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Federal Reserve Bank of Da1Ias

;;
I
)

Business Review

~~-0~~

(fA ~I . A ·1·~

A October
f

1975

~i (I , District AgrlC. uIture-

~ II' ~

\ iL
\

~r.~ "
/~'\\ l _

Sugar Production in Texas Valley
Regains Competitive Advantage

)~ Unemployment-

Recession Has Less Impact
... In Southwest Than in Nation

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

D' .
lstnct Agriculture-

SUgar Production in Texas Valley
Regains Competitive Advantage

I
J

I
I

--With th
.
last
e run-up In sugar prices
b· Year, sugar producers in the
~"lO Gr d
ized h an e Valley of Texas realtelll uge profits. Holders of a
Souf~rarilY scarce commodity,
1974 7Texas sugar fanners in the
$60 -.5 .season grossed about
29 OguOIlion from a harvest of
acres.
indu~~t s~ason was the Valley sugar
after ry s second year of operation
inact'~ore than five decades of
crop ~Vl~. Thus, sugar-a dominant
cent III outh T~xas early in this
Unp ury-has agam become an
far~rtant cash crop for Valley
ers. And although sugar prices

..........
Deficits'
7

In Sugar production ...

.9 MILLION SHORT TONS _ _ __

7.6 _

7.3 _
7.0 _

.... 1.5 _

ANNUAL DEFICIT

. . :!.o_
.... :!.s
SOUR

-r-r--,-..--,--'-T"'__'69
CE: Us

'70

'71

'72

'73

,
'74

. . Department of Agriculture

...............

~~.~--------------ltless Review I October 1975

have fallen from historic highs last
year, income prospects remain
promising nevertheless.
Revival of the sugar industry in
the 1973-74 season climaxed over
ten years of efforts to replace and
diversify crops that were becoming less profitable. Over time, the
competitive advantage of other
crops had been eroded by such
factors as changes in immigration
policies and labor costs, problems
with the natural environmentfreezes and drouth, for exampleand an inability to mechanize
operations.
In a sense, agriculture in the Rio
Grande Valley has come full circle .
As production of other crops has
become less profitable, Valley
fanners have again turned to sugar
production to bolster incomes.

Industry declines, ••
Historians date production of
sugar in the rich delta land of the
Rio Grande Valley as early as
1830. And they cite the sugar
industry as a determining factor in
the settlement of South Texas.
Sugar production in the Valley
of Texas was thriving at the beginning of this century. Railroad
lines were completed to Brownsville in 1904, linking the industry
with markets in other areas of the
country. With increased outlets for
its harvest, the sugar industry
grew rapidly. By 1913, five major
mills were producing sugar in
South Texas .
But in the same year, the domestic :p1arket chang~d radically. Passage of the Underwood Tariff
eased restrictions on imports of
raw sugar, and, as a result, foreign
sugar poured into the U.S. market .
Sugar prices fell sharply-to less

than 1 cent a pound in 1922. Profits evaporated, and sugar production in the Texas Valley ceased.
The decline in profitability of
sugar production increased the
attractiveness of producing other
crops. A long growing season in the
Texas Valley-330 frost-free days,
on average-afforded a competitive
advantage to the production of
citrus and winter vegetables.
Factors that had boosted sugar
production also boosted output of
other crops in the 1920's. Inexpensive labor was abundant, since
Valley farmers could hire either
farm laborers that were Valley

. .. fuel dramatic rise in prices
30 CENTS PER POUND - - - . . , . . - -

25-

20-

15 -

10 -

...........

""
1,,1"'" "

"""

WORLD PRICE

O--r,-"r-,,--,,--r,-.-'69

'70

'71

'72

'73

'74

SOURCE: U.S. Department of Agriculture

residents or illegal aliens looking
for agricultural work. Too, railroads provided citrus and winter
vegetable producers access to
national markets for their crops.
A glutted domestic market, combined with competitive advantages
for other crops, therefore, effectively ended sugar production in
the Valley. In 1934, when the
United States attempted to stabilize the sugar market through the
passage of the original Sugar Act,
Texas received no consideration
for an allotment.
• • • lies dormant •••
Crop production in the Valley in
following decades reflected these
changing competitive advantages.
Citrus and winter vegetables
became the primary cash crops in
the 1930's, accounting for over
half of total farm sales in 1939.
Reflecting the postwar boom
in the apparel industry, cotton
became the leader in cash receipts
in the 1940's. Demand for cotton
for domestic and export use was
high, and the Government's pricesupport program, initiated during

the Depression, continued after
World War II.
By the midsixties, grain sorghum had joined cotton as a leading cash crop. Large quantities of
grain were needed to support the
burgeoning Texas cattle feeding
industry. And production costs
were lower for grain sorghum
than for most other crops. Cotton
and grain sorghum, together,
accounted for 48 percent of total
farm sales in 1969.
Meanwhile, competitive advantages for production of citrus and
winter vegetables had dwindled .
Citrus production was hit hard by
almost back-to-back freezes in
1949 and 1951. And rather than
making the necessarily large reinvestment in new groves, many
growers opted for producing other
crops. The citrus industry was
rocked by another hard freeze
in 1962.
By then, orchards had become
rife with low-yielding trees, curtailing profits. And competition
from other areas, especially Florida, was dampening sales of Valley
citrus products.

Production of winter vegetables
was also constrained in the early
1960's. Less expensive foreign
imports-primarily from Mexicowere making inroads on established markets. And consumer
preference for fresh vegetables waS
gradually deteriorating. But, in the
main, the inability to mechanize
harvesting of citrus and winter
vegetables led to a shift away froIll
these crops.
The harvesting of crops by
hand was predominant in the Rio
Grande Valley through the midfifties. However, the bracero program that was enacted in 1954 .
sought to control the flow of MeVcan agricultural labor into the
United States. And a provision
of the new program guaranteed S
bracero workers the minimum V. .
wage. This, in effect, drove up
labor costs and induced .valley
farmers to mechanize operationB.
Termination of the bracero program in 1964 further reduced the
number of available farm workers,
encouraging mechanization to Ii
greater extent. Consequently,
Valley farmers shifted acreage

Shifts in Valley farm production reflect changing markets

1,200 THOUSAND ACRES - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - SUGAR
VEGETABLES
CITRUS

GRAIN

COTTON

1940

1945

1949

1954

1959

1964

1969

1974

SOURCES: Texas Department of Agriculture
U.S. Department of Agriculture ,

-------------------------------------------------------------------~
2

from '

cltrus and winter vegetables
o cotton and grain sorghum
rops
better suited to mechaclcal
arvesting
C
.
See tott?n producers also began to
in hen profits squeezed. Steady
ar~fea~es in the substitution of
in ficlal fibers for cotton in clotha ~ and textiles during the 1950's
t! ;:60's created a surplus of cotac' nd under the Government's
alIr~age control program, cotton
d 0 ments to the Valley steadily
c:~:eased. This program, also a
tried~ver from the Depression era,
to l'n °k match production quotas
•....ar et demand
Atb
.
broke est, ~otton farmers merely
those eVen lU some crop years. In
lar Years, any profit stemmed
(wt~ly from subsidy payments
in l~~~)subsequentlY were ended
on .
adva ~alance, then, competitive
di~ ages of several other crops
lookin shed. And Valley farmers,
So
g for new-and betterf'
to urces
su 0 lUcome, were attracted
gar production again.

(

~ • and then revives

re~:. farmers began thinking of
diplolUlUf Sugar production after
Were a lC relations with Cuba
long bevered in 1960. Cuba had
fo rel' een the nation's leading
gn sup Ii
Cent of II Per, producing 35 perUnited a Sugar consumed in the
Cent· States in 1959 and 26 perV lU 1960.
sho~~6 farm~rs believed they
of the ellconsldered for a portion
Cubanrea ocation of the huge
interestq~o.ta, Moreover, they were
to'offsete lU pr?ducing sugar
dolUest , perenlllal shortfalls in
consl'd lC production. Puerto Rico
ered
ff
'
Producer han 0 .shore domestic
qUota for' ad failed to meet its
faU was 19,Years, but its shortforeign routinely reassigned to
two fa ~r~ducers. Based on these
SUgar c ,lUterest in producing
Valley~as regenerated among
armers.
!lUs'
Iness It .
evtew I October 1975

By the midsixties, Valley farmton allotment for raw sugar beginers were experimenting to find the ning in 1973. Farmers immediately
best source of sugar-beets, cane,
began gearing up for production.
or sweet sorghum. In the main,
Sugarcane is a perennial crop
research efforts centered on sugar
that requires 50 to 60 inches of
beets and sugarcane.
irrigation water a year in the
Research showed, however, that Valley. Thus, farmers had to conproduction of sugar beets was illvert irrigated acreage on which
advised. Valley farmers concencotton, grain, and vegetables had
trated their efforts on sugarcane.
been grown a year earlier.
Congressional hearings on
It is estimated that almost
extending the Sugar Act-which
11,500 acres of cotton were conentailed review of production
vened and a like acreage of grain
sorghum. Winter vegetables
quotas-were scheduled for 1971.
In preparing a formal application
accounted for the remaining acreage, as little if any citrus acreage
for a quota at the hearings, Valley
farmers financed a feasibility study was converted, A total of 25,700
acres was planted to sugarcane
of sugarcane production that was
in 1973.
completed in 1970.
The revitalized sugar industry
Results showed that sugarcane
would tolerate the winter tempera- centers around a sugar-processing
tures and high salinity of irrigation mill established at Santa Rosa, a
small community near Harlingen.
water in South Texas. Moreover,
the report predicted that-based on The plant employs 200 people full
time and an additional 1,200 durassumed costs of 8 cents a pound
for raw sugar and 15 cents a gallon ing harvest in the fall.
Production in the first season
for molasses-net returns to sugarwas severely damaged by a hard
cane growers would average $334
freeze in December 1973. Almost a
an acre, considerably higher than
of the 25,700-acre crop was
third
net returns on other crops.
With the extension of the Sugar destroyed, and, consequently,
the net return to the farmers
Act, Texas was given a 100,000-

Before the Sugar Act expired in late 1974,
less than a fifth of sugar production was traded in the free market
100 MILLION METRIC TONS

80 60 -

16 PERCENT

:.,

14 -

WORLD PRODUCTION

20 0
'69

'##

40 -

'##

.......

$
$
.,..

12 !:REE MARKET'S
$ SHARE OF
WORLD PRODUCTION

SUGAR TRADED IN
FREE MARKET

'70

'71

'72

'73

'74

'75

'69

'70

'71

'72

'73

'74

SOURCE: U.S, Department of Agriculture

approached the break-even point.
If grain and cotton had been

planted, harvesting would have
been completed before the freeze
and the farmers would have made
a profit.
The scenario was dramatically
reversed in the 1974-75 season.
Sugar prices rose sharply, and
Valley farmers reaped large profits.
With over 29,000 acres in sugarcane by then, producers netted
about $980 an acre. Data indicate
that, overall, they netted approximately $28.4 million.

Ratio of stocks to consumption dips under 25 percent,
exerting extreme upward pressure on prices
90 MILLION METRIC TONS - - - - - - - - - - - - - - - - - -

80 70 -

60 50 40 -

Prices rocket
The sharply higher prices for sugar
last year reflected not only world39 PERCENT - - - - - - - - - - - - - - - - - - - - - wide shortfalls in production but
also the nature of the domestic and
33 world markets.
Before the Sugar Act was permitted to expire late last year, the
27 ... ...
25 .. , .. , .. .. ... ............. .. ...... " .. .. , .. .. .... ..
U.S. sugar market operated under
a system of preferential trade
21 agreements whereby foreign and
domestic producers were allocated
output quotas. Reliance on foreign
15
1 1 1 1 1 1 1 1 1 1 1 1 1 I , '1' 1' 'I 1 1 I 1 ,supplies always has been high. For
'53
'55
'57
'59
'61
'63
'65
'67
'69
'71
'73
'75
example, imports accounted for
YEARS BEGINNING MAY 1
51.4 percent of U.S. consumption
SOURCE: U.S. Department of Agriculture
in 1974.
But several foreign suppliers
either refused or were unable to
meet assigned quotas last year.
demand were adjusted downward.
With about 10 percent of the U.S.
on the free market price unless
By mid-September 1975, the NeW
quota unfilled, domestic refiners
stocks fall below 25 percent of
York spot price was down to 18
were forced to purchase sugar in
expected consumption. But world
consumption has outpaced produc- cents a pound.
the free world market.
The nature of the domestic mar'
The large purchases by refiners
tion in recent years, pushing the
ratio of world stocks to consumpket changed markedly when the
in the United States and several
other countries overtaxed the thin tion down to 19.2 percent last year. Sugar Act expired and quota aUo,!
cations ended. Beginning this yea,
Consequently, the free market
free world market. Since only 14
percent of world sugar is traded in price soared. The New York spot
the United States will purcha~fie rs t
the open market-86 percent is
price averaged 30 cents a pound in sugar in the free market on a I
1974-compared with 8 cents a
come, first served" basis.
either consumed domestically or
traded under preferential agreepound in 1970-peaking at 64.5
Outlook good
ments-excess demand exerts
cents a pound in November.
Expansion of the sugar industrY ill
After that, prices dropped
extreme upward pressures on free
the Valley would not necessitate
rapidly as large industrial users
market prices.
switched to other sweeteners, con- capital spending in the short ruIl,
Excess demand can usually be
sumer resistance peaked, estimates since the mill at Santa Rosa ca~OO
accommodated by drawing down
existing stocks. As a rule of thumb, of world supply were adjusted
accommodate the outpat of 10, IlO
more acres of sugarcane. As yet,
upward, and estimates of world
upward pressures do not impact
4

ca 't
ul p~ al expansion has been schedquestions on the
h e .. Several
borIZO
f n WI'11 need to be answered
eNre any such steps are taken.
h Ow that quota restrictions
a:v~ been removed, Valley farmers
E e ree to expand production
thxperts, though, cannot agre~ on
Stettyp e of sugar policy the United
be a es should pursue. There have
of ~h calls for the reinstatement
ad e Sugar Act, but opponents
SU v~cate a ~otally free market for
r
in r, argumg that it would result
OWer prices
I \VatE'It~er way, .Congress will be
Ply ~~mg bo~h prices and the supThe Sugar m the world market.
dOlll~~ount of protection afforded
IC producers and the assuranc
to e 0 a relatively stable price
cO~s~ndsumers will be carefully
I ered.
Que t·
regarilinlOns h.ave also been posed
tio n ' g the llnpact of a resumpthin: tr~de with Cuba. Current
still b ng IS that active trading may
ently e a long way off. Cuba presits s eXports about 70 percent of
agreUgar under preferential trade
and e~ents
with the Soviet Union
Euroo er countries in Eastern
lJ S pe. Cuban sugar entering the
to. h·lllarket would not be expected
. llnpact
.
sUchaVe. a dep ressmg
under
E c~rcumstances.
.
by thnVIronm
T
en t aI questIOns
posed
Boar; c eXas ~ir Quality Control
SUgar oncernmg the burning of
haVe ~~~e fields before harvest will
crop c
resolved. Before the
vesteda~ .e mec?anically harthe st 'lkhIck folIage surrounding
becau:e ~ mU,st be burned off. But
~shes, th UrUlng produces residual
tnvestiga~,re~la!ory agency is
standa d mg ItS llnpact on air

now lie idle five to six months a
year. At present, sugarcane is
ground from November to May,
and the processing of sorghum
would extend operation of the mill
from July through October.
For the present, stocks remain
at historically low levels. Raw
sugar prices more closely reflect
the realistic balance between
world demand and production.
Inflation, however, has driven up
production costs, and Valley growers now need a raw sugar price of
approximately 18 cents a pound
to assure an adequate return.
On balance, nevertheless, the
outlook for the sugar industry in
the Rio Grande Valley appears
bright. But as history has clearly
shown, the industry will be viable
only as long as a competitive
advantage is maintained over
other crops.
-Michael J. Minihan*

*Economist, San Antonio Branch,
Federal Reserve Bank of Dallas

V r s.

rese:6' farmers are continuing
tion. Effoefforts on sugar producon extra ;~s have mainly centered
s\Veet s c Ing quality sugar from
of Suga~rghum. If viable, this form
better production would afford
USe of milling facilities that
nUs'

tness

neVIew
. I October 1975

llnenaploynaent-

Recession Has Less Impact
In Southwest Than in Nation
The recession cut deeply into the
nation's labor market. Not since
the Depression years of the 1930's
had the unemployment rate risen
so high. But with recovery underway, demand for labor has firmed,
as evidenced by the rise in employment since May. Most analysts are
forecasting a moderate decline in
the unemployment rate as economic activity picks up.
While aggregate statistics portray a substantial decline in the
demand for labor in the past two
years, employment in some areas
of the country fared better than in
the nation as a whole. The Southwest was one such area.
During the softening in business
activity, the unemployment rate
for the nation rose, on a seasonally
adjusted basis, from 4.6 percent in
October 1973 to 9.2 percent last
May and stood at 8.4 percent in
August. By contrast, the unemployment rate for the five states
of the Eleventh Federal Reserve
District climbed from a low of 4.1
percent in February 1973 to 7.4
percent last May. But this rate fell
to 6.9 percent in June before edging up to 7.0 percent in July.
Two factors have been primarily
responsible for the smaller overall
rise in unemployment in these
southwestern states. One is the
composition of the labor marketemployment in manufacturing
represents a smaller percentage
of total nonagricultural employment in the Southwest than in
the nation.
Late in developing in the Southwest, manufacturing accounts for
about a sixth of nonagricultural
employment in the five southwestern states, compared with a fourth
in the nation. This smaller man6

ufacturing base has spared the
Southwest wide swings in unemployment that other areas have
experienced.
Manufacturing employment fluctuates cyclically in the Southwest.
But service-producing jobs stabilize labor markets in the Southwest
during periods of economic recession. Wholesale and retail trade
accounts for the highest percentage of nonagricultural employment-nearly a fourth. Government
and services are the next largest
employment categories.
Unemployment in the Southwest
is also held down by rapid economic growth. Such factors as an
expanding population, better
weather, less congestion, and
available energy supplies have
attracted many new firms. In turn,
businesses already established here
have prospered.
This growth in business has led
to increased investment in the
Southwest, which has provided a
stream of new employment opportunities. For example, Texas continues to be one of the leading
states in attracting business capital. New capital expenditures by
manufacturers in the state have
exceeded $1.4 billion a year since
1968. Louisiana has also attracted
a large amount of capital spending
by business.
Rise in unemployment rates
The last cyclical low in the unemployment rates for both the nation
and the Southwest occurred in
1973. The unemployment rate for
the nation averaged 4.9 percent
that year, after touching a seasonally adjusted 4.6 percent in
October. By contrast, the unemployment rate in the southwestern

states averaged 4.4 percent in
1973, after dropping to a low of
4.1 percent, seasonally adjusted,
in February.
The unemployment rates for
both the nation and the Southwest
climbed steadily as the recession
deepened. Nationwide, the uneIIlployment rate edged up slowly
from the October 1973 low until
September 1974. But after September, the rise in the jobless rate
accelerated sharply.
.
A similar pattern developed 111
the southwestern states. UneIIlployment held at a seasonallY
adjusted rate of 4.8 percent for
much of 1974 before beginning a
pronounced upswing in N oveIIlb er.
Within the Southwest, the
t
unemployment rate increased rn~
rapidly in Arizona, rising from 3.
percent in July 1973 to nearly 12
percent in June 1975. Job loss~s
were largely related to layoffs 111
construction and manufacturing.
Significant advances were also d
reported for Texas, Oklahoma, ~h
New Mexico. For Louisiana, whic
usually has the highest uneIIlpl~h
ment rate of the five states, gro
in the unemployment rate wa~
modest throughout the recess~on.
The rise in unemployment 111
the nation and the Southwest hIlS
had both similar and contrasting
characteristics. In both, expan- s
sion in the civilian labor force W8 S
fairly steady in the past 2 % y~ar I
although the Southwest experIenced a marked increase in the .{
work force in the last half of 197~
. The hi~her unemploym~nt r8 ine
In the natIon reflected a bIg d,fcl
tal
in the number of jobholders. _1~ d
employment in the nation pe~_
at a seasonally adjusted 86.4 d
lion workers in July 1974, edge

::n

through October, and then
Rate of unemployment has been lower
b pped sharply to 83.8 milli
in
Southwest than in nation ...
y March 1975 S.
on
eVer
. mce then, how10PERCENT--------------------------------------85.4,=loyment has grown to
r
(SEASONALLY ADJUSTED)
elnplo on. ~y contrast, total
stat .Ylnent m the southwestern
9lion es leveled off at about 8.6 milstoo;o~kers in October 1974 and
8Thea 8.~ million in July.
lnen decline in total employof la~otogether with the inability
7the' r markets to accommodate
forc~1r~ases in the civilian labor
6Plo~ e to a ~uch higher unemin th ent rate In the nation than
that Southwest. It is also likely
SOUTHWEST
rural ecause the region's large
lnan se~tor was able to absorb
the Js~.slocated urban workers,
4-r.-=~--------r------------r----------~~
1975
1974
1973
in the S: ~nemployment statistics
u west was dampened.
SOURCES: State employment agencies
U.S. Bureau of Labor Statistics
'l'he Weakn
•
'l'\...ess In employment ••.
Federal Reserve Bank of Dallas
... wo elllpl
accOuntedoyment categories
in lln8lll I for much of the increase
South p o.Ylnent in both the
The steep decline in manufacstructfest and the nation. Conbiggest number of construction
turing
employment in the nation
first to employment was the
jobs of any southwestern state.
also
began
last fall. By July this
decJin Xpel'lence a substantial
The sharp rise in the unemploybe~~ T~en, when the recession ment rate in the Southwest would year, 2.1 million manufacturing
jobs had been lost to the recession
ufacturi WI espread last fall, manhave been even worse if, as in prefor a 10-percent decline. The bigfall off ng .employment began to
vious recessions, deterioration of
l;l
rapIdly.
gest decline-12.6 percent-in the
labor markets had not been cush.l!Ilnplo.Yln t·
of manufacturing jobs was
number
structi . en m contract conioned by the smaller role played by
in
durable
goods industries.
CYclical~In t~e nation reached a
manufacturing employment. The
Employment in nondurable
had ret gh In February 1974 and deterioration from the July 1974
goods industries had fallen 8.5 perbelow theated to a level a fifth
peak was slow at first. By Novemcent by last March. The demand
advanc' e ~eak by last July before
ber, however, the recession· was
for labor in nondurable goods mansteady Ing In August. While not as readily apparent, and manufacufacturing
began firming in April,
decreasas.the national decline the
turers began making large-scale
but it was not until August that
lnent inet~n construction empioyreductions in their work forces.
employment in durable goods manhas, nev ~southwestern states
The number of jobholders in
ufacturing picked up.
In July ~~ eless, been severe.
manufacturing, which provides
As in the nation, many durable
fewer c ' ere were 12 percent
about one job in six in the Southgoods
manufacturers in the SouthJanua;nstruction jobs than in
west, declined 6.5 percent between
west
were
hard hit by the recesIn t 1974.
October 1974 and June 1975.
erllls f
sion. Significant job losses were
COnstruct' 0 number of jobs lost
Employment in durable goods
depressed'
IOn TempIoyment was most
'
reported for lumber and wood
manufacturing declined 55,100,
products,
furniture and fixtures,
cant bec In exas. That is signifi- or 7.4 percent. The reduction in
primary and fabricated metals,
~early 6~use the state accounts for employment in industries producelectrical machinery, and stone,
tlon jobs percent of all construcing nondurable goods, however,
OkIaholll~n the five-state area.
was smaller-32,600, or 5.7 percent. clay, and glass products.
In contrast to the rising unemdecline' also suffered from the
Employment in both durable and
ployment in durable goods mancentage~ constru~tion, but in per- nondurable goods manufacturing
ufacturing overall, employment in
11
lllls, Al'lzona lost the
rose in July 1975.
Uain ess It .

(

eView I October 1975

... although rates have varied widely from state to state
8 PERCENT
TEXAS

42
8 PERCENT
OKLAHOMA

642
9 PERCENT
NEW MEXICO
75
9 PERCENT
75
12 PERCENT
10 8-

42
1973

1974

SOURCES: State employment agencies
Federal Reserve Bank of Dallas (seasonal adjustment)

1975

transportation equipment manufacturing, which experienced
widespread layoffs in the auto
industry nationwide, was fairly
stable in the Southwest. This was
due to the composition of the
industry here.
With only one auto assembly
plant located in the Southwest,
much of its transportation equipment industry-particularly in
Texas-produces aircraft and asSOciated equipment. And this production has been stable and should
expand, since one producer won a
major contract for the manufacture
of fighter planes.
The deterioration of employment in many durable goods industries has been partially offset by
increased hiring of workers in
energy-related industries. PriInarily because of efforts to expand
exploration and production to
meet growing energy needs, emploYment in mining-a major indust~Y
in the Southwest-rose steadilY Jll
1973 and 1974, especially in the
Permian Basin.
The boom in mining led sup- .
pliers of oil field equipment to hire
new workers to satisfy increased
demand for their specialized products. As a result, the number of
jobs in oil field machinery manufacturing grew 17 percent.
Even with the sharp rise in .
employment in mining and the oil
field equipment industries, sornt
jobs could not be filled. Demand or
workers with special skills-welders
and machinists, for example-was
so strong that many firms tried
to hire workers from depressed
areas, such as Detroit. But the rs
increase in the demand for wo rke
in the energy-related fields was
not enough to offset the overall
decline in employment in durable
goods manufacturing.
Employment in nondurable
goods manufacturing fell less .th~~
in the durable goods sector. SIgn
icant job losses were reported for
paper and allied products, petro-

-lelUn and
and ki dr coal products, and food
B n ed products.
dec! ~t the biggest employment
due Ine fOl' ~ondurable goods pror
ers Was In the textile and
app arel'
d
Apr'II In ustries. Job losses from
10 pl 974 to March 1975 exceeded
Wer ercent in the Southwest and
WO:k~ve~ larger nationwide.
85 p rs In these industries-about
tiII ercent of which are womentu~ea~ly a tenth of all manufacDe! J?bs in Texas, for example.
tnent 'plte the big falloff in employI of theI~ thes~ two industries, one
SOuth rst SIgns of firming in
appeawest;rn labor markets
appar:;d In bot~ textile and
COIn Ie pr~du?tIo~ last spring.
tOrie~ b te liquIdatIOn of invenducers : .nondurable goods prodetnand tllnulated the renewed
that h for Workers-a situation
durabl~s not y~t developed in some
tnajor gooI ds Industries that are
elUp oyers.

(

are in retailing, and a fourth in
wholesaling.
The generally stronger economy
of the Southwest bolstered the
number of trade jobs throughout
the recession. Some weakness was
noted, however, last winter. As was
the case throughout the country,
retailers and, to a lesser extent,
wholesalers in the Southwest pared
their work forces during the slim
Christmas buying season. The cutbacks were minimal, however, and
renewed vigor in sales early this
year led to a resumption in hirings.
Government provides the second largest number of jobs in the
service-producing sector. And
about four-fifths of these jobs are
at the state and local levels.
Although the number of government jobs also trended upward

during the recession, virtually all
the gain occurred at the state and
local levels.
Employment in the services category was little affected by the
recession. The number of service
jobs peaked last March, but the
decline since then has been small.
Gains in medical and other health
services have been a major source
of strength.
Employment in the finance,
insurance, and real estate category
held up during the recession.
Although-some weakness developed last spring, renewed growth
was noted in July.
The weakest of the serviceproducing categories has been
transportation and public utilities,
where employment peaked at mid1974. A significant number of job

Decline in total employment

••• and the strength
less severe for Southwest than for nation
1'he strength .
95 MILLION - - - - - - - - - - - - - - - - - - - In labor markets in
the So th
(SEASONALL Y ADJUSTED)
servo u west has been in the
lee-Prod .
CIVILIAN
LABOR
FORCE
._
..............
. ,',."
nonIn
UCIng categories of
,
,., .... '
Acco~n,!facturing employment.
90,
UNITED STATES
fOurth tIng for nearly three, '
eInplo s of total nonagricultural
group[~ent, these occupation
85 EMPLOYMENT
"ices fi rade, government, ser(
ance
and pUbt
! ~~d transportation
I grow
eVe c .utIlitIes-have tended to
80turns' n In the face of down~
etnPIo~n the business cycle. Their
9.5?tfset t~ent ~row~h has more than
,~'_,_'_,.
Ing eInpl declInes In manufacturCIVILIAN LABOR FORCE " , ..
1'he °yment.
9.0 _
,.SOUTHWEST
groups nUmbe
d
r 0 f workers in these
,.",_ ...as in lU oes not fluctuate as widely
,..
,
etnplo anufacturing. In fact
h
YlUent .
,
8.5 as grown .In these categories
EMPLOYMENT
Years.
faIrly steadily in recent
1'r ade is th
the Servo
e largest employer in 8.0
1975
1974
1973
aCCOUnti~e-producing sector,
~Ourth of g for apprOximately a
SOURCES: State employment agencies
U.S. Bureau of Labor Statistics
In the so all nonagricultural jobs
Federal Reserve Bank of Dallas
three'fou~~hwestern states. About
hs of the trade jobs

.,'"

.. , .....

........ .....

.....

I
I

......... ........

........,.
..
',

nUs'lt1ess R

eVlew I October 1975

-losses occurred in the first half of
this year in the communications
industry, and several hundred railroad employees were laid off.
Despite the few isolated areas of
weakness, the service-producing
categories added more than
262,000 workers to their payrolls
for a 4-percent increase in the past
two years. By contrast, manufacturing employment declined 2.5
percent, or 32,000 workers.
Importance of growth
Strong economic growth in urban
areas of the Southwest has also
helped dampen the rise in unemployment in the region. For example, in Houston, where increased
demand for energy-related goods
and services has spurred growth,
the unemployment rate was 4.6
percent in July-well below the
rates for the state, the region, and
the nation.
At one time, much of the growth
in Houston was related to the
development of national markets.
But in recent years, Houston has
become a major exporter of goodsr
and services in world markets. \
This latest development has been
the source of much of the recent
economic growth and has provided a large number of new job
opportunities.
The development of Houston, as
well as the Southwest as a whole,
can be traced to many factors. But
several may be key for the Southwest. And although they may be
identified separately, they work
simultaneously and in harmony
with each other.
First, population growth in the
Southwest has been rapid, exceeding that for the nation. From 1963
to 1973, the last ten-year period
for which data are available, the
population of the five-state area
rose 14.6 percent, compared with
11.3 percent nationwide.
Much of this growth has been
an in-migration in response to
employment opportunities avail10

able here. The inflow of workers to
primary industries has generated
demand for additional goods and
services. That, in turn, has stimulated the growth of secondary
and tertiary industries. And the
development of these industries
has created a demand for even
more workers.
The second key factor is the
location of many "growth" industries in the Southwest. The most
important is the petroleum industry, especially since the Arab oil
embargo. Until the energy crisis,
this industry was largely national
in scope, but, now, much of its
growth comes from supplying
both goods and services in international markets.
With the development of energy
resources, other major industries
have germinated and expanded.
Among these are chemicals, primary and fabricated metals, transportation and public utilities, and
finance.
With the growth in population ,
and business, the Southwest has I
been able to attract and invest the
capital necessary to expand. Texas
has long been a leading state in
capital expenditures, even topping
all other states in capital expenditures for manufacturing in 1971.
These and other factors-including climate, lower taxes, and less
urban congestion-should continue
to attract business to the Southwest. And with continued growth
likely, the unemployment rate
should remain well below the
national average.
-Edward L. McClelland

New member banks
Continental National Bank, San Antonio, Texas, a newly organized institution

~cated in the territory served by the San Antonio Branch of the Federal Reserve

I
J

Rank of Dallas, opened for business September 2, 1975, as a member of the Federal
eserve System. The new member bank opened with capital of $635,512, surplus
of $?35,512, and undivided profits of $317,756. The officers are: Pete D. Cruz,
Chru:znan of the Board; John Taylor, President; and J. Ernest Rodriguez, Vice
PreSldent and Cashier.

Nat~onal Security Bank, Tyler, Texas, a newly organized institution located in the
terrltory served by the Head Office of the Federal Reserve Bank of Dallas, opened
for business September 2, 1975, as a member of the Federal Reserve System. The
new. member bank opened with capital of $500,000, surplus of $250,000, and
undivided profits of $250,000. The officers are: Ernest S. Sterling, Chairman of the
Board; Robert L. Davis, President and Chief Executive Officer; and William
Carroll Rigg, Vice President and Cashier.
Colonial National Bank Houston Texas a newly organized institution located in
the territory served by the Houst~n Bra~ch of the Federal Reserve Bank of Dallas,
opened for business September 16, 1975, as a member of the Federal Reserve
System. The new member bank opened with capital of $400,000, surplu~ of
$40~,000, and undivided profits of $200,000. The officers are: Jerry E. F!Dger,
Chamnan of the Board; C. B. Silverthorne, President and Chief Executive Officer;
and Robert J. Kramer, Vice President and Cashier.
State Bank of East Fort Worth, Fort Worth, Texas, located in the territory served
by the Head Office of the Federal Reserve Bank of Dallas, became a member of the
Federal Reserve System on September 22,1975. The new member bank, which
was organized in 1951, has capital of $1,000,000, capital debentures of $120,000,
surplus of $1,000,000, undivided profits of $1,066,000, and total resources of
$4.0,345,000. The officers are: Irby G. Metcalf, Jr., Chail;nan ?f the ~oard;
Michael C. Stinson, President; Bobby J. Cooper, Executive VlCe Presldent;
Barry G. Smith, Senior Vice President· Ed Corzine, Vice President; James E.
H.errington, Vice President; W. B. Featherston, Vice President; Martin A. Turner,
Vlce PreSident; and Gary W. Shipp, Cashier.

~----------------------------------------------------------

~Ils'Utess n .
eVlew I October 1975

New par banks

Gessner Southwest Bank and Trust, Houston, Texas, a newly organized insured
nonmember bank located in the territory served by the Houston Branch of the
Federal Reserve Bank of Dallas, opened for business August 28, 1975, remitting at
par. The officers are: Orville W. Crowder, President; M. Bing Wu, Inactive Vice
President; Richard Chofiell, Assistant Vice President; and Vera Garcia, Cashier~
Southwest Bank, San Angelo, Texas, a newly organized insured nonmember bank
located in the territory served by the Head Office of the Federal Reserve Bank of
Dallas, opened for business September 9, 1975, remitting at par. The officers are:
Edward H. Holmes, President, and Nancy Crisp, Cashier.
City Bank and Trust Company, Natchitoches, Louisiana, an insured nonmember
bank located in the territory served by the Head Office of the Federal Reserve
Bank of Dallas, and its Campti Branch, Campti, Louisiana, began remitting at par
September 10, 1975. The officers are: J. E. Pierson, President; Joe H. Pierson,
Executive Vice President; H. H. Bernard, Vice President; J. S. Mitchell, Vice
President; and Ludlow N. McNeely, Cashier.

I
I
I

I
Research Department
Federal Reserve Bank of Dallas
Station K, Dallas, Texas 75222

Federal Reserve Bank of Dallas
October 1975

Stat·IstlCal
· Supplement to the Business Review

---

Sh'
th:pments of grain stemming from
do not quit jobs unless they feel
the capability of loading five ships
Dn' recent United States-Soviet
that chances are good for getting
simultaneously at a rate of 300,000
Sll} IOn sale are expected to move
positions offering higher wages or
bushels an hour, the port can
is i~~hlY through Texas ports. This handle the increased level of grain
better working conditions.
The quit rate in Houston in June
Portat .arked contrast to transshipments.
was up 25 percent over its 1975 low
after t~on bottlenecks that occurred
e 1972 grain sale.
in February. Quit rates in DallasThe labor market for production
A.t
I
Fort Worth and San Antonio were
cars hthat
d tim e, a sh ortage of rall.
workers in Texas continues to
also higher in June.
of th a ~eveloped, as a large share
improve. Manufacturing employbein e natIon's rolling stock was
The average workweek in manument in the state rose in August,
. d us trIal
. prodfacturing
in Texas, seasonally
Ucts gBused to. m ove m
the second consecutive month of
. ut this year, WIt
. h economic
adjusted, has also advanced. In
recover'
increase. Before turning upward in
August, production workers averPlent y Ju~t underway, there are
July, the number of jobholders in
y of raIl cars available
aged
a 40.9-hour workweek, up over
manufacturing hd declined for six
A.Is o '
.
the
40.4-hour
average a month
Year ,gram movements three
consecutive months.
before, and well above the 1975 low
arriv:fg~ re h~mpered when the
Barometers of future strength in
of 39.7 hours in February.
With ra~ s .ps ~d not coincide
manufacturing employment indiage of dehverIes of grain. A short- cate this trend will likely continue.
Other highlights:
a qUict~rt storage areas prevented
Data on manufacturing labor turn• Paced by sharp gains in total
1'his urnaround of grain cars.
over-the rate at which workers
loans and in holdings of municipal
arran ,Year, grain dealers are
separate from old jobs and acquire
securities, total bank credit at
POrt c~g sc?edules to minimize
new ones-for the four largest
weekly reporting banks in the Elevearll}ar~gestIon. Much of the grain
metropolitan areas in Texas show
enth District increased substanstored' ed for Russia is being
that total worker accessions have
M'd
tially more in the four weeks ended
advanced while separations have
Illoved m
t the.
1 west before being
September 17 than in comparable
Ship a .0 port m coordination with
declined. Moreover, two key coml' rrlVals.
periods of the past five years.
ponents of the total separation
here ap
However, for the first time since
to handl pears to be ample ships
rate-the quit rate, which reflects
October 1974, banks reduced their
el(Ports ;~he expected volume of
the number of workers leaving jobs
holdings of Government securities.
tanke'
e oversupply of oil
voluntarily, and the layoff rate,
Most of the increase in total
be conr~, many of which can easily
which reflects involuntary separaloans
resulted from sizable gains in
aUg"" erted to carry grain has
tions-have been improving.
·"en ted th
'.
'
loans to nonbank financial instituBy June, the layoff rate for
CargO shi s e ex~t~g supply of
tions and security loans. Real
l'ate hik ~ . In addItIon, the recent
Dallas-Fort Worth was a third of
estate
loans also advanced notably.
D.S. Me. ~r grain shipments by the the January figure, an indication
Demand
for business loans
el(pectea:~t~e Administration is
that manufacturers are no longer
remained sluggish in September.
fil'llls t
0 mduce more American
reducing work forces. The layoff
However, loan demand by the
lllarketO enter the grain transport
rate for San Antonio fell even more
petroleum
refining and construcdramatically-to a quarter of the
S MUch of th
.
tion
industries
increased sharply.
January figure. And the layoff rate
OViet U' ~ gram headed for the
Port ofHOlon IS moving through the for Houston-which was the small• Cattle on feed in Texas and
el(Portin ous~~n-the largest grain
est rate for the four areas at the
Arizona on September 1 totaled 1. 7
Y~ar, shi g faclhty in the world. Last beginning of the year-had been
million head, 21 percent fewer than
bIllion d~~ent~ valued at over a
halved.
a
year earlier. The number of cattle
fifth of D S rs, mcluding over a
While manufacturing firms
placed on feed in August was
appear less willing to trim work
thr?ugh H~ wheat exports, moved
slightly fewer than in August 1974
graIn el
uston. WIth four major
forces, recent gains in the quit rate
capacit eVators having a combined
suggest workers sense job prospects and 9 percent below July 1975.
y of 25 m]'11'IOn bushels and
(Continued on back page)
are improving. Generally, workers

'hl

I
I

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
Commercial and Industrial loans
Agricultural loans, excluding CCC
certificates of Interest
..............................
Loans to brokers and dealers for
purchasing or carrying :
U.S. Government securities ..
Other securities ....................................
Other loans for purchasing or carrying:
U.S. Government securities ..
Other securities ....................................
Loans to nonbank financial Institutions:
Sales finance, personal finance , factors ,
and other business credit companies ..
Other ............
Real estate loans ...
Loans to domestic comm ercial banks
Loans to foreign banks ...
Consumer Instalment loans ................
Loans to foreign governments, official
Institutions , central banks, and International
Institutions ... ...........•................. . ..
Other loans ..................................•.•. ,.
Total Investments ........................ ...
Total U.S. Government securities ..
Treasury bills .
Treasury certificates of Indebtedness ...
Treasury notes and U.S. Government
bonds maturing :
Within 1 year ..
1 year to 5 years .....
After 5 years ..................................................
Obligations of states and political subdivisions:
Tax warrants and short-term notes and bills
All other ............................................................
Other bonds, corporate stocks, and securities:
Certificates representing participations In
federal agency loans ...........
All other (Including corporate stocks) ...
Cash Items In process of collection , .
Reserves 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 ASSETS

................. ",.

Sept. 17,
1975

Aug . 20,
1975

Sept. 18,
1974

1,554 ,664
10,543 ,252

1,400,825
10,419,539

1,202,129
10,517,817

5,082,498

5,070,527

4,734,735

203 ,286

197,309

252,659

200
59 ,096

200
29,054

1,253
35,309

768
371 ,037

1,018
364,227

5,292
432,765

Total deposits ..

---- ---- ----

174,901
595 ,932
1,510,658
64 ,004
88,329
1,125,610

165,915
565,690
1,494,407
54,460
87 ,096
1,112,905

169,578
719 ,125
1,564 ,974
47,054
93,745
1,121,050

2,234
1,264,699
5,139,374

1,976
1,274,755
5,106,011

73
1,340,205
4,175,540

1,595,299
331 ,915
0

910,294
96,375
0

---1,568,990
264 ,664
0

---- ----

248 ,472
842,217
172,695

135,506
521,900
156,513

296,130
2,971 ,865

241,007
2,965 ,352

183,454
2,766,108

10,282
292 ,107
1,566,519
1,187,633
133,329
549,543
43,188

11 ,274
293,079
1,536 ,302
1,187,822
139,399
535,251
41,602

14,336
301 ,348
1,541,540
1,059,898
130,248
420,699
26,Q67

1,141,402

1,113,637

924,037

21,858,904

21,480,388

19,997 ,975

---- ----

Total demand depOSits .........................................
Individuals, partnerships, and corporations ...
States and political subdivisions ......
U.S. Government ............
Banks In the United States ....
Foreign :
Governments, official Institutions, central
banks, and International Institutions .
Commercial banks ........................
Certified and officers' checks, etc . .
Total time and savings deposits .
Individuals, partnerships, and corporations:
Savings deposits
.......... , ....... "." ..
Other time deposits ............................
States and political subdivisions ..................
U.S. Government (Including postal savings)
Banks In the United States .......................
Foreign:
Governments, official Institutions , central
banks, and International Institutions
Commercial banks .................................
Federal funds purchased and securities sold
under agreements to repurchase .....
Other liabilities for borrowed money .
Other liabilities .....
Reserves on loans .................... ,." ..
Reserves on securities
............ " ....
Total capital accounts .

2,173
60,966
99,871
8,767,863

2,123
61 ,888
95,892
8,713,245

2385
64:9 45
102,507
7,786,67t

1,353,935
4,811,474
2,222,024
34,785
325,657

1,362,215
4,696,923
2,277,998
35,733
314,740

17,264
2,724

23,248
2,388

2,842,030
44,470
672,737
202,000
23,207
1,513,778

2,842,267
50 ,895
641,875
205,112
23,186
1,511,747

2640,13 7
,229,304
591,36 6
187,963
20,43 6
1 363,186
~

21,480,388

~
=::--

Sept. 18,
1974

Aug . 20,
1975

3
16,205,306 14965,58
~
12
7,178,9
7,792,819
7,492,061
5099,677
5,604,394
5,478 ,718
'533,83 7
564,098
486,470
166,417
115,229
87,925
1,209,144
1,346,088
1,279,045

16,560,682

TOTAL LIAB ILITIES, RESERVES , AND
CAPITAL ACCOUNTS

292 ,778
840,898
170,650

----

Sept. 17,
1975

LIABILITIES

21 ,858,904

1 129,426
4'4458 69

2'064:97~

, 10,27
114,366
11 ,780
9,987

----

DEMAND AND TIME DEPOSITS OF MEMBER BANKS

Eleventh Federal Reserve District

---

(Averages of dally figures. Million dollars)

TIMEDEPO~

DEMAND DEPOS ITS

U£
' g5
Date
Total
Adjusted'
Government
Total
~
-19-7-3' A-u-g-u-st---12-,94-1---9-,-49-2----1-72----1-3-,5-0-7--~2,857

1974 : ~ugtUS\ ...

. .

~U~ci

~'m

~;';~~

November .
December .
1975: January ........
February
March .
April
May
June .
July .
August.. ..

13,687
13,843
14,351
14,180
13,956
14,114
14,247
14,106
14,333r
14,501
14,514

9:976
10,148
10,355
10,353
10,245
10,349
10,572
10,374
10,529r
10,698
10,745

149
138
208
166
150
165
213
195
199r
164
129

15:714
16,016
16,177
16,842
17,052
17,177
17,196
17,303
17,273r
17,315
17,452

O~~o~~r .~r:::

CONDITION STATISTICS OF ALL MEMBER BANKS

Eleventh Federal Reserve District
(Million dollars)

Item
ASSETS
Loans and discounts, gross .
U.S. Government obligations
Other securities ..................................... .
Reserves with Federal Reserve Bank .. ..
Cash in vault ............................................ .
Balances with banks In the United States .
Balances with banks In foreign countrlese
Cash Items In process of collection ....
Other assetse
TOTAL ASSETSe ........................ .
LIABILITIES AND CAPITAL ACCOUNTS
Demand deposits of banks ..
Other demand deposits .
Tim e depOSits
Total deposits .................. .
Borrowings . .. .................... ..
Other Ilabllltiese
Total capital accountse
TOTAL LIABILITIES AND CAPITAL
ACCOUNTSe ........................... ..
e-Estlmated

Aug. 27,
1975

July 30 ,
1975

Aug . 28,
1974

21,792
3,071
7,314
1,620
406
1,512
48
1,757
2,037

21,573
2,867
7,236
1,705
397
1,570
45
1,744
2,032

20,981
2,100
6,775
1,473
383
1,286
33
1,682
1,691

39,557

39,169

36,404

2'952

2:9070~

3, 49
3,0

~,~~~

3:2 26
3325
3:348
3 409r
3:480
3,49 3_____
__ _

- - - - - - -- - - - - - - - - - -- - - - -- ' - - - --

cBS"

1. Other than those of U.S. Government and domestic commercial bankS, leSS
Items In process of collection
r-Revised

RESERVE POSITIONS OF MEMBER BANKS

EJeventh Federal Reserve District
(Averages of dally figures . Thousand dollars)

1,767
12,694
17,485

1,797
12,471
17,486

1,662
11 ,834
15,579

4 weeks ended
5 weeks ended
4 weekS ~~74
--------------------------------------------~rded
Sept. 3,1975
Aug . 6, 1975
s~
Item

31 ,946
3,139
1,724
2,748

31 ,754
2,979
1,711
2,725

29,075
3,174
1,572
2,583

39 ,557

39,169

36,404

- - - - - - - - - - -- - - - - - - - - - - --;;202 1,581
Total reserves held ..
2,012 ,846
2,012,971
1'684,363
With Federal Reserve Bank
1,659,870
1,660,488
'337,218
Currency and coin
352,976
352,483
2 005,36 1
Required reserves .
2,007,122
1,998,602
' 16,220
Excess reserves ......
5,724
14,369
177,019
Borrowings ........
12,362
8',212472
.... 160,79~
6
_F_re_e_r_e_s_
er_v_e_
s ____________________-_6_,6_3_8__________________
----------

BANK DEBITS, END-OF-MONTH DEPOSITS, AND DEPOSIT TURNOVER

SMSA's
(Do

in Eleventh Federal Reserve District

liar amoun ts In thousands, seasonally adjusted)
DEMAND DEPOStTS'

DEBITS TO DEMAND DEPOSIT ACCOUNTS '
Percent change
Aug .
1975
(Annual-rate
basis)

Standard metropolitan
statistical area
ARIZON
........................... ,.
LOU
A: Tucson
ISIANA' M
..
. S~nroe ........ .
NEW MEX
reveport ..... .............. " ....
TE
ICO : Roswell '
XAS: Abilene
...................
....................
Amarillo ...........

i~;~~oni~port·Arth~i~6;~~::~:::::
Bryan~~V~IIII~gHea~i~~~~-san ~en'tto ................ ..

,
Corpus Christi
...................
Corsicana'
............ ... ..... ............... .........................
.......... " .........
Dallas
.........
..
EI Paso
FortWo·r iii ........ ..

....................... ,

~aIVeston-+e;; ~s ·c'tty·

Ouston .. .. .........
Kille
Lare~n- Temple ... .... "

....................

........... "

........................
~~~~:~~~~~;:E·diii~~r : ::::::::::::::::::··..........................

Midland
g ...........
...............
Odessa .
San Angelo"
..
~an Antonio :: ......................
T herman-Denison'"
.........

"",

..............

~!~~rk~~~. (~eXas-A·;ks~s·aS) · . . .....................
W

o .
lehUs 'Fail's"

Total_3

~enters

Aug. 1975 from

.......................

$27,038 ,648
6,135,588
26 ,022 ,518
1,591 ,236
5,118,190
12,511 ,591
22,046,873
10,966,613
3,537,664
1,890,689
12,630,120
823,596
249,819,385
17,073,712
41 ,450,756
4,830,635
280,121 ,305
2,923,056
2,184,784
10,221 ,934
4,830,784
5,256,042
4,027,328
3,099,937
36,633,236
1,747,850
2,440,810
4,009,121
6,493 ,802
5,201,978

Aug. 31 ,
1975

Aug .
1975

July
1975

Aug,
1974

53%
5
12
10
15
8
10
- 2
- 25
15
21
0
- 5
24
8
2
22
13
8
2
20
27
29
7
15
6
13
6
23
5

23%
8
19
7
9
1
11
4
3
11
5
6
- 1
9
5
18
20
9
12
- 4
25
26
34
12
12
4
13
11
19
9

$403 ,465
133,773
370,503
57 ,747
160,973
266,670
495,571
357,285
124,484
66 ,533
333,463
44 ,317
3,305,637
350,845
1,002,842
160,054
4,103,768
135,626
75,924
256,178
172,725
219,460
146,666
104,177
985,218
90,455
98,909
151,681
172,012
185,833

66,9
47.5
68.9
27.4
31 .3
46.9
44,2
30.8
27.4
29.5
37.6
18.4
76.2
48.0
41 .9
31 .1
67.9
22.1
29.4
40.6
27.2
24 .1
28.1
29,8
36.9
19.5
24.7
26,3
37.7
27 .9

54 ,2
44 .3
73.4
25.9
28.9
43.0
47.9
31 .6
31 .7
30,2
36.7
16.8
74.4
46,1
41 .7
33.3
60.9
23 .2
30.6
40.5
28.7
20.5
28.5
29.6
33.9
20.1
24 .8
24.8
33.4
25.9

47.0
46.0
65.4
27.5
30,1
49.7
43.8
35.7
38.1
27.0
35,1
20.3
83 .3
40.8
42.9
33.6
61 .0
21 .6
30.8
41.3
25 .6
20.6
25.8
30.2
35.6
19.4
23.1
26.3
32.9
29.5

$14 ,532 ,794

53.1

55.2

10%

56.0

10%

~~~4

22%
8
- 8
4
7
8
- 10
- 3
- 19
0
0
4
1
2
1
- 5
7

- 5

...................... ..................................................... $812,679,781

8 months,
1975 from
1974

July
1975

- 2
0
- 10
15
1
-1
8
- 4
- 1
4
13
5

Annual rate
of turnover

ty basis
2. CoE~slts
of Individuals ' partnerships, and corporations and of states and political subdivisions

CONDITION OF THE FEDERAL RESERVE BANK OF DALLAS

(Tho

BUILDING PERMITS

usand dOllars)

VALUATION (Dollar amounts In thousand s)

""";;;;-Item
L al gOld
O~~ns to m~':;,~lcate reserves
Fe er loans
er banks .. ..
. .. .
U ~eral agen .. .. .
r' Govern ey Obligations
MOlal earnln;ent securi ti es .
F ember ba k assets
.
ederal res~ reserve deposits .
ClreUlatlonrve notes In actual .
~

. . . . . ....

VALUE OF C

(Mlilio

Sept. 24 ,
1975

Aug. 27,
1975

Sept. 25,
1974

422,062
21 ,340
0
275 ,799
4,256,383
4,553 ,522
1,761 ,553

422,062
6,185
0
275,855
4,165,928
4,447,968
1,619,764

554,472
133,417
0
176,368
3,525,418
3,835,203
1,683,109

2,834,872

2,827,290

2,576,235

ONSTRUCTION CONTRACTS

n dOliars)

..........

January-August
FIVE
and type
~

Aug.
1975

July
1975

June
1975

992
373
386
233
10,037
2,784

1,035
376
369
290
9,044
3,093

825
359
257
210
9,324
3,116

3,165
2,786

3,169
3,040

1975

1974r

8,797
2,683
3,458
2,656
64 ,040
20,506
21 ,858
21,676

8,249
3,126
3,196
1,927
63 ,762
25,246
22,597
15,919

SOUTH

~TATES ' WESTERN
eSldenti ......
Nonre
al bUiiiiin g" ....
NOnb Sldentlal b II ..........
U
ulidln
u ding
NITED ST g eonst ru ctlo~'
Resld
ATES ...
NOnreentlal bulid in g·.......... ·
NOnb ~Identlal b II ............ ·

~on~tr~~tTori
r R rllona L

....

~ '~~~

NOTE
eVlsed
S
: 0 ' oulslana ,New
e xM
l e o, Oklahoma, and Texas
OUReE.etalis may not
. F. W. DOdge a~d ~o total s because of rounding .
, e raw-H ili , Inc .

Percent change
Aug. 1975
from

NUMBER

Aug.
1974

8 months,
1975 from
1974

Aug.
1975

8 mos.
1975

Aug .
1975

8 mos.
1975

July
1975

4,102

$5,423

$64 ,836

- 43%

492

72
805

572
6,019

1,264
10,958

9,726
48,998

30
51

- 71
199

- 35
- 34

TEXAS
130
Abilene ....
274
Amarillo .....
500
Austin .....
202
Beaumo nl ...
126
Brownsville ...
118
Corpus Christi 1,461
Dallas
54
Denison ..
474
EI Paso ..........
341
Fort Worth
48
Galveston
1,995
Houston .
50
Laredo
185
LubbOck
118
Midland ....
125
Odessa .....
125
Port Arthur ....
45
San Angelo
San AntoniO ...... 1,525
34
Sherman ..
66
Texarkana
207
Waco .......
90
Wichita Falls

866
2,195
3,626
1,721
960
1,901
13,367
318
3,863
2,925
414
15,269
496
1,471
916
956
796
559
11 ,637
269
526
1,678
753

1,710
4,558
26,517
2,318
1,120
3,094
17,273
373
6,398
64,704
510
52,297
1,562
6,691
2,084
1,222
496
1,791
12,659
322
411
3,377
1,027

18,654
56 ,196
112,873
30,655
13,544
39,455
180,264
1,993
81,167
142,126
6,283
379,475
9,712
84,864
16,735
15,306
3,166
13,587
96,589
3,427
3,794
13,782
10,312

9
- 81
51

57
- 34
166
116

62
29
- 33
- 8
- 34
- 10
- 25
58
- 36
34
- 79
- 19
24
- 19
- 33
5
91
32
- 32
- 14
- 38
- 56
1

9,662

78,175

Area
ARIZONA
Tucson .
LOUISIANA
MonroeWest Monroe
Shreveport

Total -26 cities

-$230,159 $1.457,519

- 77
- 81
- 24
- 62
159
- 35
1,443
- 82
23
13
- 32
- 17
- 48
75
- 46
- 22
- 15
-1 0
26
15
2%

34%

- 64
18
6
384
- 22
815
- 44
- 22
122
- 34
121
- 9
182
185
70
95
- 4
- 53
26
38%

- 19%

DAILY AVERAGE PRODUCTION OF CRUDE OIL

LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT

(Thousand barrels)

Five Southwestern States'
Percent change from

Area
FOUR SOUTHWESTERN
STATES
Louisiana
New Mexico
Oklahoma
Texas
Gulf Coast
West Texas
East Texas (proper) .
Panhandle
Rest of state
UNITED STATES

Aug.
1975

July
1975

Aug .
1974r

July
1975

5.818.3
1,790.3
256.2
452.7
3,319.1
641 .0
1,787 .7
212.7
57 .8
619.9
8,351 .2

5,833 .7
1,808.0
256.9
441.9
3,326.9
637 .9
1,790.2
213.8
58 .2
626.8
8,372.6

6.125.9
1.964.9
271 .7
479.6
3.409.7
677.4
t ,794 .5
194.7
57 .7
685.4
8,681.5

- 0.3%
- 1.0
-.3
2.4
-.2
.5
-. 1
-.5
-.7
- 1.1
-. 3%

Aug.
1974
- 5.0%
-8.9
-5.7
-5 .6
- 2.7
-5.4
- .4
9.2
.2
-9.6
-3.8%

r-Rev lsed
SOURCES : American Petroleum Institute
U.S. Bureau of Mines
Federal Reserve Bank of Dallas

---

(Seasonally adjusted)

Percent change
Thousands of persons
Item
Civilian labor force
Total employment ..
Total unemployment .
Unemployment rate
Total nonagricultural wage
and salary employment
Manufacturing .
Durable
Nondurable ...
Nonmanufacturlng
Mining
Construction
.....
Transportation and
public utilities
Trade
..........................
Finance" .
Service
Government'

Aug . 1975f~

AUg·
1974

Aug .
1975p

July
1975

Aug.
1974r

July
1975

9.233.5
8,563.8
669.7
7.3%

9,175.0
8,535.0
640.0
7.0%

8,957 .3
8,527.8
429.5
4.8%

0.6%
.3
4.7
' .3

7,586.8
1,252 .5
698.5
554 .0
6,334 .3
269.3
466.2

7,542 .3
1,247.6
698.6
549.0
6,294 .7
267.7
466.7

7,506.1
1,305.4
734 .8
570.6
6,200.7
262. 1
504 .9

497.6
1,824.2
420.0
1,297.7
1,559.3

495 .8
1,815.1
418.7
1,292 .3
1,538.3

520.4
1,782.8
409 .4
1,243 .4
1,477.7

.6
.4
.0
.9
.6
.6
-. 1
.4
.5
.3
.4
1.4%

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)

3.1%
.4
55.9
'2.5

t .t
_ 4.t
_ 4.9
_2.9
2.2
2.7
_7 .7
_ 4.4
2.3
2.6
4.4
5.5%

INDUSTRIAL PRODUCTION AND TEXAS
MANUFACTURING CAPACITY UTILIZATION
(Seasonally adjusted Indexes, 1967 - 100 for production)

Area and type of Index
TEXAS
Total Industrial production "" '"
Manufacturing .. .....................
Durable ........... ........................
Nondurable .. .. ...
Mining .. ..
Utilities ................
Capacity utilization
In manufacturing (1972 - 100) .
UNITED STATES
Total Industrial production .........
Manufacturing ........................
Durable .. .. ........ ..........
Nondurable .......... .....................
Mining
Utilities .......

Aug .
1975p

July
1975

June
1975r

Aug.
1974

124.2
128.7
129.2
128.4
108.5
162.3

121 .5
124.7
125.7
123.9
108.5
162.3

121 .1
123.9
126.2
122.0
108.5
166.2

127.8
132.4
134.8
130.5
11 2. 1
166.7

TOTAL OIL WELLS DRILLED

94.9

92.2

91.9

101.7

112.9
111.0
103.8
121 .7
103.7
152.2

111 .5
109.3
102.3
119.7
106.1
151 .7

110.9
109.2
102.9
118.2
105.8
152.6

125.2
125.2
121 .6
130.4
107.3
152.7

p-Prellminary
r-Revlsed
SOURCES : Board of Governors of the Federal Reserve System
Federal Reserve Bank of Dallas

Marketings of fed cattle in August
were down 17 percent from a year
before but were 11 percent more
than in July.
• Cash receipts from farm and
ranch marketings in states of the
Eleventh District through July
were 4 percent lower than in the
same period a year earlier. Sales
improved markedly in July, as cash
receipts in June were 15 percent
lower than in June 1974. The
advance in the District exceeded a
slight improvement nationwide.

---

percenl

Area
FOUR SOUTHWESTERN
STATES .. ...................
Louisiana .......
Offshore ...
Onshore ...
New Mexico ...... ......
Oklahoma ...
Texas ..... .. ...... .... ......
Offshore ...............
Onshore ..... ..
UNITED STATES .........

Second
quarter
1975

First
quarter
1975

2,067
191
50
141
97
359
1,420
0
1,420
3,520

2,090
224
45
179
115
403
1,348
0
1,348
3,738

Percent
change
- 1.1%
- 14.7
11 .1
- 21 .2
- 15.7
- 10.9
5.3
5.3
- 5.8%

1975
cumulative
4,157
415
95
320
212
762
2,768
0
2,768
7,258

cha~~~4

from

tW e

~
30.5%
6.1
_28. 0
23. 6
30.9
44.9
31 .4
31 .4

SOURCE: American Petroleum Institute

Receipts for the United States
through July were 5 percent lower
than a.year before, after having
lagged year-earlier sales 8 percent
in June. Continued strengthening
in farm prices, a large crop harvest,
and high rates of grass-fed cattle
slaughter will likely push total cash
receipts in states of the District for
1975 over 1974 levels.
• In the first seven months of this
year, retail sales of farm tractors in
the Eleventh District were 19 percent lower than in the same period

last year. The decline was in line
with an 18-percent slump in tractor
sales nationwide. Fewer purchases d
of tractors mainly reflected reduce
farm incomes in 1974 and in the
first half of 1975. Furthermore,
many farmers have had to renew or
extend 1974 loans and have been
reluctant to assume more farm
machinery debt.

Full text of Review (Federal Reserve Bank of Dallas) : October 1975

FRASER