priced manufacturing milk decreases will gradu ally close down or be consolidated with other units. Larger Markets Market demand for manufactured dairy products, considered broadly, should stimulate future growth in the industry. We can expect consumer incomes to increase further and boost the demand for high-valued dairy products. Major national cheese distributors, which now are the prime markets for many District hard cheese producers, probably will be glad to take the output from this region’s factories in years ahead. By obtaining cheese from independent manufacturers rather than operating their own plants, distributors can conserve their capital and reduce costs. If milk surpluses increase enough, some cheese factories may even expand their markets. The market for manufactured dairy products may be further expanded as firms apply more technology, improve their product’s quality, sharpen their sales techniques, and advertise more intensively. For example, dairy specialists believe that through consumer education and promotion cottage cheese sales can Jbe greatly expanded. Since cot tage cheese is a market-oriented rather than a raw materialoriented product, District firms that improve the quality of the cheese and merchandise it vigorously probably can compete strongly for the local market. Taken altogether, the demands for hi^h-valued products could be sufficiently great in future years to provide an economical outlet for considerable surplus fluid milk. Despite these possibilities for increased output and sales of manufactured dairy products in the District, an inade quate supply of low-priced milk will inhibit the industry. Most firms cannot compete strongly for milk in areas where the supply is largely used for bottling purposes, as in Florida. Even in places where surpluses of milk for bot tling may gradually increase, as in Georgia and Alabama, only firms manufacturing relatively high-valued products can hope to obtain enough milk to markedly increase their output. Manufacturers of ice cream and frozen des serts are most favored because they use relatively small volumes of milk in their products. Ice cream producers have a special advantage since they are not tied solely to the local cream supply; they can import cream and other raw materials or an ice cream mix to fill out their needs or reduce their costs. The future for hard cheese plants is more clouded. Be cause such plants require large amounts of low-priced milk for profitable operations, they may find that their reliance on surplus high-valued milk keeps them from competing with cheese plants elsewhere in the nation. At best, con sidering the declining production of manufacturing milk, we may expect only a modest increase in hard cheese production. Thus growth will come only as surpluses of bottling milk grow sufficiently large to overflow into that low-valued use. Firms making evaporated milk and butter are greatly disadvantaged by the decline in the supply of manufacturing milk, and if it continues, they will probably have to curtail their operations further. Although these eventualities do not add up to a glowing future for dairy manufacturing, the industry in all probability will remain a desirable market for this region’s milk. A r th u r H. K a n tn e r With deposits of $953,019,000 as of December 31, 1960, the Federal Reserve Bank of Atlanta ranks eleventh largest among the Central Banks of the Free World. During July 1961 the five offices of this Reserve Bank handled 24,216,000 checks amounting to $8,057,678,000. • 3 • ECONOMIC INDICATORS Mississippi 1111111 m 111111111111111111111111111111111111111111111111111 Nonfarm Employment Mfg. Employment II111 11li I I 1111 n 111 i n 111111111111111111111111111111111M1 1 1957 1958 1959 I960 1961 Winds of Rec Mississippi was spared the brunt of the recessionary storm that struck the nation’s economy during 1959 and early 1960. True, some strong gusts rocked the state, but the center was elsewhere— in the major manufacturing areas of the North and East. Clouds showed signs of breaking up even before 1960 was over, despite forecasts that un settled economic weather in the nation would continue. We don’t know enough about the myriad of ties that link the economies of various regions to understand fully how a state, or other area, will react to foul economic weather— to the recurring periods of recession. We do know, though, that the type of recession tells us a good deal about the effect it will have on various regions. For example, if the recession is bred of an inventory adjust ment, as was the one of 1959-60, we know that the storm warnings will go up first in the manufacturing centers that produce the automobiles, the steel, the other goods that are overstocked. Since our economic regions are tied to gether, if one of them stumbles the others are bound to receive a frightening tug. But unless the mood of business men and consumers turns sour and spending degenerates, such economic storms are likely to be short-lived. As in the nation, the strongest winds struck the manu facturing component of Mississippi’s economy. Employers laid off 5.4 percent of their employees during the recent recession, which lasted roughly from May 1960 to Febru ary 1961. Manufacturing payrolls also declined appreci ably, 3.8 percent. Judging from employment, manufac turers of apparel, lumber and wood products, and trans portation equipment suffered more than other types. Weakness in lumber and wood products and apparel manufacturing was especially telling, since they employ more workers than any other two of the state’s industries taken together. Not all the employment decreases in lum ber and wood products and in transportation equipment stemmed from the recession. Some were associated with special weakness, e.g., the downdrift in construction and in shipbuilding, both of which began before the storm. Nonmanufacturing industries undoubtedly felt some of the recession’s side effects, but in none of them did em ployment appear to have been greatly affected. In fact, employment increases in nonmanufacturing industries were more than sufficient to absorb the number laid off from manufacturing jobs. Most of the pickup in nonmanu facturing occurred between August 1960 and January 1961 and represented gains in retail trade and service in dustries and in state and local governments. As a result, more Mississippians were employed outside agriculture in January 1961 than they were before the recession began. The agricultural component of Mississippi’s economy was relatively unaffected by the recession. Farm incomes appeared to hold up well during 1960. Employment, which has been declining steadily for several years, leveled off during 1960. This reversal of trend reflected in part the demands for more farm workers to handle increased output of principal crops, especially cotton. The rest of the South and the nation generally were not • 4 • i in Mississippi as fortunate as Mississippi during the recession. Nonfarm employment in the six states that comprise the District, for example, dropped throughout the recession, and even by June the total had not regained the May 1960 level. The same pattern applies to the nation, where the nonfarm employment total is slightly below the May 1960 mark. Every storm has disturbing updrafts around its center, and in Mississippi they had their greatest effect on the mood and capacity of consumers to spend. For whatever reason, loss or threatened loss of jobs or uncertainty about the future, merchants saw their sales dive. Department store sales, for example, have trended downward since mid-1959. Furniture store sales also fell during the reces sion from levels that had been stable for several months. The weakness in spending is also confirmed by the decline in sales tax receipts by the State of Mississippi. This gauge, which provides a measure of spending of all types, declined about 5 percent from early 1960 to early 1961. Bank debits, a measure of total spending by check, also weakened during 1960 and early 1961. The state’s bankers felt some of the gusts of the reces sion. These took the form of a slackening in the demand for bank loans by businesses and consumers. Total loans at member banks located in the District portion of the state were almost level between February and November 1960. This period of stability followed a period of steady loan increases beginning in 1957. The sluggishness in de mand, coupled with easier credit policies by the Federal Reserve System, brought about an increase in reserves available to the state’s bankers. Thus, bankers were able to add to their holdings of securities and raise their liquid ity, which had been drawn down sharply during the periods of loan increases. Deposits at banks in the state generally followed the national pattern during the recession. Member banks watched their deposits trend downward for the first eight months of 1960. Thereafter, deposits rose through the end of the year, and they have continued to increase in recent months. The corresponding deposit rise in the nation stemmed from the purchase of securities by banks, and Mississippi’s gain represented the participation of the state’s bankers in this deposit creation. Manufacturing employment and payrolls have shown marked increases during recent months, although both are still below pre-recession levels. That there have been addi tions of workers in food processing is especially encourag ing. Nonmanufacturing employment, on the other hand, has trended downward for the last few months, despite the strong gains during the latter part of the recession. Nonfarm employment, therefore, has exhibited a sidewise movement since January. The mood of consumers is still cautious, and spending has only recently begun to show signs of sustained recovery. To a considerable extent the course of the state’s economy in the next few months will be charted by de velopments in the nation. Practically everyone agrees that we have been in a period of recovery for several months, but there are widely differing opinions among economists about how rapid the national recovery will be. Neverthe less, Mississippi can expect a considerable boost to its economy during the months ahead if the forces of re covery mount. Equally important for Mississippi’s future are the forces of economic growth at work in the state. Observers noted long ago that recessions tend to be milder and recoveries stronger in an economy that is growing than in one that is in a long-term decline. In Mississippi, where farm em ployment has trended downward for several years, eco nomic growth has taken place through an expansion of jobs off the farm. The state’s nonfarm employment, for Employment in Mississippi 1953-61 Percent Percent example, rose 16 percent between 1953 and the end of 1960. Manufacturing employment increased at an even faster rate during this period, 18 percent. The increase in manufacturing employment exceeded both the perform ance of the U.S. and that of the District. The growth trend in the state’s economy, illustrated by employment increases, helps to explain the comparative mildness of the recession there. It also places the state in a favorable position for a strong recovery. In this, connec tion it is encouraging to note that Mississippi continued to gain new manufacturing plants right through the recession and that the number announced so far in 1961 has been impressive. Despite these indications of good economic weather for Mississippi in the months ahead, we should note that all sectors may not share fully in the expansion. Retail spend ing, for example, is apparently not increasing appreciably. Also, it might be some time before some types of manu facturing enjoy the fruits of expansion because of special circumstances in those industries. Then, too, we do not know whether expansion will proceed at a rapid enough rate to absorb the number of persons entering the labor force in search of nonagricultural jobs. W. M. D a v is This is one of a series of articles in which economic devel opments in each of the Sixth District states are discussed. Developments in Georgia’s economy were analyzed in the May R e v ie w , and a discussion of Alabama’s economy is scheduled for the September issue. •5 • Debits to Individual Demand Deposit Accounts (In Thousands of Dollars) READINGS IN SOUTHERN FINANCE I. S o urces o f F u n d s in th e S o u t h e a st . II. C r ed it N eed s of fo r Percent Change C a pit a l I n v e s t m e n t B u s in e ss B orrow ers an d June 1961 L e n d in g P olic ies a n d P rac tices of C o m m er c ia l B anks in the S o u th ea st III. T h e G e n ie in the B o tt l e — A C o n t em po r a r y V ie w of A m e r ic a ’s P o stw a r E c o no m y IV . E ssays on S o u t h e r n E co no m ic G ro w th Each o f these studies is available upon request to the Research Department, Federal Reserve Bank o f Atlanta, Atlanta 3, Georgia. Bank Announcement The St. Armands Palmer Bank, Sarasota, Florida, a newly organized nonmember bank, opened for business July 1, and began to remit at par for checks drawn on it when received from the Federal Reserve Bank. Officers are Benton W. Powell, President; John J. Kelleher, Vice President; and William H. Pritchard, Cashier. Capital totals $350,000, and surplus and undivided profits $200,000. Department Store Sales and Inventories* Percent Change Sales Place June 1961 f rom May June 1961 1960 ALABAMA . . . . —9 Birmingham . . . —9 M o b ile ....................... —8 Montgomery . . . —9 F L O R ID A ....................... —2 Daytona Beach . . +1 Jacksonville . . . —6 Miami Area . . . +2 Miami . . . . —4 Orlando....................... —2 St. Ptrsbg-Tampa Area —5 G EO RG IA....................... —10 Atlanta** . . . . —12 Augusta . . . . —8 Columbus . . . . —5 M a co n ....................... —12 Rome** . . . . +0 Savannah . . . . +3 LOUISIANA . . . . —8 Baton Rouge . . . —7 New Orleans . . . —8 MISSISSIPPI . . . —8 Jackson ....................... —9 Meridian** . . . —8 TENNESSEE . . . . —10 Bristol-KinqsportJohnson City** . —7 Bristol (Tenn. & Va.) ** + 3 Chattanooga . . . —14 Knoxville . . . . —6 D ISTR IC T....................... —7 —1 —1 —3 —5 +5 +1 +7 +5 —5 +2 —3 +1 +0 +8 +6 —0 +7 +2 —2 +3 —2 —7 —7 —1 —2 Inventories 6 |\/ionths 1961 from 1960 —1 —2 +0 —8 +5 —3 +6 +6 —7 —3 —2 —3 —3 +2 —1 —2 —3 —7 —1 +2 —1 —4 —6 —1 —2 June 30,1961 from June 30 May 31 1960 1961 —6 —5 +0 +7 —6 +5 —5 + 28 —5 —4 —3 —7 +0 +2 —7 —3 —3 —7 —7 —6 —7 —1 —0 —2 —2 +0 —9 — 12 — 12 —8 —6 —2 —4 +2 —1 —0 —7 +1 +o —6 +0 +o —4 +1 ♦Reporting stores account for over 90 percent of total District department store sales. **In order to permit publication of figures for this city, a special sample has been constructed that is not confined exclusively to department stores. Figures for non department stores, however, are not used in computing the District percent changes. ALABAMA Anniston . . . . Birm ngham . . . Dothan . . . . Gadsden . . . . Huntsville* . . . Mcb'le . . . . Montgomery . . . Selma* . . . . Tuscaloosa* . . . Total Reporting Cities Other Citiesf . . . FLORIDA Daytona Beach* Fort Lauderdale* . Gainesville* . . . Jacksonville . . . Key West* . . . Lakeland* . . . Miami . . . . Greater Miami* Orlando . . . . Pensacola . . . St. Petersburg . . Tampa . . . . W. Palm-PalmBch.* Total Reporting Cities Other Citiesf . . . GEORGIA Albany . . . . Athens* . . . . Atlanta . . . . Augusta . . . . Brunswick . . . Columbus . . . Elberton . . . . Gainesville* . . . Griffin* . . . . LaGrange* . . . Macon . . . . Marietta* . . . Newnan . . . . Rome* . . . . Savannah . . . . Valdosta . . . . Total Reporting Cities Other Citiesf . . . LOUISIANA Alexandria* . . . Baton Rouge . . Lafayette* . . . Lake Charles . . New Orleans . . Total Reporting Cities Other Citiesf . . . MISSISSIPPI Biloxi-Gulfport* Hattiesburg . . . Jackson . . . . Laurel* . . . . Mer dian . . . . Natchez* . . . . Vicksburg . . . Total Reporting Cities Other Citiesf . . . TENNESSEE Bristol . . . . Chattanooga . . Johnson City* . . Kingsport* . . . Knoxville . . . Nashville . . . Total Reporting Cities Other Citiesf . . . SIXTH DISTRICT Reporting Cities Other Citiesf . . Total, 32 Cities . . May 1961 June 1960 Year-to-date 6 Months June 1961 from 1%1 June from May 1960 1960 1961 45,325 849,177 38,678 35,487 69,754 313,895 172,592 26,263 60,634 1,611,805 748,755 45,103 970,794 38,963 38.024 74,853 319,374 201,993 26,799 63 637 1,779,540 821,965 42,279 838,242 34,315 37,700 62,516 308 479 161,180 25,425 52,534 1,562,670 732,139r +0 — 13 —1 —7 —7 —2 — 15 —2 —5 —9 —9 +7 +1 + 13 —6 + 12 +2 +7 +3 + 15 +3 +2 +3 +3 +7 —5 + 11 +1 +5 +2 +4 +3 +1 53,114 200,569 43,019 833,265 16,769 83,100 863,841 1,298,032 253,640 85,773 218,542 427,776 143,747 3,657,346 1,600,203 56,895 217,090 43,481 884,036 17,672 83,671 945,336 1,413,290 267,905 88 961 227,412 442,607 151,474 3,894 494 l,696,950r 57,815 203,602 43,819 885,307 16,145 80,309 897,275 1,314,965 262,923 92,131 210,931 435,222 133,273 3,736,442 l,558,151r —7 —8 —1 —6 —5 —1 —9 —8 —5 —8 —1 —2 —6 +4 +3 —4 —1 —4 —7 +4 —2 +8 —2 +3 —4 —2 +2 +1 +7 +3 +3 +2 —3 —3 —5 —0 +6 +1 +3 52,343 45,879 2,184,965 113,162 27,361 112,862 8,829 50,343 19,963 17,180 126,664 34.765 21,878 47,331 180,964 33,132 3,077,621 977,643 56,518 45 584 2,250,295 110,229 27,017 115,139 11,115 52,368 20.386 17,202 133,841 31,339 18,745 51,001 201,161 36,339 3,178,279 1,002,102 51,501 41,382 2,152,688 109,344 23,508 105,617 10,260 50 548 20,072 19,031 122,952 32,652 19,894 48,683 206,731 33 901 3,048,764 898,665r —7 +1 —3 +3 +1 —2 —21 —2 —0 —5 +11 + 17 —7 — 10 —9 —3 —2 +2 +11 +1 +3 + 16 +7 — 14 —0 —1 — 10 +3 +6 +10 —3 — 12 —2 +1 +9 +1 +*> +2 —1 +8 +5 —4 +3 +3 — 12 +1 +1 —0 +3 —6 +0 +2 +5 70,000 262,204 60,137 79,661 1,429,291 1,901,293 534,687 68,947 278,097 62,684 82,295 1,440,402 1,932,425 562,015r 75,879 273,117 61 015 82,202r 1,399,825 l,892,038r 508,285r +2 —6 —4 —3 —1 —2 —5 —8 —4 —1 —3 +2 +0 +5 —6 —5 +1 —7 —0 —2 —1 50,599 38,388 286,680 27,900 44,951 22 575 20,311 491,404 287,004r —1 —3 —5 —1 —8 +0 —2 —4 —0 +8 —1 +8 +6 —1 +3 + 10 +6 +1 +8 —0 +8 —3 +0 —2 +6 +6 —2 48,008 48,113 351,016 345,699 44,817 41,281 84,848 85,233 248,799 262,888 723,820 827,395 1,615,821 1,496,096 519,151r 565,313r 17,882,165r 16,730,809r 12,942,936 12,227,414r 4,939,229r 4,503,395r 11,107,229 10,506,172r +7 —0 +6 + 12 —1 —5 —2 +2 —4 —5 —4 —5 +7 +1 —2 +12 +5 +8 +6 + 11 +2 +1 +5 +1 +8 +1 —3 +1 +4 +5 +4 +6 +2 +1 +3 +1 +1 +8 +7 54,458 37,897 308,490 29,629 44,617 23.220 22,414 520,725 290,562 51,405 350,040 43,917 95,281 260,566 782,480 1,583,689 575,053 17,079,382 12,352,479 4,726,903 10,577,811 55,114 38,985 323,925 29,864 48.440 23,170 22,879 542,377 290,884 — o, —4 —3 —5 —6 —6 -A UNITED STATES 344 Cities . . . 272,083,000 268,910,000 250,852,000 * Not included in total for 32 cities that are part of the national debit series maintained by the Board of Governors. f Estimated. r Revised. • 6 • S ix th D is t r ic t In d e x e s Seasonally Adjusted (1947-49) = 100) I9 6 0 SIXTH DISTRICT | 1961 MAY JUNE JULY AUG. SEPT. OCT. NOV. DEC. JAN. FEB. MAR. APR. MAY JUNE Nonfarm Employment.................................. 144 Manufacturing Employment . . . . 126 A p p a re l................................................... 198 C h e m ic a ls..............................................137 Fabricated Metals .............................196 F o o d .........................................................118 Lbr., Wood Prod., Fur. & Fix. . . . 80 Paper ................................................... 170 99 Primary M e t a l s .................................. T e x tile s ................................................... 88 Transportation Equ'pment . . . . 210 Nonmanufacturng Employment . . . 151 Manufacturing Payrolls ............................. 230 Cotton Consumption**.................................. 94 Electric Power Production**....................... 366 Petrol. Prod, in Coastal Louisiana & Mississ p p i* * ....................... 222 Construct'on C o n tra c ts * ....................... 351 Residential................................................... 384 All Other ................................................... 325 Farm Cash Receipts........................................132 Crcps...............................................................I l l Livestock ................................................... 185 Department Store Sales*/** . . . . 176 Department Store Stocks*............................. 222 Furniture Store S a l e s * / * * .......................145 Member Bank D e p o s its * .............................180 Member Bank L o a n s * .................................. 349 271 Bank Deb t s * ................................................... Turnover of Demand Deposits* . . . . 163 In Leading C it ie s ........................................181 Outside Leading C i t i e s .............................126 ALABAMA Nonfarm Em ploym ent.............................126 Manufacturing Employment . . . . 108 Manufacturing Payrolls.............................196 Department Store S a le s * * ....................... 163 Furniture Store S a l e s .............................128 Member Bank Deposits.............................159 Member Bank L o a n s .................................. 298' Farm Cash R eceip ts.................................. 131 Bank Debits .............................................. 239 FLORIDA Nonfarm Em ploym ent............................. 203 Manufacturing Employment . . . . 209 Manufacturing P ayrolls............................. 389 Department Store S a le s * * ....................... 260 Furniture Store S a l e s .............................175 Member Bank Deposits............................. 235 Member Bank L o a n s.................................. 551 Farm Cash R eceip ts.................................. 225 Bank Debits .............................................. 395 GEORGIA Nonfarm Em ploym ent.............................137 Manufacturing Empfoyment . . . . 124 Manufacturing Payrolls............................. 226 Department Store S a le s * * .......................169 Furniture Store S a l e s .............................133 Member Bank Deposits.............................160 Member Bank L o a n s.................................. 275 Farm Cash R eceip ts.................................. 144 Bank Debits .............................................. 252 LOUISIANA Nonfarm Em ploym ent.............................132 Manufacturing Employment . . . . 96 Manufacturing P ayrolls.............................184 Department Store Sales*/** . . . . 151 Furnture Store S a le s * .............................175 Member Bank Deposits* .......................159 Member Bank L o a n s * ............................ 334 Farm Cash Receipts.................................. 101 Bank D e b its * .............................................. 225 MISSISSIPPI Nonfarm Em ploym ent.............................136 Manufacturing Employment . . . . 137 Manufacturing P ayro lls............................. 247 Department Store Sales*/** . . . . 156 Furn ture Store S a le s * .............................113 Member Bank Deposits* .......................199 Member Bank L o a n s * ............................. 429 Farm Cash R eceip ts.................................. 105 Bank D e b its * .............................................. 224 TENNESSEE Nonfarm Em ploym ent.............................127 Manufacturing Employment . . . . 127 Manufacturing P ayro lls............................. 228 Department Store Sales*/** . . . . 146 Furniture Store S a le s * .............................I l l Member Bank Deposits* .......................163 Member Bank L o a n s * ............................ 309 Farm Cash R eceip ts.................................. 95 Bank D e b its * .............................................. 241 143 126 198 138 196 117 79 167 99 88 205 151 233 93 375 143 126 199 137 196 117 78 169 97 89 197 150 236 93 382 143 125 1% 137 197 117 78 166 95 88 199 150 228 90 385 143 124 193 132 193 120 77 167 91 87 199 150 221 85 373 142 123 188 131 190 119 76 166 92 86 205 150 220 83 372 142 122 188 131 188 117 76 165 88 85 185 150 217 83 369 141 122 189 133 189 116 75 164 89 85 190 149 218 79 390 142 121 187 133 191 118 73 163 86 84 191 150 213 78 401 141 121 187 133 189 118 73 164 87 84 190 150 212 79 383 141 121 186 134 184 118 73 165 86 83 183 149 214 79 368 141 121 190 135 185 118 74 166 87 84 187 149 220 82 376 142 122 191 135 185 117 74 167 91 84 188 150 225 85 379 142 123 194 136 185 118 74 168 92 85 191 150 232 88 n.a. 220 371 387 359 132 98 192 184r 227 145 180 349 281 159 183 119 220 370 376 365 127 83 194 194 227 147 183 351 265 162 179 129 221 361 367 357 155 147 189 178 232 142 183 354 280 167 190 124 223 353 362 346 149 134 188 185 230 135 185 3*3 285 158 175 120 232 337 364 316 167 157 186 189 231 141 188 353 265 152 159 113 233 322 305 336 156 131 201 179 235 139 188 352 284 153 162 111 250 286 300 276 132 94 199 187 233 134 189 359 282r 151 163 119 239 307 286 324 134 97 191 177 224 133 189 351 288 162 176 125 237 313 326 303 145 123 191 181 221 123 192 355 279r 156 168 116 241 323 341 309 136 104 205 178 221 118 189 353 294r 155 167 122 244 344 361 330 126 99 189 183 229 137 191 354 268r 146 164 111 224 361 392 337 136 113 192 175 225 127r 191 357 289r 165 183 127 249 n.a. n.a. n.a. n.a. n.a. n.a. 185 227 128p 189 355 287 154 175 119 126 108 199 171 127 159 293 123 244 126 108 200 178 126 160 291 124 233 126 107 192 170 119 162 293 123 255 125 105 182 166 117 164 292 150 255 125 103 187 166 120 169 293 182 241 125 103 183 155 110 165 294 130 249 124 102 175 165 111 167 299 121 243r 125 101 175 158 109 169 300 115 247 123 101 175 156 105 170 299 126 238 123 101 177 166 99 167 303 133 248 123 102 183 173 131 169 298 115 231 124 102 185r 163 . lO lr 163 304 126 264 125 103 195 168 111 162 301 n.a. 251 202 209 392 264 167 236 553 187 431 202 208 407 277 167 242 557 204 390 202 208 403 263 203 240 564 270 427 202 208 392 256 172 241 560 248 418 201 207 399 261 156 246 561 212 405 201 207 384 268 168 248 551 196 420 201 208 384 276 164 250 560 232 413 200 206 368 264 156 247 550 266 414r 200 207 374 2*4 149 252 556 264 396r 200 209 373 287 145 247 556 197 413r 200 209 392 269 156 248 550 227 377r 202 211 406r 263 147 250 559 244 421 r 203 213 414 277 148 247 555 n.a. 428 136 123 223 164 135 160 275 150 263 136 123 228 175 134 161 278 125 252 135 123 220 159 137 164 286 215 259 135 121 213 168 134 166 288 160 274 135 121 211 172 144 170 286 204 250 134 118 205 158 138 169 291 120 259 134 119 205 164 135 170 289 148 257 134 117 199 157 123 169 285 144 265 134 116 200 155 120 173 2^2 152 255 133 116 203 166 124 172 292 171 267 134 117 205 155 132 172 290 149 246 134 118 215r 166 129 175 292 144 267 134 119 217 166 127p 173 291 n a. 270 131 95 181 161 184 158 334 119 242 131 96 182 159 203 161 335 102 216 130 95 181 152 145 159 334 91 230 129 94 173 148 161 164 332 113 250 129 94 170 151 159 163 329 115 212 128 93 168 140 167 164 323 137 225 128 93 175 155 172 166 331 113 234 129 92 177 151 164 165 319 93 210 129 91 173 151 152 167 322 103 207r 128 92 177 155 139 163 314 104 234r 128 91 180 149 156 169 331 98 213r 129 91 179 149 166r 166 324 105 230r 128 90 181 157 158 167 326 n.a. 246 135 136 257 177r 107 197 431 97 245 135 135 256 175 112 198 433 104 243 134 134 250 153 100 194 425 98 255 135 132 238 149 95 196 431 121 253 135 132 242 158 84 204 431 141 242 135 133 239 151 101 199 433 162 258 134 131 240 164 124 209 460 136 254 137 130 244 149 93 204 442 86 238 136 129 237 146 92 205 446 99 234 136 130 241 154 101 207 442 116 256 136 132 244 157 88 208 449 90 236 137 134 243 153 91 210 455 99 243 136 135 256 165 99p 208 451 n.a. 256 127 127 229 155 107 165 309 102 238 127 128 230 167 93 170 313 109 230 127 127 231 151 98 167 314 113 240 126 128 224 157 96 166 311 106 238 126 126 221 164 97 171 313 122 224 125 124 218 156 98 169 314 143 247 124 123 217 157 96 170 328 86 236 124 123 215 147 83 170 315 96 248r 124 123 216 154 89 176 319 99 243r 124 123 216 151 92 176 310 99 255r 124 123 222 147 103 175 311 101 233r 125 124 224r 141 96 174 315 96 258r 125 125 229 152 89 175 312 n a. 255 *For Sixth District area only. Other totals for entire six states. **Daily average basis. n.a. Not Available. p Preliminary. r Revised. Sources: Nonfarm and mfg. emp. and payrolls, state depts. of labor; cotton consumption, U.S. Bureau of Census, construction contracts, F. W. Dodge Corp., petrol, prod., U.S. Bureau of Mines; elec. power prod., Fed. Power Comm. Other indexes based on data collected by this Bank. All indexes calculated by this Bank. • 7 • D IS T R IC T I < > ><< I > I I 1 9 4 7 -4 9 = 100 Seas' Ad‘ I I I I I | ___ I I I I I I 1 It I I I I I I | I I I I I M 1 B U S IN E S S C O N D IT IO N S I Nonfarm Employment I he District's economy continues to record modest gains. On a season ally adjusted basis, most economic indicators have been moving upward. Addi tions to manufacturing employment and a further lengthening of the work week reflect expanding output. Employment in nonmanufacturing industries has been rising more slowly than in manufacturing. Activity on the farm is at a high level, and prospects for farm production are good throughout the Southeast. Nevertheless, gains in the economy have not been uniform throughout the District. Electric Power Production Nonfarm employment improved further in June. Gains were registered in both manufacturing and nonmanufacturing. Within manufacturing, small increases were general among the major types of activity. Employment figures are still well below earlier high levels. The generally improved level of nonfarm employment since March has largely reflected gains in Florida, Alabama, Georgia, and Tennessee, while relatively little change has occurred in Mis sissippi and Louisiana. Construction employment improved in June for the second consecutive month, and increases in construction contracts, representing projects to be started soon, may presage further rises. Cotton textile activity continued to improve substantially in June, as indicated by the third successive monthly rise in the amount of cotton consumed. 336 ^ The farm component of the economy is also faring well. Farm employment increased more than seasonally during June, partly because field work normally done in other months had been delayed by wet weather. Farm cash receipts have been running slightly ahead of year-ago levels, reflecting both larger marketings and strengthening prices for some products. Recent gains, though small, in both the agricultural and nonagricultural sectors have buoyed incomes. Consumers appear to be responding by _ \# increasing their spending. Latest sales tax collections in District states indicate improvement in retail sales. Department stores recorded a strong sales gain during June and according to preliminary figures may have set a new record in July. Furniture store sales rose moderately in June, but sales at household appliance stores were unchanged. )S iS \ I Dept. Store y Sales V Consumers do not appear to be stepping up their use of instalment credit. Instalment credit at commercial banks rose less than usual during June, and only moderate gains were noted at retail outlets. Loans for home improve ments and the purchase of consumer goods other than autos remained weak, but auto lending by commercial banks continued to show signs of picking up. Member Bank Loans 299" ^ Member Bank Deposits PER C EN T OF R EQ U IR ED Recent gains in economic activity still have not been translated into higher loan demands at District banks. Total loans, seasonally adjusted, RESER V ES vS^4 I I I I II I I II II I I I I II I I l I I l 1959 1960 O dropped in June following an increase the previous month. All District states except Louisiana registered decreases. Total deposits declined more than usual in both May and June. Excess reserves at member banks are still relatively high, and borrowings from the Federal Reserve Bank are nominal.
@FedFRASER