View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

UNITED STATES DEPARTMENT OF LABOR
Frances Perkins, Secretary
BUREAU OF LABOR STATISTICS
Isador Lubin, Commissioner (on leave)
A . F. Hinrichs, Acting Commissioner

Fact-Finding A ctivities
o f the
Bureau o f Labor Statistics

B ulletin T^o. 831

For sale by the Superintendent of Documents, U. S. Government Printing Office
Washington 25, D. C. - Price 10 cents







Contents

Page

Foreword_____________________________________________________________
Employment and the labor force— -------------------------------------------------------Trend of employment---------------------------------------------------------------------Scope of. the data_____________________________________________
Employment in individual manufacturing industries-------------------------Employment in the construction industry-----------------------------------------Public employment------------------------------------------------------------------------Collaboration in reporting in State and local areas------------------- . -----Employment and occupational outlook--------------------------------------------Manpower requirements and labor supply___________________
Productivity and technological developments______________________
Labor turnover------------------------------------------------------------------------------Earnings and wages..---------------------------------------------------------------------------Trend of earnings-------------------------------------------------------------------------W ages:
Index of wage rates----------------------------------------------------------------Data for wage-stabilization program----------------------------------------Industry wage surveys-------------------------------------------------------------Union wage rates---------------------------------------------------------------------Special studies------------------------------------------------------------------------Working conditions and industrial relations------------------------------------------Hours of work------------------------------------------------------------------------------Industrial hazards and accidents---------------------------------------------------Handicapped workers---------------------------------------------------------------Prices and the cost of living-------------------------------------------------- :--------------Cost of living_____________________________________________________
Retail prices---------------------------------------------------------------------------------Consumer income and expenditure studies---------------------------------------Wholesale (primary-market) prices------------------------------------------------General summaries o f price trends------------------------------------------------Labor conditions in other countries-------------------------------------------------------




(i)

m
2
2
3
4
4
6
6
7
8
8
10
11
11
12
14
15
15
16
16
17
18
18
19
19
22
24
25
26
27

Letter of Transmittal

U nited S tates D e p a r tm e n t op L abor,
B u r ea u of L abor S tatistics ,
W ashington, D . C ., M a y 17,191^5.

The S ecretary of L a b o r :
I have the honor to transmit herewith a report on the fact-finding
activities of the Bureau of Labor Statistics, prepared by Harold R.
Hosea in cooperation with the Bureau’s branch chiefs.
A . F . H in r io h s ,
A ctin g Commissioner.

Hon. F rances P e r k in s ,




Secretary o f Labor„

Foreword
One o f the more striking results of the war’s impact on the national
economy has been a widespread recognition of the necessity for having
dependable facts in solving the many complex problems faced by labor,
management, the Government, and the public in general. Achievement
of the goal o f high-level postwar employment, and successful control
of potential inflationary forces, will require even more emphasis on
olicies developed on the foundation of an intimate and detailed
nowledge o f potential problems and the probable outcome o f various
methods o f attacking them.
The Bureau of Labor Statistics, in its capacity as .a fact-finding
agency, has compiled and made available a substantial volume of ma­
terials on employment, wages, working conditions, prices, and other
subjects which are directly pertinent to many of the Nation’s economic
problems. The principal purpose of this bulletin is to describe the
more important types of information compiled by the Bureau, their
characteristics, uses, and limitations, and the forms in which they are
available. More systematic reference sources are, of course, to be
found in its official publication, the Monthly Labor Review, in the semi­
annual subject index to its contents, and in the separate lists of Bureau
publications issued from time to time.
It is obviously impossible to publish all of the large volume of infor­
mation which is collected and analyzed. Some of it, indeed, is assem­
bled as a basis for solving unique or specialized policy problems;
important as such data are for these specific purposes, they do not, in
some cases, warrant presentation for general use. Frequently, how­
ever, these unpublished materials would be of great use to labor groups,
individual employers, or associations if they were aware that such
information is available. It is hoped that this bulletin will be of
some assistance in indicating the fields in which data are likely to be
accessible.
The Bureau of Labor Statistics is a service agency operated not only
for labor and Government departments, but for the public generally;
and complying with requests for information on subjects in the broad
field o f labor economics is an important part of that service. Requests
may be sent to the Commissioner of Labor Statistics in Washington
or to one o f the field offices, a list of which appears on the inside back
cover of this bulletin. The services of the Bureau’s eight regional
directors, all o f whom are specialists in labor economics, are also
available to all organizations and individuals. They or their assist­
ants are in a position to supply copies of Bureau materials and to
provide advice and suggestions on these and related matters.

E




(ra)




B ulletin l^[o. 831 o f the
U nited States Bureau o f Labor Statistics
[Reprinted from the M onthly L abor R e v ie w , M ay 1945]

Fact-Finding A ctivities o f the B ureau o f L abor
Statistics
The act of Congress under which the Bureau of Labor Statistics
operates defines its function as that of acquiring and diffusing informa­
tion on subjects connected with labor “ in the most general and com­
prehensive sense of that word.” During its 60-year history, the
Bureau has become the Government’s principal fact-finding agency
in the field of labor economics, particularly with respect to the collec­
tion and analysis of data on employment and manpower developments,
wages, working conditions, price trends, and the costs and standards of
living. The present war, as did World War I, the depression of the
1930’s, and other economic and social crises, necessitated some
redirection of the Bureau’s work in order to meet the needs of the
times. The changes, however, have been in the nature of shifts in
emphasis, and there has been no modification in basic approach.
The Bureau’s activities continue to be geared to provide the kinds
of facts required for the solution of present-day and probable future
economic problems as they arise or can be predicted with some
assurance.
The complex problems which grew out of the present conflict,
together with consideration of the postwar adjustments that will have
to be made, are reflected in the scope of the Bureau’s current opera­
tions to a marked degree. Typical of recent developments is the
extension of its work in the collection of price and wage data to provide
a factual basis for administration of the stabilization programs by the
agencies charged with those responsibilities. This and other tasks
assigned to the Bureau have resulted in a very great increase in the
volume of data available in its files. Simultaneously, shortages in
manpower and materials have made it impossible to prepare much
of this information for general distribution. The purpose of the
present discussion is to provide a brief description of the Bureau’s
more important activities, together with some notes on the types of
data which are published, or can be made available on request, and
the purposes which they may serve.
The Bureau of Labor Statistics has no enforcement or administrative
functions of any sort. Virtually all of the basic data it collects from
workers, businessmen, and other governmental agencies are supplied
by these individuals through voluntary cooperation based on their
interest in and need for the analyses and summaries which result.
It follows, therefore, that the research and statistical projects planned
by the Bureau grow out of the needs of these same groups for informa­




(1)

2
tion of one kind or another, and its program is based on these require­
ments as they are made known by the representatives of labor,
management, and other Government agencies. Cooperation is
facilitated by the fact that the materials compiled by the Bureau are
presented typically as statistical summaries. The confidential data
supplied by individuals cooperating in its studies are never released,
even to another Government agency, in a form which would disclose
information on the operations of an individual firm or organization,
unless permission has been obtained in advance from those who
furnished the materials.
Space does not permit anything approaching a complete enumera­
tion of the wide variety of statistical and research materials assembled
by the Bureau. It is hoped, however, that the following description
of the general nature of the Bureau’s work in the several broad fields
will help to make this large volume of information more readily
accessible.
Em ploym ent and the Labor Force

One of the Bureau’s most important continuing functions is the
task of providing current information on the status and characteris­
tics of the employed segment of the Nation’s labor force. Basic data
on the total working population are compiled by the Bureau of the
Census through the decennial censuses and the Monthly Report on
the Labor Force. This information is collected from the individuals
who constitute the labor force; the Bureau of Labor Statistics, on the
other hand, is responsible for assembling and presenting the materials
on total nonagricultural employment furnished by industrial and
commercial establishments, i.e., employers. These activities and,
consequently, the data which result fall into two general groups.
The first is made up of a series of regular or periodic reports on the
trends of employment and the characteristics of the workers in a wide
variety of industries. The second type of undertaking is concerned
with analyses of special problems relating to the characteristics of the
labor force, the outlook for employment in the future, manpower
needs, and allied subjects.
TREND OF EMPLOYMENT

In order to provide basic information on the trend of employment,
more than 115,000 establishments voluntarily supply the Bureau with
regular reports on the numbers of workers during a representative
pay period in each month. Information on total man-hours worked
and aggregate wages paid are also shown on the same questionnaire.
The firms which report constitute a carefully selected cross section of
some 150 manufacturing industries; consequently, it is possible to
estimate the general trend for each of these industries by relating
the experience of these sample firms to benchmark data in the form
of complete counts made at infrequent intervals. Similar information
is made available for the more important nonmanufacturing indus­
tries such as retail trade, construction, and utilities. To these data
are added the information in reports from Federal, State, and local
government agencies. The result is an estimate of the total volume
of nonagricultural employment.




3
This information may be found in a mimeographed monthly report
entitled “ Employment and Pay Rolls: Detailed Report,” which also
includes the corresponding pay-roll indexes and State estimates of
total nonagricultural employment. War conditions have made it
necessary to reduce the numbers and distribution of most of the Bu­
reau’s publications. For this reason, the detailed reports are sent
only to organizations urgently in need of the data at the earliest
possible moment. Much of this information is also published in the
Monthly Labor Review approximately 3 to 4 weeks after the appear­
ance of the preliminary release. A brief general summary of the
employment situation, providing an over-all estimate and data for
broad industry groups, is issued in the form of a release about the
middle of the month following that to which the information relates.
Another mimeographed monthly release provides indexes of employ­
ment in manufacturing industries for about 100 metropolitan areas or
cities. Summaries showing the numbers of women employed in
manufacturing industries are also prepared from time to time.
Scope o f the Data

The types of information outlined in the foregoing paragraphs
have evolved over a period of nearly 25 years. Indexes of employ­
ment and pay rolls, based on this voluntary reporting system by
employers, are available back to 1923; prior to that date, and ex­
tending back to 1909, similar but less detailed material was com­
piled from the several Censuses of Manufactures. For a number of
reasons, none of the series can be regarded as completely continuous
over the entire period. In the first place, the number of industrial
and commercial establishments is so great as to preclude the possi­
bility of a complete monthly census; consequently, sampling pro­
cedures must be used. Irrespective of the adequacy of any sample,
biases are likely to develop over periods of time, partly as a result
of changes in the characteristics of the industry as a whole. It is
necessary, therefore, to evaluate the sample from time to time as
benchmarks (i.e., data based on complete enumerations) become
available. From’ 1923 to 1939, the Bureau’s estimates were revised,
as necessary, on the basis of the biennial Census of Manufactures.
No such census has been undertaken since 1939, and the revisions have
therefore been made largely on the basis of reports to the Bureau of
Employment Security in connection with the unemployment-compen­
sation program and to the Bureau of Old Age and Survivors Insurance.
One of the most complex problems has been the industrial classifica­
tion of individual establishments which are, of course, grouped accord­
ing to principal product or service. This perennial difficulty has been
greatly aggravated by the wholesale conversions brought about by
the war production program. Because the Bureau’s indexes are
designed primarily to measure trends, the reporting firms have been
retained in the industrial classifications which correspond to their
products or services in 1939; the actual employment estimates have
been revised on the basis of 1943 data from the Bureau of Employ­
ment Security. The monthly employment and pay-roll indexes are
available back to January 1939 on tne current base. The data for
earlier periods have been prepared only in terms of indexes based on
the average for 1923-25 as 100.
648948°—45----- 2




4
It is possible in some cases to link the employment and pay-roll
trend data for periods prior to January 1939 with the more recent
information; the extent to which this can be done depends on the
degree of stability of the industry in question, as currently defined.
In some cases:—apparel manufacturing, for example—individual plants
are unlikely to change the nature of their products sufficiently to re­
quire shifting them from one industry classification to another. On
the other hand, a plant originally producing automobile parts, for
instance, may, with comparative ease, shift to radio manufacturing
and thus bring about a change in its classification. These problems
are complicated further in some cases by the necessity for revising and
amplifying the classification system itself in order to keep pace with
technological changes and the development of new products and
consumption patterns. The Bureau recognizes the genuine need of
management, labor, and governmental agencies for long-time trend
data on employment and pay rolls, particularly in connection with the
planning of future operations, and is glad to consider special requests
for data of this type when they are not available in the published
series.
EMPLOYMENT IN INDIVIDUAL MANUFACTURING INDUSTRIES

The demands of the war on industry, particularly for munitions,
have made it necessary for the Bureau to devote increasing attention
to the movement of employment and earnings in plants manufacturing
aircraft, ships, arms, ammunition, and similar items. These activities
have involved the preparation of data for industries made up of plants
classified on the basis of current output rather than peacetime products
or services as in the case of the regular trend series. The summaries
made available include detailed data on employment, working condi­
tions, and production in the aircraft and shipbuilding industries.
Typical are articles entitled “ Employment in the Shipbuilding In­
dustry, 1935-43,” and “ Wartime Development of the Aircraft In­
dustry,” which appeared in the Monthly Labor Review for May and
November 1944, respectively. In addition to these statistical reports,
the Bureau has prepared numerous estimates of manpower require­
ments in the more important war industries for the use of the Army,
the Navy, the War Manpower Commission, and other operating
agencies. Some of these materials are available for general use; an
article entitled “ Current Developments in Manpower Requirements
and Labor Supply,” which appears in the Monthly Labor Review for
December 1944, is illustrative.
EMPLOYMENT IN THE CONSTRUCTION INDUSTRY

As noted earlier, the principal sources of the Bureau’s extensive data
on employment and pay rolls are employers throughout the United
States. The construction industry, however, presents a number of
unique problems, three of which are sufficiently important to warrant
brief mention here. In the first place, the typical construction con­
tractor does not operate continuously in a fixed location as do factories,
wholesale houses, and similar establishments. The contractors’
principal operations are at the construction sites and change from
month to month or even from week to week. Second, the fluctuations




5
in employment* and pay rolls tend to be frequent and large. Both of
these factors detract seriously from the effectiveness of a current
reporting system such as that used for industries in which employment
is relatively stable and fixed. Finally, it is essential, for numerous
reasons wmch are obvious, to distinguish between private construc­
tion and building operations financed wholly or in part from public
funds.
The necessity for finding solutions to these technical problems has
resulted in the development of numerous series, related to construc­
tion activities, which provide a considerable background in addition
to the trend of employment and pay rolls. One of the principal sources
of primary data on the volume of building construction is found in the
files of building permits which are required in the great majority of
urban communities; it is estimated that 80 to 85 percent of the
Nations urban population is in municipalities which require such
permits. The Bureau receives information from this source from
virtually all of these communities. Although the permits do not con­
tain information on employment and pay rolls, the data on type of
construction, numbers of structures, and estimated costs provide
accurate guides to the volume of employment in this segment of the
building-construction industry. Another important source of informa­
tion is that pertaining to construction financed from Federal funds.
Data of this sort, including employment and pay-roll information, are
supplied to the Bureau by the governmental agencies involved. Sup­
plementary sources of information at present are available in the files
of priorities on materials issued by the War Production Board; employ­
ment reports are also obtained by the Bureau from certain groups of
individual contractors. Thousands of construction projects of all
types have been analyzed by the Bureau, and these experience records,
together with the current reports from various sources on construction
activities, provide the basis for estimating employment in the con­
struction industry as a whole, public as well as private.
The principal statistical results of these regular compilations are
summarized for general use in the special section on Building Construc­
tion, in each issue of the Monthly Labor Review. They are also
given in more detail in the publication, Construction, a monthly
summary which makes available, under a single cover, the various
data which formerly appeared only in individual releases. In addition
to employment and pay-roll indexes for the construction industry, this
latter publication includes current and detailed monthly data on con­
struction expenditures by type of project and source of funds, to­
gether with building-construction valuations by State, city, size of
community, and source of funds. The statistics show also the num­
bers of dwelling units started each month, wholesale and retail prices
of building materials, and similar types of data.
At least equal in importance to these current statistical reports are
special analyses of the construction industry undertaken from time to
time. The sharp decline in construction activities during the war has
resulted in a backlog of essential building, both residential and nonresidential. It follows that this industry is likely to become vastly
more important after the cessation of hostilities and will play a vitally
essential role in a postwar full-employment program, irrespective of
whether it is necessary to supplement privately financed construction
with a program of public works. The Bureau’s fund of knowledge on



6
the volume and nature of the employment furnished by different
pes of construction activities is invaluable in this connection.
etailed analyses of project operations involved in the public-works
program of the 30’s have been completed, and, on the basis of these
data, it is possible to determine with a high degree of accuracy the
numbers and types of workers required for an individual project as
well as the amount of employment provided both at the site and in
other areas where the necessary construction materials are manu­
factured. The postwar plans for public works in a number of States
and individual communities have been analyzed by the Bureau, and
estimates of the amounts and types of on-site and off-site employment
involved have been supplied.
Broad summaries of this important industry, for general use, are
contained in three recent Bureau publications. The first, entitled
“ The Construction Industry in the United States,” is an exhaustive
analysis of the industry’s characteristics and trends during the period
1915-43. The probable future of the industry, with particular refer­
ence to its importance as a stabilizing factor, is discussed in detail in
two recent publications under the titles, “ Postwar Capacity and Char­
acteristics of the Construction Industry,” and “ Probable Volume of
Postwar Construction,” which are available in Bureau Bulletins Nos.
786 and 825, respectively.

g

PUBLIC EMPLOYMENT

The Bureau’s regular reports also include information on employ­
ment and pay rolls in Federal, State, and local governments as well
as statistics on military personnel. Special studies undertaken from
time to time include such analyses as the geographic distribution of
Federal civilian employees, occupations and salaries in the Federal
Government, and municipal pay rolls. The trend of public employ­
ment in the United States from 1929 to 1939 and some of the possible
postwar developments were discussed in the February 1945 issue of
the Monthly Labor Review. Although considerations of safety
make it impossible to release all of the data on military personnel at
present, this information will be made available later, to assist in
solving the numerous complex problems which are almost certain to
arise during the demobilization and postwar periods.
COLLABORATION IN REPORTING IN STATE AND LOCAL AREAS

The companies which now supply the Bureau with regular reports
on employment and pay rolls, as noted previously, constitute a large
and representative Nation-wide cross section of some 150 manufac­
turing industries and selected nonmanufacturing industries. With
comparatively few exceptions, however, these samples of establish­
ments are not sufficiently large in number to provide an adequate
basis for employment estimates in individual industries for States and
metropolitan areas. In the postwar readjustment period the emphasis
will be upon local and State problems in the solution of which the
general Nation-wide data are not particularly useful. Thus, employ­
ment-trend data for the machine-tool industry as a whole will not
provide the facts necessary for detailed planning in a particular area.
A substantial expansion of the Bureau’s employment-reporting system,



7
operated principally through its eight regional offices, is now in progress
and will make it possible to provide data on employment, pay rolls,
and earnings for each State.
It is also important to note that this expanded program is based on
a continuation and extension of the Bureau’s policy of compiling
these data, as far as possible, in collaboration with the several State
Departments of Labor.1 In 19 States, the Bureau and the States
collect the employment and pay-roll data on a single form, thus
avoiding duplication of reporting by employers. In many cases, the
data are analyzed and published by the State agency and reports are
sent to the Bureau in Washington for inclusion in the national totals.
In return, the Bureau underwrites a part of the expense incurred by
the States in collecting the information. This cooperative arrangement
has proved to be effective and economical, and further decentralization
and extension of these Federal-State programs are now in progress.
EMPLOYMENT AND OCCUPATIONAL OUTLOOK

The most effective use of the Nation’s labor force, whether under
a program of maximum production in wartime or a plan for full
employment in peace, is not a mere matter of equating the number
of jobs and the total available labor force. During the war the
Bureau’s activities in this field of analysis have centered around
problems of manpower requirements and labor supply. Aside from
the special needs arising out of the war, information as to probable
changes in employment are required by governmental agencies, by
labor and industry, and by individuals. The Bureau has therefore
attempted to bring its experience in the measuring and analysis of
employment trends to bear on the problems of anticipating future
developments.
To meet the needs of vocational counselors and agencies with
responsibility for assisting demobilized soldiers and war workers to
find the most suitable jobs after the war, the Bureau has been ex­
panding its work in the field of occupational studies. These studies
are designed to provide information on employment opportunities in
specific occupations, the training and other requirements, wages, and
working conditions and, so far as possible, some indication of the
kind of a life such an occupation affords. Occupational studies pub­
lished include “ Employment Opportunities for Diesel-Engine Mechan­
ics,” in the Monthly Labor Review for February 1945 and a series
on “ Postwar Employment Outlook in Aviation Occupations,” be­
ginning in the April 1945 issue.
Studies of the outlook for employment in each major industry are
of value both in themselves and as a necessary step in appraising the
outlook for the occupations each industry employs. The Bureau has
conducted studies in this field, reviewing historical trends in employ­
ment, and analyzing the factors affecting future employment trends.
Underlying the industry studies is a broad analysis of major trends in
employment. An example of this type of study is the article “ Fac­
tors Affecting Postwar Job Transfers* and Unemployment,” in the
February 1944 issue of the Monthly Labor Review. Examples of the
industry studies include an article on “ Trend of Employment in the
’ In Pennsylvania, part of the information is compiled b y the Philadelphia Federal Reserve Bank and
in Texas, by the State University.




8
Aluminum-Products Industry,” in the February 1944 issue of the
Monthly Labor Review, and the articles on postwar construction
activity referred to above.
M anpow er Requirements and Labor Supply

Since the beginning of the defense program, a continuous analysis
has been carried on with respect to labor requirements for munitions
production and the changes in employment in all other components
of the economy resulting from the war program. The purpose of
these analyses nas been to indicate, in the changing phases of the war,
the demands for industrial and military manpower in relation to the
available sources of labor supply. The work has involved, partic­
ularly, the development of techniques of estimating future labor
requirements based upon official war production schedules, and has
been carried on cooperatively with the War Manpower Commission
and with the assistance of the War Production Board and other Gov­
ernment agencies. The joint statements prepared by the Bureau of
Labor Statistics and the Reports and Analysis Service of the War
Manpower Commission have been officially submitted to the Chair­
man and members of the War Manpower Commission and subse­
quently issued to the public by means of press releases and in articles
in the Monthly Labor Review and the Labor Market. The seventh
in the series of joint public statements appeared in the February 1945
issue of the Monthly Labor Review.
In conjunction with the Bureau’s studies of manpower require­
ments, work in the field of labor-force analysis was initiated early in
1942. Changes in the size and composition of the labor force during
the war have been analyzed primarily from two points of view— the
availability of additional sources of labor supply to meet wartime
industrial and military needs, and the probable size of the labor force
after the war. The results of the labor-supply studies have been
incorporated in the periodic manpower-requirements statements
issued jointly by the Bureau and the War Manpower Commission,
and have been presented in detail in articles in the Monthly Labor
Review (see, for example, Sources of Wartime Labor Supply in the
United States, in the August 1944 issue, and Teen-Age Youth in the
Wartime Labor Force, in the January 1945 issue).
In many areas, the war has caused drastic changes in labor require­
ments and in industrial organization. At the same time, the char­
acter of the labor force has undergone marked changes because of
migration, the induction of large numbers into the armed forces, and
the addition of “ extra” workers (estimated at about 6.7 million in
1944) who would normally be outside the labor market. In collab­
oration with State and local authorities, the War Manpower Com­
mission, and other agencies, the Bureau has studied the impact of
the war on more than 175 communities and thus provided the factual
basis for implementation of State and local postwar plans.
PRODUCTIVITY AND TECHNOLOGICAL DEVELOPMENTS

The productivity of labor is a significant factor in determining
manpower requirements and employment levels, whether the objec­
tive be maximum production as in war or full employment under
peacetime conditions. Adam Smith’s classic description of the effects



9
of the introduction of machinery in the manufacture of pins is still
indicative of the industrial changes that are going on today, with farreaching implications to labor. New techniques are noted by the
Bureau in a monthly Summary of Technological Developments
which contains abstracts from a large number of trade and technical
journals. An extensive record of such changes in techniques and
processes is included in a recapitulation of the materials carried in
the monthly reports for 1942 and 1943, arranged by subject and index.
This summary, now in press, is designed to supply employers, labor,
and Government officials responsible for framing national policy with
guidance on trends in productivity and technological innovations.
The Bureau has also prepared indexes of productivity and unit
labor cost for the more important manufacturing and nonmanufac­
turing industries. Annual indexes are currently available for about
25 manufacturing industries, (> mining industries, steam-railroad
transportation, agriculture, etc. Special studies have been completed
or are under way for shipbuilding, alumina and aluminum production,
and aircraft. During the war, it has not been possible to continue
the preparation of productivity indexes for a number of important
manufacturing industries. The Census of Manufactures, the most
complete source of production data, has not been taken since 1939.
In some industries, which have converted to war production, the in­
dustry structure has become exceedingly complex and it has not been
possible to obtain the comparable statistics for production and labor
which are necessary in the preparation of an index of productivity.
The productivity data are published in a series of mimeographed
releases. In addition, more detailed reports analyzing the changes in
productivity have appeared as articles in the Monthly Labor Review.
Among the articles which have been published in recent years are
studies on flour milling, cement, meat packing, steam-railroad trans­
portation, copper mining, lead and zinc mining, electric-energy gener­
ation, and agriculture.
It is possible, by means of field studies, to obtain more complete
and detailed information on productivity than is ordinarily available
from secondary sources. Usually the analysis within each plant is
made on a departmental basis, and records of labor input, production,
equipment in use, and equipment changes are obtained. A field
study thus permits a rather complete analysis of the absolute level of
output per man-hour, the reasons for productivity changes within an
industry, and the effects of productivity changes on employment and
on occupations; also, such studies usually provide some basis for
anticipating future changes.
Few such field studies have been possible for complete industries
during the war period. For those made, the reports have usually
been issued in mimeographed or printed form and have almost
invariably appeared in shortened form in the Monthly Labor Review.
Both the technological developments in particular industries and
the technological relations among industries are analyzed by the
Bureau. Data relative to the flow of goods and services among the
different industries are compiled and the information so obtained is
used to estimate the effect on employment and output in each industry
of a given volume and kind of final demand. The output of any one
industry is dependent upon the level of activity in those other indus­
tries which utilize its products. The output of lumber depends,



10
for example, upon the volume of construction; freight-car mileage is
in turn related to the output of the lumber industry, while bituminouscoal production is partly determined by the fuel demands of freight
trains. Insofar as these relations grow out of technological ties or
settled customs, they may be expected to remain relatively stable and
to provide some basis for anticipating the effects of a major change in
one segment of the national economy on the output and employment
of all the other segments.
A systematic study of these relations has been completed for 1939
and the results have been published in summary form in a large
table which shows for each of 20 main industries both the distribution
of its output among the other 19 industries and the distribution of its
purchases from them. The relationships shown by the table have
been used in seyeral unpublished studies and are now being applied
in a study of possible postwar full-employment patterns. In addi­
tion to use in studying broad economic questions, the data may be
used by an industry to measure the extent of its dependence, both
direct and indirect, on the activity of any other industry.
LABOR TURNOVER

One important guide in ascertaining the degree of stability in the
employed segment of the labor force is found in the rate of turnover,
i. e., the relative frequency with which workers leave or are added to
the pay rolls of individual establishments. About 98,000 establish­
ments, which currently employ some 8 million workers, supply turn­
over data to the Bureau each month. The results are issued in the
form of preliminary mimeographed releases and are also published
regularly in the Monthly Labor Review. Separate rates, which are
in terms of separations and accessions per 100 employees, are shown
for about 100 industries; some 90 of them are manufacturing industries.
The data on separations provide considerable detail including rates
for quits, lay-offs, discharges, and military and miscellaneous separa­
tions. Separate figures for men and women are computed for 3
industries important to the war effort. Although the published
summaries of these data provide only Nation-wide totals for individual
industries, rates for individual areas are compiled from time to time
in response to special requests. As in the case of many other types
of information prepared by the Bureau, these data on turnover rates
have proved highly useful to individual companies and labor organi­
zations because they provide a norm against which the experience of
an individual plant may be checked and evaluated.
In the spring of 1943 the Bureau began the compilation of data on
absenteeism from a representative sample of individual plants, prin­
cipally those engaged in the production of war materials. This
information, which was made available in monthly mimeographed
summaries showing absence rates (in percentages of total scheduled
working time) by industry and sex, was used extensively in estimating
manpower requirements and in developing measures designed to
increase the effectiveness of the war production program. This
activity was discontinued at the end of 1944 (except for the aircraft
and shipbuilding industries), since, for some time, general absence
rates had shown no striking changes from the general patterns sug­
gested by the data compiled over a period of nearly 2 years.



11
Earnings and Wages

The collection and interpretation of data on the earnings of labor
have made up a substantial proportion of the Bureau’s work through­
out its entire history. During the past 2 % years, the need for infor­
mation in this field has increased markedly, in part as a result of
the wage-stabilization program. Because of its long experience in
wage research, the Bureau has been the principal source of such infor­
mation, and a large part of its program has been devoted to meeting
the needs of the National War Labor Board and other agencies
responsible for the administration of wage control.
The recurring reports on the trend of earnings and wages provide
seven different types of measure, each with certain unique character­
istics which reflect the need for a particular kind of yardstick. Five
of these measures relate to the actual earnings of workers while the
remaining two are concerned more with basic wage rates. The
principal characteristics, limitations, and possible uses of each of these
measures are described in the following paragraphs. A more extended
discussion may be found in an article entitled, “ Wartime Wage Move­
ments and Urban Wage Rate Changes” which appeared in the
Monthly Labor Review for October 1944.
TREND OF EARNINGS

The principal source of the Bureau’s data on the trend of earnings
is the voluntary reporting system described above in connection with
the estimates of volume of employment. The reports supplied by
the 150,000 cooperating companies contain, in addition to the employ­
ment data, information on total man-hours worked and total pay rolls
for the pay period nearest the 15th of each month. From these re­
ports and certain supplementary information, the five measures of
earnings prepared by the Bureau are computed.
Average weekly earnings, the first of these measures, derived merely
by dividing total pay rolls by total wage earners, have been summar­
ized in mimeographed releases and in the Monthly Labor Review since
1932 and are prepared currently for the same 200-odd industries re­
ferred to above in connection with the employment-trend data. The
continuity of the earnings series is subject to the same limitations
noted in that discussion, and revised data, based on the industrial
classification of individual establishments in terms of their peacetime
products and services, are available only from January 1939. As in
the case of the employment series for certain individual industries, it
is possible to link the current trend-of-earnings data with those for
periods prior to 1939; the extent to which this can be done depends on
the degree of stability of the particular industry involved.3 The
same is true of gross average hourly earnings, the second type of meas­
ure, which is computed by dividing total pay rolls in an industry by
the aggregate man-hours worked.
As the need for maximum production of war materials became more
urgent and manpower shortages more acute, the workweek was
lengthened appreciably and night work increased. This resulted
in a marked rise in gross average weekly and hourly earnings because
of the added hours and the steadily increasing importance of premium
‘ See p. 4.
646948*




12
payments for overtime and night work. The Bureau’s third type of
measure, estimated straight-time average hourly earnings, represents
an attempt to provide an index which is not affected by overtime
premium earnings. The effect of the overtime premiums is eliminated
through the use of a formula developed through a detailed analysis of
data from earlier studies of earnings; because of the burden of clerical
work involved, it has not been practicable during the war for cooperat­
ing firms to report these amounts separately.
Even this somewhat more refined index reflects the influence of a
number of factors apart from the movement of wage rates themselves.
In the case of data for groups of industries, the earnings averages tend
to be affected by any net movements of workers from one industry
to another whenever the industries involved show, as they frequently
do, differences in general wage levels. This factor has been espe­
cially important during the development of the war production pro­
gram, because of the heavy migration of workers into war industries
which tend, in general, to show comparatively higher wage levels.
Elimination of the effects of this factor is accomplished by weighting
the earnings averages for major industry groups on the basis of their
importance in terms of employment prior to and during the war.
The Bureau prepares three series of adjusted averages of this general
(i. e., the fourth) type: One, based on peacetime conditions, reflects the
distribution of employment, by industry, in 1939; another, in which the
employment weights are those of January 1941, provides a series on
the base date used in connection with the wage-stabilization program;
the third is based on October 1942.
The several series on the trend of earnings have many important
general and specific uses. For example, the data on straight-time
earnings form the statistical basis for wage-rate escalator clauses
inserted in long-time Government contracts such as those covering
the construction of battleships. Through this device, the contractor,
the workers, and the Government are protected from losses or other
inequities which might otherwise result from general economic
changes that ordinarily cannot be predicted so far in advance.
The fifth measure of earnings developed from the Bureau’s monthly
reports from employers represents an attempt to trace the movement
of spendable earnings. Briefly, this device is in the form of an index
which, starting with the data on gross average weekly earnings, in­
cludes successive adjustments designed to take account of pay-roll
deductions for social security and income taxes and bond purchases,
and the movement of retail prices. Although, this measure still
lacks numerous refinements which would be necessary to make it a
precise tool, it does nevertheless serve as a rough guide to the trend
of real wages. Current trends, as revealed by these measures of
earnings, are summarized briefly in the Monthly Labor Review.
WAGES
Index o f W age Rates

The remaining two measures of the pay received by wage earners
involve the assembly of material on wage rates as distinguished from
earnings. The collection of data on prevailing rates for specific jobs
in individual industries and areas is one of the Bureau’s oldest activi­
ties; studies of this general type have been made for more than 50




13
years. Currently, however, a general index of urban wage rates,
the sixth type of measure of earnings and wages, is prepared at inter­
vals of 6 months; this continuous series represents a new develop­
ment in the field.
This index of wage rates grew out of the need for a measure which
would be unaffected by changes in the length of the workweek, in
the amounts of premium payments for overtime and night work,
interindustry and interarea shifts in volume of employment, varia­
tions in occupational (and skill) distributions within individual plants
and industries, and other factors, all of which are reflected in statis­
tics on the levels of earnings as computed from reports on employ­
ment, man-hours, and total pay rolls. The desirability of having
such a device was accentuated during the war period by the need for a
means of determining the effectiveness of the wage-stabilization
program in which the principal emphasis has been on control over
basic rates rather 'than total earnings.
The Bureau’s considerable experience in collecting occupational
wage-rate data provided the necessary mechanics. Prior to the war
these activities consisted mainly of Nation-wide studies designed to
provide a detailed analysis of the wage structure and characteristics of
an individual industry. The data for these studies, which still play
a prominent role in the Bureau’s wage work, are collected in the course
of visits made by Bureau representatives to each plant in the samples
selected as representative of the industries. The information is com­
piled from company pay rolls and other official records. The use of
the questionnaire method in the collection of occupational wage-rate
data is generally unsatisfactory largely because the wide differences
among plants, industries, and areas in the use and meaning of occupa­
tional titles and in job content seriously undermine the comparability
of the information. The Bureau’s representatives are, therefore,
provided with standard job descriptions, developed in consultation
with employer and employee organizations, which they use in classify­
ing the workers in each plant studied.
The preparation of a wage-rate index from data collected in this
fashion necessitated the use of certain short cuts, since it is physically
impossible to compile wage information on all the jobs in all industries
at frequent intervals. Data available in the Bureau’s files tended to
substantiate the hypothesis that periodic checks on a balanced
selection of the more important industries (in terms of volume of
employment) would provide an adequate index. Consequently,
the data collected periodically are limited to some 10 standard nonmanufacturing industries and a varying number of manufacturing
industries which are important in the individual areas. Further,
experience showed that it was unnecessary to assemble rate data for
all the occupations in an industry. It is thus possible to restrict the
collection of data to a comparatively few jobs which can be defined
precisely, are common to most plants in an industry, are numerically
important, and represent different levels of skill. The trend of rates
established for these key jobs is then applied to the remaining occupa­
tions by imputation. Finally, the index is restricted to urban areas
and is currently based on the movement of rates in some 6,600 estab­
lishments distributed among 69 cities and metropolitan centers.
The effects of period-to-period changes in occupational distribution
and the movement of workers between high- and low-wage areas and



14
industries are eliminated by the use of constant occupational and
employment weights developed from the Bureau’s previous studies.
The influence of variations in the workweek and premium payments
is excluded, since the data compiled are basic wage rates for workers
paid by the hour, day, week, or other period of time, and the actual
straight-time earnings of employees paid under piece-work, produc­
tion-bonus, or other incentive s}^stems. The atest report on this
index of wage rates appeared in the February 1945 issue of the
Monthly Labor Review and contained a summary of developments
since January 1941.
The movement of wage rates, as measured by this index, is not
limited to that which results from general or “ across-the-board”
increases or decreases, since it also reflects changes resulting from
merit raises, increases in the productivity (and, ordinarily, the earn­
ings) of incentive workers, and adjustments made in the cases of
individuals or small groups of workers. The Bureau also reports
the extent of general wage increases (which are defined as simul­
taneous adjustments applied to 10 percent or more of the workers in
a plant or industry). This measure, which is the seventh type pre­
pared by the Bureau, tends, as might be expected, to show the smallest
changes of any of those described.
Data fo r W age-Stabilization Program

Administration of the wage-stabilization program by the National
War Labor Board has required a volume of occupational wage-rate
data far greater than any collected previously. The experience of
the Bureau was utilized for this purpose, and its facilities expanded to
meet the requirements of the stabilization agencies. Since the in­
ception of the program, occupational wage-rate data have been com­
piled from the records of more than 100,000 establishments represent­
ing virtually every type of industrial and commercial activity. The
industries covered varied considerably from area to area, since the
studies were geared to the needs of the several Regional War Labor
Boards. The results of these studies take two forms. In the majority
of cases, they represent summaries of the going or prevailing rates for
specific jobs in individual industries and labor-market areas. Some
8,000 such tabulations have been prepared for the use of the War
Labor Board in determining its “ wage brackets” or approvable rates.
In addition, substantial numbers of special studies have been under­
taken to provide a factual basis for the settlement of wage disputes or
the conduct of wage negotiations. These surveys ordinarily involve
specialized plants or companies which present unique problems with
respect to occupational or wage-rate characteristics; they are made in
response to specific requests from arbitration agencies, management,
or trade-union officials.
As time and facilities permit, data from studies of these two types
are prepared for general use. Typical is an article entitled “ Wage
Rates in the Manufacture of Molded Plastics in Chicago,” in the
February 1945 issue of the Monthly Labor Review; others have been
released in mimeographed form. All of these data, including unpub­
lished materials, are, however, on file in the Bureau’s several regional
offices, a list of which may be found on the inside back cover of this
issue of the Review, and summaries are supplied on request to any
individual or organization in need of them.



15
Industry Wage Surveys

As already noted, for more than 50 years the Bureau has made
studies of the wage-structure characteristics of individual industries.
Because of the extensive field work and analysis involved, it has been
possible to study but two to five complete industries each year. Among
those recently covered are rayon fiber and lumber. The reports include,
in addition to average hourly earnings or rates for all of the important
occupations by industry branch, area, and sex, detailed information
on shift operations, policies governing the payment of premiums for
overtime and night work, incentive-wage systems, provisions for vaca­
tions and sick leave, wage guaranties, holiday allowances, and other
conditions of employment. Ordinarily, these studies include all or
a large and representative Nation-wide sample of the plants in a given
industry. The results are usually presented in the form of national
summaries, supplemented by special treatment of individual areas in
which the industry is concentrated. Extensive descriptions of the
findings of these studies are reported in the Monthly Labor Review
and in the Bureau’s bulletins. The many analyses of occupational
patterns and job content, wage-structure characteristics, the labor
force, technological processes and developments, and other descriptive
data on individual industries resulting from these studies constitute
one of the most inclusive sources of information available in this field.
The urgent need for wage data to be used in connection with the
operation of the wage-stabilization program, as noted above, required
some redirection of the Bureau’s work in this field, and there has been
less emphasis on industry-wide surveys during the war. Basic infor­
mation on the wage structure, occupational characteristics, and
working conditions of the Nation’s more important peacetime indus­
tries will, however, be of paramount importance after the war. The
development of reemployment policies, determination of wage rates
and working conditions, the establishment of effective collective­
bargaining procedures, vocational guidance and education programs,
and the solution of many other problems which will accompany the
shift to a peacetime economy will be effective only if they are based
on adequate facts.
The Bureau’s plans, therefore, include provision for recurring
detailed surveys, similar in general pattern to those conducted in
the past, of individual industries such, for example, as steel, machinery,
textiles, apparel, and others which are basic in the national economy.
Work on the first study of the metalworking industries is now in
progress. The national summaries based on these surveys will be
supplemented by tabulations for individual areas. In addition to
these Nation-wide studies, a limited number of surveys will cover
certain industries which are important in individual areas; typical
are metal mining and petroleum refining.
Union Wage Rates

The wage levels and characteristics of certain important industries
are, in large part, those agreed upon by individual or associations
of employers and trade-unions. The Bureau has made annual studies
of the rates in certain of these industries for nearly 40 years. Cur­
rently, the data are collected from employers and union officials in
the more important places and cover all of the key jobs in printing



16
and publishing, local streetcar and bus operations, the building trades,
motor trucking, and bakeries. The information now compiled reflects
rates in effect as of July 1 of each year, and summaries, showing rates
for individual occupations in each of about 75 cities, appear regularly
in the Monthly Labor Review.
Special Studies

The Bureau's program in each of the individual fields of labor eco­
nomics is built around a nucleus of continuing activities, but special
studies designed to provide the answers to other and often unique
questions are equally important. An outstanding example is the
current study of Work and Wage Experience. Changes in war
schedules ana military requirements have caused marked shifts of
workers from plant to plant and from area to area, as well as consid­
erable retraining for new occupations. In the period following the
war, industrial shifts from war to peacetime production will entail
even greater dislocations; millions of workers, either by choice or
from necessity, will be leaving the war production plants and centers
and, along with returning veterans, will be seeking occupational read­
justment. Solution of the many problems which will arise requires
detailed knowledge of the occupational earnings and the employment
experiences that are associated with changes in jobs. The study now
in process will cover about 5,000 workers chosen from all parts of the
country and a variety of industries. They represent two broad groups:
(1) Workers, including veterans, who will be directly affected by shifts
in war production and by the change to peacetime activities; and (2)
for purposes of comparison, workers who are unlikely to be affected
markedly by these factors. The information, to be collected at least
twice a year directly from the workers who have agreed to cooperate
in the study, includes data on the education, training, experience,
wages and income, migration, unemployment, and other economic
and social characteristics of each worker and his family. The results
of this survey are expected to provide important guidance in the deter­
mination of policies on reemployment, unemployment, training and
vocational education, and a number of related problems.
W orking Conditions and Industrial Relations

Analysis of conditions of employment, other than wages, is also an
important part of the Bureau's work and is based on two sources—
information collected during the visits to company offices made
primarily for the purpose of collecting wage data (already noted),
and current union agreements of which over 15,000 are on file in the
Bureau. Detailed analyses of these agreements form the basis for
reports on the extent and nature of provisions for paid vacations,
sick leave, grievance procedures, seniority, reemployment of veterans,
dismissal pay, incentive-wage systems, employment and wage guar­
anties, and many other matters. Such reports are of two types:
Analyses of individual problems, each ordinarily covering a number
of industries; and discussions of the provisions of collective agree­
ments in a single industry. An example of the first type was the
article on dismissal-pay provisions in the Monthly Labor Review for
February 1945. Illustrative of the second was the study of agree­



17
ments in the airframe industry, in the August 1941 issue of the same
periodical; that study included data on all of the more important
union-agreement provisions governing working conditions and, in
addition, furnished data on the extent of unionization in the industry.
The Bureau’s files of union agreements also serve as a source of infor­
mation for individual employer and employee groups who are in need
of guidance in the preparation of agreements covering working condi­
tions. The text of standard clauses in common use is frequently
supplied in response to requests for this type of information. Num­
erous special analyses of these agreements have also been made at
the request of the National War Labor Board for information necessary
in dealing with dispute cases. Further, the Bureau has summarized
the effects of certain War Labor Board directives; the effect on union
membership of “ escape periods” in maintenance-of-membership
agreements ordered by the Board is the subject of an article in the
December 1944 issue of the Monthly Labor Review.
Closely allied to this field are the statistics on work stoppages
resulting from industrial disputes, compiled monthly by the Bureau.
These data, supplied by employers and union officials in response to
questionnaires, include the numbers of strikes and lockouts, workers
involved, and the man-days and proportions of total scheduled work­
ing time lost. Brief monthly reports and a detailed yearly analysis
are published in the Monthly Labor Review, as well as material on
current developments having a direct bearing on labor organizations
and welfare. Illustrative of the latter are summaries of the proceed­
ings of the more important trade-union conferences, a chronology of
outstanding labor events, and digests of legislation, court decisions,
and administrative rulings affecting labor.
HOURS OF WORK

No analysis of labor conditions is complete without extensive in­
formation on the length of the working day and week, since time is
the basic unit in measuring labor. The relationship between work
schedules and volume of employment, earnings, production, and other
variables are, of course, obvious. All of the wage surveys undertaken
by the Bureau since the 1880’s have included detailed data on hours
actually worked, as well as the length of operating schedules. The
cooperative employment and pay-roll reporting system, referred to
above in the discussions of employment and earnings, also provides
man-hour statistics. Thus, monthly series, showing average weekly
hours for each of the approximately 175 industries summarized by
the Bureau, are available beginning in 1932; thejr appear in the
mimeographed report on hours and earnings and in the Monthiv
Labor Review. The record attained in war production is, in no small
measure, a result of the fact that the average factory workweek has
increased by more than a full day since the beginning of hostilities.
Any changes in working schedules will, naturally, have an important
bearing on volume of employment and earnings during and after the
shift to peacetime production. The almost certain decrease in weekly
hours will be an especially significant factor in postwar earnings,
because of the current importance of premium earnings for overtime.
These regular reports on hours, together with numerous special
studies, have been put to a wide variety of uses. This information is



18
important, for example, in framing maximum-hour legislation for gen­
eral use and for application to special groups such as women and chil­
dren. Many of the Bureau’s special studies in this field are directed
toward determining the optimum work schedule under varying con­
ditions. It is known, for instance, that productivity is related to the
length of the working day and week, but numerous other variables such
as physical strain, accident hazards, mental fatigue, and type of opera­
tion must be taken into consideration. The Bureau’s investigations of
this type are illustrated by an article entitled “ Effects of Long Working
Hours” which appeared in the Monthly Labor Review for October
1944.
INDUSTRIAL HAZARDS AND ACCIDENTS

One highly significant aspect of the whole field of working conditions
has to do with accident, injuries, and the measures employed to
prevent them. In order to provide a running account of the facts,
the Bureau prepares monthly summaries showing accident-frequency
rates for each of more than 80 manufacturing industries together with
estimates of working time lost as a direct result of injuries. The data
are based on voluntary reports submitted by the officials of more
than 14,000 establishments. Estimates of total manpower losses
resulting from disabilities caused by industrial injuries are also pre­
sented from time to time. Annual summaries of accident data include
severity as well as frequency rates, and are based on reports from
over 53,000 plants. This information is used extensively by labor
and management groups as the basis for evaluating the experience
of individual plants, and it also serves as a guide to such agencies as
the Committee for the Conservation of Manpower in War Industries
in connection with the planning and operation of safety campaigns.
In a few cases, the data are compiled by State departments of labor
in connection with industrial safety programs and are forwarded to
the Bureau for incorporation in the national totals.
As in most of the Bureau’s work, these regular reports are supple­
mented by more detailed special analyses of individual industries.
Industry studies recently completed and reported in the Monthly
Labor Review include foundries, longshoring operations, and ship­
yards. The March 1944 issue, for example, contains an article on
the work injuries to women employed in shipyards. The data pre­
sented cover numbers of accidents as well as detailed information on
their types and causes, the hazards commonly encountered, and the
safety measures employed. The analysis of actual physical hazards
is also supplemented by examination of the relationships between
accident frequency, productivity, and health, on the one hand, and
working conditions such, for example, as length of the work day and
week, shift operations and rotation, wage-incentive systems and
speed-up, rest periods, and other factors. These studies are made
through actual plant visits by specially trained representatives.
Handicapped Workers

Primarily for the purpose of providing more adequate information
essential to programs for the reemployment of veterans, an extensive
investigation of handicapped workers has been undertaken. In addi­
tion to data on the numbers of such workers, these studies provide
information on performance, absence rates, hazards to the handicapped



19
workers themselves and to other employees, accident frequency, and
retraining experience. In each plant studied, the records of disabled
workers are compared in detail with those of employees similar with
respect to jobs, sex, age, and other characteristics but without physical
handicaps. Precise comparisons of experience are thus possible. As
a background for these statistical data, information is also being
compiled on the activities of public and private agencies concerned
with the rehabilitation of the handicapped.
Of special importance is the problem of compensation liability in
the case of reemployed workers with disabilities resulting from previ­
ous industrial accidents. The provisions of the several State laws
governing such situations differ considerably, particularly with respect
to the degree of responsibility which the employer of a handicapped
worker must assume in the event of a second accident. In some cases,
employers are reluctant to hire disabled workers because of provisions
which require them to assume all or part of the cost of compensation
for a former injury if a second accident occurs. Analyses of statutes
covering these situations, as well as the collection of data on the opera­
tion of public and private workmen's compensation agencies, are
being undertaken to provide information essential to improvement in
this field.
Prices and the Cost o f Living

Comparatively early in the history of the Bureau of Labor Statis­
tics, it became apparent that adequate information for judging the
relative state of welfare of the working population must include data
on the prices paid for the products of their work, and the costs of
various standards of living, as well as analyses of employment condi­
tions and levels of earnings. It is not the purpose of this discussion
to trace the historical development of the various attempts to measure
the movement of prices and living costs, but it may be noted that
much of the emphasis in the initial stages was upon wholesale prices
or, as now referred to by the Bureau, prices in primary markets. The
systematic compilation of retail-price indexes and their importance
has been greatly increased by the economic problems of the present
war period.
COST OF LIVING

The cost-of-living index prepared by the Bureau was developed dur­
ing World War I as an aid to the Government in handling wage nego­
tiations. Data for individual cities were published in 1919 and regular
publication of the national index began in February 1921. The price
data are currently collected as of the middle of each month and the
cost-of-living indexes and food prices are released approximately 30
days later in mimeographed form; published reports appear in the
following issue of the Monthly Labor Review. Data are shown for
important subdivisions of the index and for individual cities.
An understanding of the purpose, scope, and limitations of the
Bureau's cost-of-living index is essential to its proper interpretation
and use for any purpose.4 The index does not measure changes in
4 For detailed discussion of this subject see Bureau of Labor Statistics reports, Description of the Cost-ofLiving Index of the Bureau of Labor Statistics (M ay 1944), and Changes in Cost of Living in Large Cities
in the United States, 1913-41 (its Bulletin No. 699): and W hat the Cost-of-Living Index Is, b y Aryness
Joy Wickens, in Journal of Business (University of Chicago), July 1944 (pp. 146-161).




20
total living costs— that is, in the total amount families spend for liv­
ing. It is designed primarily to measure changes in the prices paid
for goods and services by city families with moderate incomes. It
does not show the full wartime effect on the cost of living of such
factors as lowered quality, disappearance of low-priced goods, forced
changes in housing, and eating away from home.
It is apparent from this statement that, first of all, the national
index is based on urban prices. Food prices are collected each month in
56 cities which represent about four-fifths of the total population in
cities of 100,000 or more. The prices of other important goods and
services are also collected monthly in 21 cities and quarterly in 13
more; individual city indexes are published for these 34 large cities
which represent somewhat over 72 percent of the total population of
all cities of 100,000 or more population. Data are also compiled in 32
additional cities, and partial reports are obtained in 7 cities for use in
connection with special problems which grew out of the war emergency.
The resulting city indexes, however, are used locally and are not in­
corporated in the national average.
The prices which form the basis for the indexes are those for the more
important items in the bill of goods and services purchased by the
typical moderate-income family; they include food, clothing, rent, fuel,
housefurnishings, transportation, personal services, and a variety of
miscellaneous goods and services. Since it would obviously be impos­
sible to price every type of article purchased by consumers, about 350
articles, including, in many instances, more than one grade or quality
of item, have been selected as representative. Further, the bulk of the
purchases of the typical family tends to be concentrated among
relatively few items in each commodity group. Thus, for example, the
price changes of canned peas, tomatoes, corn, and green beans, which
ordinarily represent two-thirds to three-fourths of all canned vege­
tables sold, are used to represent price changes of other less-important
canned items like spinach, asparagus, and carrots.
One of the most important technical problems involved in computing
a single index of the price movements of such a varied bill of goods and
services has to do with the relative importance or “ weights” assigned
to the individual priced items. The only reliable source of information
on the relative importance of individual items is, of course, the actual
experience of consumers. The most extensive data available are those
collected in a detailed study of the expenditures of about 14,000 city
wage earners’ and clerical workers’ families, made by the Bureau in
1934-36. Surveys of this type are obviously expensive and time con­
suming, and it has not been possible to conduct another study on a
similar scale since. A less-exhaustive survey, covering the purchases
of a smaller group of families in 1941 and the first quarter of 1942,
however, indicated that there had been little change in the general
pattern of spending since the mid-thirties. The weights used for in­
dividual items are, therefore, basically those derived from the largescale 1934-36 survey which made available detailed information on the
amounts and kinds of all types of goods and services bought by these
families and the prices they paid for them.
Since the outbreak of the war, however, with the great change in
kinds of goods on the market for civilians, it has been necessary to
compute the index without many of the articles formerly included.
Most important among the omissions during the war period are new



21
automobiles and tires; some furniture and many types of household
equipment such as washing machines and radios; and silk hosiery and
other articles made of silk. Wartime substitutes, including rayon
hosiery and ice refrigerators, have been added whenever they were
generally available. In addition, the relative importance of other
items in the index have been revised in the light of the best available
information on market conditions and changes in purchasing habits
resulting from rationing and wartime supply problems. Part of the
weight formerly applied to the purchase of new automobiles, for
example, is currently assigned to the cost of repairs, and the relative
importance of streetcar fares has been increased to offset in part the
decrease in expenditures for gasoline and oil.
It is also important to note that the Bureau’s index is based on the
purchasing habits and living standards of typical low-salaried or wageearner families with 1934-36 incomes averaging about $1,500 per
year. Currently, of course, incomes are higher, but this index cannot,
for numerous reasons, be regarded as a representative measure of the
living costs of families with incomes substantially below $1,000 or
above $3,000, single persons, households with unusually large numbers
of children, or any other group with economic or social characteristics
appreciably different from those of the average family as described
here. It should be emphasized that the Bureau’s cost-of-living index
relates to changes in prices paid for goods and services and does not
take account of savings and income taxes, although it does include
excise and sales taxes. Therefore, in utilizing the index, it should be
compared not with gross income from wages or salaries but with
income available for spending. To the ordinary family it is the
actual content of the pay envelope that is considered. Bond deduc­
tions and income taxes are not part of its spendable income, although
bonds represent a net addition to the family’s savings. In all calcu­
lations of the relative importance of goods in the index, the Bureau
has based its figures upon expenditures, exclusive *of bonds, other
savings, and taxes.
The use of the Bureau’s index as a basis for wage stabilization in
the program to restrain inflation has raised numerous questions of
policy, procedure, and technique which are not discussed here at
length since the subject has been treated exhaustively elsewhere.
Among the various reports issued in the last two years on problems
of measuring the cost of living in wartime, the most important is the
Report of the President’s Committee on the Cost of Living,5 which
was made on November 17, 1944. That report summarized the
reports on the Bureau’s cost-of-living index of the (Mitchell) Commit­
tee of the American Statistical Association and the Technical Com­
mittee which advised the President’s Committee, and presented
separate statements from the labor and employer members on the
Committee. The Technical Advisory Committee estimated the
extent to which the Bureau of Labor Statistics has been unable to
measure completely the rise in the cost of living during the war period.
The President’s Committee quoted from the Mitchell Report as
follows:
If the BLS had obtained strictly accurate reports of all the prices it tries to
collect; if it had caught the change in average prices caused by the reduction in
s See Report of President's Committee on Cost of Living, in M onthly Labor Review, January 1945
(pp. 168-174), and bibliographical references there included.




22
bargain sales; if it had priced the qualities bought by families with very low in­
come and the qualities bought by the most prosperous of wage earners as well as
those in the middle groups; and if it had made full allowance for increases in
expenditures forced on families by quality deterioration that can be offset by
buying more goods, its index would probably not be higher than it is now by more
than three to four points.

Since the index is essentially a price index, measuring the average
changes in the prices which must be paid for a more or less fixed bill
of goods which is normally bought by families with moderate incomes,
other types of studies are necessary to measure changes in the total
dollar outlay of city families or in their planes of living. Inquiries
into actual family expenditures which serve this purpose are also
needed to answer certain questions concerning changes in families’
well-being which are being continually raised in connection with
wage policy.
Another important problem relates to the measurement of inter­
city differences in living costs. As already noted, the function of the
Bureau’s cost-of-living index is to provide a measure of time-to-time
changes in prices charged to consumers. The index for each city
reflects the buying patterns of families of wage earners and clerical
workers in that locality. Since average income levels vary from
city to city, the level of living on which the cost-of-living index is
based also varies from city to city. For other purposes, however,
figures are desired on the cost of the same level of living in all the
cities covered. The data available at the present time are not ade­
quate as a basis for determining whether it costs more or less for the
typical family to live in the same degree of comfort in one community
or another. Such a measure was prepared by the Works Progress
Administration in 1935 on the basis of the comparative costs of
“ minimum” and “ emergency” budgets.6 For a period of several
vears, the Bureau maintained this series by periodic estimates of the
costs of these budgets based on its regular reports. Additional infor­
mation revealed' that the basic rent measures were no longer repre­
sentative in some cities and hence the series was discontinued in June
1943. Further analysis of this problem and experiments in methods
of providing measures of intercity differences in living costs are in
progress,
RETAIL PRICES

The prices on which the cost-of-living index and other summaries
are based are collected for the most part by field representatives in
the course of actual field visits to merchants and dealers just as in the
case of occupational wage-rate data. The food prices represent those
charged in about 10,500 grocery stores and meat markets patronized
by moderate-income groups, and the prices for other goods and serv­
ices are collected from about 3,900 stores and service establishments.
Rents are obtained from tenants for about 54,000 dwellings in the 34
large cities. The Bureau’s representatives engaged in collecting
prices are provided with detailed specifications for each item and
obtain the actual, not nominal (or ceiling), prices. In addition to
their use in constructing the cost-of-living index, the data are also
made available in numerous other forms for a variety of general and
special purposes.
6Works Progress Administration, Research Monograph X I I : Intercity Differences in the Cost of Living.




23
The average prices of 78 food items in each of 56 cities are issued
each month in mimeographed form, and summarized for 56 cities
combined, both in the monthly cost-of-living release and in the
Monthly Labor Review. These data are widely used by Govern­
ment agencies, manufacturers, distributors, research agencies, and
other organizations and individuals in connection with price determi­
nation and control, analysis of manufacturing operations, and mar­
keting problems. Even within specification limits, the foods priced
may vary slightly from city to city, because of consumers’ buying
habits, and do not always permit intercity comparisons for individual
food items. Similar summaries of price trends for fuel are presented
monthly and for other items such as clothing and housefurnishings
from time to time.7
The needs of the Office of Price Administration, War Production
Board, War Food Administration, and other agencies for data on
commodity prices and supplies have required some modification and
a considerable extension of the Bureau’s work in these fields. The
cost-of-living index and price data on individual items and commodity
groups have played a major role in measuring the effectiveness of the
price-control program as a whole.
In connection with its collection of price data, the Bureau has also
undertaken a large volume of special studies, many of which are con­
cerned with information on supplies of individual commodities.
Analyses of dealers’ supplies of meats, other important foods, specific
items of clothing, furniture, and numerous other goods have provided
part of the basis for the distribution of supplies including rationing,
allocation of raw materials to ease shortages of essential civilian items,
and other policies and procedures established by the Office of Price
Administration, War Production Board, and other agencies concerned
with these problems. Certain of the more extensive investigations
have been prepared for general distribution. Illustrative of these is
the article, Supplies of Food in Independent Retail Stores, March
1945, in the May issue of the Monthly Labor Review.
Housing problems, accentuated by large-scale migration and the
rapid growth of war production centers, have also been the subject of
numerous Bureau studies. The periodic-rent-survey program of the
Bureau has been extended to include approximately 75,000 dwellings
in 73 communities. The data are used to measure changes in rents
for wage earners and lower-salaried workers as a component part of the
cost-of-living index, and to provide rental-change information for all
dwellings in the city. In addition to the regular collection of rents, in­
creasing attention has been paid to changes in rental conditions. Anal­
yses of the decline in rental concessions, decreases in services supplied,
and in repairs have been undertaken for the purpose of estimating the
importance of such indirect or hidden rental increases. In addition to
this program, the Bureau conducts special rent surveys at the request
of the Office of Price Administration. These data are used to deter­
mine the need for rent control and its effectiveness, and as a check
on the trend of rentals in areas where rent control has been removed.
Also as an adjunct to its regular activities in this field, the Bureau
collects vacancy data for the use of the National Housing Agency
and similar agencies in determining the urgency of local housing
needs. Special analyses of housing requirements and existing facilities
* See, for example, Cost of Clothing for Moderate-Income Families, in M onthly Labor Review, July 1944.




24
have also been made in several war production areas. The data col­
lected in the course of these surveys have been prepared for distribu­
tion in mimeographed form.
CONSUMER INCOME AND EXPENDITURE STUDIES

The studies of consumer expenditures undertaken by the Bureau
have, as one of their objectives, the function of providing data on the
relative importance of the individual commodities and services pur­
chased by families of wage earners and clerical workers. Such figures
are, as already pointed out, essential in the construction of any costof-living index. Important as this purpose is, however, it is by no
means the principal reason for making this type of inquiry.
In the first place, this is the only type of study which provides data
on the proportions of families in the country whose purchases of con­
sumers’ goods meet American standards of well-being. It also indi­
cates where these families live, on what occupations they depend for
a living, and how many children are being brought up in the physical
environment which meets American standards. Conversely this type
of study points out the danger spots in the country’s total consump­
tion pattern, what proportion of families do not have adequate diets,
where and how these families live, and how many children they have.
It provides data on the economic situation of families with poor hous­
ing. As other quantitative measures of the American standards of
living are developed, it will be possible to use the data from surveys
of consumer expenditures to evaluate the adequacy of other elements
of the family budget.
In addition, this type of study is one of the principal sources of
information on the purchases of consumers’ goods by families at
different income levels, and on the distribution of families by income.
The necessity for dependable information of this sort is self-evident.
The production and marketing of all kinds of goods and services can­
not be planned intelligently without some basis for estimating the
extent and types of potential and effective demand. Such a factual
basis is also needed in making decisions on tax policies and estimates
of probable revenues. Equally dependent on knowledge of income
levels and distribution are plans for housing facilities, utilities, and
community services.
No extensive surveys of consumer incomes and expenditures has
been undertaken since the studies of 1934-36 already referred to.
The Bureau of Labor Statistics did, however, complete a survey of
1,300 families which provides information on consumer income,
expenditure, and savings for the year 1941 and the first quarter of
1942. Unlike most previous studies, the principal objective in this
case was to furnish the basis for national estimates rather than de­
tailed information for individual cities. Extensive data, on ’a national
basis, on urban family incomes and savings appear in Bureau Bulletin
No. 724: Income and Spending and Saving of City Families in War­
time. In Bulletin 723, the data compiled by the Bureau are com­
bined with those collected by the Bureau of Home Economics in a
simultaneous study of 1,700 rural families, to provide general estimates
for the country.
These reports also include detailed information on family-expendi­
ture patterns for the various income groups. It is a well-established
fact that expenditures for basic essentials, such as food, constitute



25
progressively smaller proportions of total outlays as income levels
rise, but more precise information on the nature of these relationships
is essential. In addition to providing the data necessary for compil­
ing the cost-of-living index and other Bureau studies, the results of
these surveys are widely used by governmental and private organiza­
tions. Manufacturers and distributors of all types of commodities
make use of this information in estimating potential demands as a
basis for planning their operations. In many cases, it is still neces­
sary for individuals and organizations requiring such information to
depend on the results of the 1934-36 study, despite the fact that they
are 10 years old. Although the 1941-42 study made it possible to pre­
pare revised national estimates, the comparatively small size of the
sample precludes the preparation of local or State reports, or, indeed, of
the extensive detailed tabulations based on the earlier study.
For the purpose of estimating the effect of the war on the prices
paid by families and on the nature of their pin-chases, including general
family-expenditure patterns in relation to income, the Bureau is cur­
rently conducting a small study covering about 1,700 families. Here
again, the sample is too small to permit geographical analysis or the
amount of detail obtained in the 1934-36 reports, but the results,
which will be available shortly, will permit Nation-wide estimates sim­
ilar to those made in 1941-42 of what city families are buying.
Another phase of this general field has to do with consumers’ dis­
tributive and service cooperatives in this country which, according to
the latest available estimates, number nearly 5,000 and do an annual
business of about half a billion dollars. Since 1918 the Bureau
has compiled data on the activities of these associations. Detailed
studies , of the types, membership, and operations of consumers’
cooperatives and credit unions are undertaken at intervals of 4 to 5
years.
WHOLESALE (PRIMARY-MARKET) PRICES

The Bureau’s series on prices of commodities in primary markets
is one of the oldest official economic indexes in the country. Although
the comprehensive monthly series dated from 1890, materials from
other sources made it possible to prepare an index extending back to
1749 and, on a fragmentary basis, to 1720. Since it is an index of
market prices, it includes commodities at various stages of production.
The information currently assembled from manufacturers, dealers,
trade publications, and Government sources includes more than
10,000 individual price quotations. Data from these extensive files
form the basis for the official index as well as for several special series.
The general index has included varying numbers of commodities at
different times. The present series is compiled from the primarymarket prices of approximately 900 commodities selected on the basis
of their importance and representativeness. The quantity weights
used in combining the individual quotations are derived from exhaus­
tive data on volume of sales, supplemented by field investigations in
principal market centers. In addition to the index for all commodi­
ties, indexes are calculated for 10 major groups and 47 subgroups.
The general index and the group indexes are released weeldy and
monthly in mimeographed form and summarized regularly in the
Monthly Labor Review. Actual prices and price relatives are also
given monthly in mimeographed releases.



26
The general index includes substantial numbers of fabricated and
semifabricated items which are less sensitive than raw materials to
short-time changes in market conditions. To meet the temporary
wartime need for a more sensitive measure, the Bureau prepares a
daily index based on the prices of 28 basic commodities (such as
cotton, wool, wheat, steers, etc.) traded on organized exchanges.
The concentration of productive facilities on war materials has, of
course, resulted in a reduced civilian market. Consequently, the
Bureau has developed an index of the price movements of 125 items
representative of commodities generally available to civilian pur­
chasers in primary markets. Publication of this wartime index of
civilian goods will begin shortly; it will supplement rather than
supplant the official index.
Among the special series already referred to is a weekly index of
prices of waste and scrap materials, which covers 44 commodities such
as metals, textiles, paper, and rubber; the data are available beginning
with 1939. Another provides information on the market prices of
standard machine tools; this series is available from January 1937
to date. Indexes of the prices of general and auxiliary machinery
and of construction equipment, such as pavers, cranes, tractors, etc.,
are also compiled. Other series are being developed as the need for
them becomes apparent. Indexes of primary-market prices of goods
which make up the leading exports and imports of the United States
will be issued in the near future.
These various indexes are used extensively by Government agencies
and private companies and organizations as a basis for planning price
control and determination, raw-material allocation, volume of produc­
tion, and distribution. In addition, the extensive Bureau files of
data on the prices of individual items, which are not ordinarily pub­
lished, make it possible to supply a large volume of special information
in response to requests from individuals and all types of organizations.
The Bureau is glad to comply with such requests whenever the neces­
sary data and facilities for processing them are available.
GENERAL SUMMARIES OF PRICE TRENDS

General trends in price movements are the subject of several re­
curring and special reports issued by the Bureau, particularly during
the war period. A summary of price developments is ordinarily
issued each quarter and a general review appears at the end of each
year. The impact of the war on wholesale and retail prices, markets,
and the availability of supplies, together with a detailed analysis of
the operation of the price-control program, is described in a report
entitled “ Wartime Prices.” Part I of this study, covering the period
from August 1939 to December 1941, was published in the Bureaus
Bulletin No. 749, and Part II, which carries the history through 1944, is
in preparation.
From its extensive files, the Bureau has prepared a summary of the
various methods used in other countries for the calculation of indexes
of wholesale and retail prices and the cost of living. In order that
information will be available for comparisons of standards and costs
of living after the war, plans are now being developed for measuring
the cost of comparable levels of living in the several large nations.




27
Labor Conditions in Other Countries

The analysis of information on developments in the labor field in
other countries was included in the Bureau’s original program, and
through its 60-year history it has become one of the most important
sources of such materials. Nearly every issue of the Monthly Labor
Review contains one or more discussions of the general labor situation
in individual countries throughout the world or summaries of available
information on a particular subject in the field of labor economics.
The Bureau’s Bulletin No. 770, entitled “ Cooperative Associations
in Europe and Their Possibilities for Postwar Reconstruction,” is
typical. Since the beginning of our participation in the war the
Bureau has carried on, largely for the benefit of the war agencies,
extensive research on labor conditions in various countries in the war
theater; reports on 19 countries have been published in the Monthly
Labor Review. Summaries of current labor developments in LatinAmerican countries are also carried in that periodical and in a series
of special reports, of which 20 have been released to date.
Materials of this sort are made available, not only for general
informational purposes, but also as a basis for decisions on policies
and procedures which must be made by private industry and the
Government. Knowledge of conditions in other countries with
respect to labor legislation, the levels of earnings, wage rates, post­
war planning, the rehabilitation of veterans, trade-union activities,
social-security measures, housing, price movements and control, and
other allied subjects is essential for three general purposes. In the
first place, decisions on foreign-trade and domestic economic policies,
which are in fact hardly separable, must be made in the light of con­
ditions abroad. The Congress and the various other Government
agencies charged with the responsibility for such matters make wide
use of the Bureau’s materials for this purpose. Secondly, the oper­
ating plans of private industry, particularly those concerned with
foreign markets and trade, as well as the activities of labor organiza­
tions, cannot be developed realistically in the absence of extensive
and authoritative information of this sort. Finally, the labor prob­
lems encountered elsewhere frequently parallel those which arise in
the United States, and the experience of other countries in dealing
with them is helpful as a guide in the determination of policies and
the development of adequate legislation.




V. 8. GOVERNMENT PRINTING O P P IC ItIM I




B ureau

of

L a b o r S t a t ist ic s

R e gio n al O f f ic e s
R e g io n

R e g io n

R e g io n
I.
Wendell D. Macdonald, Direc­
tor.
Old South Building
294 Washington Street
Boston 8, Mass.

II.
Charles C. Center, Director
1000 Parcel Post Building
341 Ninth Avenue
New York 1, N. Y.

Philadelphia Branch

V.

Arthur A. Smith, Director
522 Irwin-Keasler Building
Commerce and Ervay Streets
Dallas 1, Tex.

K an sas C ity Branch

Odis C. Clark, Regional Ana­
lyst
3000 Fidelity Building
Kansas City 6, Mo.
R e g io n V I.

Mell W. Fleetwood, Regional
Analyst
814 Widener Building
Chestnut and Juniper Streets
Philadelphia 7, Pa.
R e g io n

John B. Parrish^Director
312 National War Agencies
Building
226 West Jackson Boulevard
Chicago 6, 111.

III.
R e g io n
Adolph 6 . Berger. Director
420 Williamson Building
Public Square
Cleveland 14, Ohio

VII.

D etroit Branch

George E. Votava, Regional
Analyst
1108 Francis Palms Building
2111 Woodward Avenue
Detroit 1, Mich.
R e g io n

IV.
Harris P. Dawson, Jr., Director
308 Carl Witt Building
249 Peachtree Street, NE.
Atlanta 3, Ga




R e g io n

Louis M. Solomon, Director
406 Burns Vault Building
1536 Welton Street
Denver 2, Colo
VIII
William A. Bledsoe, Director
643 Furniture Mart
1355 Market Street
San Francisco 3, Calif.

Seattle Branch

J.

W. C. Harper, Regional
Analyst
516 Seaboard Building
Seattle 1, Wash.