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In i s issue: M anufacturing G rowth " D o w n South" P etroleu m : A G usher for th e Sou theast District Banking N o tes District B usiness C ond ition s E rra ta sh eet fo r page 130 of A u g u st 1972 M O N TH LY R E V IE W M a n u fa c tu r in g G ro w th "D o w n S o u th ” by W illiam D. Toal M e n t io n in g o b servers and t h e S o u t h e a s t 's in d u s t r ia liz a t io n r o c k e t b la s t s fr o m th e g ro w th o f lo w - w a g e la r g e la s t d e c a d e 's c it ie s . F u r t h e r m o r e , o n e c e n te re d in lo w -w a g e A s u n cover so m e m an y o b servers h ave s p e c t a c u la r , w h e t h e r o n e in c r e a s e in in In fa c t, th e h ig h gro w th m a t c h in g th e g r o w th a b o u t o n e -h a lf o f th e th e n a t io n a lly . T o to h e lp D a ta us p u t th e se gro w th w it h illu s t r a t e : ad van ced gro w th in S o u t h e a s t e r n "d o w n S o u t h '' h a s b e e n o n p e rc e n tage c o n tin u e d fa ste r th a n th e g a i n s in n a t io n a lly . m a n u fa c tu r in g jo b s c a m e n a t io n a lly , c lo s e j o b s c o n t i n u i n g t o fa ll o f e x is tin g o n e s a re n o t th e o n ly e v id e n c e o f r a p id B y t h is m e a s u r e n a t io n a lly a ls o , S o u t h e a s t e r n to it w a s o n l y th e e m p lo y m e n t p a tte rn s f o llo w e d th e a c tu a l n u m b e r o f fa rm at a fa ste r rate th a n be th e in itia l th a t o f th e p a s t o r w ith B ase d r a t e in n o n m a n u f a c t u r i n g j o b s ; a c t iv it y . by in itia l im p r e s s io n s in t h e S o u t h e a s t . F a c t o r y p a y r o l l s m e a s u r e t h e d i r e c t e a r n i n g m a n u fa c tu r in g lo c a t e d w o u ld p u b lis h e d e m p lo y m e n t g a in s b r o u g h t a b o u t b y th e o p e n in g o f n e w th e e x p a n s io n m ig h t be m a n u f a c t u r in g d u r in g th e S ix t ie s e x p e r ie n c e d F ift ie s a n d rate gro w th in s t a n c e s c o n f ir m in g o u r n o te d , m a n u fa c tu r in g a s g re a t. O t h e r w is e , F ift ie s , w i t h R a p id in m an y c e n te rs, n o tio n s s u r p r is e s . m a n u fa c tu r in g jo b s, S o u th e a s te rn fa s t e r in c r e a s e s t h a n p a tte rn s, o n e Is t h is , in fa c t , t h e c a s e ? c o m p a r e s t h is g r o w t h m a n u fa c tu r in g o f th e se p ic t u r e . F o r e x a m p le , m ig r a t io n m a n u fa c tu r in g jo b C o m m e rce fin d in g s , t h o u g h im p r e s s io n s , d o m in d s o f m a n y m ig h t e x p e c t th a t m o s t o f t h is g r o w t h in d u s t r ie s . U .S . D e p a r t m e n t o f L a b o r a n d t o th e te st. T h e r a p id n o n e in c o m p le t e o f t h e S o u t h e a s t 's p a s t r u r a l- t o - u r b a n e x p e c t m o s t o f th e in g iv e a n in t h e r is e o f m e t r o p o l i t a n m a n u fa c tu r in g .1 A lt h o u g h a r e m y t h ic a l, in itia l im p r e s s io n s c a n b e cau se c o n ju re s u p F l o r id a 's E a s t C o a s t , t h e th e tre n d ( T a b l e 1 ). p la n t s a n d by in d u s t r ia liz a t io n p o w e r p r o v id e d m a n u fa c tu r in g by has in t h e S i x t i e s a s , i n d e e d , it h a s d u r in g th e e n tir e p o s t w a r p e r io d . 'T he Southeast is defined here as encom passing those states entirely or partially within the Sixth Federal Reserve District: Alabama, Florida, Georgia, Louisiana, M ississippi, and Tennessee. Monthly Review, V o l . upon L V II, N o . 8. F re e s u b s c r i p t i o n a n d a d d i t i o n a l c o p i e s a v a i l a b l e r e q u e s t to t h e R e s e a r c h D e p a r t m e n t , F e d e r a l R e s e r v e B a n k o f A t la n t a , A t la n ta , G e o r g ia 3 0 3 0 3 . 130 M O N T H L Y REVIEW M a n u fa c t u r in g gro w th th rou gh expanded m o st of at th e a v ig o r o u s pace 1960 = 100 Seas. adj. J/' / 240 / // A ^ 7 - 220 r~ '' P ro d u c tio n f o r s o m e o f t h is in d u s t r ia l g r o w t h . P r o b a b ly m o r e im p o r t a n t , S ix t ie s h o w e ve r, re so u rce s th at m a t e r ia ls . have - 200 - 1 80 as expanded, fa c t o r ie s have have b u ilt to been fo r m a n u fa c tu r e d in it ia l e x p a n s io n s t im u la t e d t h is , tu rn , r e g io n a l G a in s >64 ’6 6 ’68 ’70 in sta n d a rd in g se c to r, fa c t u r in g A n o th e r p r o v id e d m easu re by of m a n u fa c tu r in g v a lu e - a d d e d d ata Census of Manufacturers. ad d e d m e a su re s m in u s th e ad d e d th u s th e co st o f th e in d o l l a r s ) F ift ie s , t h e S ix t ie s s a w rate th a n n a t io n a lly . im p r e s s io n s "d o w n o f in t h e ju st h a p p e n th e b u t ste m m e d S o u th e a st gro w th . A la r g e th at p o o l p r o b a b ly p r o v id e d o u tp u t p a r t ic u la r ly th a n th e re th e fo r n e w C e n su s 1967, an nual 170 m o re p e rc e n t in in c o n fir m s c o n d itio n s our not p re se n t m a n u fa c tu r in g p r o v id e d th e th is S o u th e a ste rn gro w th b ase to o n ly in 1958, in 81 tu rn , 0 th a n 10 in t h e % change 20 th e jo b s in c r e a s e d p e rc e n t o f th e be o n ly 7 S o u th e a st; p a y . V a r i a t i o n s in t h e g iv e n m a n u fa c tu r in g o f th e c o u n try 1967 30 40 fo r in d u s t r ie s is p o s s i b l y o n e average 87 pay O b v io u s ly , s ig n ific a n t fa c t u r in g by o u tp u t la r g e g a in s S o u th e a ste rn in pay to tal am o u n te d in 1967; M a n y e x p la d iff e r e n c e s in " m ix " o r im p o r t a n c e in d iffe r e n t p a rts o f th e m o r e im p o r t a n t . in m a n u fa c tu r in g m ix m a n u fa c tu r n a t io n a l fig u r e .2 T h u s , d is c r e p a n c y average to th e gro w th , pay in S o u t h e a s t e r n p e rc e n t o f th e b e a t t r ib u t e d S o u th e a ste rn average th e se a b o u t 3 0 p e rc e n t o f th e can n a t io n S o u th e a ste rn p e rc e n t. average n a t io n a l a n d U .S . ye ars e x p e n d it u r e s w e r e n a t io n a l 2-V 2 can o n ly in e q u ip e q u ip m e n t m o r e -r a p id -t h a n -n a tio n a l m a n u fa c tu r in g it w a s in g to o n ly fa ste r p la n t a n d r a is in g n a t io n s of heavy an d pay. D e s p it e r a p id r a is e s t h e r e la t iv e ly p la n t fo ste re d a th e a d d it io n s fro m t h is , m a n -h o u r; average m an u in ( m a n u fa c t u r in g ) n e w 1 27 p e rc e n t. T h e se im p o r t a n t la r g e ju d g in g per in of m a n u fa c tu r F o r t ie s a n d m a n u fa c tu r in g d id m a n u fa c tu r in g in d ic a t iv e th e n a t io n a lly w e re c a p ita l, S t ill, a d j u s t i n g f o r d if f e r e n c e s So u th e a ste rn m o st by are gro w th . th a t S o u th e a s te rn m o re t im e , rose to tal S ix t ie s . B e tw e e n s p e n d in g (i.e ., e m p lo y m e n t ) m easu red th is la b o r is e x p e n d it u r e s and pay by m a n u fa c tu r in g in d ic a t e s sam e in d iv id e d o f liv in g an d a l l y , it r o s e in S o u t h go o d s; in M a n u fa c t u r in g P a y p r o d u c t iv it y , s t im u la t e d o f advan ce m a n u fa c tu r in g at fro m m e n t. fo r m a n u fa c tu re d fu rth e r m a n u fa c tu r in g w h ic h of a ls o o f v a lu e S o u th ." in th e of 1958 p ro d u ce d to ta l m a n u fa c tu r in g O f c o u r s e , t h is g r o w t h in th e a p a y r o lls m a n u fa c tu r in g cre a se s in flu e n c e s th e o t h e r s in c e th e b y th e ad d e d gro w A g a in , r a p id in in is v a lu e gro w th gro w th v a lu e m a n u fa c tu r in g sta te d , o u tp u t ge n e rate d m a n u fa c tu r in g se c to r. A s e a ste rn of m a t e r ia ls . T h e m easu res (m e a su re d p u b lis h e d S im p ly v a lu e gro w th d e m a n d s m a n u fa c tu r in g -g e n e r a t e d p ro gre sse d F ift ie s A t p la n t s o w n o f th e se w it h d e m a n d gau ge pay, th e to n e w r e g i o n 's Each o f A v e ra ge average a n o th e r la t e and raw e c o n o m y m a n u fa c tu r in g . A v e ra ge '6 2 n atu ral n e ce ssa ry S o u th e a ste rn th e go od s. cau se d m a n u fa c tu r in g s t ill ab u n d an t th e gro w n s a t is fy o f in c o m e in th e in t e r t w in e d G ro w th ’60 th e M ore o ve r, is i n e x t r i c a b l y /' are p r o v id e d pay b e tw e e n le v e l s in c o m p o s it io n of m a n u fa c t u r in g . th e n , o th e r e x p la in in g in th e in flu e n c e s th e lo w e r S o u th e a st. m u st average be m a n u E x p la n a t io n s 2The adjustment for manufacturing mix was accom plished by weighting average pay in each Southeastern two-digit Standard Industrial Classification (SIC) manufacturer by the distribution of manufacturing em ployment that exists at the national level. O f course, differences in mix may exist within each two-digit industry and probably account for a portion of the differences in regional and national average pay for each of these two-digit manufacturing industries. Data restrictions, however, do not allow a more detailed breakdown. FEDERAL RESERVE BANK OF ATLANTA 131 E rra ta sh eet fo r page 132 of A u g u st 1972 M O N TH LY R E V IE W : TABLE 1 E M P L O Y M E N T (T h o u s a n d s ) A la b a m a Florida Georgia Lo u isia n a M is s is s ip p i Tennessee District States United Sta te s A n n u a l A v e ra ge M a n u fa c tu rin g 1950 1960 1950 Farm 1960 1970 277 107 320 213 459 363 1,739 9,926 154 121 183 151 239 253 1,101 7,057 90 113 101 76 139 153 672 4,529 216 98 284 140 86 247 1,071 14,967 237 206 340 142 119 315 1,362 16,796 N o n m a n u fa c tu rin g 1 1960 1970 1970 1950 324 324 462 175 181 466 1,934 19,369 392 595 503 481 220 493 2,684 29,771 682 1,831 1,083 870 395 861 5,722 51,247 539 1,113 710 647 284 609 3,905 37,438 'N o n m a n u f a c t u r in g in d u s trie s in c lu d e c o n stru ctio n , tra n sp o rta tio n a n d c o m m u n ic a tio n s, w h o le sa le a n d retail trade, fin a n ce , in su ra n c e , a n d real estate, se rvice s, a n d go ve rn m en t. So u rc e : U. S. D e p a rtm e n t of L a b o r U .S . D e p a rtm e n t of A g ric u ltu re th at have liv in g , been le s s o ffe re d in c lu d e u n io n iz a t io n , la b o r s u p p ly th a n an d fo r th e lo w e r a m o re n a t io n co sts of e x a m p le , a v a ila b le as a w h o le . an o f se ve ra l d e m an d ge n e ra te d s t im u la t e s W h a t e v e r t h e r e a s o n s , o n e t h i n g is c le a r . The gro w th in m a n u fa c tu r in g S o u th e a ste rn e c o n o m ic p a y r o lls , a n d o u tp u t b o th M a n u fa c t u r in g has h e lp e d S o u th e a st aro u n d , 82 to th u s th e re ach e d o f 74 o n ly th e in c o m e per A s jo b s, at a th e in c o m e d e cad e sta rt o f th e r o lle d sto o d e a r lie r th e at it F ift ie s B e s id e s By a ls o t io n a l of S o u th e a ste rn in c o m e O n e in m ig h t th e th is expect in d u s try has S o u th e a st is not th e m a n u fa c tu r in g th an it is n a t io n . 1970, in its is a n so m e w h at le s s im p o r t a n t E m p lo y m e n t in th is w h ereas to 16 th e y and m illio n t h is w it h 24 p e rc e n t of to fro m se c to r th e p a y r o lls , S o u th e a ste rn p e rc e n t at s t im u lu s B e tw e e n n e w in c r e a s e w as e m p lo y 1960 an d ad d e d se c to r. liv e A m a n u fa c n o n m a n u 1970, tra d e s, in t o th is have tru e th a n or a d d i fro m th e se not th e o f th e he S o u th e a st been d iv id e n d m a n u fa c tu r in g o u ts id e r e g io n an d w o rke r is re n t, o u t been o th e r w is e . in c o m e th e se m ig h t in c o m e f lo w e d has fro m it th is o f f lo w m ile s p la c e , m u ch as m ay o f t a k in g o f th e e c o n o m y have an d r a p id ly stre am s w o rks, has a p a y r o lls . as r e c ip ie n ts fro m at have m o re in c o m e B e cau se so m e it w o u l d th e y m a n u fa c tu r in g w h e re r e g io n 's is b e n e fit to u p th o u san d s p r o d u c t io n fo r th e se in c o m e go n e in c o m e m a n u fa c tu r in g in t e r e s t , t h is p e r io d o f m u st not in t e r e s t , ge n th e s t im u la t e d ( C o n v e r s e ly , ge n e rate d o f th e S o u t h e a s t f lo w s m a y c o u n t e r a c t a n y o u tflo w .) s iz a b le r e la t e d to c o n s t r u c t io n , by le s s t h a n re n t, to re n ts le n d e r s , Census of th e d iv id e n d h u n d re d s d o e s c lo s e th e an d m in u s (th e m a n u fa c tu r in g a q tu a l th e fir m s . ad d e d a p p r o x im a t e a d d it io n a l d iv id e n d s . in in d u s t r ia l fro m an d o f to p e r c e n t a g e w is e , A lth o u g h n e c e s s a r ily an d fro m in t h e o f fo rm p a ym e n ts 1967 S o u th e a st liv in g f a ir ly r e g io n , n o n m a n u fa c t u r in g su p p o rte d 132 m an y p r o b a b ly M a n y s e r v ic e s , are to jo b s w e re gro w th . go v e rn m e n t) to o u tp u t, S o u th e a ste rn n o n m a n u fa c t u r in g (i.e ., ap p e a r. e rate d c o n tr ib u t io n th e S o u th e a st p o r tio n s tra d e m a jo r m a n u fa c tu r in g th e v a lu e an d can ap p ear th e se w h e re o f in 1958 w e in c o n t r ib u t io n s .3 J u d g in g and, p e o p le b o o k in c o m e r e t a il asp e cts, in t e r e s t g a in S o u th e a ste rn S in c e p e r c e n t in 20 th a n aro u n d in c o m e in te r e s t, in n a t io n a lly , to n o n fa rm m a n u fa c tu r in g a m o u n te d fa r, But gro w th , d ir e c t m a n u fa c tu r in g an d r e g io n s . so a c t iv it y fa ste r im p o r t a n t S o u t h e a s t 's e m p lo y e r s o th e r its 1970, co m p a re d in d u s t r ie s . n e a r ly t w o of m o st p a in t e d im p o r t a n t le v e l. m e n t, p a y r o lls , fa c t u r in g in p ic t u r e m o re d e s p ite s t ill in c o m e , B e s id e s p a rt is A n d , n a t io n a l t u r in g th an case; a m o u n te d p e rso n al th e a fo r 22 p e rc e n t o f S o u th e a s te rn e m p lo y m e n t in th e n a t io n a lly . acc o u n te d th e fro m b e co m e rate o f a v a ila b le m a n u fa c tu r in g M a n u fa c t u r in g fa ste r th a t are re n t, th e n o n m a n u fa c tu r gro w th o w n e rs b e tw e e n fig u r e s , Im p o r t a n c e to th e Manufacturers), it p e rc e n t. in a c t iv it y in d ir e c t p ro d u ce s at d ata h a n d le a re a s). d iv id e n d s w h ic h m ay m a n u fa c tu r in g th e p ro p e rty, lo o k in g p a y r o lls by th e se le a s e d an d fro m c o n s t r u c t io n m a n u fa c tu r in g fo r fir m m a n u fa c tu re rs. M o re o v e r, b it o f g r o w t h in d ic a t e d a c t iv it y w h ic h b e tw e e n S e v e n tie s (a s la r g e a g o o d r e s id e n tia l n a t io n a lly , in c o m e , gap th e c a p it a n a t io n 's ; p e rc e n t; 68 fo ste re d e x p a n d in g th a n ge n e ra te d n a t io n . th e b y r a p id ly in g g r e a tly in e a r lie r p o s t w a r p e r io d s . S o u th e a ste rn p e rc e n t w as has c lo s e an d p ro gre ss m o re in t h e S ix t ie s a n d has a c c o u n t in g k e e p in g se c to r. For :lThese additional payments must bo made from the portion of value added rem aining alter direct payment of wages and salaries. Thus, the growth of value added m inus payrolls reflects the growth of these other income payments. M O N T H L Y REVIEW C h a n g in g G ro w th P a tte rn s on in R a p id th e g a in s have A s o n e as e ls e w h e r e , m ig h t te n s iv e . have in d ic a te d in has of in in S o u th e a ste rn m o st m a n u fa c tu r in g , p r o p o r t io n th e in a r is in g an d in c le r ic a l p r o d u c t io n jo b s lin e lin e la t e F o r tie s pay o f S ix t ie s , an d th e F if t ie s . ) n o n p r o d u c tio n p e rc e n t h ig h e r th a n it m a n u fa c tu r in g In d u s t r ia liz a t io n ch an ge s in fa c t u r in g th e m o re o n e -th ir d jo b s. w as fo r is has are as. in a ls o o f a m o n g In m a n u fa c tu r in g r a p id ly p a y r o lls at th e rate m e t r o p o lita n as rate s near th e th o se B e tw e e n o f 1963 S in c e areas in d ic a t e have w it n e s s e d by typ e o f ab o u t n o n fa ste r a c q u ir in g a m a n u fa c tu r in g . n o n m e t r o p o lit a n a c c e le r a t e d , w h e re as m e t r o p o lita n th e la t e an d 1967, are as. th e o n ly th e ir in la b o r - of t im e , su cce ede d areas F ift ie s an d all g r o w E very in c r e a s in g ly th e exp an d e d e a r ly m a n u fa c tu r in g o n e th at S o u th e a ste rn b e co m e m a n u fa c tu r in g th at o u tp u t w e re n o n m e t r o p o lit a n very p r o d u c in g p ro gre sse d , in w as o n e -h a lf in g fa ste r o f th e se n o n m e t r o p o lit a n im p o r t a n t a s c e n te rs.5 pay. A W id e Sp e ctru m o f In d u s t r ia liz a t io n ab o u t A m an u an d g r o w in g ch a ra cte r n o n an d p a y r o lls are as. 60 but have gro w th a c t iv it y ch an ges w o rke rs, jo b s o ver h o w F ift ie s in S o u t h F ift ie s an d in average S o u t h e a s t 's la t e th e fo r o u tp u t. j o b s , p a y r o lls , a n d in average m e t r o p o lita n jo b s of S ix t ie s . in t o m a n u fa c tu r in g S ix t ie s pace m o ve d b ro u gh t th e th e (A lth o u g h r is e th e c a p ita l-d e p e n d e n t A s a p p r o x im a t e ly an d e x p la in a b le , d u r in g are a s, s m a lle r p r o d u c t io n r e a d ily la t e g a in s co n are o u tp u t, m a n u fa c tu r in g a th e o f p e rc e n ta ge s e e m in g ly th at its is e m p l o y e d le s s t h a n w o rke rs is o f la r g e r T h e se n o te fa c to ry m e t r o p o lita n M o re o ve r, lo c a tio n a c t iv it y m e t r o p o lita n S ix t ie s , S o u t h e a s t 's m o re are as. a c c o u n t in g gro w th an d t h u s p a r t ia lly e x p la in in g th e s h a r p e a ste rn in t e n s iv e , o f th e sh o w e d tre n d s w e in v a l u e a d d e d w o rke rs pace w h en in d u s t r ie s . 4 fo rc e hand, n o n m e t r o p o lit a n in in t e n s it y , m a n u fa c tu r in g w o r k fo r c e at a h ig h th e c a p ita l o th e r gro w th e ve r, m a n u fa c tu re rs p o r tio n m a n u fa c tu r in g w o r k n o n p r o d u c tio n d u r in g fu s in g S o u th e a st, c a p ita l m a jo r in se c to r. in c r e a s in g ly in c r e a s e fo r ch an ge s o f t h is s h if t t o a m o r e c a p it a l- in t e n s iv e s u p e r v is o r y th e in d u s t r y b e co m e t h is by m a n u fa c tu r in g b y th e s h a r p e r in c r e a s e S o u th e a ste rn th e se a c c o m p a n ie d th e m a jo r p a y r o lls B ecau se typ e o f su sp e ct, M o st sh a re d th a n in been c h a r a c t e r is tic s th e n o n m e t r o p o lit a n d iv e r s ity o f has a c c o m p a n ie d S o u th e a ste rn t h e la s t t e n y e a r s . T o d a y , a m u c h th e th e m a n u fa c tu r in g c h a n g in g d u r in g w id e r v a r ie t y gre w F a c to ry o u tp u t, "’Since 1958, several Standard Metropolitan Statistical Areas (SM SA's) in the Southeast have been expanded to include neighboring counties; moreover, several new S M S A 's have been established. Thus, of the total number of counties and parishes (in the case of Louisiana) in the Southeast, the proportion that are metropolitan has increased. Because of this, the rapid growth of nonmetropolitan manufacturing is all the more remarkable. 4O ver the long run, if the payroll portion of output or value added declines, we can generally infer that manufacturing is becom ing m ore capital intensive. This is exactly what happened between 1958 and 1967 in both Southeastern and U.S. manufacturing in general and am ong most major manufacturing industries. TABLE 2 SU M M A R Y T A B LE (P e rce n t C h a n g e in E m p lo ym e n t, P a yro lls, A v e ra g e Pay, a n d V a lu e Added, 1 9 5 8 to 1967) Em ploym ent U.S. D istrict All M anufacturing1 Food Processing Textiles Apparel Lum ber an d Wood Furniture and Fixtures Paper P rinting C hem icals Petroleum Refining Rubber L eather Stone, Clay, and Glass Prim ary Metals F abricated M etals M achinery, except Electrical Electrical M achinery T ransportation Equipm ent Payrolls District U.S. Average Pay2 D istrict U.S. Value Added District U.S. 39.9 20.6 107.7 68.7 48.4 40.0 122.1 85.1 11.2 11.1 74.5 -16.6 57.3 22.0 37.6 33.7 -19.5 126.8 63.8 19.5 29.3 60.6 137.2 212.1 73.2 - 4.0 2.9 14.9 - 5.4 20.1 15.9 19.2 20.5 -21.0 48.6 - 5.9 6.8 17.3 26.5 38.1 64.3 17.4 58.2 75.3 148.0 46.9 113.2 69.4 80.3 83.9 9.8 174.3 132.1 72.4 65.6 116.7 186.6 312.1 138.3 32.2 49.2 55.6 39.4 59.7 60.8 59.3 63.5 8.9 90.7 27.3 47.9 56.8 71.8 94.5 125.3 65.2 42.3 57.8 42.1 76.2 35.5 38.9 31.0 37.5 36.4 21.0 41.7 44.2 28.1 35.0 20.8 32.1 37.6 37.7 45.1 35.5 47.3 33.0 38.7 33.6 35.7 37.8 28.4 35.2 38.5 33.7 35.8 40.9 37.1 40.7 72.9 104.0 164.8 65.2 134.3 50.9 93.4 127.3 77.5 159.6 135.8 75.4 57.0 140.5 292.5 306.8 185.8 50.4 67.4 67.7 54.8 74.0 72.1 80.0 91.3 115.4 107.5 38 .4 50.6 73.1 91.1 124.2 130.5 84.0 ’S tandard Industrial C lassification M anual, 1 9 7 2 (W a sh in g to n , D. C., U. S. G o ve rn m e n t P r in t in g Office, 1972) - A v e ra g e p ay e q u a ls total m a n u fa c tu rin g p a y ro lls d iv id e d b y the n u m b e r of m a n u fa c tu rin g e m p lo yee s. S o u rc e : C e n s u s of M a n u fa c tu re rs, 1958, 1967 FEDERAL RESERVE BANK OF ATLANTA 133 STATISTICAL DISTRIBUTIONS P e rce n t D is t r ib u t io n A d d e d by o f E m p lo y m e n t , M a n u fa c t u r in g P a y r o lls , In d u s t r ie s , 1 9 5 8 an d an d V a lu e 1 9 6 7 E m p lo y m e n t A la b a m a 1958 1967 All M a n u fa c tu rin g Food P ro c e ssin g Textiles Apparel Lu m ber and W ood Furniture and Fixtures Paper Printin g C h e m ic a ls Petroleum R e fin in g Ru b b e r Leather Stone, Clay, and G la ss Prim ary M e ta ls Fabricated M e ta ls M achinery, except Electrical Electrical M a c h ire ry Transportation Eq u ip m e n t 100.0 Florida 1958 1967 100.0 100.0 100.0 G eorgia 1958 1967 L o u isia n a M is s is s ip p i 1958 1967 1958 1967 100.0 100.0 100.0 100.0 100.0 8.7 17.2 9.6 10.4 8.2 13.9 14.8 6.8 21.3 0.5 3.9 7.9 15.5 0.7 5.8 4.2 13.2 30.2 12.5 8.4 10.8 25.8 15.7 4.6 22.1 18.0 — — 4.0 12.5 4.3 8.5 1.3 4.3 2.3 3.6 0.4 2.5 1.5 5.2 2.2 4.1 0.3 2.7 4.0 7.7 7.5 8.5 0.4 0.4 0.5 2.6 5.7 7.1 7.3 0.3 1.3 0.9 2.2 5.4 3.1 3.1 0.2 0.4 1.1 2.2 5.4 3.0 2.8 0.2 0.9 1.1 1.0 12.3 3.9 11.8 10.5 0.1 — 2.9 15.4 5.6 7.2 0.9 8.0 4.4 1.1 6.9 3.1 1.1 2.2 3.3 1.4 3.4 — 3.6 16.5 5.4 — T e n n e sse e 1958 1967 100.0 100.0 100.0 d istric t Sta te s 1958 1967 U. S. 1958“ 1967 100.0 100.0 100.0 100.0 12.1 4.6 22.0 20.7 9.1 4.1 22.2 12.7 10.6 10.5 13.5 6.2 7.8 7.5 16.3 3.7 13.8 13.7 10.9 9.7 10.9 10.9 13.6 5.8 10.7 5.6 7.4 3.7 8.5 4.8 7.0 2.9 0.9 8.8 3.5 11.6 6.0 0.1 — 4.5 4.8 2.0 3.2 6.7 3.5 1.6 3.2 4.3 3.2 4.3 13.5 2.8 5.7 3.8 7.3 1.3 1.0 1.3 3.2 5.0 3.7 6.9 0.8 1.7 1.5 2.2 3.4 5.4 4.4 1.1 2.2 2.2 2.2 3.3 5.3 4.3 0.7 2.7 1.7 4.8 2.6 4.3 4.4 2.6 6.3 3.5 4.3 5.3 3.5 6.8 6.6 3.0 6.6 6.9 — — — — — 2.4 1.6 1.8 4.2 5.2 3.0 4.2 12.5 0.2 2.3 4.0 3.7 0.5 2.5 3.1 0.8 5.1 3.7 3.9 5.5 3.4 3.9 5.6 4.1 4.7 4.6 0.3 3.0 2.3 4.4 2.6 2.7 2.3 3.1 1.9 4.7 2.8 3.8 2.1 3.5 8.4 9.6 1.7 1.9 2.9 8.6 1.2 2.0 0.2 1.6 2.8 6.2 3.8 7.6 2.1 4.8 7.1 9.7 7.5 5.6 5.6 8.8 7.8 10.4 5.1 9.2 10.4 8.4 2.0 4.0 6.1 7.5 9.8 9.5 P a y ro lls A la b a m a 1958 1967 A ll M a n u fa c tu rin g Food P ro c e ssin g Textiles Apparel Lu m b e r and W ood Furniture and Fixtures Paper P rin tin g C h e m ic a ls Petroleum R e fin in g Ru b b er Leather Stone, Clay, and G la s s P rim ary M e ta ls Fabricated M e ta ls M achin ery, except Electrical Electrical M ach in ery T ransportation Eq u ip m e n t Florida 1958 1967 100.0 100.0 100.0 100.0 G eorgia 1958 1967 Lo u isia n a M is s is s ip p i 1958 1967 1958 1967 100.0 100.0 100.0 100.0 100.0 Te n n e sse e 1958 1967 100.0 100.0 100.0 D istric t Sta te s 1958 1967 U. S. 1958 1967 100.0 100.0 100.0 100.0 11.5 3.9 15.0 12.6 8.9 3.6 15.0 11.4 11.0 8.2 8.0 4.0 8.2 6.0 10.2 2.7 13.1 10.4 6.9 5.9 10.0 8.8 8.3 4.2 9.7 3.7 4.5 2.5 7.6 3.3 4.2 2.1 0.5 10.1 3.2 15.4 8.7 0.1 — 4.3 11.2 2.3 4.3 5.9 5.0 1.6 4.2 3.5 4.1 5.2 20.4 2.4 7.8 4.5 10.2 2.2 1.3 0.9 2.5 6.4 4.0 10.1 1.2 1.8 1.1 1.8 3.5 5.7 5.0 1.4 2.1 1.4 1.7 3.3 5.4 4.9 0.9 2.5 1.1 4.8 3.6 4.8 3.3 8.0 6.9 2.9 7.4 7.0 3.1 10.8 2.4 16.6 14.3 7.8 12.4 5.6 5.6 7.1 11.1 8.7 4.6 12.8 0.2 1.7 3.3 12.7 0.5 3.5 2.9 12.8 25.1 9.5 5.3 9.9 22.3 10.5 3.2 18.2 2.3 7.1 2.5 5.4 1.0 5.8 2.5 4.4 0.3 3.7 — 1.2 7.1 2.3 5.0 0.4 3.5 — 2.1 6.0 5.5 6.2 0.3 0.1 0.2 1.9 6.6 6.7 7.7 0.2 1.0 0.5 2.1 7.5 4.2 3.9 0.2 0.3 0.8 1.9 7.1 3.7 3.5 0.2 0.8 0.7 0.7 13.7 3.7 15.7 15.2 0.1 — 3.7 24.6 6.5 2.9 20.6 6.0 4.4 0.5 5.4 3.9 1.0 6.7 3.1 1.2 2.6 3.2 1.5 3.6 2.2 3.1 1.5 4.7 3.2 1.6 2.1 2.1 9.6 1.7 9.8 6.5 3.8 9.8 13.7 — — — — — — — 3.3 1.3 2.3 3.0 4.2 3.8 4.6 17.5 0.2 2.6 3.1 4.3 2.7 6.7 4.0 0.5 2.7 3.4 0.8 5.6 4.1 5.3 6.3 3.9 5.0 6.2 4.3 6.8 5.4 3.6 5.5 5.7 2.3 3.1 2.4 5.7 3.4 4.4 2.8 3.9 9.3 0.0 1.4 3.0 5.9 4.4 7.2 2.4 4.9 7.3 9.8 5.5 9.4 17.4 12.6 2.2 4.2 8.4 9.7 11.7 11.5 D istrict Sta te s 1958 1967 1958 V a lu e A d d e d A la b a m a 1958 1967 All M a n u fa c tu rin g Food P ro c e ssin g Textiles Apparel Lu m b e r and W ood Furniture and Fixtures Paper P rin tin g C h e m ic a ls Petroleum R e fin in g Ru b b er Leather Stone, Clay, and G la s s Prim ary M e ta ls Fabricated M e ta ls M achin ery, except Electrical Electrical M a c h in e ry T ransportation Eq u ip m e n t Florida 1958 1967 100.0 100.0 100.0 100.0 G eorgia 1958 1967 Lo u isia n a M is s is s ip p i 1958 1967 1958 1967 Ten n e sse e 1958 1967 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 8.6 10.1 5.1 4.4 7.4 9.1 7.2 4.1 22.8 0.4 2.1 4.0 17.0 0.3 2.9 2.6 16.4 21.1 8.3 4.5 11.9 21.2 8.8 2.9 19.4 1.7 4.7 1.6 3.8 0.9 6.3 2.5 7.9 0.5 5.5 — 1.0 9.2 2.4 11.9 0.5 5.4 — 2.7 10.7 7.3 16.5 0.5 0.3 0.4 1.7 7.9 6.1 12.7 0.2 0.9 0.4 1.8 10.9 3.7 6.2 0.3 0.4 0.7 1.6 9.3 3.3 6.6 0.3 1.4 0.7 0.5 13.0 3.3 21.7 14.1 0.1 — 4.8 26.5 6.1 3.2 18.1 6.1 7.5 0.8 7.4 5.0 1.2 6.1 3.4 0.8 2.3 3.4 1.6 3.2 0.2 2.9 2.0 5.7 3.2 1.9 2.0 2.7 7.6 2.0 5.9 4.6 4.0 7.2 12.2 1967 100.0 100.0 100.0 100.0 15.2 3.1 11.8 14.4 9.6 3.5 10.7 10.1 11.9 7.1 6.2 3.0 9.3 5.2 8.4 2.1 15.2 8.4 5.6 4.8 11.8 7.7 6.6 3.5 12.5 3.4 4.2 2.3 10.2 3.1 3.8 1.9 0.4 9.1 2.6 24.4 12.4 0.1 — 4.4 8.7 2.1 8.4 5.6 4.5 1.5 9.6 2.8 5.0 4.4 24.2 — — — — — 3.1 1.6 3.0 3.3 3.4 4.4 3.8 23.5 0.2 2.4 2.9 2.0 8.8 4.0 14.7 2.4 1.9 1.0 2.1 6.0 3.5 15.0 1.9 2.2 1.0 1.7 4.0 5.6 8.7 1.8 2.3 1.3 1.6 3.7 5.5 9.0 2.1 2.6 1.0 4.9 5.9 3.7 3.8 3.9 4.8 5.6 0.4 3.1 3.6 1.0 6.5 4.4 5.5 5.0 4.0 4.6 4.8 4.9 7.4 4.7 3.8 5.2 5.0 3.9 8.2 6.7 3.2 7.6 6.9 2.9 1.8 2.2 2.8 6.6 3.0 4.0 2.2 3.9 8.8 10.6 2.7 0.1 1.1 4.3 5.9 5.6 9.7 2.8 5.1 7.5 9.4 15.8 3.5 6.2 11.0 7.6 2.0 3.8 6.1 7.8 10.8 10.8 — 16.3 U. S. — S O U R C E : C e n s u s of M an ufactu rers, 1958 and 1967 134 M O N T H L Y REVIEW of p ro d u cts is b e in g p ro d u ce d th e c o u n try , r a n g in g fr o m to c h e m ic a ls . in d u s t r ia l The stro n g e a ste rn of th e m a n u fa c tu r in g o n ly in w a ge w h at t ile s , an d t e x t ile s , been A s d e c lin e d ap p arel le a t h e r ru b b e r, an d S o u th e a ste rn p e t r o le u m Each g a in s (in in d u s try in th e n a t io n a l of v a lu e 1958 adde d) c a lle d an d In d e e d , la r g e r o r fo r a an d p e rc e n ta ge th a n p ap e r, lo s s e s th e ir p e t r o le u m (m e a su re d fa ste r p r o c e s s in g p age w as m a n u fa c tu re r an d o u tp u t. rate by 1 3 4 , in t h e th e in la t e S o u t h e a s t 's te rm s Food o f th a n m o st a ls o have cau sed m a n u fa c tu re rs. (A le s s is im p o rta n t p a y r o lls , ran ke d th e th ro u g h o u t th e at th e to p th e an d la r g e s t an d a lo n g w it h p o r tio n of t e x t ile s e m p lo y e r s . v a lu e w e re But adde d, and In d u s t r ia l in d u s t r ia l up th e gase s, b u gg y w h ip m an u g r a d u a lly S ix t ie s . By 1967, jo b s. o n e m ig h t been had ( i.e ., in t o e m p lo y e r . s u b s t a n t ia lly o f v a lu e th e sam e m a n u fa c tu re rs ad d e d are g iv e n A m o n g th e State s state s. th e w e su sp e ct, R ath e r, as a b o u n t ie s m ark e ts sp e ak te rm s fa ste st F ift ie s . fo r s lo w e r tw o state s 1970 p la c e o th e r or w as it w a s th e in th e decade, S o u th e a ste rn m a n u fa c tu r in g e m p lo y m e n t , H o w e ve r, even th e B ayou State gro w th . ra te s o f e x p a n s io n , T e n n e s s e e s t ill a b le to ran k r a n k in g s g a in in g T a b le 1 ). a m o n g sta te s, T he th e w h e re at th e to p m a n u fa c tu r in g s w it c h e d w e re m a n u fa c tu r in g as T e n n esse e (se e no p a y r o lls , c o n s e c u tiv e th e S o u t h e a s t w it h 1 9 7 0 , w it h u s u a lly w as gro w th m a n u fa c tu r in g w e re an d F lo r id a jo b s, la b o r , W h e n e ve r gro w th S ix t ie s , se co n d n a t io n a l th e th e has of reso u rces, so rt, e it h e r b e h in d o u tp u t. T he in th e la g g e d G e o r g ia t a k in g in e x p a n d in g D e s p it e and of e x p a n s io n state s. m a n u fa c tu r in g S o u t h e a s t 's exceeded any has S o u th e a ste rn a d v an tage n atu ral m a n u fa c tu r in g F lo r i d a 's in o f gro w th a ll of to o k in d iv id u a l gro w th In But p a tte rn o f th e w ay; e x c e p tio n . o u tp u t, in o f th e m ix e d a m o n g m a n u fa c tu re rs d iv e r s e le a d s m a n u fa c tu r in g d is t r ib u t e d b e tw e e n th e in jo b s. 1960 n u m b e r on e o n ly s m a lle r o th e r ch an ges S o u th e a ste rn M is s is s ip p i m o ve d th e S ix t ie s jo b s th an in in c r e a s e d th e at F ift ie s , a fa ste r in % change p r o c e s s in g Sixth District states - ge n e ra te d b e co m e ra te e x c e p t in F l o r i d a th e - 120 m o st p r o c e s s in g r a n k in g e q u ip m e n t , a lk a lie s , p ig m e n t s , are p a y r o lls , a n d e v e n ly M a n u fa c t u r in g im p o r ta n t p a y r o lls fo o d d e v e lo p in g ap p arel p r o v id e d Food m o st o f ye ars b o ys' c lo t h in g , next on S o u th e a ste rn o f m e n 's a n d th e se b ase d r e la t iv e ly d is t r ib u t io n s G ro w th sp o t th e se m ix c h e m ic a ls sh a re of in d u s t r ia l t r a n s p o r t a t io n lio n 's fa ll o f m a n y fift y te rm s c h e m ic a ls of w as w o rk th e in th e im p o r t a n t im p o r t a n t in d u s t r y , w it h se co n d r is e a n d th a n e m p lo y e r . T h e p r o d u c t io n fu r n is h in g s , gro w th he th e m o st an d e x a m p le th at im p o r t a n t C o n s e q u e n t ly , b e co m e th e p o p u la r c o n d itio n s is ch a n ge d had p a tte rn s th e m a n u fa c tu r in g d ata C o m p le t e p a y r o lls , a n d F ift ie s , f o o d e m p lo y m e n t , p r o c e s s in g d e m an d t e c h n o lo g y a g o .) p a g e 1 3 4 .) p r o v id in g C h a n g in g fa c tu re r e m p lo y m e n t , L o u is ia n a n a t io n a lly . c h a n g in g by on sta te s on e m p lo y m e n t 1967. an d g a in s . s m a lle r e m p lo y m e n t ) at m a jo r lu m b e r p a y r o lls in p r e v a ile d e m p lo y m e n t had 1971 as not e m p lo y e v e ry tw o — an d in d u s try la r g e s t to A s 1967. 1967, ap p are l S o u t h e a s t 's r a p id ly m a c h in e r y , in th e m a n u fa c tu re r, p a y r o lls , lu m b e r fa s t -g r o w in g an d Except te x n a t io n a lly . A s sh o w n and lu m b e r , b e in g m e t a ls , o u t p u t advan ced " lo w - o u t, fro m an d p e t r o le u m p r im a r y c e n te re d e q u ip m e n t lu m b e r , co u n te rp arts. r e fin in g , a n d S o u th e a ste rn ad d e d ( R a n k in g s o f m a n u f a c t u r in g in d u s t r ie s a c c o r d in g lu m b e r , b e h in d except e m p lo y m e n t case th is p o in ts sh o w e d except d o m in a n t v a lu e S o u th to o , been even 1958 r e fin in g — o f th e se , 3 fa r and m e n t in c r e a s e s b e t w e e n m a jo r to le a t h e r , ran ked b e tw e e n of Then, t r a d it io n a lly t r a n s p o r t a t io n A c t u a lly , not in d u s t r ie s . e m p lo y m e n t an d has w e re S o u th e a ste rn a ll b ase . T a b le fu r n itu r e r e g io n e v id e n c e a p p a r e l, fu r n itu r e . g r o w in g a lm o s t le n d s e x p a n s io n have an d of in d u s t r ia l in d u s t r ie s ”— th is la b o r - in t e n s iv e e x p a n s io n m a n u fa c tu re rs b r o a d e n in g in la d ie s ' u n m e n t io n a b le s and coal o f S o u th e a ste rn t h ird . c h lo r in e , ta rs) m ade c h e m ic a l p ro d u c t io n . N a t io n a lly , w as r e p la c e d e q u ip m e n t in th e la t e as th e m o st an d S ix t ie s , m a c h in e r y ( i.e ., n o n e le c t r ic a l m a c h in e r y a n d e q u ip m e n t ) o u tp u t. T h e se im p o r ta n t is o n e in o f in te rm s o f in d u s t r ie s th e c a p it a l- in t e n s iv e e le c tr ic a l by and t r a n s p o r t a t io n a ls o d iv e r s ity , c h e m ic a l p r o c e s s in g in d u s try e m p lo y m e n t , So u th e a st. g r o w in g fo o d im p o r ta n t have T h u s, w it h th e th e in d u s try FEDERAL RESERVE BANK OF ATLANTA p a y r o lls , b e co m e an d m o re p ic t u r e Ala. Fla. Ga. La. M is s . Tenn. r e la t iv e ly b e c o m in g th e 135 TABLE 3 B o th H ig h - a n d L ow -W age M a n u f a c tu r in g H ave S how n R a p id G ro w th Em ploym ent P ercen t Change 1958 to 1967 Electrical Machinery] M achinery, except Electrical R ubber Apparel T ransportation E quipm ent L eather F abricated M etals F urniture an d F ixtures P rinting C hem icals Prim ary M etals P aper S tone, Clay, an d Glaiss Food P rocessing T extiles Lum ber an d Wood P etroleum Refining Average P ay P er Employee Rank (M easured by Growth) 212.1 137.2 126.8 74.5 73.2 63.8 60.6 57.3 37.6 33.7 29.3 22.0 19.5 11.2 11.1 -16.6 -19.5 $ Rank in 1967 Am ount in 1967 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 5,726 6,158 6,115 3,390 7,198 3,876 5,933 4,317 5,902 7,275 7,036 7,137 5,654 5,053 4,475 3,998 8,644 10 6 7 17 3 16 8 14 9 2 5 4 11 12 13 15 1 NOTE: A S pearm an rank correlation te s t w as perform ed to ex am in e any correlation th a t m ight ex ist am ong in d u stries betw een m an u factu rin g em ploym ent growth an d average payrolls. No significant correlation w as found betw een th e industry rankings of em ploym ent growth and 1958 average pay (not shown here) or em ploym ent grow th an d 1967 average pay. Source: C ensus of M anufacturers, 1958, 1967 ah ead o f L o u is ia n a fa c t u r in g P art w o rk an d p a rce l e x p a n s io n a m o n g are th e S o u t h e a s t 's e m p lo y e r , M is s is s ip p i an d s t a t e 's th e la r g e s t acco u n t has fo r F ir s t r a p id In a to jo b s P r im a r y ste e l th e se jo b s. Im p r e s s io n s m a n u fa c tu r in g C e r t a in ly , gro w th th an m ig h t o n e has have d iv e r s if ic a t io n a ll an d an d th e th at p la n t s G a d sd e n se c to r in S e v e n tie s typ e s o f been th is has Por m o re co m e s u p e r v is o r y m o re in it ia lly th e r ^ ip id a la b o r th a n g re a te r an d m o st ab o u t 1 36 for FRASER Digitized b o th p a rt, o n A gro w g a in s lo w - w a g e p ro gre ss A lo n g o ffic e by s u r p r is in g , W h a t in th e ab o u t e c o n o m y w it h an d c a p it a l- in t e n s iv e S o u th e a ste rn m o re m e c h a n iz e d . n o n m e t r o p o lit a n d e v e lo p e d c o n tin u e s lid th e be fo r in t o t h is S e v e n t ie s ? th e se c to r d id fu rth e r 1970 w ill m a tch S im p ly e x t r a p o la t in g le a d o fte n ch a n ge For to has been th e p a st, a p r o b a b ly p r o b a b ly an d a lte r la r g e b e S o u th e a ste rn r e c e s s io n , ste ad y to jo b th e lo s s e s , r e v e r s e it s e lf u n t il a s th e S e v e n tie s ad van ce s. o f th e p a st th e n o t th e m a n u fa c tu r in g s h o u ld th a t s t im u la n t m ay A s n o t b e g in e rro n e o u s e x a m p le , w a s w ill n a t io n a l su ffe re d r a p id gro w th o fte n gre a te r S e v e n tie s . t h is s it u a t io n r ip e m a n u fa c T h e m a n u fa c tu r in g th a t m id -S ix tie s a lth o u g h th e m a n u fa c tu r in g D e s p it e o f b ase d r a p id t h is n a t io n a lly . r e lia n c e m o re b r o a d ly w o rd s, W h e th e r S ix t ie s gro w th lo n g - r u n s in c e t h is d e b a t a b le . fo rw a rd fo re c a sts, s u p p ly is can c o n d itio n s gro w th p a th s. la b o r , w h ic h o f to m a n u fa c tu r in g so r e a d ily gro w th a v a ila b le in in th e fu tu re . in c o r r e c t ? e x p e c te d . b ro u gh t m a n u fa c tu r in g — h ig h -w a g e . has has been been o th e r p ro gre ss, S o u th e a ste rn in In d e e d , m a n y -fa c e te d In b e c o m in g t h e la t t e r h a lf o f 1 9 7 1 . A n d m e t a ls an d is m o re an d th e w it h th e o f an d be m o st had o n ly t e x t ile s a lo n g B ir m in g h a m o f in F lo r id a in d u s try . m o st m a n u fa c tu r e x p a n s io n c o n tin u e s th e m ix o u r fir s t im p r e s s io n s a b o u t t h e a d v a n c e o f S o u th e a ste rn in g f a c t u r in g . e m p h a s is o n A p p a r e l, m a in t a in e d e m p lo y e r ; is t r u l y sta te s. p r o v id e r in d u s try , th e o f So u th e a st. H ave in m a n u rate s im p o r t a n t p r o v id e s f o u n d r ie s a r o ju n d m a n u fa c tu r in g th e jc itr u s p r o c e s s in g A la b a m a 's to tal m a n u fa c tu r in g jo b T h e p r o c e s s in g v e g e t a b le s , are as m o st la r g e s t e m p lo y e r . F lo r i d a 's is in la r g e s t in d u s tr y b ig g e s t . an d its d iffe r e n t T e n n e sse e . fo o d fo o d o f So u th e a ste rn o v e r a ll is c a n n in g s t a t e 's th e se v a r ia tio n s carpe t L o u is ia n a , s iz e t u r in g o f th e in g a s th e th e in d iv id u a l th e G e o r g ia 's in fo rc e . m a n u th e r a p id th e se s t ill m a n u fa c tu r in g c o n ta in s a b o u n ty m e t r o p o lita n to w a r n in g s , S o u th e a st p r o v id e average c h o ic e pay o f areas as th a t fo r gro w th : n a tu ral th e y (e v e n e n co u rage a fte r c o n tin u a tio n T h e S o u th e a st re so u rce s; s it e s ; e x is ts m a n u fa c tu r in g c h a r a c t e r is tic s a d e v e lo p lo c a t io n s t ill e ffe c ts) s h o u ld S o u th e a ste rn se ve ra l a u gu r in th e s h o u ld and, th e o f s t ill n o n c o n tin u e lo w e r S o u th e a ste rn re m o val o f in d u s t r y fu rth e r e x p a n s io n m ix o f m a n u fa c tu r in g .* M O N T H L Y RE V IEW P e tr o le u m : A G u s h e r fo r th e S o u th e a s t by Brian D . D ittenhafer Fro m a aw ay, so m e th e a d is ta n c e a m aze it o f s c ie n c e fic t io n S o u th e a st.1 T h e s t r ip p e r m o ve an d w e ll, th e o il p ip e s , n e a r o il th e w e ll, th e as is c o n tin u o u s in s in c e o il b u s in e s s o n ly p r o d u c t io n th e E a r ly th at cru d e th e n u se d s u p p ly o f her as w h a le b u r g e o n in g 2 0 th a la te o f E. c o u ld w as C e n tu ry in t e r n a l c o m b u s t i o n to an d State s o il w e ll o f B e s id e s , r u n n in g o u t. o il gre ase e n g in e fie ld m aze o il o f fo r in fro m p re ssu re to v a lv e s liv e an d gas c o m in g o f w o rk fro m p r o d u c t io n w e re w id e s p r e a d in o f a ls o w h en ta k in g o f d e m a n d but n o th e o il P e n n s y lv a n ia , w as th e d r illin g to o f it an p la c e . k e ro se n e , n e ce ssa ry th e has w e ll by had e n te re d T it u s v ille , That b u s in e s s . an d has G e o r g ia s u p e r io r u se , 1860, M is s is s ip p i o v e r h u n t in g in t o u se n e w fa r lu c r a t iv e as L o u is ia n a s t ill 1859. an d ago an d so u rc e w it h o ld lo n g q u a n tit ie s w as c o m in g th at a h u g e an is in a k ero sen e th e p h ase b e gan as an d w h o F o r tie s . e x p lo r a t io n U n ite d m a c h in e s T he fa r sce n e p r o d u c in g n atu ral 1916. e a r ly p r im a r ily o f is s in c e b e cau se an d an n atu ral p um p . an d A la b a m a , d e s ir e d o f o il as la r g e w as at " f lu s h " in lig h t . sce n e p e o p le o il S o u th e a st L. D r a k e ' s th e N o t su rfa c e . p la c e but T he th e T e n n e sse e T h ir t ie s v ig il. e n o u gh th e o f o r F lo r id a , th e o f o b ta in e d a m o u n ts n u m b e rs th e in s ile n t m e t h o d ic a lly be so u rce o il in a id m e t h o d ic a lly . a have f lo w th e tak e n w h ile th e e a r ly o f N o , p u m p , not tre e " to b o rd e rs, p u rp o se s, In c r e a s in g e a r ly o il o il lig h t in g has in d u s try c o m p le t io n p ro ve fo r w it h in p e t r o le u m o il p a rts th e a th e th e p ro d u ce d 1902, in is n o d d in g sta n d m a k in g ? d o e s co n tro l m an y in s e c t, gau ge s w it h o u t th e p r o d u c t io n in d u s tr y th at d u r in g b e in g o il w it h to m o ve s o il w as th e "C h r is tm a s u se d p re ssu re g ia n t an d in s e c t" w e ll a a in su rfa c e p a r t ic u la r ly o il The m o v ie o il k n o w n P r o d u c in g C ru d e lik e p ip e s "g ia n t an to fie ld s , n atu ral to lo o k s v a lv e s , to be th e u se d w h a le w h a le s , to fir s t m e th o d s. lu b r ic a t e w as a u t o m o b ile not o il th e th e u n t il w it h th e an f o r a p r o d u c t c a lle d ’For the purposes of this article, the Southeast includes those states partially or w holly within the Sixth District: Alabama, Florida, Georgia, Louisiana, M ississippi, and Tennessee. FEDERAL RESERVE BANK O F ATLANTA 1 37 P e tr o le u m m ark e ts have changed %0f u . s . total lit t le consum ption been o il. are p ro d u cts rate s, o f Heating -60 m a in s p r in g co u rse , so th e d iffe r e n t ’50 '53 ’56 ’59 '62 65 ’68 ’71 p la c e th e For th e m o re th e need o f th e fo r k e ro se n e e le c tr ic T he u se o p e n e d an d coal o f up p ro d u cts o il a fu e l v ir t u a lly d ie s e l fo r th e a v ia t io n T h u s, th e d e p r e s s io n o il in o ve r has la s t th e 25 D u r in g th an o n ly W a r it II, B u t, p e t r o le u m p ro d u cts b o th been fro m in T he 8 25 o f U. S tate s d e p e n d e n t d o m e s t ic S. p e rc e n t has u p o n o f o f th e m o re 1946 has Im p o r t s in c r e a s in g o il in 1971. m o re to and m eet n e e e d s. W h y D o W e N e e d A ll T h a t O il? p ro d u ct of th e g a s o lin e is in d u s t r y , 1 3 8 for FRASER Digitized th e an d la r g e s t d e m a n d fo r it fo r in th e have n o n e n e rgy o f assu m e d in has sp u rre d can u se d m o re an d to an d th e In in o f fu e l o ils as a are th e o f th e ir m o re o f in t o r e s u lt p e r io d p e t r o le u m u se d T h u s, o n e o f th e th an fu e l m ark e t. m o v in g as d is t illa t e fiv e -y e a r u sage a m o u n t o f d ir e c t w it h in an d e le c tr ic ity a b s o lu te p r o p o r t io n m ark e ts th e hand, p e t r o le u m T h e re fo re , b u rn e d th e ge n e ra te d r e s t r ic t io n s o n r e s id u a l 1971, no e it h e r o th e r fro m p la c e d fu e ls o f g e n e r a t io n b o th p e t r o le u m m a jo r o f u se gases e le c tr ic ity . in c r e a s e d . 1966 fo r in th e yet fro m th e rem o ve d c it ie s h a v e c o n te n t has b e tw e e n e a s ily cau se d p e t r o le u m as th e o f s u lp h u r o f is O n fu e ls m u ch h ig h u se o r fro m has m u n ic ip a litie s s u lp h u r p ro ce ss. ge n e rate m o re j u r is d ic t io n , fu e ls b u rn e d be s u lp h u r th e of E ast fo r e ig n p o llu t io n a T h e re re m o ve th e fo r M a n y w it h g e n e r a t io n . u se b u rn ed , o n ch e ap e r w it h fu e ls be p e t r o le u m u t ilit y a c c o u n t in g o th e r to o f p ro d u ct o n been ye ars. fo r 3 to 4 p a r t ic u la r ly 1964, w ay to o il m a in has m an y h o w e ve r, th e c o m b u s t io n f u e ls o f c o a l 's a n t ip o llu t io n la w s . N o n e n e rgy in c r e a s e d p r o p o r t io n o f cru d e fo r w h ic h cru d e o il v a r ie s w it h A b o u t h a lf as roa d o f T h is s t a b le . is a a s p h a lt, has th o u gh th e raw th e o il u se d fo r th e in d u s t r y fo r it w ay ran ge fo r w h ic h m e d ic in e . raw m a t e r ia ls p e t r o c h e m ic a l re arran ge s m a t e r ia ls to a ls o p ro d u cts m a t e r ia l cru d e raw t h is en d d e m a n d a c t iv it y , th e in T he b u ild in g "fe e d sto c k ” p e t r o le u m p ro d u cts even co n su m e d r e la t iv e ly roa d o il ye ars, p e t r o le u m b a s ic u se d o f th e r e m a in e d fro m u se o ve r has o f has an d ge n e ra to rs o il c o n s u m p t io n . T h is s u lp h u r is s in g le m a t e r ia l c h e m ic a ls , p ro d u cts has c o n s u m p t io n co n ce rn e d an d coal th e an d raw S. h e at, im p o r t a n c e o il e le c tr ic cru d e c o n t r o ls b e co m e fu e l a e n e rgy fu e l 1964, in e le c tr ic ity th e U . w ith ch an ge s gre a te r r o le s u b s t a n t ia lly , Im p o r t in d u s t r y . A u t o m o b ile S. in c r e a s e d th e b road th e fo r o il, r e la x e d coal in have c o n s u m p t io n b e co m e o f o f in c r e a s in g ly c o n s u m p t io n fu e l d o u b le d , w as c o n s u m p t io n p ro d u cts im p o r t s a fte r o il o il d if f e r e n c e , th u s cru d e p r o d u c t io n so m e p e t r o le u m o f th e d o u b le d p r o d u c t io n . r e fin e d has its Im m e d ia t e ly co u n try th e S. d u r in g d o m e s t ic t im e , d o m e s t ic up U. th a n p e rc e n t th o u gh th is an d m ake p e rc e n t to in th e p ro d u ce d th at in o il to U n ite d m o re its u se d 1946 s in c e gro w th cru d e S. even im p o r t e d . o f 208 p e rc e n t. U. co n su m e d , o u tp a c e d in m o re p e r io d , 92 th e h ig h e x p a n s io n , C o n s u m p t io n has C o a st. w e re by us as 90 th e c o m m e r c ia l m a r k e t r e fle c ts fo r S in c e in c r e a s e d in in t e r r u p te d to sam e o f U. c o m m e r c ia l c iv ilia n a m o u n ts in d u s tr y 1 9 3 0 's . ye ars, an d p o w e r fu e l o f p ro d u cts. th is A b o u t in e n d -u se m a r k e t r e g u la r ly a c c o u n t e d c o n te n t. w h en o f fu e l. S tate s th e in c r e a s e d W o r ld h u ge b r ie fly U n ite d th e le v e l. m ilit a r y je t II, so u rc e an d m arket p e rc e n t have The p ro d u cts W a r th e o il fu e l d is p la c e d h e a t in g . c o n tin u o u s o n ly o f th e an d a lm o s t b e in g as as p e t r o le u m u n d e rgo n e gro w th an d cru d e e v e n t u a lly p e t r o le u m W o r ld coal h e a t in g fo r an d h o m e g o b b lin g g a s o lin e in v e n t io n c o m p le t e ly fo r a fte r r e p la c e d be gan o c ta n e th e h o m e m arke t fo r d e m a n d r a ilr o a d s in 1 9 3 0 's , a lm o s t e x p lo d e d fu e l o il n e w th e so u rc e t r a n s p o r t a t io n w it h th e eq ual im p o rta n c e p r im a r ily co u rse , o f im p o r ta n t r e s id u a l fu e l an o th e r gas s im u lt a n e o u s ly , b u lb . d is t ille d d u r in g A lm o s t d e c lin e d lig h t n atu ral as im p o r t a n t . th e p r o v id e U sage cru d e ab o u t h e a t in g . m in o r T h is b e cam e O f e x a m p le , S u p p ly in g g a s o lin e re st. w it h in h o u s e h o ld sp ace to p u rp o ses, c o m p o s it io n th e a e n e rgy t r a n s p o r t a t io n . fo r in p e t r o le u m . m a n u fa c tu r in g se c to rs. s h ift co n su m e d c re a te tak e n n o fo r p ro d u cts fo r at o f to s p e c ific m a rk e ts o il is acco u n ts th e e x p a n d in g been d e m a n d p e t r o le u m u se s th e an d But g r o w in g o f cru d e o f p o w e r, th e u se s been has p e rce n t fo r '47 to o . have th e re u se d o f o th e r im p o r t a n t , o il Industrial U ses th e O f th e u se s to m o le c u le s p ro d u ce t h o u s a n d s o f d iffe r e n t p r o d u c t s , m o s t o f w h ic h M O N T H L Y REVIEW are raw b u lk o f m a t e r ia ls th e s t r ip U n ite d o f th e an d N e w s u it e d g o o d th e State s to th e w a te r p r o c e s s in g . T he L o u i s i a n a ’s a lo n g b e tw e e n p r o d u c t io n (cru d e are a is o il an d o f th e o il th e s in c e S. th e th e en d are ye ars is t h e an d se co n d th e w it h W o r ld th a n W a r n o w s u p p lie s o f le a d in g ’45 th is L o u i s i a n a 's o n ly G u lf C o a st L o u is ia n a fiv e f o ld M o st a lo n g t r a ilin g o f pace o f m o re p la c e n a t io n , o u tp u t. ’48 In 1971, Texas p e rce n t o f U. S. cru d e o il p e rc e n t; 11 an d fo r p r o d u c t io n ; C a lifo r n ia , is s t i ll g o i n g u p , th e has m a r k e d ly rate th e M is s is s ip p i o il n a t io n . is in It s t h ir d pace, s u p p lie d ab o u t m an y in an d been n ot 2 p e rce n t in c r e a s e s m u ch n e a r ly le s s so th e tre a te d o f o f in ab o u t th e th e M is s is s ip p i n a t i o n 's w as has a u n t il la c k e d m o re o th e r as p r o d u c t io n o il th e ste a d y cru d e p r o d u c t io n in exu b eran t had A la b a m a by th is o ffse t so o u tp u t th a n in 10 D is t r ic t th a n in c ith e r A fo r D is t r ic t s id e s C re e k " o il F lo r id a r e s e r v o ir in o n p ro ce ss th e s t r ik e is S in c e th a t th ru st p e rc e n t la s t L it tle o f cru d e has p la n t s s c h e d u le d th e th e cru d e s u lp h u r . s u lp h u r a lm o s t o f m u st A c c o r d in g th at is e n o u gh th e are fo r gre a te r a d ja c e n t fie ld s . to r e c la im e d m arket p r o c e s s in g . h ig h n o w v a lu e Se ve ral stre am p r o d u c t io n le v e ls in th e e x p an d e d p r o d u c t io n ap p ear be to on c o m p le t io n very so m o re th e re b y in a c t iv it y area, in an d s h o r tly , le v e ls E x p lo r a t io n th e p ro sp e c ts F lo r id a tw o c o n tin u e s an d fo r A la b a m a go o d . For P r o d u c t io n c a p it a l- in t e n s iv e t im e , th e in it is a la r g e peak cru d e to tal in fe w th a t fro m o il. h a ile d an d o f by C re e k t h a t is p r o d u c e d c o n ta in s w as "J a y " fie ld n ot th e th e m o st Jay d e la y e d th e yet but State s th e fo r FEDERAL RESERVE BANK O F ATLANTA o f w o rk n u m b e r in th e p a id in in r e fin in g p ro d u cts, an d in fo r and e m p lo y m e n t la c k 96 D e s p it e p e rso n s an d n o n fa rm m ake w o rk fo r an d t h is in up fo rc e $400 180 5 e a rn th o u san d to acco u n te d p e t r o le u m D is t r ic t . im p o r t a n c e o n ly an d th e an d in d u s t r y , a m o u n t in g c o m b in e d p e t r o le u m m illio n e n gage d p e t r o le u m th a n in an d 4 7 ,0 0 0 w orke rs M is s is s ip p i e a r n in g s th e o f th e o il to ta le d p a y r o lls in E m p lo y m e n t cru d e o f o f th e re fo re , its s h a r e th a n m o re i n d u s t r y 's e n gage d e x p lo r a t io n w as r e q u ir e d o v e r w h e lm in g , in d u s t r y . m o re w it h o f an d th e t w ic e a M o st and, p e t r o c h e m ic a ls L o u is ia n a p e rc e n t is not in c lu d e th e la b o r is "b ro u g h t e m p lo y e d is t r a n s p o r t a t io n an d is m a c h in e s , th e gas w e ll o u tp u t. S o u th e a st w e 1970, b illio n . o f d r illin g e m p lo y m e n t w o rke rs lit t le th a n w it h If a p e o p le in th e 1970, its by m o re an d w a ge s. d u r in g by has in in th e n very o f n atu ral A fte r S o u th e a st e m p lo y m e n t gas an d stre a m is p e r f o r m e d e x p lo r a t io n n atu ral o i! in d u s t r y . ste a d y S o u th e a st $ 1 .5 "so u r" s u lp h u r , a th e w orke rs E s c a m b ia cru d e " c o m p le t e d ," in d u s try in on t h e s e w e lls . S o u r le v e ls in th e th e b o rd e r. are as an d o f m a in t a in n a t i o n 's m ad e r e s e r v o ir , U n ite d fa c ilitie s h ig h m a jo r u n d e rgro u n d re p o rts so m e fie ld s fro m be gan in "L itt le th e P r o d u c t io n tre atm e n t a been sam e t h is c o n tin e n ta l ye ars. has th e th e F in a l re se rve s th e not fa c to r F lo r id a -A la b a m a A la b a m a ye ars, p r o d u c t io n . o f o il fie ld in s t ill in " to w h ile fe w n or n a t io n a l th e la s t B u t D o e s It P r o v id e j o b s ? of an d b e lo w th at d is c o v e r y p ro d u ce E s c a m b ia o il th e asse rt a d e q u a te cru d e in state b e in g s ig n ific a n t th e m ark e te d , th e co st sta te s e x p a n s io n 1964. re p o rts o f th e b ase o r o f G e o lo g ic a l in a th at m a jo r n e w b o th be L o u is ia n a M is s is s ip p i. e x p a n s iv e s ig n if ic a n t ly s m a ll in d u s t r y rem o ve a llo w in g at has le v e l. T e n n e s s e e 's p r o d u c t i o n , t h o u g h e x p a n d in g fro m can to so u rc e s, to are n in t h at th e o il ran ke d p ro d u ce r gro w n ste ad y e x a m p le , 1971 has ’71 p r o d u c t io n ran ks c o n s e q u e n t ly , ’69 ye ars. P r o d u c t io n have and, an d ’66 p r o d u c t io n ye ars. s e c o n d -la r g e s t S o u th e a st p r o d u c t io n n a t io n a l fo r th e th e re ce n t ’63 L o u is ia n a , L o u i s i a n a 's o f in c r e a s e in ’60 36 tre a tm e n t s lo w e d ’57 Texas a cc o u n te d p e rc e n t. W h ile ’54 o il- p r o d u c in g fa b le d in d u s try state , o n ly ’51 G u lf be cru d e B im o n so f an d gas) state s kept p r o d u c t io n . ta k e n L o u is ia n a in 27 le a d in g s in c e b e fo re fo r th e S o u th e a st Texas fa c ilitie s , n atu ral th a n t h ir t y U. has in in c r e a s e d p ast o f e x p a n s io n its becom e th e D is t r ic t . . m o re o u tp u t p e rc e n t C o a st. has p r o d u c t io n D is t r ic t d u r in g t h e S ix t h cru d e D is t r ic t n a t io n a l in has of e s p e c ia lly p e t r o c h e m ic a ls , r e fin in g C o ast c e n te r 7 0 0 -m ile B r o w n s v ille , T h is o f a G u lf o il- p r o d u c in g n e arb y. P r o d u c t io n state lo c a t e d t r a n s p o r t a t io n , " In S ix t h is L o u is ia n a . m a t e r ia ls lo c a t e d 29 fu rth e r G u lf C o a st O r le a n s , raw II. fo r o f t h e p e t r o c h e m ic a l m a n u f a c t u r in g c a p a b ilit y in L o u is ia n a , p r o d u c t io n p e rc e n t o f th e an d S t a t e 's a b o u t 8 p e rce n t 139 o f its t a x a b le fro m th e im p o r t a n t cre a te d M o st n o n fa rm d ir e c t to L o u is ia n a th at o f are th e r e fin in g p a y r o ll. to q u it e p e t r o le u m b e cau se r e la t e d 3 3 ,0 0 0 an d But e m p lo y m e n t , m an y so u rc e in in d u s t r ie s S o u th e a st o f o il becom es fo r th e an in c r e a s in g ly im p o r t a n t U .S . % of U.S. production are p r o d u c t io n . e m p lo y e d p e t r o c h e m ic a ls The is jo b s p e t r o le u m p e o p le a s id e - - in L o u is ia n a 25 w o u ld not have jo b s s u p p lie s w e re not d ir e c t ly r e la t e d to t io n p e t r o le u m in th at lo c a te d in d u s try n e arb y. if p e t r o l e u m D istric t C ru d e O il P ro d u c tio n E m p lo y m e n t " o f m o re th a n p e rc e n t fo rc e . 11 of th e T h is p r o d u c t io n p ro d u cts 7 8 ,0 0 0 o f in p e o p le S t a t e 's p a rt p e rc e n t th e th e o f th e 1970, p r iv a te , th e an d fo rc e n o n fa rm , t o t a le d or n e a r ly n o n fa rm w o rk - 10 10 n e a r ly p a y r o lls in i State . in w as an d in d u s t r ia l w o rke rs th e w h ic h p e t r o le u m o f in o n ly n atu ral gas e m p lo y m e n t , 1970. T h e se r e la t e d e m p lo y m e n t w e a th e to tal S t a t e 's u p o n im p a c t th e to in d u s try lic e n s in g p a id s im p ly a cco u n te d i i i i ’50 p e rc e n t but fe e s a s id e of d e p e n d e n t fro m 2 7 .5 in in 1971. S im ila r p e rce n t o f M is s i s s i p p i 's Taxes o f th e ta x e s tax th e by to o il and in d u s t r y exact S t a t e 's to tal to are , a c c o r d in g th e to M y sh o w s th a t th e is tax im p a c t th e in d u s try B e fo re an y m u st la n d . area of an d gas In th e g iv in g 1971, th e th e d r ill have o il re n e w is r e n e w a b le th e If o il expect s ig n in g a r ig h t s a th e $25 p r o d u c t io n 140 as to to o r as at r ig h t d o lla r s w as W e r e a lly o il b e g in s , r ig h t fo r te rm s, gas is yo u r $50 per F u rth e rm o re , per fo r yo u r year o il. co n d u ct an re n tal W h e n le a s e o il fo r t h is i > i ’65 I I I I I ’70 in d e vo te d an d th e g iv e up be cau se o p tio n an d le a s e th a n acre , s im p ly p la t fo r m s m ig h t an d L a rge if r e q u ir e a fte r ban ks p r o d u c t io n le a s t on o n e la r g e e q u ip m e n t b an k to th e o f th e th e have e x p lo r a t io n are th e an d o il an d L o u is ia n a , in th e co astal e q u ip m e n t s p e c ia liz e d are a o f s e r v ic in g b u ild in g su ch p la c e . th is fie ld e q u ip m e n t s p e c ia liz e s s e r v ic e fo r s e r v ic e e x a m p le , in d u s try gro w n p a r t ic u la r ly so u th e rn in Se ve ral p e t r o le u m th at m o re m ad e c o lla t e r a l d e p a rtm e n ts in in an d fig u r e s re se rv e s. up are a c t iv e lo a n s S ix t h fin a n c in g p r o v id e For p la t fo r m s th e y c o m p a n ie s in e x p lo r a t io n r e q u ir e gro w n d r illin g th e to p r o r a tio n in g have to in an d d r illin g . have in T h e se in d u s t r ie s b an ks are as o il to an d s e r v ic e th e o n sh o re in d u s t r ie s o ffsh o re fo r to o ffsh o re you p aym en t T he th e h o w So u th e a st. in d u s t r ie s p r o d u c t io n la n d , yo u lo a n s p r o d u c t io n d u r in g in d ic a t io n p r o d u c t io n s e r v ic e gas. b illio n p r e c is e ly in v o lv e d s in c e D is t r ic t m a k in g gas. im p o r t a n t le a s e s T h e to on 1971 p a id B a n k i n g F it I n ? e n o u gh th e th e fo r h a lf it w e n t th e been ever in th e to th e n atu ral r e t a in e d o f vary gas o f w as r o y a lt ie s say fu rth e r D o e s have b ase d an d So u th e a st. so m e s t a b le aro u n d n atu ral te sts ban ks in d u s try ban ks to w as m u ch o f d o lla r s a d d it io n a l co u rse , o r e s tim a t e p r o d u c t io n h o w o il S o u th e a st o il th e r o y a lt ie s a b ility A n T h e se an d fin d in g th e fo r m o n e y in an d b illio n an o f o f o n e -e ig h th p r o d u c t io n . an d in h a lf im p o r t a n c e lo a n s la n d p r o d u c t io n w o u ld i r o y a lt y fo r p o w e r th at o r even d o a o f le a s e s e x p lo r e p a id p r o d u c t io n o il c o n tra c t M o st fo u n d . on fo r D is t r ic t la r g e to ta l a w it h c o m m e r c ia l o f to in d iv id u a ls of co m p an y, to o il. i g e n e r a liz a t io n s , fo r le a s t a ca n n o t, o f D is t r ic t yo u le a s e s e s tim a t e d ye ar. th e p la c e , le a s e is of o w n e r th e th e "b o n u s" e x p lo r e ta k e an d fo u n d $50 o f p a ym e n ts m e asu re d . th e le a s e th e o il le a s e . can un de r se arch lo n g be fro m w as fiv e -y e a r is can p e rc e n t A th e if e i t h e r c o n tin u e s . r e c e iv e in to to fo r 13 D is t r ic t co m p a n y w e lls th e a c t iv it y se cu re d la n d o w n e r th re e - m ig h t be S ix t h w h ic h S o u th e a st e x p lo r a t io n . b e tw e e n an d th e e x p lo r a t io n p e r m is s io n th e on in i i '60 c o m p a n ie s . H o w not w ays i p ro sp e c ts fo r L a n d ?" O f c o u r s e , e m p lo y m e n t , p a y r o lls , a n d o n ly p a id th e p a id h o w e ve r, are th e i v a lu e co u rse , an d in d u s t r y 's "O il O n i pay th e b a r g a in in g am o u n t or 3 re ve n u e s. o f in d iv id u a ls fo r to o f a m o u n ts m uch gro u n d a m o u n te d co m p a n y o n e -q u a rte r It taxe s p e t r o le u m ga s fro m and p a id se ve ra n ce th e p e rc e n t reven u e L o u is ia n a L o u is ia n a th e and D is t r ic t revenu e, lim it e d . th at o il th e fig u r e s p e rce n t e v e ry e m p lo y m e n t , i i ’55 4 ,7 0 0 an d in i of p e t r o le u m - d ir e c t ly i p e rc e n t 1 .6 2 .6 i th e e m p lo y m e n t , an d s u b s t a n t ia l tak e fo r e a rn e d p ro d u ce d L o u is ia n a , to to jo b s e x t r e m e ly In an d a m o u n t in g p a y r o lls are are M is s is s ip p i. o n e d ir e c t 7 ,0 0 0 th e are exceeded w o rke rs G e o r g ia , M is s is s ip p i, tax in p r o d u c t io n p r o d u c t io n . gas except state in p a y r o lls . A d d i n g in d u s t r ia l an d sta te an d o f p e t r o le u m O il o th e r e m p lo y m e n t o f M is s i s s i p p i 's t a x a b le fin d i ’45 M is s is s ip p i D is t r ic t 15 la b o r e a rn e d t a x a b le 20 / tra n sfo rm a L o u is ia n a in 30 th e in h a n d le b o th lo a n s , m a k in g in d u s try . but at lo a n s S m a ll ban ks M O N T H L Y REVIEW in th e vast D is t r ic t m ake m a jo r it y M o st sh y e q u ip m e n t th re e - to u su al fiv e -y e a r o n m a x im u m lo a n k n o w n an o u ts id e to o n e -h a lf in th e w e ll, b a s is o f o f The 50 an d to 70 in th e by a o n e a gro u n d , lik e ly , w e ll. or re ason fo r su ch c a u tio n is th at th an a m in o r se tb a c k . R e q u ir in g if a n lo a n . o il w e ll th e p r o d u c t io n lo a n s o f are tw o o v e r e s t im a tio n m ad e ye ars at fo r p e r io d s so m e a o f ra te th e o f case s, to th e se in t e r e s t so m e o f t ie d th e se are to lo a n s b o rro w e r d r a w in g p r o d u c in g w e lls . b e in g m ade, th e lo a n T he lo s s to go o d , lo o k e d lo a n s u p o n p r a c t ic e n e w h ig h an d th e co m e fro m c a p ita l in t o th e $20 m illio n th e o f s h ip s per th e D is t r ic t of th e in th e ban ks been in th e O n an d to th e se la r g e in Jay Even fo r m illio n s a m en an d FEDERAL RESERVE BANK OF ATLANTA a o f o u t to ban k to b an k th e la r g e r w it h p a r t ic ip a t e ban ks u n a b le to in a ls o so u rce s, lo n g e r -t e r m or G u lf. to o f So m e n o n b an k e it h e r b u s in e s s th e a rra n ge m e n ts fo r lim it s d r illin g in c o m p a n ie s m o st c e n te rs th e su ch fu n d s p r o v id e u n w illin g to p r o v id e p r a c t ic e . W h a t o f th e F u tu re ? T he U. S. is w o r ld , to tal in 1969. in W e u se w e had to T h is S in c e no are o n sh o re o f is th e as For s u p p lie s ru n s e x a m p le , not s e r v ic e e q u ip m e n t e x a m p le , to o ffsh o re th a n to 1959, lim it to p ro d u ce d p e rc e n t q u a n t it y T he th e o f U. an d th at re se rv e s. is th e to have been d e b ate d p ro d u ce is not th e b o th im p o r t by th e o f is co st e n cou rage d o m e s t ic r e s u lt o f t h is p r o d u c t io n d e p e n d e n t t h is jo b th an p r ic e ave rage o f w h e th e r o r o il r e q u ir e s w it h in p r ic e h ig h e r d o m e s t ic fo r th e a m o u n ts o il d e s ir e d s e v e r e ly th e h ig h e r T he to d o in g fro m im p o r t s . d o m e s t ic a lly o f State s in t o im p o r t p e t r o le u m an d s u p p ly q u e s t io n p r a c t ic e , m o d if ie d o f o il d e v e lo p m e n t T he in u se d o il h ig h e r cru d e e n cou rage U n ite d so u rc e s be S. a th e an d th e fo r e ig n at b illio n im p o r te d o f a llo w s 5 .5 has d o m e s t ic s o ld e x p lo r a t io n o il p r o b le m . co n su m e d State s o f p r ic e d b o th th e w e p u rp o se s u p p ly co ve r o f U n ite d o b ta in e d . r e s t r ic t io n In e x a m p le , be so u rc e s can a For p ro te c t p r o d u c t io n q u o ta s lie s p ro d u ce. be fu rth e r so la r g e s t o il - c o n s u m in g to to in g lo b a l th e o th e r w is e d e s ig n e d th e t h e r e in th e in n a t io n o f a ls o p ro d u cts lo w e r o il p e rc e n t an d 25 th e o il- p r o d u c in g 22 w e Sta te s. r e s t r ic t io n c o u ld any are w o r ld , p e t r o le u m U n ite d T h is an up im p o r t o f q u o tas la r g e s t W e th e m o re b a r r e ls th e th e m a k in g so u rce . T h e gro w n are le n d in g m a tte r r ig s h ip d e liv e r as fo r e ig n d r illin g s o p h is t ic a t e d . ban ks Even cu sto m e rs. c o m p a n ie s , o f th o u san d . s in g le n eeds th e c o n s id e r e d , e x p lo r a t io n m o re th a t are (F o r have cu sto m e rs $800 d o lla r s . c a p ita l la r g e in s u r a n c e fro m e x a m p le , o f in d u s try re fe r as to w e re co rre sp o n d e n t m ake fin a n c ia l th e ir w o r ld b e cau se in d iv id u a l lo a n s . to th e in d iv id u a l in e x a m p le , ch an ges la r g e r D is t r ic t o th e r is th at an fo r o p e r a t io n s th e m ad e o f to in an its lo a n s m arke t in d u s try fie ld , th o u san d d r illin g ban ks fo r to in th e q u o tas c le a r e n su re s p a cka ge s. in lo a n s fro m to p e t r o le u m th e ban ks ca p tu re u n d e rtak e n . th e h ig h in fu rth e r o f s id e s u p p lie s in d u s try an d n eeds tu rn s p a r t ic ip a t e 1971. r is k y re p a y m e n t. o p e rato r b an k a on p r o d u c t io n fa st on p a st as te rm s f lo w to o it n a t io n e x t r e m e ly th e a tte m p te d cash to th e am o u n t n eeds in d u s tr y have th e in T he th e th at t im e , c a p ita l has c a p ita l s e r v ic e ste rn th e an o th e r an d T h e se an d to $5 v e s s e ls s h ip f le e t m en fu rth e r p r a c t ic e , c o n s t a n tly ban ks e n s u r in g $500 o f b e co m e to m ad e r e q u ir e m e n t s te n s u n c o m m o n .) has are n eeds o ffsh o re p o r tio n o f w it h o p e r a t io n co st W h e n ban ks r e q u ir e s ve n tu re s d r illin g In o f c r e d it is th e W h e n b e co m e h e lic o p t e r r ig s . m ade f lo a t in g rate . se cu re d p e t r o le u m th e re b y a ls o C a p ita l so m e lin e th e s tr in g e n t . th e v e n tu re s r is k y a In in p la c e A s T he y w e re $ 3 -to b o w th e s id e r ig s . fe r r y in g ta k in g b e cau se at w it h th e th e th e re fo re p e rc e n t o p e r a t io n , w ill th e and 80 b a la n c e m ad e o p e n -e n d e d , in d u s try b e cau se e s p e c ia lly to as o f p e t r o le u m p a r t ic u la r , 70 t im e fiv e gro w . p e rh ap s b u s in e s s fro m e x p e r ie n c e th e a to o f th e are w it h p r im e u p o n re d u ce s o n e p r im e . R e p aym e n t in c r e a s e d b o rro w e r lo a n s in and, is u p o n ab o ve b e co m e by fro m lo a n s r is k P r o d u c t io n m a x im u m m ad e th e th e o f th e a th e se 3 -p e rc e n t lo a n s rate to D e p e n d in g co m p an y, 2- re se rv e s. r a n g in g ban ks ye ars at o th e r b an k s. sh e e t o f of p r iv a te w e re as fro m to ste rn co st g iv e th at tu gs. o c e a n -g o in g su ch m o v in g d r illin g h a n d le , lo s s ra th e r o f s e r io u s s e t b a c k s o v e r se v e r a l f a c ilitie s a n d r is k is is an d r ig s th ru ste rs b arge s w it h barge s th e se c lo s e in n e ce ssa ry w e lls — s e v e r a l w e lls a s c o lla t e r a l fo r lo a n s s p r e a d s th e th e o ffsh o re m in im u m m o re la r g e s t s p e c ia liz e s b o w th e e q u ip m e n t o f s im p ly s it e s o p h is t ic a t e d T h e se m a n e u v e r in g th e w h en N o w are t im e d r illin g w h en s p e c ia l c a p a b ilit y on th e r e q u ir e d a s c o lla t e r a l fo r a p r o d u c t io n g o e s b a d , it is u s u a l l y a c a t a s t r o p h i c th ru ste rs. re se rv e s u p o n A w it h of m ad e th e an d v a lu e . o n e th e s h ip s an d m illio n at to s e lf-p r o p e lle d . or are o f m ad e fiv e its w e re in t o a ttach e d by b ase d Loans are th e g e o lo g is t v a lu e p r o d u c in g m o re b a s is r ig s p u sh e d e v o lv e d th e o f th e fir m . fe w as se cu re d w it h d r illin g w e re fo r on b an k e s tim a t e d ru n p e rc e n t m ad e th e lo a n s . ye ars are its e lf, o il o n ly and, e ig h t e it h e r th e m ad e lo a n s c o n s u lt in g o n ly th re e — u s u a lly o f m ad e up are w it h are but p r o d u c t io n e q u ip m e n t b e in g b y th at te rm s, lo a n s re se rv e s e s tim a t e s e q u ip m e n t , E q u ip m e n t th e P r o d u c t io n o n fro m lo a n s m a x im u m . m o rtga ge s lo a n s aw ay v ita l u p o n en ergy n o t th e e x p e c te d im p o r t o f th e m s id e s . p ro gra m in a b ilit y p e t r o le u m o f has th e been U. p ro d u cts S. to it th e b o u n d s o f e ffic ie n t p r o d u c t io n 141 p r a c t ic e s . T h u s, p ro d u cts, su ch is e x p e c te d 1945. H u ge to im p o r t in g as h e a t in g in c r e a s e , i n c r e a s e s in cru d e o il ju st o il fo r as it or r e fin e d th e N o rth e a st, has been s in c e im p o r t q u o t a s are u n d e r c o n s id e r a t io n T he keep in c r e a s e pace w it h as d o m e s t ic s o a r in g p r o d u c t io n c o n s u m p t io n r fa ils to B iiiions of 42 gallon barrels th an p e rce n t 4 th e o ff. 1945, even b r ie f n eeds o f o u r fo r is to d r ill in But th e se e m s need an d fu tu re th e fo r th e ab o u t p r o v id e d p ro ve d re se rv e s. in o il th e in an d in o f flo w th e m u st in d u s try in p r o d u c t iv e F e ars is o f G u lf, flo w gas a So u th e a st, n o rm a l w o rk th e a c t iv it ie s m o st M e x ic o . o f w h ic h has th e d e v e lo p m e n t o f o f p r o d u c t io n in t e r r u p t io n th e e x p lo r a t io n an d a d d it io n an d th e s in c e p ro ve d e x p lo r a t io n o f to o f o f lo c a t e d G u lf re se rv e s am o u n t rage s, in t e r r u p t e d d r illin g , jo b s. are th e have co n se q u e n t fu rth e r m o re has c o n tin u o u s ly fie ld s , am o u n t u n d e n ia b le , s p illa g e an d th e s t ill S. p r im a r ily s a le s , in T h e o il gas at p r o d u c t io n p ro ve d to ta l A la s k a n n atu ral g r o w in g a lm o s t th e co n tro v e rsy an d is w h ile o f fa lle n need U. p la c e s ye ar, in c r e a s e d . th e o il State s r a t io has has b o o st T h e th e per th o u gh in p ip e lin e cru d e U n ite d T h e c o n s u m p t io n re se rv e s 142 fo r in re se rv e s m e e t th e e n e rg y d e m a n d en ergy le v e le d Im p o r t s to r a p id ly e x p a n d in g e c o n o m y . an d su ch ta k e th e o il le a s e w it h lo s s o f th a t p la c e , S o u th e a st assu re d . ■ M O N T H L Y REVIEW and Bank A n n o u n c e m e n ts R o b e rta S m it h , $ 5 7 7 ,5 0 0 ; s u r p lu s a s s is t a n t and c a s h ie r s . C a p ita l, o th e r c a p ita l fu n d s , as n o n m e m b e r. $ 1 ,0 3 1 ,- 500. J u ly 13, B A N K 1972 O F PELH A M Pelham, Alabama J u ly 3 , 1 9 7 2 W A R R E N O pened C O U N T Y B A N K L. McMinnville, Tennessee G. v ic e O p e n e d fo r b u s in e s s a s a n o n m e m b e r . o th e r J u ly 7 , 1 9 7 2 J u ly B A N K O F STU ART, N A T IO N A L A S S O C IA T IO N O pened fo r S tu a rt, b u s in e s s as a c o n v e r s io n of th e Bank S t u a r t , F l o r i d a . O f f i c e r s : R o b e r t E. G r e e n e , p r e s id e n t ; p r e s id e n t . C a p ita l, c a p ita l 19, B A N K O pened W illia m fo r M . e x e c u t iv e p r e s id e n t ; C. Jean S h a k le y , and p r e s id e n t ; Sem pey, C. Jam es a s s is t a n t v ic e C h a r le n e and M an son $ 2 0 0 ,0 0 0 ; O ffic e r s : K. R o p er, s u r p lu s and $ 3 0 0 ,0 0 0 . H O L ID A Y p r e s id e n t ; d e n t; fu n d s, a 1972 O F c h a i r m a n ; J. T . W i l l i a m s , p r e s i d e n t ; A . J. W e h r m a n , v ic e b u s in e s s Holiday, Florida Stuart, Florida of fo r H o rto n , R. B a r e fie ld , p r e s id e n t s ; W a x ie r , c a s h ie r s ; FEDERAL RESERVE BAN K O F ATLANTA H a rr is , and v ic e and W ild a H e le n p r e s i Ste v e n c a s h ie r ; D a ile y p r e s id e n t . B e rn ard c a p ita l b u s in e s s R e g is te r, C h e ste r Lynn and A. a m em b er. L. C r i m m i n s , Y o u n ge r, K e n n e th C a p ita l, fu n d s, as Jr., c h a i r m a n ; L. C. Evan s, Jr., e x e c u t i v e v ic e La rso n , $ 9 6 0 ,0 0 0 ; O ffic e r s : J e rry v ic e p r e s id e n t and a s s is t a n t v ic e s u r p lu s and o th e r $ 2 8 8 ,0 0 0 . 143 B A N K IN G S T A T IS T IC S B illio n $ —*30 — Sis -1 2 D E P O S IT S 28 - 1 7 — 16 — 7.5 s ts — 7 -6 —5 J — 4 - 3 iii iiIii iiii tiii iIi iiii i t D J J 1970 D J 1971 J 1971 1970 1972 1972 LATEST M O N T H PLO TTED: JU NE Note: All figures are seasonally adjusted and cover all Sixth District m ember banks. •Daily average figures **Figures are for the last W ednesday of each month. S IX T H D IST R IC T B A N K I N G N O T E S C H A N G E S IN M A T U R IT Y O F C O M M E R C IA L A N D IN D U S T R IA L T E R M L O A N S END O F 1971— M ID -1 9 7 2 M illio n _ 60 T erm _ 40 _ 20 Durable Goods Mfg. Nondurable Goods Mfg. 144 M in in g Transp., Comm., P.U. Construction Services M O N T H L Y REVIEW T E R M B u s in e s s a c t iv it y en ed to th e m o re lo n g - t e r m b an ks are le n d in g lo a n s to an T he at o f ban ks d u r in g e c o n o m ic ju st ity w as $27 T he d e la y e d th ro u gh n eeds ban k q u ir e m e n t s has have m e r c ia l 8 .9 te rm F e e lin g lo a n s t h is p ast la r g e D is t r ic t a ll k in d s d e m a n d fo r fo r 1970 1971 1972 up ban ks. te rm stro n g In 13 or m illio n b am a of have in $31 c r e d it th e ir by a ls o tra d e N o n d u r a b le o th e r hand, D is t r ic t fo o d , $2 lo n g e r -t e r m lo a n s th e in c r e a s e Loans to th e up in v e n t o r ie s in a ll n e a r ly w as sta te s $11 m il T e n n e sse e . th e ir to m a n u fa c tu r in g d ro p in tu m in th e ban ks an d fu n d s, "ta k e d o w n " FEDERAL RESERVE BANK OF ATLANTA r e g io n , g iv e n o f th e la s t se c to rs a d d it io n a l te rm A la w e re to u se th e y stro n ge r lo a n th e up an d te rm A t la n t a in an d te rm O u t s id e re p a y m e n ts acco u n te d fo r p e t r o le u m th e and fir m s . c o n tin u e s b u s in e s s D is t r ic t to g a in fir m s ban ks lo n g -t e r m r e la t iv e ly be re d u ce d g a in lo a n rose L o u is ia n a , p ro d u ce rs. m in in g and th e ir b o r r o w in g la r g e th e th e th e se fir m s fir m s T he o f o n w it h so u th e rn ban ks la r g e r s h o u ld a ll la r g e m o re s t ill fir m s , lo a n s ap p arel ru bbe r a c t iv it y th e se of e con o m y. to th e p e cte d by e x p lo r a t io n A n d , except g r o w in g ye ar. in F lo r id a , p ro d u cts state s. n e a r ly fie ld , se c to r fa st o n e gas e c o n o m ic an d F lo r id a b o r r o w in g n atu ral A s an d L o u is ia n a sta te s c r e d it m o s tly a lth o u g h F lo r id a , an d in t e r m e d ia t e - a ll are fo r c h e m ic a l A la b a m a in m o st t h e ir th is fir m s in in d u s t r ie s in o f d u r th e m e ta ls te rm to b a c c o T e x t ile b o r r o w in g s e r v ic e an d u se b an k o f A la b a m a , s lig h t ly , e s p e c ia lly w h o le s a le m illio n , th e ir h a lf P r im a r y t h e ir an d in in c r e a s e s e co n o m y u n e x p e c t e d ly , m illio n — in th e m a n u fa c tu r in g b an ks liq u o r , m illio n , an d g o o d s to s e r v ic e not fir s t $6 d e cre a se d lo a n s an d in c r e a s in g G e o r g ia . a th e rose a d v a n c in g acc o u n te d r a is e d o f m ake b o o ste d th e T e n n e sse e . ban ks le s s e r pace T h e re fo re , lo a n s m illio n , by th e d u r in g m illio n , la r g e a c t iv it y as m a n u fa c tu re rs an d $ 2 .9 by fro m but m a n u fa c tu re rs c r e d it . M a c h in e r y th e has w e re e c o n o m y go o d s co n su m e r in c r e a s e d tra d e M a n u fa c t u r in g a b le $10 e co n o m y, by A d v a n c in g o f te rm to c r e d it c r e d it , b an k c o n p e rc e n t. fir m s r e c e iv a b le . m o st b an k stre n gth e n s, th e te rm b o r r o w in g c o m m illio n , b u ild in g s p e n d in g ban k fin a n c in g $27 in on lo a n s b u s in e s s e c o n o m y 1972. n e a r ly c o n s t r u c t io n b an k ban k sh o rt-te rm $167 o f re b u s in e s s ' been r e la t e d W it h sh o rt S h o rt-te rm stre n gth th o se fin a n c in g th e have of m illio n . b o r r o w in g . th e 650 a c t iv pace th e a fte r h a lf h e a v ily co n su m e r F lo r id a , an d an d fir s t y e a r 's r e lie d a cco u n ts e x p e r ie n c e d o f 7 00 b o r r o w in g o th e r a fte r ad van ce d an d te rm $20 In c r e a s e d th e 750 w as sh o rt-te rm in c r e a s e d t h e ir s h o r t - t e r m a m o u n t— w e re 8 00 a c t u a lly illu s t r a t e s , lo a n s th e b o o m in g , t h e ir w h ereas tra d e 850 e n tir e fin a n c ia l by m o re t im e an d fir m s an d e x t e n s iv e ly . have th e lio n , lo a n s T h e se p e r io d so m e fa ll have except Million $ 23 large banks w h en th e b u s in e s s an d c r e d it u se d s p e n d in g creased flo w cu rre n t d u r in g c o n s t r u c t io n an d LO ANS th e a c t iv it y ste p p e d -u p la r g e ly in d u s t r ia l la s t a o f p u rp o ses. m et te rm fo r an d la te fir m s TERM la r g e s t e c o n o m ic in v e n t o r ie s cash been p e rce n t, tra st, IN D U S T R IA L c o n tra st, lo a n s . A t fir s t, b u s i n e s s be as th e ban k ad van ce d s in c e te rm AND te rm year d u r in g w h e n to t y p ic a l c a p ita l can B u t, u se lo a n s an d to In b u s in e s s 1970 se ason al in c r e a s e d lo a n s . is te rm fo r w o r k in g fir m s up, in t h is C O M M E R C IA L B A N K S "ta k e e x a m p le , D i s t r ic t 's m illio n re sp o n se a c t iv it y are o w n p ic k s e n s it iv e o f D IS T R IC T y e a r.) b u s in e s s e s th e L A R G E ST w eak. e c o n o m ic te rm to lo a n s o n e T H E te rm (T e rm s t r o n g ly . w h en in fir m s . o f A T la r g e s t in d u s t r ia l For m o n th s $40 m illio n at r is in g p e r io d b e g in n in g d e c lin e d th a t th e pace e x ce ss a c t iv it y . s ix w as o n ly a an d in m illio n fir s t stre n gth r e q u ir in g r e s u lt, p a r t ic u la r ly $92 rose a R IS E are in d u s t r ia l c r e d it is th e 1971, an d te rm a c t iv it y lo a n s A s T H E n o w fir m s ste p p e d -u p b u s in e s s in c r e a s e d o f a m a t u r it y b an ks pace lo a n s te rm c r e d it . O N has b u s in e s s c o m m e r c ia l o f IS S o u th e a st c o m m e r c ia l th o se o r ig in a l o v e r a ll year b an k v o lu m e d o w n " th e th a t r e p o r tin g are w it h in p o in t C R E D IT a b ilit y a b le to be fo r p a rt c r e d it liq u id to m o m e n can attra ct ex o f n e ed s. p o s itio n o f a d d it io n a l a cc o m m o d a te th is dem an d. J O H N M . G O D F R E Y 145 S i x t h D i s t r i c t S ta tis tic s S e a s o n a lly A d ju ste d (A ll d a ta a re in d e x e s, u n le s s in d ic a te d o th e rw is e .) Latest Month 1972 One Month Ago Two Months Ago One Year Ago Unemployment Rate (Percent of Work Force) . . Avg. Weekly Hrs. in Mfg. (Hrs.) SIXTH DISTRICT IN CO M E A N D SP E N D IN G Manufacturing P a y r o l l s .................June Farm Cash R e c e i p t s ....................... May C r o p s ........................... Livestock ................................. May Instalment Credit at Banks* (Mil. $) New L o a n s ................................ June R e p aym e n ts................................ June 144 114 151 107 145 133 140 139 149 146 193 143 135 139 198 134 452 391 465r 404r 450 380 379 361 Printing and Publishing . June Stone, Clay, and Glass . June . June Transportation Equipment . June T r a d e ........................... Fin., ins., and real est. . . . June . June Itoo Months Ago O n* Year Ago . June . June 5.1 41.7 5.4 41.0 5.4 41.2 5.2 41.2 . June . June . June 176 160 166 174 162 166 172 157 169 150 142 143 Manufacturing P a y r o l l s .................June Farm Cash R e c e ip t s .......................May 143 140 144 131 147 175 136 192 126 111 129 132 85 126 110 129 132 96 125 110 128 135 97 122 108 124 129 101 3.5 41.1 3.7 41.2 3.9 41.6 4.2 40.9 196 185 219 194 186 210 190 178 208 169 168 185 144 132 144 128 145 136 132 84 115 105 120 108 80 115 105 120 108 87 115 105 120 109 86 113 104 117 107 82 3.7 41.1 3.8 40.8 3.7 41.2 3.8 40.4 179 148 203 174 152 197 167 146 193 148 133 172 136 106 134 120 137 122 129 94 107 101 108 86 75 107 102 109 90 85 107 102 109 93 82 104 100 105 83 75 5.9 42.2 5.7 41.9 5.7 42.5 6.6 42.4 159 153 161 154 154 151 154 150 149 138 141 143 165 140 163 169 164 162 143 139 114 120 111 92 88 114 119 112 95 91 114 119 112 96 88 111 113 110 98 90 FIN AN CE A N D B A N KIN G FLORIDA 116 108 108 102 106 106 111 115 105 107 102 110 104 117 124 101 119 109 115 119 125 124 98 125 86 116 108 108 103 105 105 110 115 105 107 102 111 106 118 123 101 119 111 116 119 125 123 100 125 90 116 108 108 104 104 106 109 114 104 107 102 112 106 118 122 102 119 113 116 125 124 123 100 125 89 113 106 107 101 103 106 110 114 105 105 98 107 105 115 117 105 115 107 112 115 121 119 99 120 86 4.2 4.3 4.3 4.8 2.4 41.0 195 247 143 168 86 123 277 233 186 268 286 215 163 297 318 193 184 181 205 270 409 708 407 2.3 41.0 238 259 217 176 85 124 269 234 185 266 290 215 164 299 311 193 183 185 200 267 398 650 413 2.3 41.3 224 282 167 170 91 112 268 231 184 264 287 211 164 294 314 190 179 187 202 266 396 652 425 2.9 40.7 183 192 175 165 89 124 254 219 177 243 278 200 166 261 296 174 177 166 211 241 386 614 389 181 169 177 165 173 159 154 143 165 146 192 166 149 184 160 143 182 149 136 164 Member Bank L o a n s * .................... June Member Bank D e p o s it s * .................June Bank D e b i t s * / * * ...........................June INCOM E Manufacturing P a y r o l l s .................June Farm Cash R e c e ip t s .......................May EMPLOYM ENT Nonfarm E m p lo y m e n t .................... June M a n u f a c t u r i n g ...........................June N o n m a n u fa ctu rin g.......................June C o n s t r u c t io n ...........................June Farm E m p lo y m e n t..........................June Unemployment Rate (Percent of Work Force) June Avg. Weekly Hrs. in Mfg. (Hrs.) . . . June FIN AN CE A N D BAN KIN G Member Bank L o a n s .......................June Member Bank D e p o s i t s .................June Bank D e b i t s * * .............................. June GEORGIA INCOM E Manufacturing P a y r o l l s .................June Farm Cash R e c e i p t s .................... May EM PLO YM EN T Unemployment Rate (Percent of Work Fort Insured Unemployment Electric Power Production* Cotton Consumption** . . One Month Ago IN CO M E EM PLO YM EN T A N D PRODUCTION Avg. Weekly Hrs. in Mfg. (Hrs.) Latest Month 1972 . June . Mar. .** July . May . May . May . May Printing and Publishing . May Furniture and Fixtures Stone, Clay, and Glass ■ May . May . May Nonelectrical Machinery . Electrical Machinery . . . Transportation Equipment . . . . May May May May FIN AN CE A N D B AN KIN G Loans* . June Deposits* . June Nonfarm E m p lo y m e n t .................... June M a n u f a c t u r i n g ...........................June N o n m a n u fa ctu rin g.......................June C o n s t r u c t io n ...........................June Farm E m p lo y m e n t..........................June Unemployment Rate (Percent of Work F o r c e ) ............. June Avg. Weekly Hrs. in Mfg. (Hrs.) . . . June FIN A N CE A N D BAN KIN G Member Bank L o a n s .................... June Member Bank D e p o s i t s .................June Bank D e b i t s * * .............................. June LO UISIANA IN COM E Manufacturing P a y r o lls ................... June Farm Cash R e c e i p t s ....................... May E M PLO YM EN T Nonfarm E m p lo y m e n t .................... June M a n u f a c t u r i n g ...........................June N o n m a n u fa c tu rin g.......................June C o n s t r u c t io n ...........................June Farm E m p lo y m e n t.......................... June Unemployment Rate (Percent of Work F o r c e ) ............. June Avg. Weekly Hrs. in Mfg. (Hrs.) . . June FIN A N CE A N D B A N KIN G M IS S IS S IP P I IN CO M E Manufacturing P a y r o lls ................... June Farm Cash R e c e ip t s ....................... May 144 62 141 165 151 171 134 166 108 106 109 95 76 108 107 109 97 81 108 106 109 96 82 107 107 107 100 81 E M PLO YM EN T 146 EMPLOYM ENT . June M O N T H L Y REVIEW Latest Month 1972 One Month Ago Two Months Ago One Year Ago One Latest Month 1972 Month Ago Two Months Ago One Year Ago 115 108 119 117 92 115 108 119 119 91 116 108 120 124 92 111 106 114 107 91 3.9 40.1 3.7 40.8 3.6 40.9 4.8 40.1 179 158 170 172 159 154 168 155 155 152 142 152 EMPLOYM ENT Unemployment Rate (Percent of Work F o r c e ) ............. . June Avg. Weekly Hrs. in Mfg. (Hrs.) . . . June 4.3 40.9 4.2 40.8 4.2 41.0 5.1 40.5 FIN AN CE AN D B AN KIN G Member Bank L o a n s * .................... June Member Bank D e p o s it s * ................ , June Bank D e b i t s * / * * ....................... ..., June 183 168 193 180 163 184 175 160 173 158 148 158 Nonfarm E m p lo y m e n t ................... , June Manufacturing .......................... , June , June C o n s t r u c t io n .......................... June Farm E m p lo y m e n t......................... June Unemployment Rate (Percent of Work F o r c e ) ............. June Avg. Weekly Hrs. in Mfg. (Hrs.) . . . June T E N N ESSE E FIN AN CE A N D B AN KIN G Manufacturing P a y r o lls ................... June Farm Cash R e c e i p t s ....................... May 143 106 149 134 153 147 Member Bank L o a n s * .................... June Member Bank D e p o s it s * ................ June Bank D e b it s * / * * ............................. June 138 214 *For Sixth District area only; other totals for entire six states Daily average basis tPreliminary data NA r-Revised Not available Note: Indexes for bank debits, construction co n tracts, cotton consum ption, em ploym ent, farm cash receipts, loans, deposits, petroleum production, and payrolls: 1967= 100. All o th er indexes: 1957-59=100. Sources: Manufacturing production estimated by this Bank; nonfarm, mfg. and nonmfg. emp., mfg. payrolls and hours, and unemp., U.S. Dept, of Labor and cooperating state agencies; cotton consumption, U.S. Bureau of Census; construction contracts, F. W. Dodge Div., McGraw-Hill Information Systems Co.; petrol, prod., U.S. Bureau of Mines; industrial use of elec. power, Fed. Power Comm.; farm cash receipts and farm emp., U.S.D.A. Other indexes based on data collected by this Bank. All indexes calculated by this Bank. D e b its to D e m a n d D e p o s it A c c o u n ts In su re d C o m m e rc ia l B a n k s in th e S ix th D is tric t (In T h o u s a n d s of D o lla rs) Percent Change Percent Change May 1972 June 1972 June 1971 Year to June date 1972 6 mos. From 1972 May June from 1972 1971 1971 STANDARD METROPOLITAN STATISTICAL AREAS + 16 +8 + + 8 + + 14 19 +8 + 1,311,137 + 3 + 24 2,719,744 + 8 + 22 4,965,255r + 3 + 5 979,647 + 4 + 31 342,651 + 9 + 20 17 + 88 288,092 2,583,220 - 2 + 16 771,203 - 1 + 15 141,555 + 3 + 19 9,622,353 + 3 + 18 392,941 + 6 + 14 337,232 1 + 9 380,674 + 7 + 19 410,018 + 5 + 12 1 + 22 166,277 1,018,663 2 + 8 188,209 3 + 18 4 + 11 184,133 3,257,903r + 4 + 11 197,643 + 4 + 15 3 + 18 1,003,736 988,298 + 6 + 2 722,206 + 3 + 4 2,304,489 + 9 + 26 + 26 +4 +8 + 19 + 119 + 21 + + 29 + 12 + 26 15 + +111 + 21 + 14 + 18 16 + 15 + + 11 + 15 + 12 + 11 + 11 + 14 + 10 +6 + 14 + 12 + 3 + 10 + 20 40,071 123,894 227,119 119,593 14 + 67 + + 12 -7 +7 _ 1 + 16 2 + 14 + 9 + 27 + 4 + 26 + 11 + 16 + 12 + 14 + 23 + 17 + 27 170,718 -1 3 + 2,361,774 83,011 243,726 724,804 447,263 145,353 Birmingham . . . 2,749,881 90,002 Gadsden . . . . 263,750 Huntsville . . 864,642 M o b i l e ............ Montgomery . . 508,634 157,648 Tuscaloosa . . . 2,833,438 84,430 272,913 864,611 519,443 166,270 Ft. Lauderdale— Hollywood . . Jacksonville . . Miami . . . . Orlando . . . . Pensacola . . . Tallahassee . . . Tampa— St. Pete. W. Palm Beach 1,621,908 3,325,793 5,191,506 1,283,001 412,144 541,333 3,009,760 884,897 1,582,039 3,071,254 5,044,354 1,230,821 379,386 653,238 3,064,748 890,782 168,257 11,393,197 448,375 365,907 453,632 459,451 162,675 11,061,322 423,352 369,367 425,540 439,209 203,518 1,103,748 222,816 203,892 3,625,015 206,353 1,123,759 230,598 212,938 3,470,721 Biloxi—Gulfport Jackson . . . . 227,293 1,181,157 219,213 1,219,777 Chattanooga . . Knoxville . . . Nashville . . . 1,003,684 753,506 2,899,624 948,851 731,012 2,647,139 102,373 125,106 58,800 96,214 134,417 63,307 89,754 111,592 55,193 46,577 141,513 289,003 150,423 47,121 144,136 265,811 144,337 165,024 189,758 Albany Atlanta Augusta Columbus Macon Savannah . . . . . . . . . . . . . . . . . . . . . . Alexandria . Baton Rouge Lafayette . Lake Charles New Orleans . . . . . . . . . . OTHER CEN TERS Anniston . . . . Dothan . . . . Selma ............. Bartow . . . . Bradenton . . . Brevard County . Daytona Beach Ft. M ye rsN. Ft. Myers . . ■Estimated 3 7 — 3 0 - 2 5 — — — — — - - 3 7 June 1972 From June 1972 FEDERAL RESERVE BANK OF ATLANTA June 1971 May 1972 175,380 237,661 58,614 140,249 29,081 725,713 242,001 1,488,399 125,054 163,856 219,877 51,539 119,838 29,906 650,244 194,876 1,303,323 110,738 + 2 + 2 - 1 +10 + 10 - 3 1 + 2 + 2 158,144 80,801 164,270 25,568 106,878 64,442 22,917 52,104 124,304 83,874 138,282 82,093 158,848 24,025 104,667 58,353 31,087 43,770 119,340 80,481 185,769 72,554 134,235 17,130 105,337 51,886 27,177 38,117 113,501 76,926 + 14 - 2 + 3 + 6 + 2 +10 -2 6 + 19 + 4 + 4 . . . . . 14,670 8,643 56,421 50,600 16,658 30,346 15,130 9,178 60,319 53,942 16,317 34,189 15,051 8,554 51,598 44,899 14,499 27,910 - 3 - 6 - 6 - 6 + 2 -11 Hattiesburg . . L a u r e l ............. Meridian . . . . Natchez . . . . Pascagoula— Moss Point . . Vicksburg . . . Yazoo City . . . 108,457 59,442 104,376 59,506 105,931 62,771 101,847 47,957 87,987 50,078 82,978 45,115 + 2 - 5 + 2 +24 153,635 59,216 36,515 139,364 58,720 38,858 95,931 57,265 37,745 - Bristol . . . . Johnson City . . Kingsport . . . 128,246 154,704 226,784 123,084 140,369 225,651 118,169 125,872 202,172 strict Total . . . . 59,585,274 58,264,973 51,368,359r + 2 . 6,622,150 20,414,426 . 16,490,578 . 6,421,755 . 2,664,907 . 6,971,458 6,839,805 19,846,933 15,972,472 6,360,722 2,627,258 6,617,783 5,754,187 17,427,545r 14,061,940 5,737,040r 2,194,773 6,192,874 . Winter Haven . Athens . . . . Brunswick . . Dalton . . . . Elberton . . . Gainesville . . . G r i f f in ............. LaGrange . . Newnan . . . . Rome . . . . Valdosta . . . Abbeville Bunkie . Hammond New Iberia Plaquemine Thibodaux . . . . . . . . . . . Alabamat . Florida}: . . Georgia} . Louisianat* M ississippit* Tennesseet* ■ . . ■ ■ . ■ . . ■ . . 3Partially estim ated. 6 June 1971 + 10 + 10 + 13 + 28 +7 + 268 + 17 + + + 15 179,640 241,266 58,223 153,930 32,090 703,277 245,605 1,518,785 127,305 Gainesville . . Lakeland . . . Monroe County Ocala . . . . St. Augustine . St. Petersburg Sarasota . . . in c lu d e s o n ly banks in the Sixth District portion of the state; partially estim ated. May 1972 Year to date mos. 1972 from 1971 + 10 +1 6 + 4 + 10 1 + - 3 + 3 + 3 1 1 + 5 + + - 15 - 18 + 11 + 19 + 22 + 20 + 49 + 25 + 241 + 5 + 16 + 10 - 6 — 37 + 30 + + 109 + 16 + + 15 3 8 + 1 + 9 + 13 + 159 + + 23 + 26 19 + + 32 + 603 ++ 314 + —3 + 6 + 9 + 8 + 23 + 21 + 12 + 13 + 16 + 15 + 20 + 17 + 20 + 17 + 12 + 21 - + 13 N A - N o t available. 147 D i s t r i c t B u s in e s s C o n d i t i o n s Unemployment Rate* Average Weekly H o u rs' M fg . Payrolls i i i i i ii i i i i Ii i i i i i i i i i i Ii 1970 1971 *S e a s . adj. figure; not an in d ex L a te st plotting: J u n e — excep t m fg. p ro d u c tio n an d farm receipts, M a y T he So u th e a ste rn o u tp u t has d e m a n d T he in at sh o w u n e m p lo y m e n t rate in A v e ra ge th an in fa c to ry h o u rs expan de d d u r a b le d u r a b le an d s t r o n g ly s in c e m arch in d ro p p e d an d at to 4 .2 p e rc e n t o ffse t rate s. w it h se c to r. S m a ll fr a c t io n a l ste ad y. M ay, gre w e m se c to r. gro u p s at u p w ard to a lo a n s , fo r th e s a le s d is p la y e d th re e m o n th s O n ly in d u s t r ie s fifth in has b o th advan ced p o s it g a in s pace of c o n s e c u tiv e m o n th . G a in s of n ew e a r ly re co rd lo a n th e to ta l lo a n s an d su rge d June d u r in g au to th e p a st d o m e s t ic a lly le v e ls J u ly . L a rge r t im e Stro n g e x p a n s io n P ic k in g fu rth e r c o n s t r u c t io n and by u p a in m a n u fa c tu r in g s u b s t a n t ia l in c r e a s in g ap p e a re d s e llin g b u s in e s s e s le n d in g , an d b ase d ap p e a re d to v o lu m e co n su m e r rece d e o f c r e d it . fro m re co rd to m o re state on “m o n e y an d lo c a l p r e lim in a r y ad van ce le s s m ark e t" C D 's go v e rn m e n ts. d ata r a p id ly fo r to B ank m o s t o f J u ly , th an it has d u r in g m o s t o f t h is y e a r. D e s p it e p r ic e s fo r th e stro n g ban ks M a y an d n ary J u ly o ffse t fir s t a b y fa rm e rs r e m a in e d d ata le v e l an d p r e v io u s g a in . F a rm e l s u b s t a n t ia lly rate as of g a in m o re u se o f p r ic e s r e c e ip t s th a n fro m P r e lim i p r ic e s re ach e d m a in t a in e d ad van ce d th at fo r 1 9 7 2 , fa rm e rs c r e d it u p le v e ls . d u r in g t h e ir to a y e a r e a r lie r ; d o u b le M a y c it r u s p r ic e s , e d ge d to b a cco th a t o f n e a r ly T h ro u gh lib e r a l th at cash an d June y e a r-a g o liv e s t o c k ab o ve w as a w h o le . ab o v e in d ic a t e re co rd in a le v F lo r id a 's th e D is t r ic t m ad e th e m u ch y e a r-a g o p e r io d . p ro d e m a n d s a v in g s s u b s t a n t ia lly lo w e r g r a in r e c e iv e d h a lf T he June. e x p e r ie n c e d co n su m e r se n t au to stre n gth , s a le s b an ks in n o t a b le v ig o r . au to s in s t a lm e n t ju n e B o th u n u su al c a le n d a r ye ar. er in le v e l. p u sh ed d u ce d M e m b e r to b an k s s h o w in g b y cre a se s stre n gth P r o d u c t io n co n su m e r re co rd of th e a ll c o m m e r c ia l o u ts t a n d in g p e rso n al in pace. ra te . M a n u fa c t u r in g s p e c ia l m id -1 9 7 1 . in c r e a s e s liv e ly c o n s u m p t io n a L a rge a u n e m p lo y m e n t stre n gth . u n e m p lo y m e n t a n t ic ip a t e d h e ld n o n d u r a b le a lo n g th e e x p a n d in g n o n m a n u fa c t u r in g in g o o d s to d ro p c o n s id e r a b le jo b s th e a ye ar. s e a s o n a lly lo s s e s p r o d u c t io n th e la b o r fo r c e m a n u fa c tu r in g p lo y m e n t in to t h is s lo w e r by su p p o rte d e a r lie r June, as th e g a in s b an ks c o n tin u e d a c h ie v e d c o n tin u e s a c c o m p a n ie d d e p o s it s , A g r ic u ltu r e le v e ls e c o n o m y been d e s lo w d e p o s it in v a lu e o f m o n th in tre a te d fro m t in u e d c o n s t r u c t io n R e s id e n t ia l to R e s id e n t ia l a aw ard s row , an d M a y 's p o st la r g e m o rtgage c o n tra c t d e c lin e d aw ard s fo r n o n r e s id e n t ia l reco rd g a in s rate s le v e l. in th e aw ard s F lo r id a s t ill c o n s t r u c t io n r e m a in e d fe ll in se co n d re c o n a c t iv it y . s t a b le . Note: Data on w h ic h sta te m e n ts are b a se d have been ad ju ste d w h e n e v e r p o s sib le to e lim in a te s e a s o n a l in flu e n c e s. 148 M O N T H L Y R E V IE W A ugust 1972
@FedFRASER