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I IN TH ISSUE: IS • The Changing Emphasis on Mobile Home Financing • The Southern Faim Borrower • Tennessee Comes Out Ahead R E V I E W • District Business Conditions FEDERAL RESERVE BANK OF A T L A N T A M ay 19 6 7 T h e C h a n g in g E m p h a s is o n M o b il e H o m e F i n a n c in g The pros and cons of financing mobile homes are frequently debated among bankers. The lack of a consensus was apparent in a recent survey by the Federal Reserve Bank of Atlanta in which a variety of opinions and attitudes on this subject was expressed by Sixth District bankers. The responses did suggest, however, that an increasing number of bankers are enlarging the funds de voted to this type of instalment lending. Mobile home loans held by sampled banks more than doubled from 1961 to the end of last year, and the dollar volume grew nearly four-fold. Specifically, the survey sought to determine the extent and manner in which bankers in this Dis trict are helping finance this expanding segment of the housing market and to obtain some idea of their overall impression of mobile home lend ing. The Southern region provides an excellent area to study the response of bankers to recent changes in the industry. A representative sample of banks in this Dis trict was chosen for the study, including those that regularly report their consumer loan activity to the Federal Reserve Bank of Atlanta. The list M o n th ly R eview , Vol. L I I , No. 5. Free subscription and additional copies available upon request to the Research Departm ent, Federal Reserve B a n k of Atlanta, Atlanta, G eorgia 30303. 58 was then expanded to incorporate the 50 largest banks in the District. Thus, in addition to a sample of banks of all sizes, the survey also cov ered those banks which probably account for most of the outstanding mobile home loan volume in the Sixth District. The final list was made up of 121 banks to which a specially designed ques tionnaire was mailed in February of this year. Out of this number, 113 responded, and about one-half reported making mobile home loans. When the responding banks were grouped ac cording to size (using total deposits as the mea sure) , it was apparent that larger banks made proportionately more mobile home loans. Banks with total deposits of $26 to $50 million were about equally divided between those making and those not making mobile home loans. Banks with deposits greater than $50 million granted pro portionately more of these loans, while the re verse was true for smaller banks. While these figures indicate a direct relation ship between bank size and mobile home lending, many large banks do not make instalment logins for this purpose. Sixteen of the 40 largest banks in the District do not presently make such loans. Thus, while close to two-thirds of the banks mak ing these loans in 1966 had total deposits in excess of $50 million, a large number in this deposit size category did not. A much higher concentration of the outstandM O N TH LY R EV IIE W T a b le I: B a n ks R e s p o n d in g to S urvey M ak in g M obile H om e L oans D e p o sit S ize N ot M aking M obile H om e L oans T otal M illions $ U n d e r $10.0 4 15 19 10.0— 24.9 9 12 21 25.0— 49.9 8 8 16 50.0— 99.9 10 7 17 100.0 a n d o v e r 24 16 40 All R e p o rtin g B an k s 55 58 113 The more rapid rate of growth in volume out standing than in number of accounts has resulted, in part, from the trend toward larger and more expensive units financed. For example, the aver age mobile home loan at the responding banks, including loans for both new and used units, in creased from around $2,000 in 1961 to approxi mately $3,300 in 1965 and to over $4,000 last year. Thus, roughly 20 percent of the increase last year was attributable to a gain in the average loan amount. The rise in mobile home lending did not merely T a b le II: B a n ks M a k in g M o b ile H om e Lo an s N u m b e r o f Lo a n s a t R e s p o n d in g B an ks D e p o sit S ize M illions $ V o lu m e O u ts ta n d in g , End of Y ear 1966 T housands $ U n d e r 10.0 142.5 10.0— 24.9 3 9 5.5 25.0— 49.9 1,258.9 50.0— 99.9 3 ,2 7 0 .8 100.0 a n d o v e r 9 3 ,0 3 0 .8 All R ep o rtin g B an k s 98,0 9 8 .5 % 0.2 0 .4 1.3 3.3 94.8 100.0 A verage O u ts ta n d in g s p e r B an k B an k s % Thou sands $ 4 9 8 10 24 7.3 16.4 14.5 18.2 43 .6 3 5 .6 43 .9 157.4 327.1 3 ,8 7 6 .3 55 100.0 N um ber 1,783.6 ing volume of mobile home paper was held by the larger banks. Banks with deposits below $50 million accounted for about two-fifths of those reporting mobile home loans, but only about 2 percent of the outstanding volume. On the other hand, the largest two-fifths (those with deposits of $100.0 million and over) held approximately 95 percent of the reported volume. Banks with deposits in excess of $100 million held, on aver age, about $3.9 million in mobile home paper, compared with average holdings of about $1.8 million for all banks. 1961 1965 1966 T he n u m b e r of m o b ile h o m e lo a n s a t b a n k s in th e Sixth Dis tr i c t re s p o n d in g to th e su rv e y h a s in c re a s e d ra p id ly s in c e 1961, O u ts ta n d in g V o lu m e o f Loans a t R e s p o n d in g B an ks Millions $ 10 0 80 - 60 40 20 0 1961 Changing Attitudes Unquestionably, many bankers in this region are seriously considering adding more mobile home loans to their consumer portfolios. Such loans at responding banks grew from around 10,000 in 1961 to slightly over 24,000 at the end of last year. The corresponding dollar volume at these banks increased from approximately $21 million to around $98 million during the same period. No attempt was made to estimate the total vol ume of mobile home paper outstanding at all Dis trict banks. However, since the survey did in clude a representative cross-section of banks, as well as the 50 largest, the results should provide an indication of the relative growth of this type of lending activity. Digitized 1 9 6 7 M A Y for FRASER 1965 a n d th e d o lla r v o lu m e o u ts ta n d in g 1966 h a s grow n fa s te r . M o b ile H om e L e n d in g A c tiv ity By B a n ks o f V a rio u s S izes Deposit Size Millions $ Making Mobile Home Loans \ Not Making Mobile Home Loans ^ S u rv ey b a n k s of all s iz e s re p o rte d m a k in g m o b ile h o m e lo a n s, b u t la rg e r b a n k s a re th e m o s t a c tiv e le n d e rs in th is field. 59 represent the more intensive lending activity of the same banks. The number of banks making mobile home loans has also increased. One-fifth of the banks making these loans in 1966 had less than three years’ experience and one-half less than six years’. Thus, it would appear that mobile home lending, once limited primarily to the more specialized and experienced banks, is now attract ing the attention of other banks in this area. Close to three-quarters of the increase in the number of accounts and about one-half of the increased volume between 1961 and 1966 were contributed by banks not previously engaged in this type of lending activity. These new entrants represented banks of all sizes, but over nine-tenths of the resulting volume was accounted for by those with total deposits of $50 million or more. In order to gain some insight into the attitudes of bankers, we asked them to summarize their current policy on mobile home lending. Onefourth were definitely attempting to increase this type of lending, and approximately 55 percent indicated no change. But the remaining one-fifth were trying to decrease their outstanding volume of mobile home paper. As mobile home lending becomes more pervasive, bankers are in disagree ment on the relative merits of consumer financing of mobile home paper, primarily because of the lengthening of maturities and their poor repos sessions experience. Even though mobile home lending has become more pervasive, the varying experiences of bankers continue to contribute to a difference of opinion as to the relative merits of consumer financing of mobile homes. Although these opinions cover the period of tighter credit conditions of 1966, they neverthe less express longer-run policy objectives. It could be that some banks’ attempts to decrease volume reflected the overall credit restraint of last year. However, the overwhelming majority reported that neither their lending standards nor interest rates on instalment loans changed during this period. The small percentage reporting changes in lending standards or interest rates on mobile home loans generally cited changing money mar ket conditions and the increased likelihood of younger borrowers being drafted as their reasons. Less than one-tenth of the respondents classi fied mobile home loans as below average in risk, compared with other types of instalment lending. The majority of bankers apparently view these loans as equally desirable or more attractive than other types of consumer loans. This may be fur ther evidence that a majority of bankers are attempting to increase mobile home lending and 60 possibly why lending standards in most instances were not changed last year. The old axiom that the requirement of a good instalment loan is a good dealer has particular significance in financing mobile homes. Because of the mobility factor and the restricted market for used mobile homes, most mobile home paper held by banks is purchased from a dealer. This is true at practically all District banks. In most cases the bankers have full recourse to the dealers. About three-fifths of the banks reported no differences in rates charged on direct and pur chased paper. However, of the remaining twofifths, a majority indicated that rates on pur chased paper were generally more liberal. Down Payments and Maturities The ratio of down payment to total selling price and the length of the note have special signifi cance for mobile home loans compared with other durable goods. Because of the rather limited mar ket for resales, any changes in maturities and interest cost of the structure not offset by down payment requirements may have a direct bearing on the amount of equity the purchaser holds. A relaxation of terms in this manner could have a direct bearing on the possibility of repossessions. Generally, banks in this region require between 10 and 30 percent down payment on a mobile home loan. The most frequently required down payment, however, is around 25-30 percent. Very seldom will the bank accept less than 10 percent down. In a few instances, however, the down pay ment is figured as the difference between the sell ing price of the unit and the dealer’s invoice. For loans to purchase a new mobile home, the mini mum down payment is usually around 15 percent, and for resales slightly more. The average maturity of loans to purchase new mobile homes is generally from five to seven years. Over three-fifths of the loans outstanding at District banks in 1966 had maturities falling in this range. About one-quarter were to run for less than five years, while close to 10 percent had maturities in excess of seven years. For loans to buy used mobile homes, virtually all of those outstanding in 1966 at surveyed banks were to run for less than seven years, and most of these were for less than five years. Delinquencies and Repossessions Most banks reported an end-of-year delinquency rate between 2 and 3 percent in 1965 and 1966. In a few instances, the rate was 4 percent or M O N T H L Y R E V IE W Table III: Delinquencies and Repossessions At Reporting Banks 1965 1966 N um ber P e rc e n t N um ber P e rc e n t 16,556 100.0 2 4,188 100.0 385 2.3 729 3.0 30-59 d a y s 291 1.8 550 2.3 60-89 d a y s 66 0 .4 103 0.4 28 0.1 76 0.3 476 2.9 647 2.7 of a mobile home is around $6,000, completely furnished, while the conventional home averages considerably more. The young married couple will not lose equity in the mobile home should they relocate; they will move their home. T otal A c c o u n ts a t R ep o rtin g B an k s D e lin q u e n t A c c o u n ts 90 d a y s o r ov er R e p o s s e s s io n s slightly above, but this represented only a small percentage of the total accounts outstanding. In 1965, the average delinquency rate was 2.3 per cent, with most of the overdue accounts in the 30-59 day range. The delinquency rate rose to 3.0 percent in 1966, as a result of the increase in past due accounts of less than two months. A frequently used indicator of the quality of a group of loans is the repossessions ratio, the percentage of loans made during the year that subsequently must be repossessed. Banks in this area in recent years have experienced a repos sessions rate of around 3 percent or less. In 1966, however, the rate of repossessions at District banks declined slightly to 2.7 percent from 2.9 percent in 1965. Mobile Home Living Today Last year, while conventional housing was de clining, dealer shipments of mobile homes held around their 1965 level of 216,000 units. With the trend toward more expensive mobile struc tures, last year’s dollar volume probably in creased. A better comparison of the impact on the total housing industry is the growing share of the market claimed by mobile homes. In 1965 one in every six single-family housing starts was of the mobile type. As recently as 1961, they rep resented less than one-tenth of the market. A sig nificant factor in the growth of mobile home living has been the provision of less mobility and more housing. Mobile structures today may never be moved any farther than from the factory to the park. Even though the likelihood of movement is not as great as it once was, the potential for mo bility is still available. This is particularly ap pealing to young married couples and retired persons, who represent the greater share of the market for mobile homes. For young married couples, the home on wheels provides a completely furnished residence at a comparatively low price. The average cost Digitized 1 9 6 7 for FRASER M AY Who Are the Residents? Part of the reason for banks’ re-examination of financing mobile homes may be the shifting image of residents. The Mobile Home Manufacturers Association estimates that there are over 4 mil lion mobile home owners in the U. S. The age-old idea that people lived in mobile homes because they could not afford to live elsewhere has proven erroneous by several recent surveys. A University of Michigan survey indicated that about twothirds of all mobile home dwellers have annual household incomes in excess of $6,000, with a median level of close to $8,000. The rising average income level for mobile home residents, which is above the average for all U. S. residents, largely reflects the changing composition of occupational groups preferring to live in a mobile home. This same survey reported that one-fourth of the mobile home heads of households are skilled workers, and about onefifth are professionals, proprietors, or self-em ployed. Military personnel, accounting for about 10 percent by occupation, are not as prevalent among residents as they once were. According to the 1965 University of Michigan survey, nearly half of the mobile homeowners previously owned conventional homes, and another one-fifth lived in apartments. Thus, it would appear that the convenience and mobility factors have certainly attracted a growing number of desirable tenants. This, coupled with the fact that approximately one-fourth have lived in a mobile unit for nine or more years, supports the view that this type of living is satisfactory to many families. Manufacturers The improved design of the mobile home and more desirable parks have also contributed to the changing image of mobile home living. The trailer 10 feet wide by 50 feet long was in demand for many years. Now, because they are moved less often, the 12-wide has become very popular. This unit may be as long as 70 feet and include three or four bedrooms and two or three baths. If the units are to remain mobile, however, this is prob ably the maximum width attainable. Recently, however, “Doublewides” (two inde 61 pendent units joined together lengthwise at the site) and expandable units (one or more sections that fold or pull out from the basic unit) are being used quite frequently. While the structures have changed, the same basic design is used in constructing most units. Manufacturers have taken advantage of cost re duction through mass production in building units, and the retail price has been held down. Of course, the interiors in most cases can be altered to suit the buyer without any appreciable change in costs. The assembly-line type produc tion also provides almost instant housing. According to the Mobile Home Manufacturers Association, approximately 350 mobile home fac tories are scattered in almost every state. How ever, certain areas remain important production centers. In 1965, over one-half of all mobile homes produced were in the East North Central and South Atlantic regions, and close to one-half of the plants were there. Within these regions, how ever, the major part of the production is localized in only a few states. Michigan and Indiana man ufacture most of the units in the East North Central region, while Georgia is the number one producer in the South and the second in the en tire nation. According to the Georgia Mobile Home Association, 41 mobile home manufacturMobile Home Shipments Thousands 2 0— 0 10— 0 1961 1962 1963 1964 1965 1966 O ne in d ic a tio n of th e g ro w th of m o b ile h o m e s a le s is th e in c re a s in g n u m b e r of s h ip m e n ts by U. S. d e a le rs . U. S. Population 20-29 and 65-74 Millions 50 40 — 30 I 1 1 1960 1 1 1963 * U .S . D e p a rtm e n t p ro je c tio n s . I I 1965 of I 1970* C o m m e rc e , I 1975* B u re a u of th e A s tim u lu s to in c re a s in g s a le s h a s b e e n th e e n la rg e m e n t in th e n u m b e r of re s id e n ts in th e y o u n g e r a n d re tir e m e n t a g e g ro u p s. It is c u rre n tly e s tim a te d th a t th e s e g ro u p s w ill e x p a n d a t a n a c c e le ra te d ra te in c o m in g y e a rs. 62 ing plants are located in Georgia with annual payrolls of over $12 million. Estimates show that these plants produced approximately 30,000 mo bile homes last year and accounted for 11 per cent of total industry production. Travel trailer and recreational vehicles, as well as special unit structures not classified as mobile homes, are also increasing at many of these man ufacturing plants. These special units are becom ing more and more popular for use as school rooms, offices, and other types of structures. Implications All indications point to a continued rapid growth in mobile home sales. The younger and older segments of the population are increasing rapidly and should continue to find this type of living desirable. The demand for mobile homes will probably also be stimulated by the growing number of families purchasing second homes. The continued orderly and steady growth of the industry depends, to a large extent, on the ability and desire of lenders to provide adequate financing to dealers and customers. Recent ex perience indicates that 75-80 percent of all mobile homes sold are financed. Historically, commercial banks and sales fi nance companies have supplied most of the direct retail financing of mobile homes, with the largest share going to the latter. Lending institutions spe cializing in housing loans such as savings and loan associations and mutual savings banks are legally restricted from making consumer loans. However, with mobile homes claiming an increas ing share of the homebuilding industry, savings and loan associations are pushing vigorously for legislation to allow an expansion of their lending powers to cover consumer instalment loans, in cluding mobile homes. Many commercial banks, too, are now making a serious bid to become more active competitors for a larger share of the conventional home login market. Loans to finance mobile homes could well be the competitive arena in which a claim on a larger share of the total single-family hous ing market will finally be decided. How far the mobile home industry will be able to penetrate the housing market is uncertain. However, further penetrations will likely occur, which may hasten the aggressive bidding of lend C en su s, ers for a bigger share of the housing dollar. What ever the outcome, some bankers now seem more willing and anxious to devote more funds to this type of lending. Joe W. McLeary M O N T H L Y R E V IE W T h e S o u th e rn F a rm B o rro w e r Dynamic changes are taking place in the agri cultural sector of the economy. In the last decade, advances in animal husbandry, agronomy, agri cultural engineering, and agri-business have ap peared with clock-like regularity. And the ad justments in agriculture are reflected in changes in the type of farmers borrowing at commercial banks in the Sixth Federal Reserve District. Since 1956, total assets, net worth, gross sales, and bank indebtedness have all advanced sharply for the average southeastern farm borrower. The total volume of bank loans to farmers has more than doubled, while the number of borrowers has declined. There has been a marked increase in the number of part-time farmers and producers of single commodities. And the tenant and share cropper appear less frequently. To better under stand the impact of agricultural adjustment on farm producers and bankers, it is necessary to identify specific areas of change from these aggre gate data and then to evaluate their influence on production and farm finance. Personal Characteristics Throughout the Southeast and other predomi nantly rural regions in the U.S., farm populations have migrated to urban areas. Generally younger Digitized 9 6 7 FRASER for MAY 1 persons have been the most likely prospects to leave the farm. Many older persons have found moving much less attractive and therefore have remained on the farm. These developments have caused the total num ber of farm borrowers in the District to decline nearly 12,000, or 5 percent, since 1956, while the average age of borrowers remaining on the farm has advanced from 45 to 48. Because propor tionately more young people are leaving the farm, borrowers 44 years of age and younger now ac count for 38 percent of all farm borrowers, com pared with 50 percent ten years ago. This group is responsible for most of the total reduction in borrowers, because the number of farmers 45 years old or over has actually increased. Although young borrowers are proportionately fewer, they have been expanding their average bank indebtedness much faster than those 45 years or older. Since 1956, the average volume of bank loans held by farm borrowers 35-44 years of age has more than doubled; that of their counterparts under 35 years has gained 90 per cent. As a group, farmers over 45 increased their average bank loan by only 8 percent. Part-Time Farmers—Contrary to the trend toward fewer farmers, however, the number of part-time 63 farmers, those receiving one-third or more of their gross income from nonfarm sources, has advanced nearly 60 percent in the last decade. Currently, 36 percent of all individual farm operators for which data are available are part-time. The pro pelling force causing many farmers to seek nonfarm employment is the increasing difficulty to derive adequate income from relatively small farming units. Improved methods of transporta tion and greater job opportunities in most parts of the Southeast now make it easier for rural citi zens to earn extra incomes without moving from their community. This availability of nonfarm employment has probably held down the rate of migration from farms. The total volume of bank loans to part-time farmers has advanced nearly four times since 1956 because of the increased number of these operators and the 147-percent jump in the av erage bank debt per borrower. In 1966, the average amount of loans outstanding for these borrowers was $3,775, compared with $3,881 for full-time farmers. Surprisingly, average credit requirements of part-time farmers do not differ significantly from their full-time counterparts. Farm Type—For both the full-time and part-time farmer, the general farm is still the most common production unit in the Southeast. In 1966, 56 per cent of all farm borrowers, about the same propor tion as ten years ago, operated general farms. However, the absolute number of these farms has declined, reflecting the total reduction in farm numbers. These farmers had average bank in debtedness of $2,923, well below the $3,806average of all farm borrowers. While the relative importance of the general farm has changed little since 1956, the number of specialized farms except cotton has increased sharply. For example, the number of borrowers operating meat animal farms has doubled in the last ten years and now represents 12 percent of the District’s farms. The number of borrowers operating poultry farms has increased over 2x /z times. Also, the number of borrowers specializing in cash grain, fruit, sugarcane, and other major products has advanced sharply since the mid1950’s. Generally, the types of specialized farms listed above are more capital and less labor intensive than tobacco, small cotton, and general farms. Partial evidence of this tendency is apparent from the average outstanding loan of these farmers which totals more than $5,000, well above the average for all farms. With average loans ex ceeding $25,000, citrus fruit producers have higher credit needs than any other group of fann borrowers in the Southeast. The drop from over 53,000 to less than 20,000 cotton farms in ten years is perhaps the most spectacular development in southeastern agri culture. Reduction in cotton acreages, increased production costs, lower prices, and better alter native uses for land have made cotton a secon dary crop on most District farms. Since many cotton farmers still operate small farms, their av erage indebtedness has advanced to only $2,971. Tenure—Along with the decline in the number of general farms and cotton farms has been the re duction in the number of borrowers that are ten ants and sharecroppers. In 1956 these borrowers represented 20 percent of banks’ farm borrowers; today, less than 10 percent. Similarly, there has been a 50-percent cutback in the number of bor rowers who are landlords, while the group of farmers owning all or part of the land they op erate has increased slightly in number. Average credit requirements have advanced about 2*/2 times for both owner-operator and tenant farmers, while the average landlord has borrowed 88 per cent more in the last ten years. Farm Borrowers at District Banks Percent 10 0 Age of Borrower Tenure —10 0 Net Worth 80 — — 80 60 — — 60 40 — — 40 1956 1966 2— 0 —2 0 □ —i 0■ Under 35 35-44 45 or Older Landlords Tenants or Croppers Full or Part Owners Under $10,000 $ 10,00024,999 $25,00099,999 —0 Over $100,000 S in c e 1956, th e p ro p o rtio n of y o u n g p e o p le , la n d lo rd s , a n d te n a n ts h a s d e c lin e d . Of th o s e re m a in in g , fa rm e rs w ith h ig h e r n e t w o rth s 64 M O N TH LY R E V IE W Asset and Credit Requirements Changes in the type of farming and the charac teristics of borrowers fail to show some important developments in the asset structure and financial requirements of many farmers. From 1956 to 1966, the financial needs of all farmers continued to advance rapidly. No longer are the major costs of production embodied in the farmer’s labor and the homegrown feed supplies for work stock. Today production credit is needed for fertilizer, seed, feed, equipment, gasoline and other pe troleum products, repairs, labor and other pur chased items. Intermediate- and long-term credit are required to purchase farm machinery, to im prove land and buildings, and to buy additional acreages. And as the amount and price of many of these items advance, so does the producer’s need for credit. Bank Indebtedness—These trends are, in part, re flected in a lesser number of farm borrowers with small loans. Farmers owing the bank less than $1,000 have dropped from nearly 145,000 to less than 88,000 since 1956, and the number owing $1,000 to $1,999 has advanced only slightly. Meanwhile, the number of borrowers owing larger amounts increased quite sharply between 1956 and 1966. For example, borrowers with indebted ness of $2,000 to $4,999 rose in number by 71 percent, while 130 percent owed banks $5,000 to $9,999. Similarly, three times as many farmers owed $10,000 to $24,999 in 1966 than in 1956, and those owing $25,000 to $99,999 and $100,000 and over gained five and one-half and ten times, respectively. These adjustments caused a significant shift in the distribution of loans at District banks. On June 30, 1966, 60 percent of the borrowers had loans of $2,000 or less and accounted for only 12 percent of the total volume of farm debt at banks. However, borrowers owing $50,000 or more made up less than one percent of the bor rowers but held over 15 percent of the loans. Net Worth—Just as changes in the sizes of loans identify advances in the financial needs of farm borrowers, the modifications in net worth reflect changes in the size of farm units. Currently, only one-half as many borrowers as ten years ago have net worths of less than $10,000. Part of this de cline is the result of the expansion of farming units or repayment of previous indebtedness. However, most of the reduction was probably caused when farmers with these low equities quit farming. Reflecting a generally increased need for production credit, however, the farmers with low net worths that remained on the farm nearly doubled their average bank borrowings. Contrary to trends toward fewer farming units, the number of farms with higher net worths is actually increasing. At all levels of net worth above $10,000 per borrower, there are now more farmers than in mid-1956. And these individuals account for increasing proportions of the total farm loan portfolios of District bankers. Cur rently, borrowers with net worths exceeding $25,000 account for approximately 65 percent of the volume of loans outstanding. In 1956, 40 per cent of the loans went to farmers reporting this much equity in their farm. Income—Information relating to the 1956 farm sales is not available, but the 1966 survey indi cates that 45 percent of all borrowers had gross incomes below $5,000. Certainly, incomes are near subsistent levels, since farm operators must repay bank loans averaging $1,658, plus various production expenditures not reported in the sur vey. Discounting the fact that living expenditures are usually lower in rural areas and that many of the borrowers had nonfarm incomes, these small —1 0 0 Type of Farm Operated — 80 — 60 — 40 —2 0 '" I I .." I Under $999 and h ig h e r b a n k Dairy lo a n s a p p e a r m u c h Digitized 1for FRASER MAY 9 67 Poultry Meat Animals n . Cotton Other Major Crops General —0 m o re fre q u e n tly , a s d o p ro d u c e rs s p e c ia liz in g in “ o th e r m a jo r c ro p s ” a n d liv e sto ck . 65 production units will find it difficult to remain operative in the years to come. Those borrowers with incomes below $5,000 will probably be the best candidates to leave the farm, and the aggre gate demand for credit from those that remain will grow only slowly. The remaining farm bor rowers were about equally divided between those with gross farm incomes of $5,000 to $9,999 and $10,000 and more. In 1966, 99.4 percent of all farm borrowers at District banks were individual operators. Of the remaining farms, 0.4 percent, or 742, were part nerships, and 0.2 percent, or 468, were corporatetype business structures. These data indicate that the family farm is still the bulwark of south eastern agriculture. However, in certain types of production with extremely high capital require ments and greater economies of scale, such as Florida citrus, the corporate-type business struc ture appears more frequently. The average in debtedness for partnerships and corporate farms was $19,790 and $64,312, respectively, compared with $3,612 for individuals. Future In anticipating future changes in the charac teristics of farm borrowers and agriculture, it is safe to assume that past performances will prob ably continue but perhaps at a more rapid rate. Farm sizes will expand further as more people leave agriculture and the consolidation of farm ing units continues. These trends will be re inforced by the movement toward more mech anization and specialization of farm production. Generally, the adaptation of advanced produc tion techniques and mechanization has been slower in the South than in other regions. A large number of social and economic factors, such as a relatively cheap labor supply, a large num ber of subsistence type farms, highly diversified agriculture in some areas, and a single crop cot ton economy in others, have all contributed to the problem. However, in recent years, adjust ments in farm production have proceeded more rapidly. Labor shortages, larger farming units, increased credit supplies both from credit agen cies and businesses, and higher educational levels of farm operators have all contributed to the adjustments. However, District farmers still rank below their national counterparts in the rate of adjustment in these areas. The proportion of southeastern farm borrowers with total assets under $10,000 and net worths of less than $5,000 is nearly twice as high as in the U.S. Similarly, 66 annual sales were less than $5,000 for 45 percent of the District borrowers, compared with only one-fourth in the U.S. And while adjustments are taking place more rapidly for each of the char acteristics mentioned, the rate of change during the last ten years was slower in the Southeast than in the nation. Nevertheless, the southern farm scene has been changing quickly. And, as these trends continue, very likely today’s medium-size or middle income farm will become the subsistence farm of to morrow. The 131,000 borrowers with total sales of less than $10,000 will certainly find it difficult to maintain net incomes and a good level of liv ing without increasing the size of their farms or without sizable amounts of nonfarm incomes. If present trends continue, banks can expect only a slight expansion in aggregate loan demand from this block of borrowers. Even though the average credit needs of individual borrowers will increase, ten years from now a substantial num ber of them will have left the area. Also, banks in these areas may experience problems with de posit growth from agriculture. Therefore, banks with both the ability and de sire to expand aggregate farm loan volumes will need to attract or seek out individuals who are expanding their farming operations. However, the competition for these accounts may be keen. Farmers with large loan requests, plus high net worths and improved income flows, will request better banking services. Local banks that fail to compete in this field may lose prime customers to other institutions with better rates and services. One future requirement of farm borrowers may include continuous debt financing to implement long-run production plans rather than operate from year to year as in the past. Under these conditions, bankers may be expected to evaluate loans more in terms of productivity and less on value of the collateral pledged by the borrower. Certainly, the banker will have to require balance sheets and cash flow information, as well as cost and return data, to evaluate the productivity and profitability of various enterprises. The banker may also be expected to seek new ways to grant loans exceeding legal lending limits and to dis sipate the risk associated with large accounts. The banker who is aware of these adjustments and modifies his operations to meet these and other new demands will be best serving the needs of farm borrowers and the community. Robert E. Sweeney This is the secon d in a series of a rticles on the 1966 farm loan su rvey. M O N TH LY R E V II-W Tennessee C o m es O ut A h ead When you’re struggling to catch up, whether in a foot race or in terms of personal income, you’ve got to go faster than the leader to get abreast of him. Last year Tennessee, a state whose per capita income trails the national average, ad vanced more rapidly. Personal income, the most comprehensive indicator of economic growth, grew 10 percent in the Volunteer state, com pared with 8 percent for the nation. Personal income was not, however, the only Tennessee economic indicator to outpace those of the nation. The state’s nonagricultural em ployment growth exceeded the nation’s by an even wider margin than personal income. Mean while, unemployment remained lower in Tennes see than in the nation. The number of jobs resulting from investment in new and expanded plants in Tennessee ex ceeded that of each of the other District states, according to Georgia Tech’s Industrial Develop ment Division. Tennessee ran second in the value of such investment. Its total growth of nonagri cultural employment also ran ahead of that of other District states, although, as was common in the nation, it did not equal 1965’s gain. tor, an income source more important in the state than in the nation and one whose income growth rate in the state is rivaled only by gov ernment. Gains in manufacturing, Tennessee’s largest employer, were not evenly distributed, of course. Cities showing particularly strong growth were Chattanooga, the Tri-Cities (Kingsport, Bristol, and Johnson City), and Memphis (out side the Sixth District). From August 1965 to August 1966, Chatta nooga’s total employment growth led every major metropolitan area in the nation but one, yet em ployment in its major manufacturing industry, textile mill products, declined during this period P e rso n a l In co m e Billions of Dollars Ratio Scale Manufacturing Spurred by Chemicals 1964 The most rapid growth of Tennessee employ ment was experienced in the manufacturing sec M AY 1967 ■H i 1965 1966 nHH 1967 In 1966 th e gro w th of T e n n e s s e e 's p e rs o n a l in c o m e c o n tin u e d to o u tp a c e th e n a tio n ’s. 67 and through the remainder of 1966. Textile mill employment for the state as a whole also showed a December-to-December employment decline. But, despite this weakness in textiles, common to much of the nation, Chattanooga’s manufactur ing employment rose more rapidly than did total nonagricultural employment. Employment growth in the nation slowed dur ing the fall, but the reverse was true in both total and manufacturing employment in Chatta nooga, where the growth of employment in the December-to-December period exceeded Augustto-August growth. Sparking this expansion was a large increase in employment in chemicals, a rapidly growing sector throughout the state. This swift rise of chemical and allied products em ployment was spurred by the industry’s strong performance nationally. The most important chemical industries in Tennessee are basic chemicals, mainly inorganic in nature, and fibers, plastics, and rubbers, with concentration in cellulosic manmade fibers. While overall chemical gains in the nation were strong throughout the year, some softness in syn thetic fibers, which were plagued by over-capac ity, import competition, and price cutting, was evident in the fall. Explosives, though not a major industry in the state, are important in some sec tions and expanded greatly in response to the heavy ammunition requirements of the Viet Nam War. Both Chattanooga and the Tri-Cities bene fited from this “boom” in ordnance. The chemical industry, largest manufacturing employer in the Tri-Cities, played an important role in the area’s pace-setting growth of employ ment. As in Chattanooga, total nonagricultural, N o n a g ric u ltu ra l an d M a n u fa c tu rin g E m p lo y m e n t in T enn esse e Percent Increase, December 1966 from December 1965 0 4 8 12 16 I I I I I I I I Chattanooga | Manufacturing Employment Memphis T he ra te of e m p lo y m e n t g ro w th fro m D e c e m b e r 1965 to De c e m b e r 1966 v a rie d s ig n ific a n tly in d iffe re n t s e c tio n s of th e s ta te , b u t gro w th of m a n u fa c tu rin g e m p lo y m e n t w a s re la tiv e ly v ig o ro u s a lm o s t e v ery w h ere. 68 manufacturing, and chemical employment in the Tri-Cities area rose even more rapidly in the December-to-December period than in the Augustto-August period. And again like Chattanooga, the rate of gain in manufacturing employment was greater than that in total employment. In Knoxville, chemicals, though not so im portant as in the Tri-Cities, are also the largest manufacturing employer. Due perhaps to the in dustry’s different structure in Knoxville, its rate of growth in this city fell well below that of Chattanooga and the Tri-Cities. The growth of total nonagricultural and manufacturing employ ment in Knoxville was also below their rates. And in contrast to Chattanooga and the Tri-Cities, the growth of manufacturing employment in Knox ville decreased late in the year and its growth rate was less than that of total employment, which rose. In the state’s other large interior city, Nash ville, the picture was the reverse of Knoxville in two respects: manufacturing employment led total employment growth, and both rates of in crease fell off as the year progressed. Yet Nash ville’s most important manufacturing industry, printing and publishing, grew more rapidly. Off setting this strength was a December-to-Decem ber weakness in other areas of manufacturing and trade. The growth rate of trade jobs declined through out the state as the year grew older, though climbing in Chattanooga, Knoxville, and the TriCities. Only in Chattanooga was the rise excep tionally large, however. For the state, trade showed the greatest employment growth outside manufacturing. This, along with sales tax figures, suggests that Tennessee’s retailers were not ad versely affected by the widespread slowing of the nation’s retail sales growth. Autumn Growth Slower In spite of the faster growth of total employment in some of its major cities in the December-toDecember period than in the August-to-August period, the record of the state as a whole more closely mirrored the national trend, i.e., it ex perienced a slowdown in employment growth as the year progressed. A more moderate rate of growth was seen in total nonagricultural, total manufacturing, and durable and nondurable goods manufacturing employment. The rise of construction employment in Ten nessee compared favorably with the national level, which was affected by a slump in resi M O N T H L Y R E V IE W dential construction. During this period the na tion experienced an absolute decline in con struction employment. In Tennessee a reduction of activity in residential construction showed up clearly in the various construction contract and building permit series and in the figures on real estate mortgage loans, as the accustomed flow of mortgage money fell off sharply. However, Tennessee savings and loan institutions experi enced the smallest contraction of savings flows of any District state, and, not surprisingly, cut back less on mortgage lending. Although the number of residential construc tion contracts declined from the previous year’s total by 14 percent, nonresidential construction contracts showed a whopping 26-percent gain and total construction contracts rose 9 percent. While residential construction contracts managed to actually post a small gain in Chattanooga, they fell off by 30 percent or more in the two cities which in 1965 accounted for a quarter of the state’s residential construction—Knoxville and Nashville. Growth Pattern Important The manufacturing-dominated pattern of em ployment growth last year was encouraging for a state striving to catch up with national per sonal income, for manufacturing pays relatively well. The vigorous growth of employment in dur able goods manufacturing throughout the year was particularly helpful. Durables’ December-toDecember growth rate at 13.3 percent dwarfed the 6.6-percent rise of nondurable goods and the 6.8percent gain for total nonagricultural employ ment. And though durables’ August-to-August gain was higher than the December increase, the slowing late in 1966 was slight. In Tennessee, this sector is less important than in the nation and pays, on average, slightly higher wages than the much larger nondurable goods sector. Because the nation’s distribution of jobs is weighted more heavily in the faster growing durables than Ten nessee’s, the Volunteer state faced a handicap in outpacing the nation last year. Agriculture Near Record In 1966 cash receipts from farm marketings fell short of the 1965 record level by less than one percent. This development reflects diverse trends in the two major sources of farm income: crop and livestock sales. In 1966 crop sales dropped to the lowest level in six years, caused mainly by a sharp reduc M A Y 1 9 67 tion in cotton production and prices. Meanwhile, for the year, sales from livestock, which ac counted for 59 percent of Tennessee’s cash re ceipts, were the highest on record. Large market ings and high prices for cattle, broilers, and hogs pushed receipts up in the first half of the year. In the last half, prices for these commodities moderated. However, milk and egg prices gained significantly. Although production expenditures rose further and cash receipts are down slightly, Tennessee farmers will probably report net farm incomes near 1965 levels. Somewhat higher government payments in the form of price supports and acreage diversion payments in the cotton pro gram will be the balancing factor. Outlook Although we are all interested in how we ar rived at our destination, we are more concerned about where we are going. One of the best indi cators of this, however, is how we got where we are. Tennessee’s record indicates that if she is to hold her own in 1967, she must beat the na tion’s overall record. This is the harsh demand of a vital, growing economy. One must run faster just to stay in the same place. To pass all the hurdles, one must advance more rapidly. And although its prospects now look bright, we will have to wait and see if the Volunteer state this year manages to fulfill this requirement. C a ro le E. S c o tt T h is is one of a series in w hich econom ic d ev e lo p m en ts in each of th e S ix th D istric t sta te s are d is cussed. C opies of A R e v i e w o f A l a b a m a ’s E c o n o m y , 1960-1966; A R e v i e w o f G e o r g i a ’s E c o n o m y , 19601967; and A R e v i e w o f T e n n e s s e e ’s E c o n o m y , 19601967, are now available upon req u est to the R esearch D ep a rtm en t, F ed era l R eserve B an k of A tla n ta , A t lanta, G eorgia 30303. B a n k A n n o u n c e m e n ts The Sea Island Bank, Statesboro, Georgia, a nonmem ber bank, began to rem it at par on A pril 13 fo r checks drawn on it when received from the Federal Reserve Bank. On A p ril 27, The Trust Company of Georgia Bank of Sandy Springs, Sandy Springs, Georgia, opened fo r business as a nonmember bank and began to rem it at par. W illia m L. Henning is president, and S. Jack Hall, vice president and cashier. Capital is $200,000; sur plus and other cap ital funds, $300,000. 69 S i x t h D is t r ic t S t a t is t ic s Seasonally Adjusted (All data are indexes, 1957-59 = IOO, unless indicated otherwise.) Latest Month (1967) One Month Ago Two Months Ago One Year Ago SIXTH DISTRICT INCOME AND SPENDING Personal Income, (Mil. $ Ann. Rate) Manufacturing P a y ro lls ............................ Farm Cash R e c e ip t s ................................. C r o p s ............................................................. L iv e s t o c k ....................................................... Instalment Credit at Banks, *(M iI. $) Feb. 56,197 Mar. 195 137 Feb. Feb. 125 146 Feb. Mar. Mar. 54,833r 54,269r 52,067 181 195r 196 147 12 0 131 151 108 116 147 152 148 289r 258 256 253 292 233 136 137 170 132 154 116 108 116 129 107 179 135 135 130 130 159 123 143 113 104 68 136 137 168 131 155 115 106 117r 129 106 177r 136r 132 70 3.4 3.4 3.3 3.3 2.1 40.9 140 159 124 141 117 217 2.1 40.9 142 121 159 146 120 220 2 .2 r 41.4 156 150 160 145 117 216r 2.5 41.8 170 184 157 134 115 198 272 254 Latest Month (1967) N o nm anufacturing .......................................Mar. C o n s t r u c t io n .............................................Mar. Farm E m p lo ym e n t............................................ Mar. Unemployment Rate (Percent of Work F o r c e ) ...................... Mar. Avg. Weekly Hrs. in Mfg., (Hrs.) . . . Mar. One Two Month Months Ago Ago One Year Ago 146r 112 r 145 2.6 42.3 2.7 41.6r 2.7 42.4 42.4 256 189 184 252 184 184 250 187 181 228 173 174 146 Ill 12 1 10 0 88 140 115 8 8 2 .6 FINANCE AND BANKING Member Bank L o a n s .......................................Mar. Member Bank D e p o sits................................. Mar. Bank D e b its * * ....................................................... Mar. PRODUCTION AND EMPLOYMENT Nonfarm E m p lo y m e n t...................................Mar. Manufacturing ............................................ Mar. Apparel ....................................................... Mar. C h e m ic a l s ..................................................Mar. Fabricated M e t a ls ................................. Mar. F o o d ..................................................................Mar. Lbr., Wood Prod., Furn. & Fix. . . Mar. P a p e r .............................................................Mar. Prim ary M e t a ls .......................................Mar. Textiles ....................................................... Mar. Transportation Equipment . . . Mar. N onm anufacturing.......................................Mar. Construction ............................................ Mar. Farm Em p lo ym e n t............................................ Mar. Unemployment Rate (Percent of Work F o r c e ) ......................Mar. Insured Unemployment (Percent of Cov. E m p .) ............................Mar. Avg. Weekly Hrs. in Mfg., (Hrs.) . . . Mar. Construction C o n t r a c t s * ............................Mar. R e s id e n t ia l....................................................... Mar. All O t h e r ............................................................ Mar. Electric Power P ro d u ctio n **...................... Feb. Cotton C o n su m p tio n **................................. Feb. Petrol. Prod, in Coastal La. and M iss.** Mar. 136 136 165 129 154 116 105 117 126 106 174 136 132 11 1 113 103 168 130 132 70 G E O R G IA INCOME AND SPENDING Personal Income, (Mil. $ Ann. Rate) . Feb. Manufacturing P a y r o lls ................................. Mar. Farm Cash R e c e ip t s .......................................Feb. 10,838 192 137 10,649r 10,632r 10,087 182 195r 197 145 141 134 PRODUCTION AND EMPLOYMENT Nonfarm E m p lo y m e n t................................. Mar. M anufacturing ..................................................Mar. N onm anufacturing .......................................Mar. C o n s t r u c t io n ............................................ Mar. Farm E m p lo ym e n t............................................ Mar. Unemployment Rate (Percent of Work F o r c e ) ...................... Mar. Avg. Weekly Hrs. in Mfg., (Hrs.) . . . Mar. 135 130 137 133 55 134 130 136 131r 59 135 131 137 132 66 130 127 131 143 55 3.4 40.4 3.2 40.6r 3.0 41.2 4.2 41.3 258 204 215 257 204 207 253 202 196 251 189 199 8,604 177 147 8,312r 178r 133 8,162r 173 132 7,768 159 142 FINANCE AND BANKING Member Bank L o a n s .......................................Mar. Member Bank D e p o sits ................................. Mar. Bank D e b its * * ....................................................... Mar. INCOME AND SPENDING FINANCE AND BANKING Personal Income, (Mil. $ Ann. Rate) . Feb. Member Bank Loans* 247 244 229 222 245 223 222 2 10 185 170 193 183 167 190 183 167 186 173 157 183 Feb. Member Bank Deposits* Bank D e b its * / * * ................................. PRODUCTION AND EMPLOYMENT 127 ALABAMA INCOME AND SPENDING Personal Income, (Mil. $ Ann. Rate) . Feb. Manufacturing P a y r o lls ................................. Mar. Farm Cash R e c e ip t s .......................................Feb. 7,388 175 148 7,257r 177r 140 7,276r 177 112 6,934 169 154 125 124 126 126 73 12 1 126 123 75 125 124 126 124 80 4.1 41.1 3.9r 41.l r 4.5 41.5 4.0 42.1 PRODUCTION AND EMPLOYMENT Mar. Mar. Mar. Mar. Mar. Unemployment Rate (Percent of Work Force) . . . Avg. Weekly Hrs. in Mfg., (Hrs.) . 127 128 10 2 12 1 11 2 146 6 6 12 1 Mar. Mar. 125 12 2 12 0 Unemployment Rate (Percent of Work Force Avg. Weekly Hrs. in Mfg., . Mar. . Mar. 12 1 129 153 64 129 159 61 4.2 42.2 4.2 42.6r 4.0 42.3 4.2 42.6 205 151 165 FINANCE AND BANKING 220 221 158 163 Member Bank Loans* . Member Bank Deposits* Bank Debits*/** . . . . 156 161 223 158 168 12 1 126 69 INCOME AND SPENDING Personal Income, (Mil. $ Ann. Rate) . Feb. 231 181 229 180 218 173 FLORIDA INCOME AND SPENDING Personal Income, (Mil. $ Ann. Rate) . Feb. 15,974 Manufacturing P a y r o lls ................................. Mar. 241 Farm Cash R e c e ip t s .......................................Feb. 126 15,691r 15,588r 14,899 235r 236 207 116 126 147 4,006r 2 12 2 12 20 0 145 234 184 4,122r 2 11 FINANCE AND BANKING Mar. Member Bank L o a n s ............................ Mar. Member Bank D e p o sits ...................... Bank D e b its * *....................................................... Mar. 12 1 129 154 60 140 10 2 168 138 146 135 146 61 139 148 135 144 62 139 149 135 151 60 131 143 126 139 64 3.9 40.5 4.1 40.7 4.3 41.1 3.5 41.7 294 223 207 298 296 268 222 220 20 1 209 194 192 4,352 4,089 PRODUCTION AND EMPLOYMENT . Mar. C o n s t r u c t io n ............................ Farm Em p lo ym e n t............................ Unemployment Rate (Percent of Work Force) . . Avg. Weekly Hrs. in Mfg., (Hrs.) . Mar. FINANCE AND BANKING PRODUCTION AND EMPLOYMENT Nonfarm E m p lo y m e n t ................................. Mar. M anufacturing..................................................Mar. http://fraser.stlouisfed.org/ 70 Federal Reserve Bank of St. Louis 147 155 147 155 146 154 141 142 Member Bank Loans* . . . . Member Bank Deposits* . . . Bank D e b its * /* *................................. M O N TH LY R E V IE W La te st M o n th (1 9 6 7 ) One M on th Ago Two M on th s Ago One Year Ago TEN N ESSEE IN C O M E A N D S P E N D IN G P e r s o n a l In c o m e , (M il. $ A n n . R a te ) Feb. Feb. 9,0 4 1 19 2 12 7 8 ,8 0 2 r 191r 8 ,6 0 5 r 1 93 12 0 110 8 ,2 9 0 178 124 La te st M o n th (1 9 6 7 ) N o n m a n u f a c t u r i n g ...........................M a r. C o n s t r u c t i o n .............................. M a r. F a r m E m p l o y m e n t .............................. M a r. U n e m p lo y m e n t R a te (P e rc e n t of W o r k F o r c e ) ............... M a r. A v g . W e e k ly H rs. in M fg ., (H rs.) . . . M a r. 134 165 77 O ne M on th Ago Two M onths Ago 134 170r 70 134 177 75 3.2 3 9 .9 r 3.2 4 0 .6 238 173 208 3.3 4 0 .0 O ne Year Ago 127 156 82 238 173 193 3.0 4 1 .5 F IN A N C E A N D B A N K IN G P R O D U C T IO N AND EM PLOYM ENT 138 14 5 138 14 7 * F o r S ix t h D is t r ic t a re a o n ly . O th e r t o t a ls fo r e n t ire s i x sta te s . 139 148 131 138 * * D a i l y a v e r a g e b a s is. M e m b e r B a n k L o a n s * .......................M a r. M e m b e r B a n k D e p o s i t s * ...................M a r. B a n k D e b i t s * / * * .................................. M a r. 240 173 215 225 168 198 r-R e v ise d . S o u r c e s : P e r s o n a l in c o m e e s tim a t e d b y t h is B a n k ; n o n fa rm , m fg. a n d n o n m f g . em p., m fg. p a y r o lls a n d h o u rs, a n d u n e m p ., U. S. D e p t, of L a b o r a n d c o o p e r a t in g st a t e a g e n c ie s ; c o t to n c o n s u m p t io n , U. S. B u r e a u of C e n s u s ; c o n s t r u c t io n c o n t ra c ts , F. W. D o d g e C orp.; petrol, prod ., U. S . B u r e a u of M in e s ; in d u s t r ia l u s e o f e lec. pow er, Fed. P o w e r C o m m .; fa r m c a s h r e c e ip ts a n d fa rm em p., U .S.D .A . O th e r i n d e x e s b a s e d o n d a ta c o lle c te d b y t h i s B a n k . A ll i n d e x e s c a lc u la t e d b y t h is B a n k . D e b its to D e m a n d D e p o s it A c c o Insured Commercial Banks in the Sixth District ( In T h o u s a n d s o f D o lla r s ) P e rc e n t C h a n g e M ar. Feb. 1 96 7 1967 P e rc e n t C h a n g e Y e a r-to -D a te 3 m o s. M a r. 1 9 6 7 fro m 1 9 6 7 Y e a r-to -D a te 3 m o s. M a r. 1 9 6 7 fro m 1 9 6 7 M a r. 1966 Feb. 1967 M a r. fro m 1966 1966 T u s c a lo o s a . . . . . . . . . . . . . . . . . . . . Ft. L a u d e r d a le H o lly w o o d J a c k s o n v ille M ia m i . . . 1,5 1 3 ,8 1 5 5 9 ,3 7 0 1 8 6 ,9 9 3 4 7 0 ,0 1 6 3 0 6 ,2 2 3 9 8 ,3 4 0 l , 4 2 6 ,6 9 4 r + 15 6 3 ,5 1 9 r + 10 1 8 3 ,5 9 0 r + 17 4 6 7 ,2 7 l r + 1 2 2 9 2 ,7 7 1 r + 13 + 17 8 9 ,1 0 7 +6 + 11 -7 -6 +2 + 1 +3 +4 +5 +7 +5 + 10 2 ,2 3 0 ,6 6 0 5 7 2 ,4 9 2 r 1 8 5 ,6 2 7 r +1 + + 7 2 2 + 17 +6 +6 +8 + 9 + 19 -3 +3 + 15 +1 + 7 + 1 1 0 120,393 -8 + 7 l,3 0 5 ,9 8 8 r 4 4 9 ,0 9 5 r + 14 +7 +6 + 11 -1 7 +21 + 12 +8 6 5 6 ,5 2 4 r l , 5 5 5 ,4 9 0 r 1 ,38 0,371 4 4 6 ,6 8 7 A lb a n y A t la n ta A u gu sta C o lu m b u s M acon Savannah 8 6 ,0 0 5 4 ,7 4 5 ,4 8 3 2 8 7 ,8 5 2 2 1 6 ,2 8 2 2 5 4 ,6 1 5 2 8 2 ,9 7 0 7 7 ,5 5 0 3 ,9 2 8 ,4 6 4 2 5 7 ,7 9 4 1 9 0 ,1 5 3 2 1 1 ,1 0 7 2 3 5 ,0 2 2 1 0 0 ,7 5 6 4 ,3 8 1 ,l l l r 2 4 9 ,5 2 4 r 2 0 6 ,7 0 8 r 2 2 4 ,3 0 1 r 2 5 6 ,0 8 5 r B aton R o u g e L a fa y e tte L a k e C h a r le s N e w O r le a n s 5 4 9 ,8 6 9 1 1 2 ,8 5 0 1 4 1 ,7 8 8 2 ,4 7 3 ,3 3 3 4 9 4 ,9 6 2 + 11 -1 1 3 1 ,7 8 0 2 ,0 3 5 ,3 7 6 5 5 2 ,9 5 3 r 1 1 9 ,3 0 9 1 2 1 ,9 4 2 2 ,5 7 1 ,2 5 6 r +2 +8 +22 -5 + 16 -4 +21 6 1 9 ,4 1 6 5 8 9 ,3 5 5 5 8 4 ,2 0 5 r + 5 +6 + 10 Jackson . . C h attan o o ga K n o x v ille N a s h v il le 6 7 1 ,4 1 3 1 ,6 4 4 ,2 5 8 2 ,4 1 7 ,7 5 1 5 5 5 ,6 5 4 1 9 7 ,8 4 4 1 ,3 1 8 ,1 7 6 5 4 ,0 9 0 1 5 9 ,4 3 5 4 1 8 ,8 1 9 2 7 2 ,0 7 7 8 8 ,0 7 7 5 9 8 ,6 9 0 1 ,4 0 4 ,2 5 9 2 ,0 2 8 ,4 9 1 r 4 8 4 ,2 2 1 1 7 9 ,2 4 5 r 1 3 8 ,8 1 5 l , 2 1 2 ,8 0 2 r 4 1 5 ,8 3 9 O r la n d o . . P e n s a c o la T a lla h a s s e e . T a m p a - S t . P e te rsb u rg W. P a lm B e a c h Feb. 1967 M a r. 1966 1 24 ,7 4 1 3 8 ,7 0 6 5 6 .4 9 2 19,6 1 5 3 6 1 ,9 4 0 1 0 1 ,6 7 9 6 9 2 ,5 9 4 6 2 ,6 8 8 1 1 6 ,4 0 3 3 2 ,0 5 8 5 7 ,0 7 9 1 7 ,3 7 0 3 0 2 ,1 4 9 r 9 2 ,6 3 1 6 1 2 ,0 6 0 5 9 ,2 2 8 1 2 8 ,3 0 9 3 8 ,2 0 2 +7 +21 -3 +1 5 9 ,5 4 0 2 1 ,3 0 8 3 1 6 ,1 2 1 1 1 1 ,5 9 6 6 8 4 ,1 1 3 6 8 ,6 8 4 r -1 +13 +20 +10 +13 -5 7 3 ,7 1 0 4 0 .4 9 2 7 8 ,4 1 2 1 8 ,5 5 2 7 1 ,0 8 2 3 1 ,5 3 0 2 3 ,6 9 4 2 1 ,4 3 8 7 1 ,5 6 4 5 4 ,4 7 5 6 6 ,7 0 0 3 4 ,7 2 5 7 1 ,6 6 9 1 1 ,9 4 9 6 5 ,6 6 0 2 9 ,1 5 7 2 0 ,2 8 0 2 2 ,4 6 6 6 3 ,6 5 0 4 7 ,4 1 9 7 0 ,1 4 0 3 8 ,6 1 6 8 9 ,9 4 9 1 3 ,6 8 8 5 6 ,4 4 3 3 1 ,4 4 9 2 5 ,1 5 9 2 5 ,9 6 5 7 1 ,1 9 6 5 0 ,8 2 3 A b b e v ille . . . . A le x a n d r ia . . . . ............... B u n k ie H am m ond . . . . N e w Ib e ria . . . . P la q u e m in e . . . T h ib o d a u x . . . . 1 1 ,6 5 9 1 3 9 ,0 8 4 6 ,7 8 4 3 8 ,1 7 1 3 3 ,5 8 1 1 0 ,6 3 4 2 2 ,8 7 9 1 0 ,0 1 5 1 3 2 ,6 0 4 5,72 7 3 4 ,6 0 8 3 0 ,8 4 3 1 1 ,6 3 4 1 9 ,5 0 8 1 1 ,1 1 1 1 1 2 ,6 5 9 5 ,4 6 2 3 3 ,1 2 1 3 4 ,9 5 3 9 ,7 7 6 2 2 ,0 0 5 B ilo x i-G u lfp o rt . . H a t t ie s b u r g . . . L a u r e l ................... M e r i d i a n ............... 1 0 8 ,2 2 1 5 5 ,4 2 1 3 3 ,9 6 3 9 0 ,4 4 5 4 9 ,3 9 3 3 1 ,5 4 6 5 8 ,6 1 6 3 3 ,4 9 5 8 9 ,2 2 8 5 2 ,5 3 4 3 5 ,9 1 5 6 1 ,3 8 5 3 5 ,4 4 3 L a k e la n d S T A N D A R D M E T R O P O L IT A N S T A T IS T IC A L A R E A S ! B ir m in g h a m . G adsden . . . H u n t s v ille . . M o b ile . . . M o n tgo m e ry . M ar. 1967 128,230 6 3 2 ,4 1 1 4 5 1 ,6 9 3 1,6 2 7 ,2 9 2 1 1 1 ,0 0 2 5 0 9 ,5 8 1 4 1 1 ,4 1 0 1 ,4 4 4 ,2 6 0 5 7 7 ,0 8 9 r 4 2 6 ,8 7 9 r l,4 3 0 , 0 1 4 r + 14 +21 +20 + 24 + 10 + 13 -1 + 15 +5 + 14 + 10 + 10 + 6 + 14 +15 +7 +3 -4 +9 + 15 + 10 + 10 +9 +7 +3 +3 + 9 + 10 + 16 . . M o n ro e C ounty O c a la . . . . St. A u g u s t in e . St. P e t e r s b u r g Sa ra so ta . . . Tam pa . . . W in te r H a v e n . A th e n s B r u n s w ic k D a lt o n . . E lb e rto n G a in e s v ille G riffin . . L aG ran ge N ew nan Rom e . . V a ld o s t a N a t c h e z ............... P a s c a g o u la — 6 4 ,1 3 2 3 9 ,7 4 7 Feb. 1967 +6 M a r. fro m 1966 1966 -8 +14 -9 +1 -9 +1 1 + 17 +9 +55 +8 -1 3 +36 +26 +8 + 0 +17 -5 +1 2 -6 -1 7 + 15 + 16 + 5 + 18 + 10 +9 -8 + 17 +20 + 12 +8 +9 + 19 +5 +4 +4 +7 +5 -1 +6 +3 +1 2 +5 -6 +18 +13 +9 -1 + 1 +4 +1 2 +5 +23 +24 + 15 -4 +9 +4 +21 +5 -5 +4 + 12 +6 +26 +22 +23 -2 +22 +3 + 13 +5 -1 +7 +13 M o s s P o in t . . . V ic k s b u rg . . . . 5 4 ,0 1 4 4 0 ,8 2 8 +8 +6 26 ,4 4 7 5 0 ,1 7 7 3 8 ,4 4 2 2 3 ,8 0 9 5 1 ,0 3 1 3 9 ,3 4 2 Y a z o o C it y 2 4 ,1 8 5 + 11 6 5 ,3 8 4 7 7 ,2 8 9 1 7 0 ,1 6 4 5 5 ,3 4 5 6 8 ,6 1 1 1 3 5 ,1 7 2 6 8 ,7 6 5 7 1 ,5 2 0 1 6 2 ,6 4 6 + 18 + 13 +26 -5 +8 +9 + 11 +5 + 11 + 15 +5 +8 10 +3 15 18 15 +9 + 15 +6 +8 -1 +8 +6 . . . . +6 + 13 +4 +9 + 10 + 10 O THER C EN T ER S A n n is t o n D otha n S e lm a 6 3 ,4 7 3 6 2 ,2 8 5 4 4 ,2 8 8 5 4 ,5 9 0 5 3 ,6 1 0 4 0 ,0 7 1 6 1 ,9 5 3 5 7 ,2 7 9 4 0 ,9 7 4 + 16 + 16 + 11 +2 +9 + 8 +4 + 13 B r i s t o l ................... J o h n s o n C it y . . . K in g s p o r t . . . . +8 S IX T H B a rto w B ra d e n to n B revard C o u n ty D aytona B e ac h Ft. M y e r s — N. Ft. M y e r s G a in e s v ille . . 3 6 ,7 9 3 -1 +27 + 1 +7 3 8 ,2 7 3 7 5 ,1 8 8 2 1 7 ,7 5 0 9 6 ,3 9 4 6 1 ,0 5 2 1 9 2 ,3 9 6 7 3 ,9 0 1 3 8 ,5 1 8 5 7 ,9 8 7 2 2 4 ,9 5 6 8 0 ,0 8 8 +4 +23 + 13 +30 +20 8 2 ,4 6 6 8 6 ,6 7 9 7 0 ,8 3 6 7 4 ,5 0 8 78,0 1 1 7 8 ,1 0 9 + 16 + 16 +6 + 11 In c lu d e s o n ly b a n k s in th e S ix t h D is t r ic t p o rtio n o f th e state. M AY 1967 3 0 ,7 2 0 ,0 3 9 2 6 ,7 5 0 ,1 9 4 r 2 9 ,1 2 7 ,4 5 3 r 3 ,8 4 9 ,4 0 6 9 ,6 1 9 ,8 8 0 3 ,5 0 1 ,5 6 0 8 ,3 3 7 ,5 4 8 r 3 ,7 2 6 ,8 4 6 r 7 ,6 9 0 ,0 8 7 4 ,0 8 6 ,1 7 8 1 ,3 8 5 ,9 8 0 4 ,0 8 8 ,5 0 8 6 ,5 4 2 ,1 3 1 3 ,5 5 8 ,0 0 6 1 ,2 6 5 ,8 2 2 3,5 4 5 ,1 2 7 +8 +30 -3 D IS T R IC T , T o ta l +6 +9 t P a r t ia lly e s tim a t e d . A la b a m a ! . . . . F l o r i d a ^ ............... G e o r g i a ! ............... L o u is ia n a *! M ississ ip p i*! T e n n e sse e *! . . . . . . . . . 9 ,0 9 7 ,0 8 7 7 ,1 3 1 ,8 6 6 r 4 ,1 2 7 ,6 5 8 r l, 2 7 5 , 5 4 3 r 3 ,7 6 8 ,4 5 3 r + + + + +9 +8 ^ E s t im a t e d . 71 +9 +6 + 10 + 11 D is tric t B u s in e s s C o n d it io n s The District echoed the somewhat brighter tone of national business statistics for March. The expan sion of nonmanufacturing jobs overshadowed the weakness in manufacturing, and consumers loosened their purse strings. More tangible evidence of recovery in construction appeared. Bankers assumed a more receptive attitude toward business borrowers. Meanwhile, farmers coped with flood or drought-like conditions. Nonfarm jobs gained in March, but manufactur ing activity again slackened. Setbacks in jobs, the length of the workweek, and electricity consump tion—a measure of capital usage—characterized February manufacturing activity. Further de clines in manufacturing jobs and the workweek occurred in March even though total nonfarm jobs advanced. The unemployment rate continued to fluctuate around 3 ^ percent. District consumers spent more of their rising incomes in March after several months of subdued spending. Car sales, though still below the high rate of March 1966, advanced from the previous month and pushed extensions of automobile loans up sharply at commercial banks. Bank loans for retail purchases, an indirect measure of spending for other types of durable goods, also expanded in March. Total construction experienced a 15-percent in crease over February in contract volume. However, for the first quarter both residential and non residential construction totaled substantially less than for the same period last year. Savings flows to mortgage lending institutions continue to im prove, as evidenced by an all-time record net 72 savings inflow to Florida savings and loan asso ciations in the first quarter. A slight decline in conventional mortgage rates at several District markets enhanced mortgage lending volume. Bank lending to business has revived, judging by April gains in business loans at large city banks. Having acquired substantial volumes of invest ments in the past five months, most city banks are in a better position to expand their loan port folios. Time-deposit growth retained its force, despite some moderation in the issuance of large denomination certificates of deposits. Divergent weather patterns slowed field work. A record rainfall in mid-April damaged vegetable and field crops in southern Louisiana. However, very dry and unseasonably warm weather in the eastern two-thirds of the District delayed plant ings. In March, average prices received by farmers were well below year-ago levels, while prices paid by them advanced. District bankers report the demand for farm loans equals or exceeds last year’s. NOTE: D ata on w h ic h s ta t e m e n ts a r e b a s e d h a v e b e e n a d ju s te d w h e n e v e r p o s s ib le to e lim in a te s e a s o n a l in flu e n c e s. M O N TH LY R E V IE W