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This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) Labor Force- Changes in Composition Affect Unemployment The growth rate of the nation's labor force has risen steadily over the past 13 years. Where an aver~~e of about 0.8 million people JOIned the labor force each year in the 1950's, about 1.0 million were added each year from 1960 through 1965. And from 1965 through 1972, new additions averaged more than 1.6 Inillion a year. Most of this increase in the rate of additions was a direct result of faster growth in the segment of the population old ~nough to work. But a slight rise ~n the rate of labor force particIalPatio n of these potential workers so contributed to the increased growth. . Accompanying this trend of ris~g overall growth has been a shift ~n the composition of the labor orce. Although the shift has been tradu~l, the cumulative effect has then SIzable and has impacted on e structure and level of unempIoyment. f Three factors account for most o t~7 change in labor force comihsItlOn-the accelerated growth in t e2Young-adult segment (ages 16 o 4) of the population, the in?reased rate of female participation In the labor force, and the declining rate of male participation. More young adults Because death rates and net immig~tion rates have been relatively ble in the United States since of rld War II, the age distribution ti I ~th the population and potenfl. a .abor force is mainly a reo:b~Ion of the historical pattern r t lrth rates. The rather low birth a e of the 1930's caused the r~~,g-adult population of the as f s to expand only about half of ast as the population 25 years age and older. As a result, the W b Busines R . s eVlew I February 1973 mature-adult component of the labor force increased nearly 16 percent from 1950 to 1960, while the young-adult segment increased less than 4 percent. But by the early 1960's, the postwar "baby boom" began to impact on the young-adult component of the labor force. At the same time, the relatively small number of people born in the 1930's were reaching prime working age. Reflecting these developments, the young-adult component grew nearly five times as fast from 1960 to 1971 as the mature-adult segment. And by 1972, young adults accounted for well over 23 percent of the total labor force, compared with 18 percent in 1960. This mushrooming of the young-adult segment of the labor force was primarily the result of the changing age structure of the population and did not reflect any major change in labor force participation rates of younger people. More female job seekers In addition to the larger number of young people available for work, there has been an increasingly large number of women that want to work. In 1972, women accounted for slightly more than 37 percent of the labor force, compared with 32 percent in 1960. This reflected a gain in the female labor force of more than 42 percent since 1960nearly twice the increase in the female population of labor force age. The difference was due to a rise in the rate of labor force participation by women from about 38 percent in 1960 to more than 43 percent in 1972. This increase in the participation rate for women, coupled with a decline in the participation rate for men, caused growth in the female labor force to consistently outpace growth in the male labor force. Women, in fact, accounted for about three-fifths of the overall increase in the labor force in both the 1950's and 1960's. In the 1950's and early 1960's, the rise in the female labor force participation rate was concentrated among women 45 to 64 years old. From 1950 to 1964, the proportion of women 45 to 54 years old in the labor force increased an average of nearly 1 percentage point a year, rising from 38 percent in 1950 to more than 51 percent in 1964. Meanwhile, the rate of participation for women 55 to 64 years old increased from 27 percent to more than 40 percent. For women under 45, there was only a modest increase in the rate of labor force participation, and there was virtually no change in the participation rate for women 65 years old and over. Since 1964, the increase in the labor force participation rate for women 45 to 64 years old has slowed. But the rate of increase Young adults have the highest unemployment rates Selected categories Total labor force ... Males and females 16 to 19 years old 20 to 24 years old 25 years old and over Males .. Females . . . . . . Unemployment rate for group 1960-72 1950·59 average average 4.5% 5.0% 11.3 14.9 7.1 7.B 3.5 4.2 3.2 4.3 SOURCES: U.S. Department of Labor Federal Reserve Bank of Dallas 1 Labor force partiCipation rate rises for women, declines for men PERCENT 90------------------------------------------- - 80- 70TOTAL LAB OR FORCE 60 -~~--------~~~~____----~---50- ~ 30 - FEMALES 40- I '50 I I '52 '54 I '56 I I I '58 '6 0 '62 '64 '66 I I '68 '7 0 '72 Male participation 1972 partly estimated SOURCES: U.S. Department of labor Federa l Reserve Bank of Da lias Proportion of young people and women In the labor force increases Labor force composition 1950 Percent of civilian labor force 1960 1970 19721 By age 16 to 24 years old, males and fema les . 25 years old and over Males .... ...... . ....... ......... . Females .. . . .. . .. . By sex Males .... Females 19.5% 17.9% 23.2% 23.8% 58.6 22.0 56.3 25.8 49.6 27.3 48.7 27.4 71.2 28.8 67.8 32.2 63.3 36.7 62.6 37.3 1. Partly estimated NOTE: Details may not add to 100.0 percent because of rounding . SOURCES: U.S. Department 01 Labor Federal Reserve Bank of Dallas 1. The 1971 Manpower Report of the President, U.S. Department of Labor 2 for younger women-ages 20 to 44 -has accelerated sharply. From 1964 to 1972, the labor force participation rate for women of ages 20 to 34 rose more than 9 percentage points and that for women of ages 35 to 44 rose more than 6 percentage points. By contrast, the rate for women 45 to 64 years old rose less than 3 percentage points. This slowdown in the growth of the participation rate for older women has caused some analysts to suggest there may be some upper limit on the proportion of older women that will want to work. 1 On the other hand, the acceleration in the participation rates for younger women is thought to be related largely to the declining birth rates of recent years, the increasing proportion of women with college education, and the desire of women to supplement the family income. In contrast to the trend among women to increase their labor force participation, the trend among men has been to decrease their participation. The rate for men dropped from nearly 87 percent in 1950 to 84 percent in 1960. By 1972, the rate had slipped below 80 percent. The decline in male labor force participation in conjunction with the upward trend in female participation has produced a significant drop in the relative importance of men in the labor force. Men of all ages accounted for 71 percent of the labor force in 1950. By 1960, this proportion had fallen to 68 percent. And by 1972, the labor force was slightly less than 63 percent men. The declining rate of male participation has been centered in the two extremes of the age spectrUIl1-\\ men under 25 and men 55 and over. The participation rate of meJl in the intermediate age bracket haS held fairly steady at more than 90 labor force and unemployment depend on many factors POTENTIAL LABOR FORCE (PEOPLE AGE 16 AND OLDER) ---"',..,..------- LABOR FORCE PARTICIPATION RATE ~o=:::-------- MILITARY POSTURE ~,.------ STATE OF THE ECONOMY percent. The drop in participation of younger men is due mainly to th . I elr more frequent and more proOnged enrollment in school. For tnen 55 years old and over the drop mainly reflects a tren'd toward earlier retirement. many more young people in the labor force and they traditionally have a much harder time finding employment than their more experienced elders. However, the increased number of young adults in the labor force may have pushed their unemployment rates even Implications for unemployment higher in recent years. Since 1960, the jobless rate for people 16 to 19 These changes in the composition years old has averaged 14.9 per?f the labor force produced signifcent, compared with 11.3 percent ICant changes in the makeup of in the 1950's. And people 20 to 24 Unetnployment in the 1960's and early 1970's. Most of the impact on years old have experienced an aver:employment has been related to age unemployment rate of 7.8 percent since 1960, compared with 7.1 I Upsurge of young adults in the percent in the 1950's. or force-a group with a tradiThere has also been a slight rise IO:Uy high unemployment rate. in the proportion of unemployment f I here young adults accounted or ess than 34 percent of those accounted for by women 25 years :etnployed in both 1950 and 1960, old and over. This is a case of more 19~y comprised about 49 percent in women looking for work and, on average, being less successful than t. 2. This rise was due almost enlrely to the fact that there were so men in finding employment. tb -2. The other dramatic change in the unemployment picture has been the sharp drop in the percentage of unemployment accounted for by males 25 years old and over-the workers often considered the nation's principal breadwinners. Where this group accounted for nearly 44 percent of all unemployment in 1960, it accounted for less than 28 percent in 1972. Thus, the composition of unemployment has shifted in recent years away from older male workers and toward women and younger workers of both sexes. 2 The increasing importance of women and the young in the labor force has tended to put upward pressure on the average total unemployment rate. This is because the total unemployment figure is, in effect, a weighted average of the unemployment rates for the com- !~c n(~d~ti?~ to structural changes. t hese shifts r eflect, to " minor extent, definitional cha nges introduced by the Labor Department in 1967. Changes in un e nltlOn of unemployed workers lowered slight ly t he number of adult men and teenagers counted as unemployed a nd increased the number oC M.:.,tn/Ployed a dult women, according to Rober t L . Stein, " N ew Definitions Cor E mp loym ent and Unemp loyment ," Emp!oyment and Earning. and t I!y Report On tho L abor Force, U .S. Department of Labor, February 1967. nUsineSS R eVleW . / February 1973 3 ponent groups of the l~bor force: And the weights used m detenmning the total unemployment rate are the percentages of the labor force accounted for by the subgroups. Thus, it could be possible for the unemployment rate of each component group to remain stable while the total unemployment rate changed significantly due to an increase or decrease in the proportion of some subgroup whose unemployment rate deviates considerably from the average. This effect is evident in the present situation. With the increase in the number of women and especially young adults in the labor force-categories that typically have relatively high unemployment rates-the total unemployment rate has been subjected to upward pressures in recent years, at least compared with some earlier periods. What might the unemployment rate have been today if the composition of the labor force had remained constant over time? To answer this question, the average labor force composition for the 1950's can be computed and the results used as a set of standard weights for the various age and sex components of the civilian labor force. These weights can then be multiplied by the actual unemployment rates for the age and sex groups in each period and added together to arrive at "standardized" unemployment rates. The results of such computations show that the shifting composition of the labor force had little impact on the total unemployment rate until 1963. Since then, however, the actual rate of unemployment has been consistently higher than the standardized rate, suggesting that the changing composition of the labor force has resulted in a higher average unemployment rate for the United States. But this upward shift has not been particularly laFge. Labor force participation rates for women show varying rates of increase between age groups PERCENT 60------------------------------------------ 55- 35 TO 44 25-,--~--~1r-~1--~--'1---r1--~--~1--~1--~1--~ '50 '52 '54 '58 '60 '62 ' 64 '66 '68 '70 '72 By 1968, when the actual U.S. percent, the standardized rate was unemployment rate averaged a rel- 5.1 percent. atively low 3.6 percent, the stanLooking ahead dardized rate was a somewhat lower 3.2 percent. This suggests Labor force projections for the that the relative increase in the 1970's suggest that the momentum number of women and younger of change predominating in recent people in the labor force was reyears is slowing. If projections sulting in a somewhat higher unmade in 1970 by the U.S. Departemployment rate than would have ment of Labor prove accurate, the occurred if the composition of the composition of the labor force in labor force had not changed from 1980 would not be too different the average of the 1950's. In 1972, from that in 1972.8 when the actual unemployment Since all people making up the rate still averaged a rather high 5.6 , labor force between now and the 3. These projections were reported in t he MonthLy lA<bor Revi"," . F ebruary 1970. 4 '56 1972 partly estimated SOURCES: U.S. Department of Labor Federal Reserve Bank of Dallas Standardized unemployment rate drops below actual rate in recent years PERCENT OF LABOR FORCE 7.0----________________________________________________ 6.56.05.5~ 4.5- \ 4.0- ~ 5.0- \ \ 3.5- STANDARDIZED RATE ~ 3.0- 2. 5 ---r1--'-1-'"T'I---r-/-'"T/---r-I-""'1---'-1--rl---r-/-""/-~I '50 '52 '54 '56 '58 ' 60 '62 '64 '66 '68 '70 '72 1972 N partly estimated aTE: Standardized rate is derived from the average age-sex composition of the So labor force in the 1950's and actual unemployment rates for each year. URCES: U.S. Department of Labor Federal Reserve Bank of Dallas - tnid . have all'eady been borneIghties ·t· ,1 IS possible to make rea- ~~~IY accurate projections of the th t ng~age population through at a ~erlOd. Predicting the rate st WhICh people of various circumtha~ces will actually participate in ris~ abor force is somewhat more y, however. th Because the dramatic upsurge in lab number of young people in the by ~r .for~e was caused primarily p hIf~ In the age structure of the oPUlatlOn, this trend will prob- -- ably level out in the near future. Birth rates turned down again in the late 1950's, and individuals ~orn then are now reaching labor orce age, slowing the expansion in he number of potential youngdult workers. Although the number of young workers will continue to increase, the rate of growth from 1970 to 1980 will probably be only about a fourth as rapid as the rate between 1960 and 1970. Also, as the current large group of young adults reaches age 25 and beyond, the older component of the labor force will expand at a faster pace. Barring an unforeseen upturn in the participation rate of young adults, their proportion of the labor force should remain at about 23 percent in the 1970's and will probably begin to decline in the 1980's. The Labor Department estimates that the rate of participation and relative importance of females in the labor force will continue to rise in the 1970's but at a slower pace than in the 1960's. Recent developments suggest that the Labor Department may have underestimated the growth in the participation rate for women, however. In fact, in 1972, women accounted for about 37 percent of the total labor force-about what the Labor Department had projected for 1980. The changes of the 1960's seem to have established a new pattern of labor force composition that will last at least through the 1970's. In such a changed situation, it becomes clear that labor markets may need to be more flexible and adaptive so that they can better absorb the relatively larger supplies of mature women and youth of both sexes that want to work. One priority seems to be the continuation and intensification of efforts to open job opportunities to women in a wider range of occupations. Also, increased flexibility in working hours-particularly the expansion of part-time employment opportunities-might make it easier to employ mothers and students that need employment but have other important obligations as well. Significantly, in 1972, about a fourth of those unemployed were seeking part-time work. And of these, more than 90 percent were either young adults or women. 4 Other measures that might ease the high unemployment rate for 4. P or Ecoll~~~~e~t d.iscussion of this situation for women, see Carol S. Green wald, "Wor king Mothers: The Need for More Part-time Jobs," N ew England nUS' eVlew, F edera l Reserve Bank of Boston , September/October 1972. llless Review I February 1973 5 Military buildups and cutbacks The total labor force is composed of people engaged in both civilian and military occupations. While shifts of potential workers from civilian to military status can cause short-run changes in the civilian labor force and, therefore, in job market conditions, these movements tend to balance out over the long haul. The military buildup beginning in the midsixties, for example, doubtlessly prevented some young men from entering the civilian labor force and was a contributing factor in the low unemployment rates from 1965 to 1968. And as the military forces have been reduced since 1969, the civilian labor force has grown faster than would otherwise have been the case. As a result, upward pressure may have been put on the unemployment rate. But many young men affected by the military buildup and cutback would have entered the labor force anyway. Their being called up or released from service merely affected the timing of their availability in the civilian labor force, and not the size of that force in the long run. Also, not all the men called up came from the civilian labor force. Many were students. And not all released from military service joined the civilian labor force. Many entered schools or simply remained out of the labor force for a while. Eventually, however, most of the male population enters the civilian labor force. Only the timing of this entry is affected by such considerations as military service, labor market conditions, education or personal choices. ' young adults could be a special minimum wage for youth-lower than the minimum wage for adult workers-.,.and exemption from Social Security coverage. A lower rate of effective pay for young, entry-level workers might induce employers to increase hiring of these workers for tasks that are presently ignored because the labor cost is too high. Measures such as these are suggestive of a number of ways in which hiring and compensation practices might be changed to facilitate better utilization of the available labor force. Adjustments in hiring and wage policies are desirable not only to reduce the burden of unemployment that now falls on women and young adults, particularly, but also to help employers meet their manpower needs in the 1970's. -Leonard G. ~ower 6 Bank Structure- Concentration Projected To Increase in Texas The multi bank holding company mOvement, although still fairly ~e~ to Texas, has already worked aSIC structural changes in the state's banking industry. Pre~ented by unit-banking laws from ranching into suburbs-where ~ost .of the growth in demand for tanking services has been-downhown banks in metropolitan areas ad been losing their share of the state's banking market for several bears. Where the state's 38 largest 5;nks, for example, held more than , percent of the deposits in Texas In 1961, they held less than 46 percent ten years later. t More than half this loss was due bO competition from medium-size anks. But close to half the loss Was accounted for by the establish~ent of small suburban banks. rom 1961 to 1970 the number of comm' ' SMS ~rc~al banks in the state's 25 thi A s Increased by nearly a I'd, while the number of banks out 'd tial~l e SMSA's remained essenY unchanged. st But in 1970, a number of the . ate's largest banks began form~ng holding companies and acquir~ng subsidiary banks-not only in ocal suburbs but in other rna)' or bankin Th I g markets across the state. d e ong-standing trend toward bconcentl'ation in Texas was ~9~uPtlY halted. In both 1971 and up 2, deposit concentration edged Ward on a statewide basis. }fold' lng company expansion In 'd pos~ -1970, the low point for debanhlconcentration in Texas llluit. ng, there were only three th lbank holding companies in n:iltate-one each in Houston, as, and Fort Worth. These -- three companies controlled 11 subsidiary banks that accounted for 8 percent of the state's deposits. The real surge in holding company activity began in 1971, and by the middle of that year, the number of multibank holding companies had doubled, with the six companies controlling 19 subsidiary banks and 11 percent of total bank deposits in the state. At the start of July 1972, the number of multibank holding companies had again doubled. There were 12 companies with 40 subsidiary banks holding nearly a fifth of the state's deposits. Multibank holding company activity accelerated still further in the second half of 1972, as more of the state's largest independent banks rushed to organize their own holding companies. In January of this year, the number of multibank holding companies in Texas stood at 15. These companies had 71 subsidiary banks with 32 percent of the state's deposits. But holding company proposals involving another 61 Texas banks had been announced, and 16 of these were pending before the Board of Governors of the Federal Reserve System. If all these publicly announced proposals were approved by the Board of Governors and consummated, multibank holding companies in Texas would number 25, and their 132 subsidiary banks would account for about 49 percent of deposits in the state. The holding company movement in Texas was sparked by large downtown Houston banks acquiring their suburban affiliates. While these acquisitions had an effect on deposit concentration in the Hous- ton SMSA, the acquired banks were too small to have much impact on statewide concentration. But as the movement gained momentum, bank holding companies began expanding across the state, acquiring banks in many of the state's major banking markets. By mid-1972, there were banking subsidiaries of multibank holding companies in nine of the state's 25 SMSA's. In seven of these SMSA's, subsidiary banks ranked among the top three banks in their respective markets. Since these banks were typically larger than the suburban affiliates acquired in the earlier stages of the movement, their acquisition had a greater impact on statewide concentration. Measuring the impact The impact of multibank holding company expansion on deposit concentration in Texas can be estimated with the aid of a Markov chain model. l To apply this model, two important initial assumptions are made. First, it is assumed that the bank holding company movement of the past two years did not take place. Second, it is assumed that all banks had an equal opportunity to grow proportionately during this period. These assumptions-and the results of the Markov model-allow theoretical projections to be made, estimating what the concentration of deposits might have been had the trend of the 1960's not been altered. It is then possible to compare these projections with the actual pattern of deposit concentration and estimate the impact of the multibank holding company movement. 1, F'o~ a d' lSCU8sion of the Markov chain model, see the accompany ing technical note, 8 us inesS IteVlew ' I February 1973 7 Technical note The Markov process is stochastic (random) in structure. Given a sequence of experiments, the outcomes of any particular experiment depend only on the outcomes of the immediately preceding experiment. 1 If each experiment has a given set of r outcomes (B l • . • B r ), the probability of mov1 ing from B, in time t to B; in time t is Pi; and is dependent only on B i • The transition probability for every pair of outcomes may be written as the matrix + B , . . . Br (1) [~~:: j p = B, Br ~rl" .pr;J where (2) Pi;~ (3) ~Pi; , 0 = 1 The method of restricted least squares is used to estimate the transition probability matrix. 2 The ordinary least squares model is transformed into a quadratic programming problem where the objective function, a quadratic form in Pi;, is maximized subject to linear constraints, equations (2) and (3). The estimated transition probability matrix, P', representing the probability estimates for changes in deposit concentration in Texas, was computed to be B, p' = B. B. B, B , [8824 .1118 .0057 0 B. 0 .4737 .5263 0 B. 0 .4548 .0344 .5108 B, .0832 0 .4026 .5142 B. 0 0 0 .0218 B. .1J The values of the elements on the principal diagonal (.8824, .4737, .0344, .5142, and .9782) are estimates of the probability that 8 a particular bank will remain in its category the following year. For example, the value .8824 suggests that one of the smallest Texas banks has about an 88 percent probability of remaining in the category of smallest banks from year to year, all other things being equal. The values of the off-diagonal elements estimate the probabilities of a given bank moving from one category to another. For example, there is better than an 11 percent chance that one of the smallest banks in the state will become a medium-small bank and about a 0.6 percent chance that it will become a medium-size bank. Similarly, there is just over a 2 percent chance for one of the largest banks to move back and be classified as a medium-large bank. After the transition probability matrix is estimated, projections can be made of the changes in deposit concentration for each bank category. Given the transition probability matrix P and an initial set of outcomes (4) b(O) = (bl(O) . • . brIO)~, it is possible to derive the outcomes of future experiments. Initially, (5) b (O) P b tl) or b(n)p b(n +l) or more generally, = (6) b(O)P,. = = bIn), where n is the nth experiment. Multiplying the June 1970 deposit shares b~ th~ estimated transition probability matrIX YIelds an estimate of deposit shares for Jur:e 1971. Similarly, the product of the proJe?t.ed June 1971 deposit shares and the tranSItion probability matrix yields an estimate of the distribution of deposits for June 1972. 1. For a complete discuss ion of the Markov process, see J. G. Kemeny and J . L. Snell, F ini te Marlcov Chains, Princeton, De Van Nostrand Company, 2. T. C. Lee, G. G. Judge, and the Transition Probabilities Of Farm Economics, August Inc., 1960. T. Takayama "On E stimating of a Markov Process" Journal 1966 ' As a preliminary step, all Texas ba~s were ranked according to ~helr total deposits and grouped Into five categories for each of the y.ears 1961 to 1970. Each succeshIve category contains half as many anks as the preceding one. The resulting breakdown, showing June 19:2 deposits, isb S'!tallest banks-about half the anks In the state (those with dePosits under $10 million) f • Medium-small banks-a fourth ~ the banks (304 with deposits rorn $10 million to $21 million) th· Medium banks-an eighth of $2~ b~~ (152 with deposits from nullion to $42 million) t • Medium-large banks-a sixee~th of the banks (76 with deP~SI~S from $42 million to $107 million) d • Largest banks-38 banks with eposits of at least $107 million he~t rnid-1961, the smallest banks P . 5.2 percent of total state deh~SI~S. By mid-1970, their share ~ Increased to 9.5 percent. The projection for this category indi~:te~ that this share would have ~ e~ 10.0 percent by mid-1972. cre lrnilar but slightly smaller injec:ses were shown for the proCat ed ~arket shares of the three A egorles of medium-size banks in~cording to the projections, th~se th reases would have occurred at in e expense of the 38 largest bankst:t~r~aniz~tions, whose share of fall epOSlts would then have ;~ t? 43.8 percent by mid-1972. corn e lrnpact of the bank holding denfwYmovement is readily evicat ci. here the projection indiin t~ a decline from 1970 to 1972 38 1 e share of deposits held by the thei~rgest banking organizations, reachl'ctual share edged upward, Oth ng 46.6 percent by mid-1972. trar~\categOries also behaved conPOsit 0 the projections. The deaf rne~ares ?f all three categories And t urn-SIze banks declined. est b he deposit share of the smalljecr an~s grew less than the proIOn Indicated. nu'Sitless R . eVlew I February 1973 Declining trend in deposit concentration in Texas is reversed in 1970 190-0 lEiiiIIC=-. PERCENT OF COMMERCIAL BANK DEPOSITS (END-OF-JUNE FIGURES) 80 - --. 70- 60 - ------ 50 - --- --. 40- PROJECTED 30 - 20~~~~~'---r-~--'---r-~---r--r--'1---r--~ 1971 At mid-1972, the actual share of state deposits held by the 38 largest banking organizations was about 2.8 percentage points higher than the projected share. And no more than 1.1 percentage points separated the actual and projected deposit shares of each of the four other size categories. Further consolidation While the differences between the actual and the projected market shares of the five categories were small in 1972, the actual pat- 1973 tern of deposit concentration is likely to deviate further from projections in the years immediately ahead. Multibank holding companies will continue to acquire more banks. Many of these acquisitions will involve suburban banks already affiliated with leading downtown banks, while others will cut across geographic markets. The effect of this activity will be to further increase the share of deposits held by the largest banks while decreasing the shares of banks in the three intermediate size categories. 9 ... A number of such acquisitionsas well as some acquisitions of small banks-have already been proposed and, if consummated, will boost the share of state deposits held by the 38 largest banking organizations to about 60 percent. Therefore, if no other multibank holding company activity took place in the first six months of this year, the share of deposits held by the largest banks would, on the basis of 1972 deposits, increase to about 17 percentage points more than the projected share. As the multibank holding company movement matures in 'Texas, acquisitions of existing banks should taper off, resulting in a slowing in the rate of deposit consolidation. But another trend is likely to develop to further increase deposit concentration. In the past, most of the newly chartered banks in Texas have been independent banks. In the future, many banks will doubtlessly be established de novo by holding companies. Since the deposits of these small banks will normally be added to those of the largest banking organizations, the relative share of deposits held by small independent banks is likely to decline. Multibank holding companies, then, have already had a significant impact on deposit concentration in Texas. And as the holding company movement gains momentum in the years immediately ahead, further consolidation seems assured. This change will mean a new structure for the state's banking industry-a structure that would have been difficult to foresee only a few years ago. -Edward L. McClelland 10 New member bank The Nueces National Bank, Corpus Christi, Texas, a newly organized institution located in the territory served by the San Antonio Branch of the Federal Reserve Bank of Dallas, opened for business January 2, 1973, as a member of the Federal Reserve System. The new member bank has capital of $250,000, surplus of $200,000, and undivided profits of $150,000. The officers are: Jose A. Montoya, Chairman of the Board; Leonard E. Larson, President; and Richard J. Sahadi, Cashier. New par banks The University Bank, EI Paso, Texas, an insured nonmember bank located in the territory served by the EI Paso Branch of the Federal Reserve Bank of Dallas, was added to the Par List on its opening date, January 2, 1973. The officers are: Thomas A. Ewers, President; Martin D. Balk, Vice President (Inactive); and C. Gary Young, Cashier. The Canyon Lake Bank of Sattler, Sattler, Texas, an insured nonmember bank located in the territory served by the San Antonio Branch of the Federal Reserve Bank of Dallas, was added to the Par List on its opening date, January 5, 1973. The officers are: E. Harrison Preston, President; Ben F. Wolle, Vice President (Inactive); Marvin Aaron, Cashier and Senior Operations Officer; and Mrs. Nancy Biggs, Assistant Vice President. The Lake Cities State Bank, Lake Dallas, Texas, an insured nonmember bank located in the territory served by the Head Office of the Federal Reserve Bank of Dallas, was added to the Par List on its opening date, January 22,1973. The officers are: Jack D. Hedge, President; Joe N. Bethany, Vice President and Cashier; and Mrs. Louis R. Gross, Vice President (Inactive). 11... • ""'ness R.eVlew . I February 1973 11 Federal Reserve Bank of Dallas February 1973 Statistical Supplement to the Business Review Total credit at weekly reporting banks in the Eleventh District rose considerably in the five weeks ended January 24, reflecting larger fh an usual increases in both total oans and investments. The increase in bank credit was accommo~ated by large net purchases of ed<;ral funds, as total deposits declined sharply. Since all major types of borrowers except nonbank financial insti~tions used their bank credit es more than usual, total loans ~dvanced considerably more than In comparable periods of other recent years. Business loans and real estate loans continued to account for most of the strength in lOan demand. Total investments also rose ~~arplY, as banks added subs tant Ially to their holdings of shorterm Government securities and runicipal obligations. Holdings of onger-term Government instruments declined somewhat. d T?tal deposits fell as a ~harp t ecline in demand deposits more han offset a moderate rise in time ~nd savings deposits. An increase ~ large negotiable CD's outstand~g accounted for much of the gain n time. and savings deposits. Bank orrowmgs from nondeposit ~Our.ces other than Federal funds theclined somewhat-particularly in e Eurodollar market. b !easonally adjusted total employst ent in the five southwestern IIIates posted its sixth consecutive Onth-to-month increase in De~:mbe~, reaching a level 3.5 per19nt hIgher than in December ou~1. Expansion in the labor force h Paced employment growth, in°~hver, producing a slight rise e unemployment rate. But December's rate of 4.1 percent was still significantly lower than the 4.8 percent recorded a year earlier. Manufacturing showed the stronger rise in the nonfarm sector, as both durable and nondurable industries rose 0.6 percent over a month before. Among nonmanufacturing industries, advances were more moderate, with the exception of the 0.8-percent increase in services. Employment was also up over November levels in finance, transportation and public utilities, and government. Construction and trade posted slight declines. All the nonmanufacturing industries showed year-to-year employment increases, with construction (up 7.3 percent) and finance (up 5.6 percent) leading these gains. Registrations of new passenger automobiles in Dallas, Fort Worth, Houston, and San Antonio dropped 5 percent in December. This was a seasonal decline. Registrations in the four centers were 16 percent greater than in December 1971. Cumulative registrations for 1972 were 12 percent higher than for 1971. Department store sales in the Eleventh District were 5 percent greater in the four weeks ended January 27 than in the corresponding period a year earlier. Total sales for 1972 were 11 percent higher than in 1971. Ice, snow, and freezing temperatures in early January hindered almost all agricultural activities in the states of the Eleventh District. Weather was responsible for some further delay in completion of the cotton harvest and light freeze damage to winter vegetables. Citrus crops in the Lower Rio Grande Valley, however, escaped damage. Although livestock conditions remain generally good, supplemental feeding was stepped up as pasture and range conditions deteriorated. Deaths of stocker cattle were moderate to heavy in the High Plains, and feed supplies are short in some areas. Winter wheat acreages in both Texas and Oklahoma increased moderately this season. And farmers' intentions to harvest a larger share of seeded acreage should boost production even further. Average prices received by Texas farmers and ranchers in the month ended December 15 advanced 6 percent to a level 13 percent higher than a year earlier. Crops posted the biggest gain for the month as prices rose for all except rice. Livestock prices were mixed, with meat animal prices advancing sharply. Egg prices soared 19 percent to an average of 50 cents a dozen. Prices paid by U.S. farmers rose slightly, reaching an average 7 percent above a year earlier. The increase was due mainly to higher costs of feed, food, clothing, and building materials. The seasonally adjusted Texas industrial production index eased slightly in December to 132.8 percent of its 1967 base. Both manufacturing and utilities fell from their November levels, while mining rose slightly. Nevertheless, the index gained 8.6 percent in 1972. In manufacturing, durable goods production fell 1.4 percent during the month, as only two industry groups reported increases-lumber (Continued on back page) CONDITION STATISTICS OF WEEKLY REPORTING COMMERCIAL BANKS Eleventh Federal Reserve District - (Thousand dollars) ASSETS Federal funds sold and securities purchased under agreements to resell • •.. . •.....••....• Other loans and discounts, gross ... ............ . Jan. 24, 1973 Dec. 20, 1972 Jan . 26, 1972 1,016,549 8,772,762 1,426,193 8,769,102 1,155,313 7,321,455 Total deposits ••..•••••.•••. • •.. • • • ••.•• •.••. 13,340,050 ---- Commercial and industrial loons . •. .. ...... ... Agricultural loan s, excluding 3,886,326 3,844,157 cer ,iAca'es of interest ..... ........ .. . .. .. . loans to brokers and dealers for 245,389 228,941 165,987 1,329 79,37 1 1,340 85,438 500 53,749 7,1 19 504,608 6,773 471,444 5,254 449,502 137,275 685,990 1,226,186 21,579 13,799 966,303 169,601 790,237 1,181,469 24,486 15,750 957,837 130,787 492,273 901,182 20,341 28,488 824,305 0 997,488 4,077,891 0 991,629 3,803,437 0 866,098 3,389,284 1,096,331 262,634 0 985,988 192,957 0 1,077,185 125,484 0 eec 3,382,989 purchasing or carrying : U.S. Government securities .. ... ..... . " . .. . Other securities . ... . ....... ............. . Other loans for purcha sing or carrying: U.S. Government securities .... ....... .. ,. .. . Other securities .... ................ . .... . loans to nonbank flnancial in stitutions: Soles finance, personal flncnce, factors, and other busine ss credit componies •... .. . Other ••••. • •..•.••..•.•••.•.•.•.••.. . . Real estate loans ... ..... ........ ... . ..... . loons to dome stic commercial banks• .. ... . .... loons to foreign banks . ... .......... . .... .. . Consumer instalment loans....... . ... . . ..... . loans to foreign governments, official institutions, central banks, and international institutions ............................. . Other loan s. . .. ..... .. ........ . .......... . Total investments • ••... •• ...•.... ••.••.• •.••• Total U.S. Government securities ..... ...... .. . Treasury bills .•. ........ .. .............. Treasury certiflcotes of indebtedness .••.. ... Treasury notes and U.S. Government bonds maturing: Within 1 year .• . .. . ................... 1 year to 5 years ••• . .•.•....•......... 160,790 440,645 191,596 187,356 599,905 164,440 258,203 2,437,059 242,089 2,326,306 98,981 2,028,663 13,603 272,695 1,453,649 912,442 116,415 387,693 14,944 14,138 234,916 1,441,486 843,013 118,406 394,297 12,368 16,686 167,769 1,3 12,009 1,038,574 100,931 442,279 12,111 682,089 672,129 511,383 TOTAL ASSETS........ . .......... . .. . ... 17,434,434 17,480,431 15,283,339 After 5 years • • •.•..•..•.• •• ••••••.••. All other ••••..•..•.••••••••.••.••.••.•. Other bond s, corporate stocks, and securities: Certiflcates representing participations in federal agency loan s•.• .......•... . .... All other (including corporate stocks) ••••• • .. • Cash items in process of collection ••••....... . .. . Rese rves with Federal Reserve Bank . ...••. ....•. Currency and coin ...••.... . . •.. . .... •.•..... Balances with banks in the United States. .. ..... . Balances with banks in foreign countries . •.. . ... " Other assets (including investments in subsidiaries not consolidated) . . ...... ............... .. . Total demand deposits.... .. .. " .... , . .. , ... Individuals, partnerships, and corporations .... State s and political subdivisions ..•.... •.... U.S. Government ...... . .... .. .. .. . ... .. . Banks in the United State s. •............... Foreign: Governments, offlcial institutions, central banks, and international institutions • .. .•. Commercial bonks .. ... .. ............. . Certifled and offlcers' checks, etc .. ... •...... Total time and saving s deposits•............ . . Individuals, partnerships, and corporations: Savings deposits.... ... •......•. . ' " .... Other time deposits .•. ... ..... ....... . . States and political subdivisions .. .... •. .... U.S. Governm ent (including postal saving s) .... Banks in the United States . ... ... •......... Foreign: Governments, offlcial institutions, centra l bonks, and international institutions .. • ... Commercial bonks ... . .. .......•...•. . . Federal funds purchased and securities sold under agreements to repurcha se . .•. '" . " .... Other lia bilities for borrowed money .... ... . .... Other liabilities . .... ............. " ..•.... ... Reserves on loans • . ..•.. ... ......... ... .. .... Reserves on securities .. ... .. ....... .... . • .•... Total capitol accounts .... .. ..••...... ... .• . .. 7,106,259 4,960,061 525,796 248,49 1 1,211,95 1 Dec. 20, 1972 13,501,860 -7,360,838 - -5,099,208 527,334 246,094 1,289,113 1,199,057 3,220,098 1,665,129 25,560 111 ,727 1,210,157 3,249,738 1,536,025 25,253 107,634 2,757,11 1,302,291 15,453 82,566 11,100 1,120 11,095 1,120 19,800 1,100 2,195,894 109,763 457,568 158,670 17,763 1,1 54,726 1,943,667 244,609 472,214 142,045 17,413 1,1 58,623 1 910,845 ' 41,601 394,511 144,211 22,632 1,092,937 ---- 17,480,431 Nov. 29, 1972 Dec. 29, 1971 loans and discounts, gross •.... .........•. U.S. Government obligations ...... ...... . . Other securities .•..... . .. . ... .•.. ....... Reserves with Federal Reserve Bank •.... ... Cosh in vault ...... ........ • ......•. •.. . Balances with banks in the United States .... Balances with banks in foreign countries e •... Cash items in process of collection ....... ... Oth er assets e ... . .................•.... 17,475 2,439 5,548 1,449 35B 1,550 14 1,973 1,356 17,021 2,338 5,340 1,350 318 1,241 12 1,548 1,300 14,825 2,611 4,572 1,687 323 1,336 17 1,624 928 TOTAL ASSETSe ••...••.....••. • •..••. 32,162 30,468 27,923 Demond deposits of bank s ..•...•.. •• ... • Other demand deposits .......... ........ Time d eposits . ... ...................... 1,872 12,088 12,337 1,594 11 ,100 12,159 1,81 2 10,734 10,457 Total deposits ••..•.....•..••. • ..•• ••. 26,297 2,610 1,046 2,209 24,853 2,224 1,225 2,166 23,003 1,726 1,287 1,907 item ASSETS LIABILITIES AND CAPITAL ACCOUNTS Borrowings . . .......................... Other liab ilities e .... . ...... . . ........... Total capital accounts e . .•• . . . .. ... . ..... TOTAL LIABILITIES AND CAPITAL ACCOUNTSe •••.....•..•..•......• e-Estimated 32,162 30,468 27,923 1,096,22~ - - J:&28~ - (Dollar amounts In thousands) Demand Standard Debits to demand deposit accounts I depo~ Annual rate ofturnove~ 1972 1971 Percent change 1972 1~ $9,74 1,062 $7,7 16,553 26% 31.9 28.8 Monroe . . .......... . Shreveport . . ...... . . 4,028,301 13,678,905 3,339,696 11,660,532 21 17 36.5 46.1 34.6 43.6 NEW MEXICO Roswell' ••.•..•••.• • TEXAS 980,742 982,489 -0 22.5 24.0 2,604,703 7,817,733 12,656,101 2,293,332 6,500,472 10,93B,577 14 20 16 21.9 40.8 30.2 21.4 38.5 30.3 6,939,t77 6,603,624 Tucson .... . .... .... . Dec. 27, 1972 6,402,055 4,417,07 4 350,787 206,329 1,308,406 2,392 32,103 84,96 4 5,274,547 LOUISIANA (Million dollars) 11,676,602 2,891 40,551 155,647 6,141,022 ARIZONA Eleventh Federal Reserve District - ANNUAL BANK DEBITS AND ANNUAL RATE OF TURNOVER OF DEMAND DEPOSITS metropolitan statistica l area CONDITION STATISTICS OF ALL MEMBER BANKS Jan. 26, 1972 3,815 39,864 116,281 6,233,791 TOTAL LIABILITIES, RESERVES, AND CAPITAL ACCOUNTS •••••.••..•• . .•.••. 17,434,434 174, 104 461,349 198,244 Obligations of states and political sub divisions: Tax warrants and short-term notes and bills •. . Jan. 24, 1973 LIABILITIES Abilene ... . ........ . Amarillo ........... . Austin ...... . ...... . Beaumont- Port ArthurOrange .••....••. . Brownsville-HarlingenSon Benito . ... . . . . Bryan - College Station. Corpus Christi ... .... . Corsicana 2 • • • • • • • • . • 25.4 25.9 2,498,315 1,318,613 7,441,802 520,401 152,822,52 1 9,649,372 28,917,336 3,t 58,256 139,541,680 1,168,892 5,513,042 2,099,328 1,085,776r 6,544,457 490,831 135,057,600 8,292,050 26,418,512 2,978,827 114,999,799 1,034,295 4,820,928 19 21 14 6 13 16 9 6 21 13 14 25.3 25.5 27.5 14.8 55.8 32.7 36.8 25.3 45.0 23.4 29.2 24.6 24.0 r 23. 6 57. 1 31.8 37.8 26. 1 42.3 23. 8 27. 8 2,528,065 2,252,220 1,863,226 1,679,132 22,510,879 1,274,549 1,874,163 2,088,677 1,707,39t 1,469,431 20,711,9 10 l,t64,430 35 8 9 14 9 9 18.2 14.8 17.4 21.4 27.3 17.1 17.1 15.0 17.8 19.8 29.0 17.0 1,753,598 2,933,259 3,929,629 2,95 1,249 1,562,903 2,393,633 3,411,554 2,596,296 12 23 15 14 20.6 25.1 27.3 22 .3 20.4 22. 9 26. 1 20.9 Tota l-29 centers .•..... $454,672,760 $392,838,066 16% 40.1 39. Dallas •.•.••••.•..•. EI Paso • . ..•.•..••.. Fort Worth •. .... • ... Galve ston-Texas City .. Houston ... ......... . laredo . ........ •. . . Lubbock ••.. •. •••..• McAllen· Pharr· Edinburg •...•.•..• Midland .•..•.....•. Odos sa .... .... .... . Son Ange lo .... ..... . San Antonio ..... . .. . Sherman-Denison •.... Texarkana (TexasArkansas) .. ..•.... Tyler •....•.....••.. Waco . ............ • Wichita Falls • •• • ..•• • 14.0 2 --------------------------------------------------;, 1. Unadjusted deposits of individuals, partnerships, and corporations and states and political subdivisions 2. County basis r-Revised BANK DEBITS, END-OF-MONTH DEPOSITS, AND DEPOSIT TURNOVER SMSA's in Eleventh Federal Reserve District (Dollar amounts In thousands, seasonally adjusted) - DE81TS TO DEMAND DEPOSIT ACCOUNTS' DEMAND DEPOSITS' Percent change 1972 Annual rate of turn over Dece mber 1972 from Dec em ber 12 months, 1972 frem 1971 Decem ber 31, Decem ber Novemb er Dece mb er 1972 1972 1972 1971 27% 21 18 $319,529 107,484 313,197 45,062 128,712 218,366 474,402 289,669 107,882 57,661 280,306 35,282 2,940,315 311,261 825,531 124,034 3,226,938 58,073 200,197 151,189 170,316 116,348 80,764 890,981 78,186 91,197 124,753 153,169 135,711 37.5 40.0 49.6 22.7 22.2 40.8 27.1 25.2 24.2 23.7 28.2 15.8 62.8 32.8 35.2 26.3 46.7 21.8 27.9 18.8 14.8 17. 1 21.7 28.0 16.4 18.2 30.5 25.7 23.8 38.6 37.6 48.9 22.3 22.1 43 .9 32.6 26.9 25.7 26.6 29.7 15.6 60.2 35.4 36.7 28.4 48.0 25.2 28.3 19.1 16.2 17.0 22.8 27.6 16.8 21.3 30.6 27.1 23.7 30.7 35.8 44.0 22.7 21.9 38.9 31.2 23.8 25.9 23.9 27.3 15.4 57.4 31.9 34.8 24.3 41.8 23.4 23.7 16.6 13.4 18 .2 19.7 27.6 17.2 18.9 21.8 25.3 20.7 42.3 42.7 38.9 Standard metropolitan (Annual-rot e be sis ) Novem ber 1972 December statistical area ARIZONA, Tucson LOUISIANA, Monr~~::::::::::::::::::::::::::::::::: N Shreveport. . . • • . • . • . . . . • • . . . . • • . . . . . • • . • T EW MEXICO, Roswe ll ' ... . . . . . . . • . . . • • . . . . . • . • . • . • . . EXAS, Abil ene $ 11,077,776 4,370,568 15,097,224 1,020,588 2,814,936 -3% 1 0 3 4 30% 23 26 3 22 ::::::::::::::::::::::::::::::::::: :eeumont. Port Arthur.Orong e.. . . . . • . . • . • .• . . . . . rownsville-Harlingen-San Benito............ ..... ~:;ren.CC~~g~ Station ••••.. ••• .. •••... , . . • . . . . 1 6,992,568 2,567,100 -3 13 10 1~ 17 22 14 ~: 14 17 10 6 22 13 12 35 ~:~i~I.I~.: ff~~~1:~/L iii iii iii ii;;; ii;;; i;;; iii iii ~alveston.Texas City .... . ... .. ... .... ... .. ... . tm:~~ri -l~ -6 1,2~~'m =~ l:iJ1iim =1 =~ 3,2~~,~:: t~bi~~:·:·.: :::::::::::::::::::::::::::::::::: 151:!~~:~~~ 2,767,1~~ -r ~~~"en.Pharr.Edinburg........................ f:t~~!L:L. H ,1:111111 Tejarkana (Texas· Arkan sas)... ..... ... ..... .... km'~!~ i~i~t~ :~~Iis:. :::::::::::::::::::::::::::::::: g:m:~~5 centers... .... ............................. $499,415,388 ~29 _~ =1 - I~ -: 0% 1971 o 14 21 15 2~ 5 ~i 6 n ~~ 8 15 10 II 9 10 12 23 5~ 15 ~~ 14 16% 25% $12,056,515 ~. DepOSits 01 Individuals partnerships and corporations and 01 slales and political subdivisions . COunty baSis ' , RESERVE POSITIONS OF MEMBER BANKS DEMAND AND TIME DEPOSITS OF MEMBER BANKS Eleventh Federal Reserve District Eleventh Federal Reserve District (Averages 01 dally ligures. Thousand dollars) (Averages 01 dally ligures. Million dollars) --l ! I ~ate 1970, December 1971 , Decembe;' 1972danuary • . ~bruar~:: : A a~ch..... :"1...... Jay.... .. /ne... .. . . uly .. '" . • ~Ugust..... ep te mber .• October r TIME DEPOSITS DEMAND DEPOSITS --- Novemb~;.: December. . U.S. Total Adlusted' Governm ent Total Savings 11,271 11,981 12,313 11,983 12,118 12,470 12,268 12,320 12,529 12,420 12,619 12,866 12,844 13 439 7,781 8,388 8,510 8,382 8,515 8,696 8,530 8,553 8,694 8,824 8,933 9,034 9,321 9,688 286 266 300 281 300 314 384 280 289 226 254 264 222 289 8,825 10,273 10,607 10,864 10,978 10,938 11,075 11,233 11,304 11,441 11,492 11,618 12,009 12,261 2,183 2,509 2,528 2,552 2,430 2,640 2,660 2,688 2,714 2,717 2,744 2,770 2,786 2,812 sand dollars) ___ Item fLotal gold cort' cons t IAcoto reserves •.... •... •...•. Other 1° member banks .... ..... . ........ . . federQ~ans •••••••........•...•.•..•....• ~.S. Gov:~~~CY oblige!!ons .•.•... • ..••.. ••. Mlal carni" ont securilles •••... • ... •...•..• F ember bQ~k assets ....... " ...... ........ . adoral R res erve depOSits ...... ....... . ~serve noles in actual circulation .... . 559,203 51,250 o 57,258 3,076,375 3,184,883 1,476,419 2,236,469 Dec. 20, 1972 Jan. 26, 1972 211,268 191,155 526,046 805 51,019 3,052,7 45 3,294,919 1,392,108 2,280,725 29,968 3,222,178 3,252,951 1,708,360 2,078,856 o Jen. 5, 1972 1,712,981 1,411,830 301,151 1,750,928 -37,947 81,986 -119,933 1,734,604 1,454,854 279,750 1,668,625 65,979 48,802 17,177 1,763,471 1,491,303 272,168 1,796,527 - 33,056 1,924 -34,980 DAILY AVERAGE PRODUCTION OF CRUDE OIL CONDITION OF THE FEDERAL RESERVE BANK OF DALLAS Jan. 24, 1973 5 weeks en ded Doc. 6, 1972 Total reserveS held ..• •• .... ••.... (Thousand barrels) Percent change from Area ----- 5 weeks en ded Jon. 3, 1973 With Federal Re se rve Bank ••.. .. Currency and coin .••.....•.... Required reserves, •.• ••• • ••...... Excess reserves •. .......•........ Borrowings . •. . ....... ... . . ..... Free reserves •..... ..•.......... ' ' . Oth casherl t h an those 01 U.S. Gpvernmenl and domestic commercial banks, less tems In process 01 collection (Thou 4 weeks en ded Itom o FOUR SOUTHWESTERN STATES •. • • • ... ••• ••• •· • louisiana .. . . ... ....... . . New Mexico . ... ...... ··· Oklahoma •••..•••.....•. Texas ......... ········ . Gulf Coast .•. ••• . •..• . West Texas .......... . East Texas (proper) • •. •• Panhandle ••••.•...•... Rest of state .•• •. •• . •. . UNITED STATES • ••• • • ... ••. December Novemb er December November December 1972 1972 1971r 1972 1971 6,877.6 2,529.5 295.9 534.9 3,517.3 726.4 1,739.6 240.4 65.9 745.0 9,467.3 6,941.1 2,556.2 296.0 537.6 3,551.3 733.4 1,748.9 242.6 66.5 759.9 9,540.6 6,562.9 2,452.4 311.1 596.0 3,163.4 589.2 1,609.3 169.3 69.2 726.4 9,162.9 r-Revised SOURCES: American Petroleum Institute U.S. Bureau of Mines Federal Reserve Bank 01 Dallas -0.9% -1.0 .0 -.5 -1.0 -1.0 -.5 -.9 -.9 -2.0 -.8% 4.8% 3.1 -4.9 -10.3 11.2 23.3 8.1 42.0 -4.8 2.6 3.3% VALUE OF CONSTRUCTION CONTRACTS INDUSTRIAL PRODUCTION (Million dollars) (Seasonally adjusted Indexes, 1967 January-December December November 1972 1972 October 1972 1972 1971r 874 392 324 157 6,464 3,120 2,212 1,132 775 445 183 147 7,248 3,663 2,184 1,402 864 478 242 145 8,225 4,298 2,384 1,544 11,355 5,778 3,097 2,481 91,213 45,366 27,118 18,729 9,229 4,553 2,721 1,955 80,188 34,714 25,590 19,883 Area and type = 100) - December November 1972 October 1972 December t972p 132.8 135.0 148.2 125.5 122.8 151.3 133.4 135.9 150.3 125.5 122.4 152.6 131.5r 133.9r 146.3 125.0r 121.9 146.2r 122.3 125.4 135.5 118.1 108.4 147.4 119.3 118.6 113.9 125.3 109.4 146.8 118.4 11 7.5 112.6 124.6 110.9 147.1 117.3r 116.6r 111.3 124.3r 109.9r 146.3r 108.1 106.2 99.5 116.0 107.8 135.8 Area and type of index 1971 TEXAS Total industrial production •••.. . FIVE SOUTHWESTERN STATES' ..••.........•.. Re sid ential building .••...• Nonresidential building •••• Nonbuilding construction •••• UNITED STATES ............ Residential building ••••••• Nonresi d e ntial building • • •• Nonbuilding construction •••• Manufacturing ••••••• • ••••••••• Durable ••• ..•.• • ••• •••••..• . Nondurable . •.••. ••••..•..•.• Mining •••••••• ••••••••• •••• ••• Utilities • ••••• ••• •••• •••• • •••• • UNITED STATES Totcl industrial production •. .•.. Manufacturing •••••• • ••••••• • •• Durable •. ••••••••••••••.•.•• 1. Arizona, Louisiana, New Mexico, Oklahoma, and Texas r-Revlsed NOTE : De ta ils ma y not add to tota ls because of rounding. SOURCE: F. W. Dodge Division, McGraw-Hili Information Systems Company Nondurable • ••..••••.•••••..• Mining •••••••••••••••••••••••• Utilities .•••..•.•••••.•••••..•• p-Prellmlnary r-Revlsed SOURCES: Board of Governors of the Federal Reserve System Federal Reserve Bank of Dallas BUILDING PERMITS VALUATION lDoliar amounts In thousands) Percent chang e Dec. 1972 NUMBER LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Five Southwestern States l from 12 months, Dec. Area 1972 12 mos. December 1972 1972 12 mos. 1972 Nov. 1972 Dec. 1971 1972 from 1971 415 8,055 $10,764 $171,327 32 301 1,030 5,437 739 2,271 23,660 61,276 5 -74 -14 -51 35 -30 808 1,885 6,327 2,457 1,232 4,473 19,028 363 6,918 4,847 860 42,530 600 2,252 1,059 1,011 1,018 843 17,050 508 691 2,509 925 722 3,292 21,298 4,824 2,721 3,557 22,305 88 10,901 8,690 2,658 81,807 419 4,580 392 1,206 399 572 14,776 357 279 6,420 1,706 17,103 33,838 240,229 30,182 15,942 61,085 382,917 3,956 172,265 93,175 15,097 667,524 12,963 63,177 17,529 24,023 5,349 8,608 223,749 7,672 7,012 42,658 15,796 -55 118 96 348 145 -9 -32 -93 5 47 255 56 40 -36 -38 17 181 -21 12 -58 -46 75 106 52 180 -16 328 282 -73 33 -30 -27 81 892 97 101 -71 -22 270 334 42 -4 62 -39 147 -41 43 5 19 57 58 -17 30 37 41 -19 26 10 68 -8 32 94 Wichita Falls •• • 48 88 324 132 78 216 1,078 9 431 299 38 3,565 33 136 45 43 47 63 839 21 50 172 45 Total-26 cities .• 8,548 134,716 -2% 7% TEXAS Abilen e ••• • ••• Amarillo ..•••• Austin •••••••• Beaumont ••• •• Brownsville •••• Corpus Christi •• Dallas .....•.. Denison •• ••••• EI Pa so ....... Fort Worth .... Galveston •• ••• Houston ••••••• Laredo ••••••• Lubbock ••••.. Midland .. . •.• Odessa •...• .. Port Arthur • . .. San Angelo •••. San Antonio ••• Sh erman •••••• Te xarkana • ••• Waco •••••••• $207,743 $2,418,112 and wood products and primary metals. The largest declines were in stone, clay, and glass products, furniture and fixtures, and electrical machinery. Nondurable goods production also fell, despite increases in textile mill products and food and allied products. All manufacturing industries reported year-to-year increases. Mining increased 0.3 percent in December as gains in production of crude petroleum, natural gas, and metal, stone, and earth minerals more than offset a decline in 20% 19% -8 -15 71 39 -36 58 -37 137% Dec. 1972 from Thousands of persons 88% LOUISIANA Monroe-West Monroe •• ••• Shre veport •••• -- Percent change ARIZONA Tucson ••• •• •• • (Seasonally adjusted) Nov. 1972 - DeC. December November December Item 1972p 1972 1971r Civilian labor force ••••••••• Total employment •• ••• . ••••• Total unemployment • • ••••••• Unemplo yment rate • • ••••••• Total nonagricultural wage and sa lary employment •••• Manufacturing ••••••••••• 8,583.7 8,236.4 347.3 4. 1% 8,558 .5 8,219.8 338.8 4.0% 8,361.1 7,958.0 403 .1 4.8% 6,742.3 1,184.8 649.1 535.7 5,557.5 227.6 452.8 6,725.1 1,177.7 645.4 532.3 5,547.4 227.5 453.7 6,478.4 1,136.5 614.8 521.7 5,342.0 226.9 421.9 .3 .6 .6 .6 .2 .0 -.2 4.1 4.2 5.6 2.7 4.0 .3 7.3 461.9 1,594.4 362.1 1,094.9 1,363.9 460.7 1,595.4 361.1 1,086.5 1,362.4 451.1 1,527.6 342.9 1,046.1 1,325.5 .3 -.1 .3 .8 .1 2.4 4.4 5.6 4.7 2.9 Durable . . .. . .... ... .. . Nondurable ........... Nonmanufocturing •••••••• Mining ••• ••• •••• • ••••• Construction ••••• • • • ••• Transportation and public utilities •••••••• Trad e ..... . .......... Finance ••••••••••••••• Service ••••••••••••••• Govornment ••••••••••• 1. Arizona, Louisiana, New Mexico, Oklahoma, and Texas 2. Actual change p-Prellmlnary r- Revlsed NOTE : Details may not add to totals because of rounding. SOURCES: State employment agencies Federal Reserve Bank of Dallas (seasonal adjustment) output of natural gas liquids, Mining was 13.4 percent above a year earlier. The drop in utilities in December was due to a reduction in the distribution of electricity. Although crude oil output has been at maximum levels in producing Eleventh District states since early last year, January's cold wave brought fuel shortages to many areas. Low temperatures reportedly caused mechanical problems that cut production in the field somewhat. Temporary cur- 1971 0.3% 2.7% 3.5 .2 2.5 _13.8 '_.7 '.I --- tailment of natural gas distribUtion forced some refineries to shift to other fuels, reducing efficiencY and output. Preliminary data indicate tha.t Texas wells produced $4.5 billion worth of oil in 1972, setting a new production record. Oil output was 6 percent greater than in 1971 and nearly 4 percent more than in 1970, the previous record year. In view of the dwindling reserves in the state, 1972 may prove to have been the peak production year for Texas oil.
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