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Survey of Current Conditions The general industrial outlook now appears brighter than at any time since the beginning of the year, even though delayed effects of disruptions which occurred earlier will continue to be felt throughout the economy for many months to come. Settlement of major labor disputes in the basic raw material producing industries, assuming such agreements will prove something more than transitory, provides the first opportunity this year for industrial management to plan operating sched ules without the threat of major work stoppages in the foreground. Thus, even though considerable uncertainty prevails in most industries with respect to the extent of future price increases, the possi bility now exists for substantial progress toward accomplishing full utilization of the nation’s pro duction and distribution capacity. Early achievement of volume production should not be expected to occur simultaneously in all seg ments of industry. The effect of higher costs re sulting from wage increases in the coal, steel, and other primary raw material industries, as well as the effect of materials shortages resulting from earlier labor disputes in these areas, will not be uniform throughout the productive system. The problem of adjusting operations to either current or foreseeable cost levels and raw material supply conditions varies not only among industries and individual producers within each industry, but also in many instances among items manufactured by a specific company. Thus production probably will remain fairly spotty until the effects of higher costs have filtered through all levels and permeated all segments of the industrial system. Present conditions provide management with powerful incentives to offset higher manufactur ing costs by replacing obsolete equipment with new, efficient, and labor-saving machine tools. Re cent estimates indicate that industry currently is operating with a larger number of over-age ma chine tools than were in place twenty years ago. Replacement of obsolete equipment was deferred during the war years, but the pressure of increas ing labor and raw material costs and the imminent return to a fully competitive price system will greatly increase the rate at which inefficient ma chines are replaced. The fact that corporate net working capital is at an all-time high, plus the availability of ample low-cost funds in the money market, offers further inducement to management to utilize this means of maintaining their competi tive positions. Although neither the general level of manufacturing costs nor the quantity of goods produced will be affected materially during the im mediate future by the replacement of high-cost equipment, both will be influenced considerably by this trend in the next few years. EMPLOYMENT Total employment in the Eighth District in creased slightly during May primarily due to gains in the number of workers employed in construc tion and agriculture. Factory employment re mained at approximately the April level, but con tinued somewhat below earlier expectations. How ever, substantial additions to manufacturing em ployment should occur during the next few months as industrial activity moves into higher levels, and (Continued on P age 7) The Problem of Surplus Population in the Eighth District One of the basic problems that has confronted the Eighth Federal Reserve District has to do with surplus population. The birth rate— that is, the number of births per 1,000 people— in this district traditionally has been higher than that for the nation as a whole, and yet the percentage increase in district population since 1900 has been far less than that for the United States. There have not been sufficient job opportunities in this district to support all of the people born and migrating here. As a result, net outmigration on a large scale has occurred. This action has solved the district’s problem only partially for total income produced by those left in the district has not been adequate to maintain district per capita income at anything like the national average. In general, areas tend to lose population unless they can create productive employment. The Eighth District happens to be rich in natural re sources, but it has failed to fully exploit them. The district is primarily rural and agricultural in character— much of the explanation for its high birth rate may be found in this characteristic— but its agriculture has not created sufficient income to support its native farm population. Its own cities have absorbed some of the overflow from the farms but a large part has left the region. Thus, while the district’s population has grown, the increase has been less than would have occurred had there been no outmigration of those in search of better economic opportunity. For example, in the 1930-39 decade the total district population rose almost 600,000, but in those same years about 350,000 district residents migrated from the area. During W orld W ar II the district actually lost population, even when the effect of withdrawals for military service is taken into consideration. Most of these people migrated to work in war plants located in other areas. Some have returned since war’s end and others are expected to return, but unless the district can keep outmigration for the next five years at a minimum the 1940-49 decade could well see only a nominal population increase, if any. Since much of the district’s surplus population problem has come from a large surplus farm popu lation, there is every reason to believe that the future will present as extensive, if not a more extensive problem. The movement to mechanize Page 2 agriculture is still practically in its infancy and probably will grow rapidly in coming years. This will lead to even larger surpluses of labor in rural areas and probably will accentuate the trend of migration to the cities. It could lead to even larger scale migration from the district proper if the urban areas do not provide sufficient jobs for their own people plus the migrants. From a national viewpoint there probably is no great reason for concern about where displaced farm workers migrate as long as they find produc tive non-agricultural employment. From a regional viewpoint, however, it seems desirable to create sufficient economic opportunities within the region so as to make outmigration unnecessary, or at least minimize it. By so doing the income-producing forces in the region should be strengthened and total income, as well as per capita income, raised. The district’s problem, then, may be stated simply— enough jobs must be created in nonagri cultural pursuits to absorb the surplus population from the rural areas. A good start is being made in this direction, and many new job opportunities are being opened up in the district. Whether there will be sufficient new nonagricultural jobs here, however, is still open to question. If there are not, outmigration will continue. The nature of the district’s problem will be made more clear by a review of population growth trends and characteristics, after which future prospects may be considered in a little more detail. In gen eral, the district offers a marked contrast to the nation with a higher birth rate but lower rate of population increase, a younger population less welleducated, a more extensive negro population, and a much smaller foreign-born population. POPULATION GROWTH TRENDS AND CHARACTERISTICS Population Increase in the United States— In the century and a half following 1790 the population of the United States increased 33-fold, rising from 4 million in 1790 to 132 million in 1940. In 1945, it was estimated that the total population, includ ing those in the armed forces, was about 140 million. Very large percentage increases in population during this period occurred in the Nineteenth Cen tury and were due mainly to large-scale immigra tion and a sharply declining death rate. After 1900, more strict immigration laws and a relatively less sharp drop in death rates resulted in a de clining rate of increase for the nation’s population, even though the absolute gain in number of people continued to be large. During the 1930-39 decade the annual rate of increase in the population of the United States was at an all-time low, 0.7 per cent. This low rate of gain was attributed mainly to depression which postponed marriages and kept birth rates low. Be tween 1940 and 1944 the annual rate of population growth was 1.2 per cent, as wartime prosperity induced marriages and led to higher birth rates. Consequently, despite war losses, the present popu lation of the United States is larger than it would have been had the 1930-39 trend been continued. While the total population increased from 1940 to 1945, the civilian population declined by about 5 million, as the military services drained off large numbers of men. Urban civilian population, how ever, increased in the five-year period largely be cause the heavy demand for workers by war in dustries induced large-scale migration from rural areas. During the previous decade rural population had increased more than urban population. Population Increase in the Eighth District—The major period of population growth in the Eighth Federal Reserve District came after the great west ward migration of the late 1840’s. St. Louis was the gateway to the W est and through it flowed emigrants on their way to California and gold. Many of them stayed in this region and their num bers were added to by the wave of German settlers who came to this country following the overthrow of the liberal movement in Germany. In 1850, this region had 2.6 million people; by 1900, it had 8 million. The percentage gain throughout this pe riod closely paralleled that for the United States. birth and high death rates. The other district states had population increases because of high birth rates which outweighed heavy outmigration. Population in the five major district cities, St. Louis, Louisville, Memphis, Little Rock and Evans ville, increased from 135,000 in 1850 to 1,613,000 in 1940. Almost one-fifth of the total district popu lation gain over the past 90 years has been in these five cities. Since 1940, total district population has decreased, in contrast to national experience. From April, 1940, to November, 1943, the district’s population (including those in military service) dropped 150,000. While there is little specific information covering the last two years, there are strong indi cations that the downward trend continued until the end of the war. E I G H T H D I S T R I C T P O P U L A T I O N — 1940 (I n thousands of persons) Per cent of T otal______ Rural Rural Total U rban Nonfarm Farm Arkansas ......................................... 1,949 22 21 57 Illinois ............................................. 1,305 42 28 30 Indiana ........................................... 639 42 25 33 Kentucky ....................................... 1,466 36 21 43 Mississippi .................................... 1,110 13 14 73 M issouri ................................ ........ 2,860 48 19 33 Tennessee ....................................... 858 43 15 42 T otal D istrict ......................... 10.187 U nited States ................................ 132,669 36 57 20 20 44 23 Birth and Death Rates— The natural increase in the population of a nation or region depends upon the birth and death rates applying to that region. With immigration now greatly restricted, population trends for the future will be determined largely by these two factors. E IG H T H D IS T R IC T PO PU LATIO N , 1850-1940 MILLIONS OF PEOPLE 12 I— MILLIONS OF PEOPLE ---------------- ---------------- ---------------- ---------------- -----------------1 ----------------r — ]--------------- |2 After 1900, however, the rate of increase in dis trict population slowed down considerably and in the next 40 years population rose only 2.2 mil lion or 28 per cent. The gain in the United States during those four decades was 73 per cent. The much smaller increase shown by the district was due principally to outmigration from the region to areas where economic opportunities were better. Between 1850 and 1940, Arkansas had the largest percentage increase in population of any district state or portion of state. Eighth District Indiana registered the smallest gain in that period. The district portions of the more highly industrialized states of Indiana, Missouri, and Illinois showed population gains because they had relatively little outmigration which compensated for relatively low 1850 SO URCE ; 1870 BUR EAU Of 1890 1910 1930 C E N0 U0 Page 3 The birth rate in the United States has declined rather steadily since 1800, from 55 per 1,000 per sons at that time to 18 per 1,000 persons in 1940. During the depression years of the 1930’s, the birth rate declined sharply, but rose even more sharply in W orld W ar II until 1944. It probably will show little decline, if any, for the next two or three years as a large number of postwar marriages have taken, and in fact are still taking, place. In the long run, however, the downward trend in birth rates seems likely to continue. Birth rates have tended to be higher among rural residents and foreign-born than among city dwellers of native birth.1 A declining farm population probably will lead to a lower average birth rate. As noted, the number of foreign-born is declining because of immigration laws, although there may be a tempo rary arresting of this trend because of international marriages during and after the war. The Eighth District birth rate has been con sistently higher than the national rate. In 1943, the district rate was 24 per 1,000 persons, while the national rate was 23 per 1,000 persons. Birth rates in Arkansas, Kentucky, Mississippi, and Ten nessee have run considerably higher than the na tional average, while those in Illinois, Indiana, and Missouri have run lower. There is little difference between national and district death rates, although the regions within the district which have the highest birth rates average lowest in death rates. Due to improved standards of living and great advances in medical science and public health administration the annual death rate in the United States dropped from 17 per 1,000 persons in 1900 to 11 per 1,000 persons in 1944. The death rate probably will continue to decrease, but more slowly. Net Reproduction Rate— A good indication of the potential population growth or decline of a region is the net reproduction rate.2 A rate of 100 means that the population will just replace itself. A rate below 100 indicates a declining popula tion. In this district, if the 1935-40 birth and death rates continued and there were no migration, the population in Indiana, Illinois, and Missouri would not replace itself in the next generation, while that in Arkansas, Kentucky, Mississippi, and Tennessee 1 Birth rates also have tended to b e higher am ong lower incom e groups. A National H ealth Survey made in 1935 showed that the fertility rate varied from 82 per 1,000 persons for the group with less than $1,000 annual fam ily incom e to 31 per 1,000 persons for the group with m ore than $3,000 annual family incom e. 8 Technically defined, the net reproduction rate represents the number o f daughters a group of 100 female infants beginning life together would have during the course of their lives if the group were subject to both the birth and the death rates at each age level which prevailed at the time specified. Page 4 would more than replace itself. Since birth and death rates are expected to decrease over the long run, the declining population tre,nd noted in the first three states will probably be accentuated, but the net reproduction rates in the other states could suffer substantial decreases and still be above 100. The net reproduction rate among urban residents of this district in the 1935-40 period was much lower than that of rural residents. For whites, the urban net reproduction rate varied from 64 per cent in Missouri to 81 per cent in Indiana, while the rural farm net reproduction rate ranged from 146 per cent in Missouri to 186 per cent in Ken tucky. The rate for nonwhites generally averaged higher than that for whites. Age Distribution— Declining birth and death rates lead to a larger proportion of older people in the population. Between 1900 and 1940, the proportion of the population in the United States ten years or more old increased from 76 to 84 per cent. If the birth rate continues its long-term de clining trend, the proportion of older people in the population will increase further. The Eighth District has a younger population than has the nation as a whole. In 1940, the dis trict population ten years of age or older was 8.4 million or 82 per cent of the total. Explanation for this situation lies mainly in a birth rate higher than the national average and large outmigration. Since children constitute a smaller proportion of migrants than of total population, heavy outmigra tion from a region tends to result in a younger population for that region. Education— Eighth District residents, according to Census figures, are less well-educated than the average individual in the United States. Ap parently this results mostly from heavier migra tion of the better-educated people of the district rather than from lack of educational opportunities. Only 7 per cent of the district’s population 25 years of age and older had attended college, ac cording to the 1940 Census, and only 29 per cent had attended high school or college. Correspond ing proportions for the United States were 10 per cent and 40 per cent. In this same age group, however, the proportion of district residents with no schooling at all was lower than the national average— 3 per cent for the district and 4 per cent for the nation. Some por tions of the district, particularly the southern areas, ran well above the district average. In Mississippi, for example, 7 per cent of the population 25 years of age or older had had no schooling in 1940. Negro Population— The Eighth District has a much higher proportion of negroes than does the nation— 17.6 per cent of the total for the district as against 10 per cent for the United States. The ratio of negroes to the total population varies widely among district states or part states from more than 50 per cent in Mississippi to only 2 per cent in Indiana. Many negroes moved out of the district during the war period and obtained higher incomes by so doing. W ith mechanization of farming increasing, there may well be a further outmigration in the future. Foreign-born Population — The percentage of white population in the United States born in for eign countries declined from 15 per cent in 1900 to 10 per cent in 1940, mostly as a result of stricter immigration laws. The Eighth District has a much lower percentage of foreign-born than has the na tion. In 1900, only 5 per cent of the district’s white population were foreign-born and in 1940 only 2 per cent originally came from abroad. T H E C H A R A C T E R A N D E X T E N T OF M IG R A T IO N From earliest times the population in the United States has been a migratory one. The principal movements have been from the south to the north and west, from the north to the west, and from rural to urban areas. Since 1900, the south has ex ported a net of about 2.8 million and the north about 1.8 million persons to other sections, while the west has gained about 4.7 million. E S T IM A T E D N E T C IV IL IA N M IG R A T IO N * E IG H T H F E D E R A L R E S E R V E D IS T R IC T (I n thousands o f persons) A pril, 1940 1930 to to N ov., 1943 1940 Arkansas .................................................... ...— 225 Illinois ............................................................— 62 Indiana ............................................................-f- 22 K entucky .................................................... ...— 78 M ississippi .................................................. ...— 135 M issouri ...................................................... ...— 121 Tennessee .................................................... ...— 16 1920 to 1930 — 173 4 -1 4 — 1 — 79 — 68 — 14 — 28 — 216 — 167 — 53 — 181 — 61 ___ 115 — 26 T otal D istrict ....................................... — 615 — 349 M inus sign indicates ou tm ig ra tion ; plus sign, inm igration. E xcludes m ovem ents o f armed forces. — 819 Migration from the District — Relatively high birth rates and predominantly rural characteristics have made the Eighth District a surplus popula tion area. Increased agricultural productivity made more agricultural workers available than could be absorbed by the industrial centers in the district. Since the district has retained, but not increased, its proportion of national employment in the past forty years, both surplus rural and urban workers migrated to sections of greater opportunity. In general, migrants from rural areas seem to have gone to urban centers within the district, while those from the cities left the district proper. In the two decades prior to 1940, this district fur nished a net of more than one million people to other areas. All district states had net outmigration between 1920 and 1940. The number of net outmigrants from the district was more than twice as large in the 1920-30 decade as in the following one. The average annual net outmigration rate in the former period was 0.9 per cent, and in the latter period only 0.4 per cent. This district had a slightly smaller percentage of negro than white and a much higher percentage of urban than rural outmigrants in the 1920-40 period. The states with lowest per capita income (Arkansas, Mississippi, Kentucky, and Tennessee) had the highest percentages of urban population outmigrating, while the other states had the high est percentages of rural population outmigrating. During W orld W ar II, the volume of migration, excluding movements of the armed forces, was ap proximately two-thirds greater than in the 1935-40 period. The direction of wartime migration, how ever, was not much different than that of prewar years with the same general shift to the west and to urban areas. Many of the wartime migrants moved long dis tances with more than half crossing state lines. Evidently there was more family migration during the war than in the prewar period. Approximately 60 per cent of the migrants 14 years of age and over were women, with servicemen’s wives accounting for a large number of female migrants. Between April, 1940, and November, 1943, the Eighth District had a net civilian outmigration of 614,000. No figures are available on migration after November, 1943. However, if the trend be tween 1940 and 1943 were applied, the amount of net outmigration from this district between 1940 and August, 1945, would be approximately 900,000. Migration Within the District — The rapid growth in urban population is a significant de velopment in the history of the United States. The Bureau of the Census defines urban population as including individuals living in towns with more than 2,500 population. In 1790, only 5 per cent of the United States population was urban, as com pared with 57 per cent in 1940. The Industrial Revolution with its transition from an agricultural to an industrial economy Page 5 made necessary large concentrations of popula tion. After 1890, the rate of urban increase de clined and reached an all-time low during the 1930’s. The demand for industrial workers during W orld W ar II gave renewed emphasis to the shift from rural areas. Urban population in the Eighth District has not increased as rapidly as in the country as a whole during the last 40 years and currently com prises a much smaller proportion of the total than the national average. Urban population in the United States increased 142 per cent between 1900 and 1940 as compared with 103 per cent for the district. In 1900, urban population in the dis trict was 1.8 million or 23 per cent of the total population. By 1940, it had increased to 3.7 million or 36 per cent. Looked at from the other side, the essentially rural character of this district may be seen from the fact that in 1940 about 64 per cent of its people lived in rural communities, two-thirds of these on farms. Missouri is the most highly urbanized and Mis sissippi the most rural section of the district. The greatest percentage increase in urban population in the district between 1900 and 1940 occurred in Arkansas, where 1940 urban population was almost four times that of 1900. Urban population in dis trict Mississippi and Tennessee tripled, and in dis trict Illinois doubled in this period. OUTLOOK Considering the various factors relating to the district’s population, there seems, on balance, reason to believe that birth rates here will con tinue to exceed the national average and conse quently that district population growth could po tentially run higher than that for the country as a whole. At the same time, this conclusion means that there must be either a continuation of out migration on a large scale or considerably higher nonagricultural employment in the region. As noted earlier, migration should not be con sidered an evil from a national viewpoint. Histor ically, migration has been and probably will con tinue to be necessary, for urban industrialized areas have lower birth rates and more job opportunities than have rural areas. Unless the distribution of job opportunities changes radically or unless cur rent regional differences in birth rates are mini mized, some migration from rural to urban regions will be both necessary and desirable. For the district to maintain or better its popula tion relative to that of the United States, however, it will be necessary to hold outmigration from here to a minimum. To do so means providing enough Page 6 high-income employment in the district’s urban areas to keep people here. In this connection it should be noted that the district will have to create relatively more job op portunities than the nation as a whole if it is to re tain its population. For example, assuming that the district’s share of national employment in 19S0 were no greater than in 1940, average national employment of 55 million (about that which pre vailed in 1943) would lead to employment of only 86 per cent of the district’s potential labor force in that year if there were no outmigration between now and then. Assuming full employment in 1950 were about 60 million, the same relative share for the district as in 1940 would provide work for but 91 per cent of the district’s potential labor force. In other words, in 1940 the district did not pro vide enough jobs to take care of its native labor force and consequently there was outmigration. Regardless of the increase in employment by 1950, unless the district increase is substantially larger than the national average, there will still be not enough jobs here for the native population. Among the various portions of states located in the district, the above assumptions would indicate Indiana is the only one where 1950 job opportuni ties would exceed the potential labor supply with out some inmigration. Missouri and Illinois would provide almost enough jobs, but other states or part states would find it necessary to export people if they were to avoid unemployment. Postwar nonagricultural employment prospects, however, seem to be more favorable for the dis trict than for the nation as a whole. This conclu sion is based mostly on surveys of future employ ment prospects conducted in many Eighth District cities in the latter part of the war period. The high nonagricultural employment level indicated for the district after full reconversion (2.7 million as against 2 million in 1940) was based on reason ably realistic market analyses and plans to exploit more fully the natural resources and advantages of this region and not on mere hopes. Consequently, the outlook for holding outmigra tion from the district to a minimum for the next few years by providing a d e q u a te employment opportunities seem fairly good. It should be stressed, of course, that the postwar job prospects are still prospective for the most part. The pros pects, however, a c t u a l l y are bright. If they materialize, the district will not have to face the alternatives of unemployment here or exporting its people. Gertrude Krausnick CU RRE N T CO N D ITIO N S (C ontinued from Page 1) by the end of the year the labor market is likely to be considerably tighter than at the present time. Although total district employment is at a rela tively high level, the number of new job openings has not kept pace with the increase in the number of persons seeking employment. However, a large part of the resulting increase in unemployment is due to the seasonal influx of school graduates and vacation workers, plus the continued entry of vet erans into the labor market. Regular unemployment compensation claims continued to decline during May, and servicemen’s readjustment allowances apparently have leveled off. The average length of unemployment is some what greater than would be expected in a relatively tight labor market due to the fact that receipt of unemployment compensation payments reduces the pressure to accept whatever employment possibili ties are available and provides workers with an opportunity to explore all available job openings. On a national basis, about half of the persons seek ing employment have been unemployed for two or more months, according to a Bureau of Labor Statistics survey. INDUSTRY Industrial activity in the Eighth District in May was at about the same rate as in April, despite the fact that coal shortages during the early part of the month resulted in curtailment of production in some lines. However, additional supplies of fuel resulting from the truce between mine operators and the union, plus the fact that most producers failed to exhaust their pre-strike coal inventories, enabled most of the district’s industries to main tain operations at approximately the April level. Industrial electric power consumption in the major district cities was off only fractionally from April, the first month-to-month decline this year. In Little Rock, the amount of electric power con sumed by industrial users again was in excess of consumption in the corresponding month a year ago and, together with Louisville and Evansville, showed an increase over April, 1946. Manufacturing— The general level of manufac turing activity in this district in May averaged only slightly below April. Not all manufacturing plants were affected to the same degree by the coal strike and divergent trends are apparent as between in dustries. Operations in the chemicals group, as well as production of some types of machinery and transportation equipment, were slightly higher in May than in the previous month, while food proc essing and some durable goods manufacturing con cerns, chiefly in the iron and steel products group, showed a decline. Lack of coal curtailed opera tions in the cement industry and while some plants were shut down completely, shipments were main tained, although at reduced levels, by filling orders out of inventories. Steel operations averaged only 23 per cent of capacity as compared with 29 per cent during April. The longest strike in the history of the steel-industry has continued to keep one leading steel producing plant out of production, and the resulting loss of output has affected opera tions in a number of manufacturing plants in this district normally dependent upon this steel pro ducer for their chief source of supply. Although other sources have been developed, expansion of operations in some plants has been delayed due to inadequate steel supplies. Production of lumber in district mills continued to increase during May. The southern hardwood industry operated at about 65 per cent of capacity as compared with 63 per cent in April and 57 per cent in May, 1945. Output of southern pine in April was about 7 per cent larger than in March and preliminary reports indicate that the April rate was probably maintained during May. The in crease in lumber production in the district states during the first three months of the year was some what larger than in the nation as a whole. In March, the latest period for which monthly produc tion figures are available by states, output in this district amounted to 16.6 per cent of total United States production as compared with 14.2 per cent in December. The number of whiskey distilleries in operation in the district at the end of May was considerably smaller than at the end of the preceding month. The pressure of grain shortages and continued restrictions on inventories resulted in the closing of all but 17 distilleries as of the end of May. In April, 45 distilleries were operating and 54 were in production in May, 1945. Activity in the meat packing industry in May was higher than in the previous month as indicated by a 13 per cent increase in the number of animals slaughtered under Federal inspection. However, total slaughter was 6 per cent below May, 1945. The number of cattle slaughtered declined for the seventh consecutive month to a new low of 11,600 head or 7 per cent less than in April and 63 per cent below May, 1945. Slaughter of sheep was off 10 per cent from April and 55 per cent from May, Page 7 1945, while the number of hogs and calves handled by packers increased 15 per cent and 52 per cent, respectively. Mining and Oil— Settlement of the coal strike resulted in a sharp increase in coal production in May. Total United States output amounted to 20.4 million tons as compared with 3.2 million tons in April and 49.5 million tons in May, 1945. The in crease in output from Illinois mines was somewhat less than in the nation as a whole, due to the fact that production was maintained during April in a number of Illinois mines where employees were not involved in the nationwide strike. Mine pro duction in Illinois in May amounted to 1.9 million tons as compared with 1.2 million tons in April and 5.4 million tons in May, 1945. Production of crude oil in the district in May was only slightly less than in April and 7 per cent higher than in May last year. Daily average pro duction in May amounted to 337,500 barrels as com pared with 337,700 barrels in April and 316,000 barrels in May, 1945. The number of new well completions in the district states declined from 267 in April to 248 in May. However, a larger per centage of the May completions resulted in produc ing wells. During the first five months of this year, 60 per cent of the new completions within the district resulted in oil-producing wells as com pared with 56 per cent in the nation as a whole. Lead production in the district in April was slightly below the preceding month and 9 per cent less than in April, 1945. Considerable difficulty has been experienced in lifting output to the required levels and the supply available to industrial users has been curtailed seriously. Relatively low lead prices have tended to discourage the use of lead substitutes and to curtail imports from foreign producers as well. In addition, the supply of re coverable lead has diminished with the increase in the amounts used in production of paint pigments and tetraethyl lead. Construction—The value of building permits awarded in the five major district cities increased sharply from $4.3 million in April to $5.1 million in May, but totaled considerably less than the aver age for the first three months of the year. Largest increases were in Memphis and St. Louis, with a slight gain reported in Evansville. The only sub stantial decline occurred in Louisville, although the value of permits awarded in Little Rock was slightly less than in April. Shortages of critical building materials continued to impose severe dif ficulties on the construction industry and to dis courage many people from attempting new resi dential building. Although output of most critical items has increased considerably since the begin ning of the year, production is still far below the amount required for the successful completion of the national housing program. Transportation— The number of freight cars in terchanged in May among the railroads operating in St. Louis declined 6 per cent from April and to taled 114,000 as compared with 121,000 in April and 174,000 in May, 1945. The contraseasonal decline in May reflected the curtailment of coal shipments as well as the brief railroad strike. During the first nine days of June, the number of cars interchanged was off less than 1 per cent from the correspondAGRICULTURE INDUSTRY ( K .W .H . in thous.) C O N S U M P T IO N O F E L E C T R IC IT Y M ay, 1946 M ay, A p r., M ay, compared with 1946 1945 1946 A pr., ’46 M ay, *45 K .W .H . K .W .H . K .W .H . Evansville .... L ittle R ock.. Louisville .... Mem phis ...... Pine Bluff.... St. L o u is ...... 40 35 82 31 19 96 6,800 3,214 17,153 5,219 1,027 57,115 6,506 3,189 16,783 5,287 1,496 57,789 10,259 3,045 18,084 6,947 6,572 67,914 + 5% 4* 1 + 2 — 1 — 31 — 1 — 34% + 5 — s — 25 — 84 — 16 — 20 112,821 — 1 90,528 91,050 Totals ...... 303 •Selected industrial customers. L O A D S I N T E R C H A N G E D F O R 25 R A I L R O A D S A T ST . L O U I S First nine days June, *46 June, *45 5 mos. ’ 46 5 mos. ’45 M ay, '46 A pr., *46 M ay, *45 814,941 47,695 592,955 173,952 36,406 114.430 121,329 S ou rce: Terminal Railroad A ssociation o f St. Louis. E M P L O Y M E N T IN M A N U F A C T U R I N G IN D E X E S O F IN D U S T R IE S B Y M E T R O P O L IT A N A R E A S Bureau of L abor Mar., 46 com p, with M ar., M ar., Feb., Statistics Feb., ’46 M ar., '45 1946 1946 1945 (1937 = 100) — 65% 79.6 83.1 — 4% 226.0 Evansville ................... — 25 118.2 119.1 157.6 —1 — 18 118.1 M emphis ..................... , 120.0 146.5 4-2 — 30 +2 St. Louis ................... .. 105.3 103.5 150.9 Page 8 R E C E IP T S A N D N o. of Customers* S H IP M E N T S A T Receipts M ay, 1946 N A T IO N A L A pr., 1946 M ay, 1945 Cattle and Calves..l 13,987 H o g s ....................... 187,531 H orses and M ules 9,269 Sheep ....................... 79,640 115,913 184,181 7,534 59,228 Totals ...................390,427 366,856 ( I n thousands o f dollars) M ay, 1946 A p r., 1946 M ay, 1945 126,479 167,842 3,089 168,517 92,825 69,398 9,269 54,599 93,801 72,841 7,534 26,442 86,437 53,174 3,069 101,919 465,927 226,091 200,618 244,599 C A S H F A R M IN C O M E A pril Cumulative for 4 months -------------------------------- ---------------------------------------------------------1946 1945 1946 1945 1944 Arkansas .............. $ Illinois ................. Indiana ................. Kentucky ............ Mississippi .......... Missouri ............... Tennessee ............ Totals STOCK YA R D S Shipments 16,848$ 12,653 $ 90,537 88,816 49,874 49,733 14,958 15,904 13,030 12,166 43,730 45,354 17,614 18,214 ............... 246,591 242,840 79,071 $ 355,410 188,866 151,637 70,859 182,451 100,172 1,128,466 75,533 $ 353,635 190,322 194,638 80,508 189,137 102,587 1,186,360 66,833 391,220 212,252 147,098 57,789 202,983 98,937 1,177,112 ing period in May but was 26 per cent less than in the first nine days of June, 1945. TRADE Retail sales of reporting stores in the Eighth Dis trict during May reflected less than the usual seasonal decline, and dollar volume continued at a level substantially above that of a year ago. Fur niture stores, department stores and men’s clothing stores showed substantial gains over the same pe riod last year. Continuation of the current rate of increase depends primarily upon increasing supplies of consumer goods and a high level of consumer income. Although inventories are higher than a year ago, they are unbalanced and the stock-sales ratios are substantially below normal in most lines. Buying still seems to be limited mainly by the amount of merchandise available although greater selectivity is being manifest by some buyers. Sales of reporting department stores in this dis trict in May, while 3 per cent less than the pre ceding month, were 35 per cent greater than in May, 1945. The increase over a year ago for Eighth District stores continues to run better than the na tional average and preliminary reports for June indicate that this month will maintain the 27 per cent increase recorded for the first five months of 1946 relative to the comparable period in 1945. Inventories at department stores are still far from normal, particularly in the •durable goods lines. Some items are in fair supply but major items are still scarce and not much more than token deliveries are being received by the stores. Other lines, such as some “ soft” goods items., which were in fair supply during the war period have now be- come scarce. Shortages are especially noticeable in various kinds of men’s wear: suits, shirts and mis cellaneous items. Some types of women’s wear are also in very short supply. Total department store inventories (in terms of value), however, show an increase of 7 per cent for the month and 17 per cent over the same date last year. Dollar volume of sales at reporting furniture stores in May was slightly higher than in the pre vious month but 53 per cent abov£ a year ago. Fur niture store sales have been showing considerable increases over comparable periods last year but such gains have been limited by shortages of major durable items. Furniture store stocks on the whole at the end of May were 24 per cent higher than a year ago but, like those in other lines, are out of balance. Refrigerators, stoves, electric washing machines, kitchen, dining room and bedroom fur niture are still very difficult to obtain, reflecting in turn difficulties encountered by manufacturers in achieving volume production. Smaller items, such as end tables, occasional pieces and a few of the minor electrical appliances are in fair supply. Some stores have made checks to determine how much they can depend on their waiting lists to actually become orders when goods are available. These checks reveal considerable duplicate ordering and in addition indicate other probable cancellations for a variety of reasons. Sales volume at men’s apparel stores is also limited by inadequate supplies. In May, men’s store sales were 18 per cent smaller than in the preceding month although 48 per cent higher than in May, 1945. W ith some items of men’s wear in DEBITS TO DEPOSIT ACCOUNTS PRICES CO ST OF L IV IN G Bureau of Labor Statistics M ay 15, 1946 (1935-39— 100) United States..... 131.5 St. L ou is........ 129.5 * M em phis ...... * N ot available, A pr. 15, 1946 130.9 129.1 * Sept. 15, 1942 117.8 116.6 119-. 3 M ay 15, ’ 46 Comp, with A pr. 15, ’ 46 Sept. 15, ’ 42 + 0.5% + 11.6% + 0.3 4-11.1 * * COST OF FO O D Bureau of Labor Statistics M ay 15, (1 9 3 5 -3 9 = 1 0 0 ) 1946 U . S. (51 cities) 142.6 St. L ou is ........ 144.5 L ittle R ock.... 141.6 Louisville ...... 133.2 M em phis ........ 151.7 A pr. 15, 1946 141.7 143.4 141.2 133.8 149.8 Sept. 15, 1942 126.6 126.7 129.2 129.7 129.7 M ay 15, *46 Comp, with A pr. 15, ’ 46 Sept. 15, ’ 42 4 -12 .6% 4 - 0.6% 4 - 0.8 + 14.0 4 - 0.3 4 - 9.6 -0 4 - 2.7 + 1 7 .0 4 - 1.3 W H O L E S A L E P R I C E S IN T H E U N I T E D S T A T E S Bureau of L abor Statistics M ay, *46 Comp, with (1 9 2 6 = 1 0 0 ) M ay, ’ 46 A pr., ’ 46 M ay, ’ 45 A pr., ’ 46 M ay, ’ 45 110.2 106.0 + 0.7% All Commodities........ 111.0 4 - 4.7% Farm P rod u cts...... 137.5 135.4 129.9 + 1.6 + 5.9 Foods ..................... 111.5 110.8 107.0 + 0.6 + 4.2 Other ..................... 103.9 103.3 99.4 + 0.6 + 4.5 (In thousands of dollars) M ay, 1946 A p r., 1946 M ay, 1945 12,582 $ 10,037 El Dorado, A rk ......... $ 14,331 $ 28,961 32,185 22,983 Fort Smith, A rk ...... . 4,886 5,567 4,242 Helena, Ark. ......... . 90,047 90,420 85,778 Little R ock, A rk ....... 19,343 17,822 15,001 Pine Bluff, A rk ....... 8,079 11,855 Texarkana, A rk.-T ex. 8,507 16,252 14,812 A lto n ,' 111..................... 17,160 68,059 66,358 E .S t.L .-N a t.S .Y ., 111. 66,645 21,503 20,820 18,400 Quincy, 111.................. 73,035 68,081 104,129 Evansville, In d ........... 365,277 373,520 , 370,713 16,872 21,859 22,507 Owensboro, K y .......... Paducah, K y .............. 11,446 9,080 11,355 9,060 14,215 Greenville, M iss......... 11,366 5,789 Cape Girardeau, M o. 7,718 7,560 5,163 5,682 5,679 Hannibal, M o ............ 38,952 32,621 20,277 Jefferson City, M o... St. Louis, M o ........... 1,185,806 1,138,103 1,235,956 8,661 7,979 6,935 Sedalia, M o.................. Springfield, M o .......... 44,364 42,251 35,276 Jackson, T enn............ 12,393 13,459 9,527 275,954 Memphis, T enn.......... 350,943 371,524 Totals ..................... 2,402,109 2,378,266 2,363,347 M ay, *46 com p, with A pr., *46 M ay, ’ 45 + 14% — 10 — 12 — 5 — 8 + ^ + 6 -0+ ^ + 7 + 1 — 3 — 1 — 20 + 2 -0— 16 + 4 + 2 + ^ — 8 — 6 +43% +26 +15 — 5 — 8 + 5 +16 — 2 +17 — 30 — 1 +30 +25 +25 +33 + 10 +15 — 4 +25 +26 +30 +27 + + 1 2 Page 9 RETAIL TRADE D E P A R T M E N T STORES Stocks Stock N et Sales on Hand Turnover 5 mos. 1946 May 31, 1946 M ay, 1946 to same comp, with Jan. 1, to compared with period M ay 31, M ay 31, A pr., 1946 M ay, 1945 1945 1945 1946 1945 2.42 1.81 Ft. Smith, Ark... — 6% + 16% +23% — 3% 2.68 2.31 + 8 +28 +22 Little R ock , Ark. — 3 2.38 2.0 7 +24 +20 Quincy, 111. — 7 +29 1.79 1.55 +21 — 10 Evansville, Ind... — 6 +36 2.82 2.61 + 15 — 6 Louisville, K y .. * +34 +26 +27 +21 2.31 2.08 +39 St. Louis Area1.. — 3 +22 2.30 2.08 St. Louis, M o. — 4 +38 +27 + 73 +36 E. St. Louis, 111. + 6 +38 + 1 2.47 1.74 +47 Springfield, M o... 4 - 3 2.62 2.38 +20 +26 +26 Memphis, Tenn... — 2 2.44 2.05 + 56 + 38 *A11 other cities.. + 2 + 19 + 17 2.44 2.18 +27 +35 8th F. R. Dist... — 3 * E l D orado, Fayetteville, Pine Bluff, A r k .; Alton, Harrisburg, Jack sonville, M t. Vernon, 111.; N ew A lbany, Vincennes, Ind. ; Danville, H o p kinsville, Mayfield, Paducah, K y . ; Chillicothe, M o .; and Jackson, Tenn. 1 Includes St. Iyouis, M o., East St. Louis and Belleville, 111. Trading da ys: M ay, 1946— 2 6 ; A pril, 1946— 2 6 ; M ay, 1945— 26. O utstanding orders of reporting stores at the end of May, 1946, were 56 per cent greater than on the corresponding date a year ago. Percentage of accounts and notes receivable outstanding M ay 1, 1946, collected during M ay, by citie s : Instalm ent E xcl. Instal. Instalment E xcl. Instal. A ccoun ts A ccoun ts A ccounts Accounts Fort Smith ............ % 63% ' Q uincy .......... 40% 74% Little R o ck ..... 38 73 St. L ou is.......... 41 74 Louisville ........ 45 63 Other cities..... 34 64 64 8th F .R . Dist. 42 70 Memphis ........ 49 IN D E X E S O F D E P A R T M E N T S T O R E SA LE S A N D STOCKS 8th Federal Reserve District M ay, Apr., Mar., May, 1946 1946 1946 1945 281 264 201r Sales (daily average), U nadjusted2.............. 272 Sales (daily average), Seasonally adjusted2.. 277 267 286 205r Stocks, U nadjusted3 ......................................... 211 193 180 172 Stocks, Seasonally adjusted3............................ 211 193 185 172 2 D aily A verage 1935-39 = 100. 3 End of M onth A verage 1935-39 = 100. r Revised. S P E C IA L T Y STO R ES Stocks Stock ___________ N et Sales______________ on Hand Turnover 5 mos. 1946 M ay 31, 1946 M ay, 1946 to same com p, with Jan. 1, to compared with period M ay 31, May 31, A pr., 1946 M ay, 1945 1945 1945 1946 1945 M en’ s Furnishings— 18% +48% +41% — 20% 3.22 1.49 Boots and Shoes....— 17 +25 +24 +43 4.64 4.04 Percentage of accounts and notes receivable outstanding M ay 1, 1946, collected during M a y : M en’ s Furnishings................... 69% B oots and Shoes.................. 57% Trading d ays: M ay, 1946— 2 6 ; A pril, 1946— 2 6; May, 1945— 26. R E T A IL F U R N IT U R E STO RES N et Sales Inventories M ay, 1946 M ay 31, 1946 Ratio of compared with com pared with Collections A p ril,’ 46 M a y ,’ 45 A pr. 30,’ 46 M ay 31,’ 45 M ay,’46 M ay,’45 St. Louis Area1. ^ 6 % + 55% +10% 38% + 13% ’ 48% St. Louis ......+ 6 + 55 +1 38 46 + 13 0 Louisville Area2.— 11 + 25 + 2+ 1 7 6 33 32 Louisville ......— 10 +31 + 2+ 1 8 9 32 30 Memphis ..........+ 1 + 56 + 2+ 1 0 0 32 25 Little R o ck ........- 0 + 61 + + 58 9 36 32 * * * * F ort Sm ith........+ 4 +125 8th Dist. T otal3..+ 2 + 53 42 + 2+ 1 2 4 35 *N ot shown separately due to insufficient coverage, but included in Eighth D istrict totals. in c lu d e s St. Louis, M issou ri; East St. Louis and A lton, Illinois. 2Includes Louisville, K en tu ck y; and N ew Albany, Indiana. 3In addition to above cities, includes stores in Blytheville, Pine Bluff, A rkansas; Henderson, O w ensboro, K en tu ck y ; Greenville, Greenwood, M ississippi; Hannibal, Springfield, M issouri; and Evansville, Indiana. P E R C E N T A G E D IS T R IB U T IO N O F F U R N IT U R E M ay, ’ 46 Apr., ’46 Cash Sales ..................................................“ 27% ‘ 27% Credit Sales ................................................ 73 73 Total Sales ............................................. 100 100 Page 10 SALES M ay, ’45 22% 78 100 fair supply and others extremely short, the inven tory situation in both department store men’s divi sions and in men’s wear stores is spotty, although the unevenness is probably more marked in the latter. Shirts and woolen suits are expected to be in short supply for quite some time and probably manufacturers’ shipments to retailers will be con tinued on a quota basis. At the close of May, men’s store inventories were up 7 per cent from a month earlier but were 20 per cent less than a year ago. W omen’s apparel store sales in May in this dis trict were 24 per cent less than in April and 10 per cent more than in May, 1945. These stores so far in 1946 have experienced less difficulty in maintaining normal stock-sales ratios than most other lines, but some shortages, particularly of quality goods, are becoming evident. Inventories at women’s apparel stores at the end of May were one per cent under the previous month and 5 per cent more than the same date last year. The con tinued high level of sales at women’s wear stores is due in part to consumer demand for the better quality and higher priced merchandise. Present indications are that this factor will continue to have an important influence on dollar sales volume. B A N K IN G A N D F IN A N C E Banking changes during the last month re flected primarily the effects of Treasury operations. Cash redemption of approximately $2 billion of Treasury certificates of indebtedness which ma tured June 1 and of about $1.8 billion of Treasury bonds called for redemption on June 15 brought total cash redemptions since the end of February to about $10.2 billion. The net effect of the re demption of securities held by the commercial banks was to decrease their War Loan deposits and their holdings of Government securities. On the other hand, checks drawn to meet income tax payments, due June 15, reduced private deposits and increased Government deposits. The usual withdrawal of deposits from St. Louis banks over June 1 to avoid the incidence of the personal prop erty tax did not occur this year as bank deposits are not taxed under the new law. War Loan deposits at Eighth District reporting banks were down $103 million during the last month. This brings the total decline for the year to $195 million. Demand deposits other than inter bank and Government deposits showed relatively little change, the total being $5 million higher than a month ago. Time deposits continued to show about the same rate of increase although the in crease this year for both demand and time deposits has been less than during the corresponding period last year. The investment portfolios of district reporting member banks continued to reflect the effects of the cash redemption of Treasury securities. Gov ernment security holdings of reporting banks were down $99 million for the month. Since the first of the year, the decrease has amounted to $179 million. Most of the decrease has been in Treas ury bills, certificates of indebtedness and notes. Total loans declined $8 million during the month. The decrease was seasonal and was in about the same amount as during the same period last year. Most of the decline was in commercial, industrial and agricultural loans although loans to others than brokers and dealers for the pur chase or carrying of United States securities also decreased slightly. Real estate and other loans, mostly consumer loans, registered slight increases. Consumer credit extended by district reporting agencies was less in May than in the preceding month but the volume outstanding continued above the levels of both a month and a year ago. New loans were down 14 per cent for the month at com mercial banks but outstandings were still 6 per cent above April and substantially above May of last year. Industrial loan agencies and credit unions reported small increases in new business for the month while small loan companies registered a decrease. AGRICULTURE During the latter part of May and the first part of NEW MEMBER BANK WHOLESALING Lines o f Comm odities N et Sales M ay, 1946 Data furnished by Bureau o f Census, compared with U . S. Dept, o f Comm erce* A p r., ’ 46 M ay, ’ 45 A utom otive Supplies ..................... ........ — 9% 4 - 44% Drugs and Chem icals..................... .........4 - l 4 - 25 D ry Goods ........................................ ......... 4 - H 4 - 68 Electrical Supplies ......................... 4 - 40 Furniture ................................ ;....... 4 - 78 Groceries .......................................... 4 - 17 Hardware ......................... ............... 4 - 58 Plum bing Supplies ...................... ..........-4- 2 4* 71 T ob a cco and its P ro d u cts---------- _ 4 4 - 57 7 Miscellaneous .................................. 4- 6 Total all lin es**..-......................... .........4 - 2 4 - 38 * Preliminary. ** Includes certain lines not listed above. t 4-84 4-38 4- 4 4-50 4-55 -|-44 CONSTRUCTION B U IL D IN G P E R M IT S N ew Construction (C ost in thousands) N um ber 1946 1945 Evansville ...... 45 L ittle R ock... ... 91 Louisville ..... M e m p h is ....... ... 856 St. L ou is.......... 269 M ay Totals... ...1,409 A pr. Totals... ...1,237 39 53 62 C ost 1946 1945 $ 138 428 548 $ 384 1,922 78 1,270 207 132 161 767 238 616 526 4,306 3,656 1,505 978 Repairs, etc. Num ber 1946 1945 1946 C ost 1945 162 173 55 221 135 187 38 243 144 183 280 219 538 213 891 979 822 840 839 645 596 460 $ 5T 65 41 $’ 82 104 14 BANKING CH AN G ES IN P R IN C IP A L FED ERAL RESERVE A SSETS A N D L IA B IL IT IE S B A N K O F ST. L O U IS Change from (I n thousands o f dollars) June 19, 1946 M ay 15, 1946 June 20, 1945 4 - 12,635 — 1,461 4 - 22,950 4-832,816 .......... Industrial advances under Sec. 13b ,.$ Other advances and rediscounts............... 25,680 U . S. securities.............................................. . 1,054,220 Total earning assets................................. ,. 1,079,900 4 - 11,174 4-855,766 Total reserves .......... ..................................... . 603,546 Total deposits ................................................. . 638,233 F. R. notes in circulation........................... . 1,047,418 — — 4- 9,440 3,598 4,305 4-482,565 4-621,401 4-963,253 Industrial commitments under Sec. 13b. 4- 3,597 -f. , On May 31, 1946, the Mutual Bank and Trust Company of St. Louis, Missouri, became a member of the Federal Reserve System. This brings the total membership of the Federal Reserve Bank of St. Louis to 493 banks. The Mutual Bank and Trust Company was organized in April, 1934 and is located in the down town business section of St. Louis. It has a total capital account of $1,676,000 and total deposits of approximately $27,800,000. Its officers are E. A. Schmid, President; Ed. T. Murray, Vice President and Trust Officer; V. Jacquemin, Jr., Vice Presi dent; Leonard G. Miller, Cashier; Theodore R. Barker, J. L. Hauk, Richard L. Rawlings, Perry Topping, Jr., Assistant Cashiers; Albert L. Sautter, Secretary, and George R. Bradbury, Assistant Trust Officer. S tocks M ay 31,1 94 6 com pared with M ay 31, 1945 ....% 3,600 50 P R I N C I P A L R E S O U R C E A N D L I A B I L I T Y IT E M S O F R E P O R T IN G M E M B E R B A N K S Change from (I n thousands o f dollars) June 19, 1946 M ay 15, 1946 June 20, 1945 .$1,999,274 — 103,376 1 . 299,129 — 12,143 4* 64,448 Loans to brokers and dealers in securities 12,336 -0 4 - 4,629 Other loans to purchase and carry securities ..................................................... . 68,182 ___ 5,816 4 - 13,366 Real estate loans............................................ 80,773 + 3,865 4 - 15,139 Loans to banks.. 2,305 252 4 260 . 117,091 6,368 4 - 30,462 . 579,816 7,978 4-128,304 Treasury b 10,126 — 38,980 — 50,230 Certificates of . 213,960 — 24,426 — 64,205 230,749 — 28,134 — 96,867 U . S. B onds.............. ...................................... 823,870 — 7,523 4-127,558 Obligations guaranteed b y U . S. G ovt. 366 - 0— 247 . 140,387 4 - 3,665 4 - 11,932 . 1,419,458 95,398 — 72,059 Balances with dom estic banks.. 114,650 — . 142 — 8 Demand deposits— adjusted** .. . 1,121,675 - f 4,738 4 - 87,304 . 363,269 4 - 4,099 4 - 56,698 U. 273,318 — 103,006 — 69,143 . 552,515 — 34,037 37,476 Borrow ings ........................................ . 21,300 4 - 11,000 — 1,700 *Includes open market paper. **O ther than interbank and Governm ent deposits, less cash items on hand or in process o f collection. A bove figures are for selected member banks in St. Louis, Louisville Memphis, L ittle R o ck and Evansville. Page 11 June, general agricultural conditions in the United States were not as favorable as earlier in the season. As a result, much of the gains that the unusually early spring had brought were lost, and currently the stage of general crop development is about normal. For the Eighth Federal Reserve District, the outlook for this season is not as favorable as for the country as a whole. The very early spring enabled district farmers to get an excellent start this year, but cold, wet weather throughout most of May retarded crop development sufficiently so that at present it is less further advanced than normal. Much replanting of early crops has been necessary in this district. Reports from river bottom sections indicate that some farmers have had to replant three and four times. At the same time, crop prospects in the district as of June 1, 1946, were considerably better than on the comparable date last year. Prospects were good to excellent in most of Missouri and fair in almost all other sections of the district. Only small sections of northeastern and southwestern Arkansas and southern Illinois had poor crop prospects at that time. A year ago no section of the district was rated as having good to excellent prospects and much larger sections had poor crop prospects. The farm labor situation as of June 1 was easier than on the same date a year ago. The number of persons working on farms on June 1, according to the U. S. Department of Agriculture, totaled 11,422,000, as compared with 10,994,000 on June 1, 1945. The number of family workers on farms was about 300,000 more than a year earlier, while the number of hired workers was about 100,000 more. The total number of farm workers at the beginning of June, 1946, how ever, was 1,100,000 less than the average prevailing on that date in the 1935-39 period. The 1946 winter wheat harvest is under way in the southern areas of the United States. The estimated United States crop this year is 775 million bushels, the third largest of record, but almost 6 per cent less than last year’s bumper crop. With an indicated 251 million bushel spring wheat crop, however, total wheat production this season again is expected to run better than 1 billion bushels. In the states contained partly or wholly within the Eighth District, the indicated 1946 winter wheat crop, as of June 1, was 84 million bushels as compared with 95 million bushels last year and a 97 million bushel average for the ten-year (1935-44) average. Excess rain in the southern parts of the district reduced wheat prospects there considerably in the past month, and there are additional reports from scattered localities of serious damage from Hessian fly. Planting of corn has been delayed this season Page 12 because of frequent rains and much of the early planted corn is weedy. In some sections of the district, par ticularly in the southern and eastern portions, plant ings were only 5 per cent complete by June 1. The second largest oats crop of record is in prospect for this season. As of June 1, the United States crop was estimated at almost 1.5 billion bushels, only 3 per cent less than the bumper crop of 1945 and 32 per cent more than the average crop of the 1935-44 period. In this district the 1946 oats crop is expected to exceed that of 1945 by about 25 million bushels. The total hay crop in the United States, both tame and wild, is expected to be about 96 million tons this year, one of the smallest of the last six years. Average production in the 1941-45 period was 100 million tons. The record carryover from last year’s crop, however, apparently will make the total supply of hay adequate for the livestock population. Pastures have been in very good condition with the continued rains aiding development. Condition of pastures in this district as of June 1 averaged about 93 per cent, 11 points better than prevailed on the average during the ten years, 1935-44. Production of peaches this year will be very much heavier than that of the average year in the 1935-44 period but somewhat smaller than in 1945. District prospects deteriorated during the last month as late frosts injured the Illinois and Indiana crops rather badly and wet weather hurt the Mississippi crop. Freeze damage in Arkansas was negligible, however, and prospects for that1 state are uniformly good. Missouri peaches also were not hurt badly by the frosts. For the peach producing states in this district, the 1946 crop was estimated on June 1 to be about 9 million bushels as compared with 10.9 million bushels in 1945 and 6.9 million bushels for the long-term average. The 1946 pear crop in district states is expected to total about 1.6 million bushels, 600,000 bushels less than were produced in 1945 and 400,000 bushels less than were harvested during the period 1935-44. Pear prospects in Arkansas are the best since 1941. The commercial apple crop in the United States this year is expected to be smaller than average but about half again as large as the very small crop of 1945. In this district, the Arkansas crop is expected to be double that of 1945 and the Missouri and Illinois crops somewhat better than last year. Condition of early potatoes in the district as of June 1 averaged 91 per cent of normal as compared with about 80 per cent last year. Early potatoes were being harvested in Arkansas and Tennessee at the beginning of June, and yields were proving to be T excellent.
@FedFRASER