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SUEVEY OF CURRENT BUSINESS 10 Corporate Profits Information on corporate profits is at present confined to published reports for the first three quarters of the year; data for the full year are not yet available. Merely in order to complete the national income table and not implying an actual forecast, fourth-quarter profits have been calculated by averaging the results obtained by holding constant, first, third-quarter corporate profits before tax plus the inventory valuation adjustment and, second, third-quarter corporate profits before tax without that adjustment. It is believed that the annual figure which is obtained in this manner will be near enough to the final estimates for general purposes. Corporate profits before tax rose from about 30 billion dollars in 1947 to 32 billion in 1948. If the inventory valuation adjustment is introduced the increase is much more pronounced. Corporate profits so adjusted are seen to February 1949 have risen from about 24% billion dollars to 29 billion. Corporate profits including the inventory valuation adjustment measure the level of corporate profits which would have obtained if corporations had charged the replacement cost of inventories used up in production as a cost of sales. Under accounting practices most generally used, the charge actually made falls below replacement cost in periods of rising prices, and explains the fact that unadjusted profits were higher than adjusted profits both in 1947 and 1948. Owing to the sharper rise in prices during 1947 than during 1948, the overstatement of profits in terms of national income concepts was also larger in the former year—5 billion dollars in 1947 as compared with 3 billion in 1948. Taxes took roughly 40 percent of corporate profits in both years. Dividend disbursements did not keep pace and consequently the share of undistributed earnings increased. Table 5.—National Income and Product, 1947 and 1948 l [Billions of dollars] Quarterly, 1948 Item 1947 Unadjusted 1948 I II Seasonally adjusted at annual rates III IV I II III 222.3 136.3 131.3 113.2 3.5 14.6 5.0 51.6 25.3 18.9 7.4 29.6 32.1 12.5 19.6 -2.5 4.8 16.8 228.2 142.4 137.4 118.2 3.5 15.6 5.1 50.6 25.2 18.1 7.4 30.2 34.0 13.3 20.8 -3.9 5.0 17.7 264.9 181.0 22.9 105.1 53.0 42.8 14.7 6.9 7.9 22.7 5.3 4.1 —.4 41.5 25.4 .2 16. a IV NATIONAL INCOME BY DISTRIBUTIVE SHARES National income Compensation o f employees _ _ _ _ _ _ Wages and. salaries Private Military Government civilian Supplements to wages and 3salaries Proprietors' and rental income Business and professional Farm Rental income of persons _ Corporate profits and inventory valuation adjustment Corporate profits before tax Corporate profits tax liability _ _ Corporate profits after tax Inventory valuation adjustment _ _ _ _ _ _ Net interest Addendum* fompetisatiQii of gfineral GovernTnent eiriploy^fis _ _ _ _ 202.5 127.5 122.2 104.7 3.9 13.6 5.3 46.0 23.2 15.6 7.1 24.7 29.8 11.7 18.1 -5.1 4.3 16.8 224.4 139.4 134.4 115.6 3.5 15.2 5.0 50.9 25.2 18.2 7.4 29.2 32.2 12.5 19.7 -3.0 4.9 17.4 53.0 33.0 31.8 27.3 .9 3.6 1.3 12.5 6.2 4.4 1.9 6.3 t.6 3.0 4.7 -1.3 1.2 4.2 55.6 34.1 32.8 28.2 .9 3.7 1.3 12.9 6.3 4.7 1.9 7.4 8.0 3.1 4.9 -.6 1.2 4.3 57.1 35.6 34.4 29.9 .9 3.6 1.3 12.7 6.3 4.5 1.8 7.5 8.5 3.3 5.2 -1.0 1.3 4.1 58.7 36.6 35.4 30.3 .9 4.2 . 1.2 12.8 6.4 4.6 1.9 (33) (3) (3) () 4.7 213.9 134.0 129.1 111.4 3.4 14.2 4.9 49.9 24.8 17.6 7.5 25.3 30.5 11.8 18.7 -5.3 4.7 16.5 231.6 164.8 21.0 96.5 47.3 30.0 11.7 5.3 6.4 17.8 .6 2.7 8.9 28.0 16.9 1.3 12.3 254.9 177.7 22.7 103.6 51.4 39.7 14.6 7.0 7.6 21.4 3.8 3.0 1.5 36.0 21.5 .6 15.1 59.4 41.2 4.9 23.8 12.5 9.7 2.9 1.4 1.5 5.0 1.8 1.9 1.0 7.5 4.5 .3 3.4 61.3 43.5 5.5 25.3 12.7 8.5 3.6 1.7 1.9 5.3 -.3 -.6 .7 8.6 5.0 .2 3.8 64.6 44.1 5.6 25.5 13.0 11.1 4.2 2.1 2.2 5.4 1.5 1.1 —.1 9.4 5.7 .1 3.8 69.6 48.9 6.7 29.1 13.2 10.3 3.8 1.8 2.0 5.7 .8 .5 —.1 10.4 6.3 .1 4.1 244.9 172.5 21.3 101.4 49.8 38.0 14.3 7.0 7.3 19.8 3.9 4.3 3.9 30.5 17.9 1.2 13.7 251.9 177.3 22.8 103.7 50.8 38.0 14.4 6.9 7.4 21.0 2.6 1.7 2.7 33.9 19.8 14! 8 258.1 180.1 23.7 104.3 52.1 40.2 14.8 7.1 7.6 21.9 3.5 2.1 -.3 38.2 22.9 .2 15.5 195.2 21.6 19.7 2.0 173.6 164.8 8.8 213.6 21.0 18.9 2.1 192.6 177.7 14.9 51.1 9.2 8.6 .6 41.8 41.2 .7 52.7 3.9 3.3 .6 48.8 43.5 5.4 53.7 4.2 3.8 .5 49.5 44.1 5.4 56.1 3.6 3.2 .5 52.5 48.9 3.5 207.0 23.0 21.0 2.1 183.9 172.5 11.4 210.8 20.6 18.5 2.1 190.2 177.3 12.9 216.3 20.0 17.9 2.1 196. 2 180.1 16.1 219.6 20.2 18.0 2.2 199.4 181.0 18.4 231.6 13.3 18.5 .6 -3.4 —.1 202.5 24.7 5.6 .0 11.1 4.4 6.9 .6 195.2 254.9 14.4 19.8 .6 -4.4 .0 224.4 29.2 5.1 .0 10.5 4.6 7.8 .6 213.6 59.4 3.5 4.7 .2 -2.0 __ i 61.3 3.6 4.9 .2 -2.9 .0 55.6 7.4 1.3 .0 2.7 1.3 1.7 .2 52.7 64.6 3.6 5.0 .2 -1.3 .1 57.1 7.5 1.3 .0 2.5 1.0 1.8 .2 53.7 69.6 3.7 5.2 .2 1.8 .0 58.7 (3) 1.2 .0 2.6 1.2 3.6 .2 56.1 244.9 14.0 19.1 .6 -2.9 -.2 213.9 25.3 5.0 .1 11.0 4.5 7.4 .6 207.0 251.9 14.3 19.7 .6 -5.2 258.1 14.6 20.0 .6 -5.1 .2 228.2 30.2 5.2 —.1 10.3 4.6 7.7 .6 216.3 264.9 14.9 20.3 .6 -4.0 ._? 233.2 (3) 5.1 -.1 9.9 4.6 8.3 .6 219.% i!s 233.2 144.7 139.6 119.6 3.7 16.2 5.1 51.4 25.6 18.4 7.4 8 () 3 (8) 5! 2 18.4 GROSS NATIONAL PRODUCT OR EXPENDITURE Gross national product Personal consumption expenditures _ Durable goods Nondurable goods Services Gross private domestic investment New construction Residential nonfann__ _ Other Producers' durable equipment Change in business inventories, total Nonfarm only Net foreign investment Government purchases of goods and services Federal _ ... Less: Government s^es State and local _ __ _ __ 1 _ _ ._ __ DISPOSITION OF PERSONAL INCOME Personal income Less* Personal tax and nontax payments Federal State and local Equals' Disposable personal income _ Less* Personal consumption expenditures Equals' Personal saving _ RELATION OF GROSS NATIONAL PRODUCT, NATIONAL INCOME, AND PERSONAL INCOME Gross national product Less* Capital consumption allowances _ _ _ _ _ _ _ Indirect business tax and nontax liability Business transfer payments Statistical discrepancy Plus' Subsidies less current surplus of Government enterprises Equals' National income _ _ _ _ ____ Less : C or porate profits and inventory valuation adjustment . Contributions for social insurance Excess of wage accruals over disbursements _ Plus* Government transfer payments Net interest paid by government _ _ Dividends Business transfer payments Equals: Personal income __ _ _ _ 53! 0 6.3 1.3 .0 2.8 1.1 1.7 .2 51.1 222! 3 29.6 5.0 .1 10.7 4.5 7.4 .6 210.8 1 Detail will not necessarily add to totals because of rounding. Includes noncorporate inventory valuation adjustment. Data for estimating fourth-quarter corporate profits are not yet available. In order to arrive at a national income total for the fourth quarter and at national income and its components for the year, corporate profits for the fourth quarter were obtained arbitrarily through averaging the results derived by holding constant, first, third-quarter corporate profits before tax andsecond, third-quarter corporate profits and inventory valuation adjustment. It is believed that totals calculated on this basis will be sufficiently accurate for general purposes. NOTE.—Data for prior years are published in the July 1948 SURVEY and in the National Income Supplement to the July 1947 SURVEY. Source: U. S. Department of Commerce, Office of Business Economics. 2 3 BUSINESS STATISTICS J.HE DATA here are a continuation of the statistics published in the 1947 Statistical Supplement to the SURVEY OF CURRENT BUSINESS. That volume1 contains monthly data for the years 1941 to 1946, and monthly averages for earlier years back to 1935 insofar as available; it also provides a description of each series and references to sources of monthly figures prior to 1941. Series added or revised since publication of the 1947 Supplement are indicated by an asterisk (*) and a dagger (f), respectively, the accompanying footnote indicating where historical data and a descriptive note may be found. The terms "unadjusted" and "adjusted" used to designate index numbers refer to adjustment of monthly figures for seasonal variation. Data subsequent to December for selected series will be found in the Weekly Supplement to the Survey. Unless otherwise stated, statistics through 1946 and descriptive notes may be found in the 1947 Supplement to the Survey 1947 December 1948 j January February March April May June July August September October November December GENERAL BUSINESS INDICATORS NATIONAL INCOME AND PRODUCTf Seasonally adjusted quarterly totals at annual rates: National income, total _. _ bil. of dol. _ Compensation of employees, total do Wages and salaries, total do. __ Private do Military do Government civilian do Supplements to wages and salaries _ do. _ Proprietors' and rental income, total do Business and professional. do Farm do Rental income of persons do Corporate profits and inventory valuation adjustment, total bil. of dol._ Corporate profits before tax, total. do Corporate profits tax liability do Corporate profits after tax ...do Inventory valuation adjustment do Net interest _.-do r r T r 212.8 132.2 127.1 109.5 3.6 14.0 5.0 48.6 24.7 16.5 7.4 27.5 32.4 12.7 19.7 —4. 9 4.5 Gross national product, total do. _. Personal consumption expenditures,total. _ do Durable goods _ do. _ Nondurable goods do Services _ ___ _ _ _ . do_ _ Gross private domestic investment do New construction . _ do. Producers' durable equipment do Change in business inventories... do Net foreign investment do Government purchases of goods and services, total bil. of dol. Federal (less Government sales)... do State and local do 243.8 171.1 22.1 100. 2 48.8 35.4 14.0 18.9 2.5 8.2 Personal income, total do Less: Personal tax and nontax payments.. _do Equals: Disposable personal income-. do Personal savings! _ _ . _ do 203.1 22.2 180.9 9.7 T ' 222. 3 ' 136 3 'r 131 3 113.2 r 3 5 ' 14.6 5 0 '51.6 ' 25. 3 18.9 213.9 134 0 129 1 111.4 T 3 4 14.2 4 9 '49.9 r 24 8 ' 17.6 7 5 '74 '26.3 ' 30 5 ' 11.8 '18.7 -5.3 r 47 '29.6 '32. 1 ' 12.5 '19.6 244.9 172. 5 21.3 r r 101 4 r r 49 8 38. 0 14 3 19 8 r 3. 9 3.9 'T 30.5 16 7 13.7 29.0 15.5 13.5 ' ' ' ' 207. 0 '23.0 ' r183 9 11.4 233.2 144.7 139.6 119.6 3.7 16.2 5.1 51.4 25.6 18.4 7.4 —2.5 '48 30.2 34 0 13.3 20.8 -3.9 '50 -.4 5.2 ' 251. 9 ' 177.3 ' 22. 8 ' 103 7 ' 50.8 '38.0 14 4 ' 21 0 ' 2.6 '2.7 ' 258. 1 ' 180. 1 '23 7 ' 104 3 ' 52 1 ' 40 2 14.8 ' 21 9 '3 5 —.3 264.9 181.0 22.9 105.1 53.0 42.8 14.7 22.7 5.3 4 '33.9 19. 1 ' 14.8 '22 7 15.5 41.5 25.2 16.3 ' 210.8 '20.6 ' 190. 2 '12.9 '216 3 ' 20.0 ' 196 2 ' 16.1 219. 6 20.2 199.4 18.4 T r 228 2 142 4 137 4 118 2 '3 5 15 6 '51 50.6 25 2 18.2 '74 PERSONAL INCOME BY SOURCEf Seasonally adjusted, at annual rates: Total personal income, bil. of dol. _ Wage and salary receipts, total — _do Employer disbursements, total do Commodity-producing industries... do. _ Distributive industries. do Service industries . do Government do Less employee contributions for social insurance bil. of doL. Other labor income-. do. Proprietors' and rental income . do Personal interest income and dividends ...do Total transfer payments _ . do Total nonagricultural income do 207.7 127.4 129.4 59.2 37.4 15.2 17.6 2.0 1.9 51.3 16.2 10.9 184.2 ' 208. 8 ' 127. 4 ' 129. 6 '68.9 37.5 r 15.5 '17.7 2.2 1.9 ' 61. 8 16.5 '11.2 ' 184. 3 ' 206. 4 ' 126. 8 ' 128. 8 '57.8 37.8 ' 16. 6 ' 17. 6 ' 205. 7 ' 126. 6 ' 128. 7 ' 57.7 '37.6 '16.6 '17.8 ' 208. 6 ' 126. 8 ' 128. 8 'r 57.3 37. 8 ' 15.9 '17.8 2.0 2.0 '49.6 16.6 '11.4 2.1 1.9 '48. 4 16.6 '12.2 2.0 2.0 '51.2 16.7 '11.9 184.3 185.1 185.3 ' 214. 4 '131.4 ' 133. 6 '60.4 ' 38. 8 ' 16.1 18.3 ' 214. 8 ' 133. 4 ' 135. 6 '60.9 '39.5 ' 16.4 18.8 ' 216. 7 ' 135. 9 ' 138. 0 '62.3 '40.0 '16.5 ' 19.2 ' 217. 3 ' 136. 7 ' 138. 9 '63.0 . r 40. 0 ' 16.4 ' 19.5 ' 218. 5 ' 137. 5 ' 139. 6 '63.0 '40.2 '16.6 '19.8 ' 219. 9 ' 138. 0 ' 140. 1 '63.8 '39.7 '16.6 20.0 220.8 137.3 139.5 63.2 39.7 16.5 20.1 2.0 2.0 ' 50. 4 16.8 '11.0 2.2 2.0 ' 53. 0 16.8 11.1 2.2 2.1 ' 51.7 17.0 '11.1 '2.1 2.1 '50.3 17.3 '11.1 '2.2 2.1 '50.4 17.5 '10.6 '2.1 2.1 ' 50.7 ' 17.8 '10.4 '2.1 2.1 '51.4 '18.1 10.3 2.2 2.1 52.2 18.4 10.8 186.6 189.7 191.3 193.8 195.0 195.6 ' 196. 3 197.1 ' 209. 2 ' 129. 0 '131.0 r 58.5 '38.6 r 15. 9 '18.0 NEW PLANT AND EQUIPMENT EXPENDITURES 4,170 4,820 All industries, total ..mil. of dol._ 4, 830 4,940 15,010 1 500 Electric and gas utilities do 640 690 620 780 1,800 2,140 Manufacturing do 2,290 2,090 i 2, 160 180 200 Mining do 210 200 U80 270 310 Railroad .... do 300 330 1400 180 190 Other transportation . . _ _ . . _ . . do. _ 190 170 1160 1,240 Commercial and miscellaneous do 1,340 1,340 1,360 1 1. 330 ' Revised. i Estimates based on anticipated capital expenditures of business. § Personal savings is excess of disposable income over personal consumption expenditures shown as a component of gross national product above. f Revised series. Estimates of national income, gross national product, and personal income have been revised beginning 1944; see pp. 27-29 of the July 1948 Survey for the revised figures. S-l 822014°—49 5