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83d Congress, 1st Session

HISTORICAL AND DESCRIPTIVE
SUPPLEMENT TO

Economic Indicators
Prepared for the Joint Committee on the Economic Report
hy the Committee Staff with the Cooperation
of the
Office of Statistical Standards, Bureau of the Budget




UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON : 19S3

JOINT COMMITTEE ON THE ECONOMIC REPORT
(Created pursuant to sec. 5 (a) of Public Law 304, 79th Cong.)
JESSE P. WOLCOTT, Michigan,
RALPH E. FLANDERS, Vermont,

Chairman

Vice Chairman

ARTHUR V. WATKINS (Utah)
BARRY GOLDWATER (Arizona)
FRANK CARLSON (Kansas)
JOHN SPARKMAN (Alabama)
PAUL H. DOUGLAS (Illinois)
J. WILLIAM FULBRIGHT (Arkansas)

RICHARD M. SIMPSON (Pennsylvania)
HENRY O. TALLE (Iowa)
GEORGE H. BENDER (Ohio)
EDWARD J. HART (New Jersey)
WRIGHT PATMAN (Texas)
RICHARD BOLLING (Missouri)
GROVER W .
JOHN W .

ENSLEY, Staff Director
LEHMAN, Clerk

[PUBLIC LAW 120—81ST CONGRESS; CHAPTER 237—1ST SESSION]
J O I N T R E S O L U T I O N [S. J. Res. 55]
T o print the monthly publication entitled "Economic Indicators"
Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That the Joint
Committee on the Economic Report be authorized to issue a monthly publication entitled "Economic Indicators/'
and that a sufficient quantity be printed to furnish one copy to each Member of Congress; the Secretary and the
Sergeant at Arms of the Senate; the Clerk, Sergeant at Arms, and Doorkeeper of the House of Representatives; two
copies to the libraries of the Senate and House, and the Congressional Library; seven hundred copies to the Joint
Committee on the Economic Report; and the required number of copies to the Superintendent of Documents for
distribution to depository libraries; and that the Superintendent of Documents be authorized to have copies printed
for sale to the public.
Approved June 23, 1949.

ii



Letters of Transmittal
DECEMBER 1 8 , 1 9 5 3 .

To Members of the Joint Committee on the Economic Report:
For the information of the members of the Joint Committee on the Economic Report and others interested
there is transmitted herewith a Supplement to the committee's monthly publication Economic Indicators
containing both historical tables of the various indicators now published and a description of the derivation,
limitations and uses of each indicator. These materials were developed by the committee staff with the
cooperation of the Office of Statistical Standards, Bureau of the Budget, and of the agencies responsible for
each series.
As you are undoubtedly aware, there have been numerous requests for this information in recent years.
It is believed that the present publication will be useful not only to the members of the committee and to
other Members of Congress but also to other users of Economic Indicators, both within the Government
and among the nearly 4,000 private subscribers.
JESSE P .

WOLCOTT,

Chairman, Joint Committee on the Economic Report.
DECEMBER 1 8 , 1 9 5 3 .

The Honorable JESSE P . WOLCOTT,
Chairman, Joint Committee on the Economic Report,
United States House of Representatives, Washington, D. C.
D E A R M R . WOLCOTT: Pursuant to numerous requests the committee staff transmits herewith a supplement to the committee's monthly publication Economic Indicators, containing for each indicator (1) historical
data and (2) a description and references to additional technical explanations. This report is intended to
answer most of the requests for general information which cannot be carried each month in the committee's
publication but which is often essential to the interpretation and use of the current materials.
The descriptive material shown for each series in Economic Indicators attempts in a nontechnical way
to explain how the series is derived, what its limitations are, and the uses for which it is appropriate or, in
some cases, warning of uses for which it is especially not appropriate. Both the historical data and the
descriptions which are included in this Supplement are designed for general users of the data rather than
for technicians.
It might be helpful to point out for the benefit of persons not familiar with Economic Indicators that this
is a monthly publication printed by the Congress in accordance with Public Law 120, 81st Congress; chapter
237, 1st session, a copy of which is reproduced on the back of the front cover of this Supplement. Economic
Indicators was first published by the Joint Committee on the Economic Report as a committee print in
1948 to provide its members with information on current economic trends and developments in a concise
and graphic form. Knowing that other Members of the Congress, businessmen, farm leaders, labor organizations, and representatives of the press also sought such information the Joint Committee at the same time
sponsored legislation which later resulted in authorizing publication on a permanent basis. The materials
for Economic Indicators are prepared each month for the Joint Committee on the Economic Report by the
Council of Economic Advisers.
The Committee has always invited suggestions for improving Economic Indicators. Improvements have
been made as a result of these suggestions. It is recognized that the materials included must be limited to
those series of most general use by Members of Congress, executive Government agencies, and others. The
Committee policy has been to carry standard series and relationships without interpretation. Other
publications of the Committee and the executive agencies are considered the medium for interpretations
of the data.




iii

Economic Indicators currently has a list of nearly 4,000 paid subscribers. It is used widely by schools
and libraries as a reference source and has a circulation of over 200 foreign subscribers, covering all major
nations of the world. The monthly Indicators is sold through the Superintendent of Documents, United
States Government Printing Office, Washington, D. C., price 20 cents per copy; $2 per year; $2.50 foreign.
For this Supplement, the developmental and supervisory work was done by the Committee staff.
The descriptions of the series were written by members of the staff of the Office of Statistical Standards,
Bureau of the Budget. The tables were prepared by Miss Frances James and the agencies compiling the
original data.
Respectfully submitted.
G H O V E R W . E N S L E Y , Staff Director.




Contents
THE TOTAL OUTPUT OF THE ECONOMY
The Nation's Economic Accounts
Gross National Product
PRICES
Consumer Prices
Wholesale Prices.
Prices Received and Paid by Farmers
Stock Prices
EMPLOYMENT AND WAGES
Civilian Labor Force
Nonagricultural Employment—Selected Industries
Average Weekly Hours—Selected Industries
Average Hourly Earnings—Selected Industries
Average Weekly Earnings—Selected Industries
PRODUCTION AND BUSINESS ACTIVITY
Industrial Production
Production of Selected Manufactures
Weekly Production—Selected Indicators
Gross Private Domestic Investment
Expenditures for New Plant and Equipment
New Construction
New Housing Starts
Inventories and Sales
Merchandise Exports and Imports

Pagfl

—

1
4
6
8
10
13
-

— --

-

14
18
20
22
22
24
27
28
30
32
34
36
38
40

PURCHASING POWER
National Income
—
Corporate Profits
Personal Income.
Per Capita Disposable Income
Consumer Income, Spending, and Saving. _
Farm Income

42
44
46
46
48
50

CREDIT, MONEY, AND FEDERAL FINANCE
Bank Loans and Investments
Consumer Credit
Bond Yields and Interest Rates
Money Supply
Federal Budget Receipts and Expenditures
Federal Cash Receipts From and Payments to the Public

52
54
56
58
60
62




-

V




THE TOTAL OUTPUT OF THE ECONOMY
THE NATION'S ECONOMIC ACCOUNTS
Description of series.—The Nation's economic
Government receipts and expenditures are shown
accounts summarize the combined incomes and o: an income and product account basis, rather than
on
expenditures of consumers, business, and Govern- o; either a. cash or a conventional budget 'basis,
on
ment. Tbe accounts are designed to equal, when s as to be consistent with the receipts and expendi<
so
totaled, expenditures for gross national production ti
ture accounts of the other sectors and with the gross
national product total. Government transfer payon the one side and incomes from gross national n
ments, such as social security and veterans' benefits,
production on the other side. The statement of n
and
these accounts represents the results of double-entry a: interest charges represent income to the recipients, but are not included in the gross national
bookkeeping—for every dollar of recorded expendi- e;
product. Therefore, these payments are subtracted
tures for goods and services there must be a dollar of p
recorded income. Thus in the Nation's economic h
from both receipts and expenditures.
accounts, receipts and expenditures add to the same
The income and product accounts of the Government are on a consolidated basis, just as the cash
total. It follows,that for any past period if the n
receipts of any one of these three categories of the a
accounts are, but they depart from the latter beeconomy exceeds the expenditures of that category, c
cause of the timing of the items included in each and
this saving will be offset by an excess of expenditures because of conceptual differences. The income and
b
over receipts in another category or categories*
p
product accounts of the Government are designed
The consumer account summarizes the detailed tto be in accord with the accrual records maintained
<
statistics on personal income and consumption shown b private business. Thus, business taxes, espeby
cially those on corporate profits, are recorded on an
in the tables in the Purchasing Power section of c
Economic Indicators, particularly the table on Con- accrual rather than a collections basis, and Governa
sumer Income, Spending, and Saving. It should n
ment expenditures for goods are corrected for the lag
between deliveries and payments therefor. All capibe rioted that, whereas personal income includes b
the income of unincorporated businesses and farms, t transactions, such as receipts from the sale of
tal
only expenditures for consumption purposes are C
Government property and changes in loans and inincluded in this account. Investments of both cor- v
vestments of Government credit agencies, are exporate and noncorporate businesses are included in c
cluded from the income and product accounts althe business account. Residential construction, t!
though such transactions are included in both the
whether for owner occupancy or for rental purposes, c
cash and conventional budgets.
is also included with business investment, while the
Uses and lirnitations.—A set of economic accounts
actual or imputed rent of dwellings is included in f< the Nation reduces the voluminous detail of
for
consumer expenditure.
e
economic activity to understandable proportions by
In the business account, receipts of business include p
providing the factual background for seeing in perspective the operations of the major categories of
the undistributed profits of corporations after ad- s
the economy—consumer, business, and Governjustment for inventory valuation, plus the capital t'
ment—and the interrelationships or transactions
consumption allowances of both corporate and non- n
between and among them. A statement of these
corporate enterprises and institutions, and deprecia- b
accounts serves a number of purposes:
tion on residences. Depreciation allowances must a
be added to receipts since investment is on a gross
(1) In summarizing the pattern of change in the
economy over recent periods, the statement indicates
basis, that is, before deduction for depreciation, e
Business investment includes additions to plant and \
what one should look for among the other charts
and tables included in Economic Indicators.
equipment and inventories of both corporate and a
noncorporate enterprises, as well as residential
(2) The accounting methodology needed to preconstruction.
i
pare this statement helps to assure that the various




1

estimates such as income, expenditures, savings,
investment in the other charts and tables are
consistent.
(3) It is frequently necessary to project and
evaluate the likely economic impact of public and
private programs on the economy. The framework
of these accounts enables the expression quantitatively of the combination of such public and
private plans within a framework of the broad
categories of the economy so as to measure inconsistencies or imbalances between and among them,
and inconsistencies between and among the assumptions upon which these plans are based.
Preparation of a Nation's economic budget for a
future period, using these accounts, is especially
helpful when Government programs are of such
magnitude and importance that they dominate
changes in the economy; in other words, when Government spending and tax plans are the main forces
making for changes in the economy. This type of
analysis is therefore particularly useful in formulating
a stabilization program in periods of war or high
national defense operations. At other times, its
main benefit is in identifying and measuring inflationary and deflationary programs of Government
and private economic groups or individuals and in
pointing out areas in which adjustments are necessary to achieve economic stability and growth.
(4) Another use, related to this last use, is that of
enabling those who must make an actual forecast,
such as businessfirms,private economists and others,
to check their forecasts as to their consistency in
several ways: consistency with past patterns of
fluctations in the total and various segments of the
economy; consistency as between and among the
various assumptions as to income, savings, investment, prices, and employment that underlie the
forecast.
Certain limitations must be recognized in using
these economic accounts. Needless to say, the
statistics do not throw light on all aspects of the
economy but only broad summary categories and

2



thus must be supplemented by the use of additional
economic information, such as that contained in
other parts of Economic Indicators. Also, the data
are national in coverage, hence their trends and
changes must be carefully interpreted and supplemented by other data for use in the analysis of regional or individual industry problems. Third, they
do not, of course, provide the assumptions or the
reasons which one should have for explaining or
projecting economic changes; they only provide the
relevant statistical background for intelligent reasoning and judgment. Finally, it must be recognized
that estimates for both receipts and expenditures for
some of these categories rest upon data collected for
other purposes, or upon crude or indirect estimates
in cases where no direct survey is regularly conducted to obtain data. Thus there will be times
when it will be difficult to interpret the meaning of
some of the changes in the accounts if, at the time,
statistical discrepancies in the accounts which arise
from technical problems in estimating the various
items are so large that they throw doubt on some of
the movements or the importance of other movements in the accounts.
References.—The estimates included in the Nation's
economic accounts are all taken from the national
income and product statistics of the Department of
Commerce. The National Income Supplement to the
Survey oj Current Business, 1951, has complete statistics from 1929 to 1950, as well as much explanatory
material. Revised estimates for 1949-52 can be
found in the Survey of Current Business, July 1953.
See also Technical Notes on the Nation's Economic
Budget, Appendix A: Report of the Joint Committee on
the Economic Report on the January 1952 Economic
Report of the President, Senate Report No. 1295, 82d
Congress, 2d session, pp. 99-105, and statistical materials accompanying the Annual Economic Reviews
prepared by the Council of Economic Advisers for
inclusion with the Economic Report of the President,
1948-53.

The Nation1 s Economic Accounts
[Billions of dollars]
Consumers
Year

Consumption expenditures

Disposable income

Business
Saving
( + ) or
dissaving ( - )

Gross retained
earnings

Investment 1

Government
Excess of
Expendi- Excess of
earnings
Receipts
receipts
tures for
( + ) or (less trans- goods and
( + ) or
investexpendifers, etc.)
services
tures (—)
ment (—)

Statistical
discrepancy 2

1929

82. 5

78. 8

+ 3. 7

11.9

16. 6

-4.7

9.5

8.5

+ 1. 1

-0. 1

193 0
193 1
193 2
193 3
193 4

73. 7
63. 0
47. 8
45. 2
51. 6

70. 8
61. 2
49. 2
46. 3
51. 9

+ 2.9
+ 1.8
-1. 4
-1. 2
2

9.0
5.3
2.7
2. 7
5. 0

10. 9
5. 6
1. 1
1. 5
3. 2

-1. 9
2
+ 1.7
+ 1.2
+ 1.7

8.9
6.4
6.4
6. 7
7.4

9. 2
9. 2
8. 1
8.0
9.8

3
-2. 8
-1. 7
-t. 3
-2.4

-. 7
+ 1.2
+ 1.4
+ 1.2
+.9

1935—
193 6
193 7
193 8
193 9

58. 0
66. 1
71. 1
65. 5
70. 2

56. 2
62. 5
67. 1
64. 5
67. 5

+
+
+
+
+

1. 8
3. 6
3. 9
1.0
2. 7

6. 5
6. 7
7.9
8.0
8. 6

6. 1
8. 2
11. 5
7.4
10. 8

+.4
-1. 6
-3. 6
+.6
-2. 2

8. 0
8.9
12. 3
11. 3
11. 2

9. 9
11. 7
11. 6
12. 8
13. 1

-1. 8
-2. 9
+.7
-1.5
-1. 9

-.3
+.9
-1. 0
1
+ 1.4

194 0
194 1
1942—
1943—
1944—.

75. 7
92. 0
116. 7
132. 4
147. 0

72. 1
82. 3
91. 2
102. 2
111. 6

+ 3. 7
+ 9. 8
+ 25. 6
+ 30. 2
+ 35.4

10. 7
11. 6
13. 9
16. 3
17.5

15. 5
19. 5
10. 7
3. 5
5. 6

-4.8
-7.9
+ 3. 2
+ 12. 8
+ 11. 9

13.4
21. 2
28. 6
44. 7
45. 2

13. 9
24. 7
59. 7
88. 6
96. 5

-. 5
-3. 5
-31. 2
—43. 9
-51. 4

+ 1.6
+ 1. 6
+ 2.3
+.9
+4.0

194 5
194 6
194 7
194 8
194 9

151. 1
158. 9
169. 5
188. 4
187. 2

123. 1
146. 9
165. 6
177. 9
180. 6

+ 28. 0
+ 12. 0
+ 3.9
+ 10. 5
+ 6.7

15. 7
15. 0
21. 1
29. 1
30.2

9.3
33. 3
39. 1
44. 6
34. 0

+ 6. 4
-18. 3
-18. 0
-15. 5
-3.8

43.6
35. 5
42. 4
44. 8
40. 6

82. 8
30. 9
28. 6
36. 6
43. 6

-39. 2
+4. 6
+ 13. 7
+ 8. 2
-3. 1

+ 4. 9
+ 1.7
+.3
-3. 2
+.2

1950
1951—_
1952

205. 8
225. 0
235. 0

194. 6
208. 1
218. 1

+ 11. 3
+ 16. 9
+ 16. 9

30. 3
33.8
37.4

50. 2
58. 8
52. 3

-20. 0
»25. 0
-14. 9

50. 3
70. 0
75. 1

42. 0
62. 9
77.5

+ 8.3
+7.1
-2.4

+.4
+ 1. 1
+.5

i Gross private domestic investment and net foreign investment.
» Excess of the value of the estimated gross national product computed by thefinalproducts irethod over its independently estimated value computed by adding
necessary conceptual adjustments to the national income. Discrepancy shown may differ from that derived from income and expenditure items shown in this table
because of rounding.
Source: Department of Commerce.

6044S—53

2




3

GROSS NATIONAL PRODUCT
Description of series.—Gro_ss National Product purchases from abroad and international contribu(often called GNP) represents the total national tions. Items which do not represent current prooutput of goods and services at current market ductive activity—such as transfer payments (e. g.,
prices. It measures this output in terms of the social security and veterans' payments), Governexpenditures by which these goods are acquired. ment interest, subsidies, loans, and other financial
These expenditures are the sum of four major items: transfers—are excluded. The GNP series on Government purchases will differ from expenditures
1. Personal consumption expenditures
shown in the Federal Budget, which includes many
2. Gross private domestic investment
of these items. Differences may also arise because
3. Net foreign investment
4. Government purchases of goods and services of variation in the time at which expenditures occur
The goods and services included in the GNP are and are recorded.
Statistical procedures.—Hundreds of basic ecofor the most part those actually bought for final use
in legal markets. There are a number of exceptions, nomic series are evaluated, adjusted, and combined
the most important of which is the rental value of in the process of preparing the GNP estimates. For
example, consumer expenditures are estimated for
owner-occupied dwellings.
The GNP series measures the product attributable benchmark years primarily from data in the Censuses
to the factors of production—labor and property— of Business and Manufactures, reports of the Desupplied by residents of continental United States. partment of Agriculture, Internal Revenue Service,
For the most part these factors are located in this and Interstate Commerce Commission, with current
country, but the GNP total also includes earnings quarterly estimates carried forward by the extensive
of American employees of the United States Gov- sample reports of the Census Bureau's Monthly Reernment stationed abroad, foreign interest and port on Retail Trade, sales-tax data, and data from
dividends received by Americans, and the profits other sources. Construction activity is estimated
from foreign branches of American business.
jointly by the Departments of Commerce and Labor
"Personal consumption expenditures" is the sum from BLS reports on building permits secured in
of money and imputed expenditures made by hundreds of cities, special field surveys, and F. W.
consumers (individuals, nonprofit institutions such Dodge reports on construction contract awards and
as hospitals, etc.) for goods and services. This related items. Investment in producers' durable
series is described below, in the section on Consumer equipment is estimated for benchmark years from
Income, Spending and Saving (p. 48).
Census of Manufactures and related data, with cur"Gross private domestic investment" consists of rent quarterly and annual totals estimated from
new construction, producers' durable equipment, sample surveys and sales andfinancialreports to the
and changes in business inventories. This component Department of Commerce and other agencies. For
of GNP is described below, in a separate section details of the methods used, reference should be
(p. 30).
made to the comprehensive study by the Department
"Net foreign investment" is the net change in the of Commerce, National Income, 1951 edition.
international assets and liabilities of this country
Relation to other series.—Two other series widely
(including our gold stocks) arising out of current used as indicators of the general level of economic
transactions with foreign countries. It is the sum of: activity are National Income and the Federal Reserve
(1) domestic output sold abroad minus United States Index of Industrial Production. Gross National Prodpurchases of foreign output; (2) cash gifts and con- uct and National Income are compiled from the same
tributions received from abroad minus those sent series of accounts, but whereas the former measures
abroad; and (3) production abroad by United States the current value of total output, the latter measures
labor and property minus production in the United only the earnings of labor and property which flow
States by foreign-owned labor and property.
from that output. National Income is the smaller of
"Government purchases of goods and services" the two aggregates because from the current value
are those made by Federal, State, and local govern- of total output are subtracted (1) allowance for
ments. They include: (1) net purchases of new depreciation and similar capital consumption, and
goods (such as school buildings and armaments); (2) indirect taxes (such as sales and excise taxes).
(2) payments for services (principally compensation
The GNP measures total output, whereas the
for Government employees); (3) gross investment by Federal Reserve Index of Industrial Production
Government enterprises; and (4) net Government covers only two sections of the economy—manufac4



Gross National Product
[Billions of dollars]
Government purchases of goods and services

Year

1929.
1930.
19311932_
1933.
1934.
1935.
1936.
1937.
1938.
1939.
19401941_
1942.
19431944.
1945.
1946.
1947.
1948.
1949.
1950_
1951.
1952.

Personal Gross
Total
conNet
private
gross
sump- domestic foreign
national
tion
investproduct expend- investment
ment
itures

103.8
90. 9
75. 9
58. 3
55.8
64.9

72.2

82.5
90. 2
84.7
91.3
101. 4
126.4

161. 6

194. 3
213.7
215.2
211. 1
233.3
259.0
258. 2

286.8

329.8
348.0

78.8
70. 8

61.2

49.2
46. 3
51. 9
56.2
62. 5
67. 1
64. 5
67.5
72. 1
82. 3
91.2
102.2
111.6
123. 1
146. 9
165. 6
177. 9

180. 6
194. 6

208. 1
218. 1

15. 8

0.8

10. 2

.7
.2
.2
.2
.4
1
1
.1

5.4
. 9
1.3

2.8

6. 1
8. 3
11.4
6.3
9.9
13. 9
18.3
10.9
5.7
7.7
10.7
28. 7
30.2
42.7
33.5
52. 5
58. 6
52. 5

1.1

.9
1.5

1. 1
-.2

»2.2

-2. 1
-1.4
4.6
8.9
1.9
.5
-2.3
.3
-.2

Federal
Total
Total

8.5
9.2
9.2
8. 1

8.0

9.8
9.9
11.7
11. 6

12. 8

13. 1
33. 9
24. 7
59. 7

88. 6
96.5

82.8
30.9

28.6

36. 6
43.6
42.0
62. 9
77.5

1.3
1.4
1.5
1.5

2.0

3.0
2. 9
4. 8
4.6
5.3
5.2
6.2
16.9
52.0
81.2
89.0
74.8
20.9
15.8
21.0
25.4
22. 1
41. 1
54.2

National
security

(2)

2
(2)

(

(2)
(2)
(2)
2
(2)
(
(2
(2)
1.3
2. 2
13.8
49.6
80. 4
88.6
75.9

21.2

13.3
16. 1
19.3
18. 5
37.4
48. 9

Other

(2)
(2)
(2)
(3)
(2)
(2)
(2)
(2)
(2)
(2)
3. 9
4.0
3.2
2.7
1.5
1.6
1.0
2. 5
3.8
5.6

6.6
3.9
4. 1
5.8

Less
Government
sales

(3)
(3)

0.2
. 6

1.2
2.2

2.7
1.3
. 6
. 4
.2
.4
.5

State
and
local

7.2
7.8
7.7
6. 6
5. 9
6.8
7.0
6. 9
7.0
7.5
7. 9
7.8
7.8
7.7
7.4
7.5
8.0
10.0

12.8

15. 6
18.2
19.9
21.8
23.4

i Includes expenditures for military services, international security and foreign relations (except foreign loans), development and control of atomic energy, promo*
tion of the merchant marine, promotion of defense production and economic stabilization, and civil defense. For further details, see Economic Report of the Presf
dent, January 1953 (p. 165), and Survey of Current Business, July 1953 (p. 10).
a Not available.
* Less than $50 million.
NOTE.—Detail will not necessarily add to totals because of rounding.
Quarterly data are available beginning with 1939.
Source: Department of Commerce.

tures and mining. The products in the GNP series the physical quantity of goods and services produced
are final product, whereas the Reserve Board index by the economy. On an annual basis, however, GNP
includes both final and intermediate product, and estimates corrected for price changes ("deflated
thus may show an increase or decrease in activity GNP") are available which show changes in the total
not yet reflected in flow of final output. The volume of national output. One of the most
GNP series in current prices combines price and important characteristics of the GNP is that changes
volume changes, whereas the Federal Reserve index in the total can be analyzed by examination of
measures physical volume.
changes in its components, notably purchases by
Uses and limitations.—The GNP total is the most consumers, the investment of private business, the
inclusive monetary measure of trends in the economy expenditures of Government, and the movement of
as a whole which is currently estimated. It also foreign trade.
has high value as an analytic tool, since the moveReferences.—The quarterly GNP estimates appear
ments of many sectors of the economy, including each month in the statistical section of the Survey of
the sales of many industries and enterprises, are Current Business. Preliminary annual estimates
quite closely related to changes in the level of GNP. appear in the February issue, final estimates in the
Since GNP is measured in current dollars, the July issue. Statistical data for 1929-48, including
effects of changes in both the price level and the measures of deflated GNP, appear in the 1951
physical volume of output are combined, and move- National Income Supplement to the Survey of Current
ments in the total from quarter to quarter should not Business; those for 1949-52 appear in the July 1953
be interpreted as necessarily representing changes in issue of the Survey.




5

PRICES
CONSUMER PRICES
Description oj series.—The Consumer Price Index,
compiled by the Bureau of Labor Statistics, measures
the average change in prices of goods and services
purchased by urban wage earner and salaried clerical
workers' families. The goods and services included
in the index are those required to maintain the level
of living characteristic of such families in 1952. These
families represent about 64 percent of all people living
in urban places, and about 40 percent of the total
United States population. The index is not specifically representative of price changes for commodities
and services purchased by farm families, for persons
making purchases in communities of less than 2,500
population, for single persons, or for families living
in urban areas whose purchases are not similar to
those of wage earner and salaried clerical workers'
families. The index is a price barometer; it does
not measure changes in the total amount of money
spent by such urban families for family living.
The index is based upon prices collected on about
300 items in 46 cities. These 300 items were selected
by the Bureau of Labor Statistics as representative,
of the thousands of commodities and services purchased in 1950 as reported in a survey of wage earner
and salaried clerical workers' families in 91 cities.
In each of these 46 cities the Bureau has selected a
list of stores and service establishments from which
to collect prices regularly. This list is representative
of the types of outlets in which wage earner and
salaried clerical workers' families make their purchases, and includes chain stores, independent stores,
department stores, specialty stores and public utilities. Prices are also collected on such items as
physicians' and dentists' fees, hospital rates, and
beauty-parlor services. Federal, State, and city
taxes are added to the retail prices for the commodities on which they are imposed. Automobile taxes
are added; property taxes are included in the cost of
homeownership, and implicitly included in rental
costs. Neither income taxes nor social-security taxes
are included.
Prices on the 300 items are collected by the use of
specifications limiting the qualities- priced to those
representative of the qualities purchased by urban
wage earner and salaried clerical workers', families in
1952. Revisions in individual specifications are
made from time to time as former descriptions
become obsolete. Prices are collected in each city
at intervals ranging from once every month to once
every 4 months. Prices for foods, for a few other
6



important items such as cigarettes and public transportation, and for rents, are collected monthly in
each city. Prices for other goods and services are
collected every month in the 5 largest cities; in the
other 41 cities they are collected every 3 or 4 months,
depending on the size of the city. Pricing of these
other goods and services in these 41 cities is on a
rotating cycle so that several cities of each size group
are priced each month. Between the periodic pricing
periods in a given city, the price change for groups
of these items is estimated for the purpose of computing the monthly national index.
Prices for practically all of the commodities and
many of the services are collected by personal interview. Monthly rent information and a few other
prices (e. g., streetcar and bus fares, public utility
rates, fuel prices) are collected by mail.
A major revision of this series was recently completed, with the revised index introduced as of January 1953. The principal changes were—
1. Change in the list of items priced to reflect
current purchasing habits.
2. Increase in the number of items priced.
Among the important additions to the pricing
list were used cars, home purchase and maintenance, and restaurant meals.
3. Revision and expansion of the list of cities
in which prices were collected so that the index
will reflect price changes affecting wage earner
and clerical workers' families in all urban areas.
4. Change of the base period of the index
from 1935-39 to 1947-49.
The revised series was linked to the former series
to provide a continuous index from 1913.
Statistical procedures.—The purpose of the index
calculation is to determine how much more or less it
would cost to purchase the same quantities and
qualities of goods and services in this period than in
an earlier period. The first step in the index calculation is to compare the current price for each commodity or service with the price reported for that
particular commodity or service at the time of the
preceding collection. This percentage change is
then multiplied by the estimated cost of this fixed
quantity of the item in the preceding period. After
these calculations have been made for each of the
food items, for example, these estimated costs for
food for the current period are totaled and compared
with the total for the preceding period. This result
measures the average price change for all foods, and

Consumer Prices
[1947-49=100]

Year

All
items

Housing
Apparel

Food
Total

Kent

Transportation

Reading
and
Medical Personal
care
recreacare
tion

Other
goods
and

1917.
1918.
1919.

54.8
64. 3
74. 0

57. 9
66. 5
74. 2

77.4
78. 8
85. .3

88.2

1920.
1921.
1922.
1923.
1924.

85.7
76.4
71.6
72. 9
73. 1

83. 6
63. 5
59.4
61.4
60. 8

100.2
115. 1
118.5
121. 6
125. 9

105. 1
80. 9
65. 7
65. 8
65.3

1925.
1926.
1927.
1928.

75.0
75.6
74.2
73.3

65.8
68.0
65. 5
64. 8

126.4
125.2
123. 2
120. 3

64. 0
63. 0
60. 9

1929.

73.3

65. 6

117. 4

60. 3

1930.
1931.
1932.
1933.
1934-

71.4
65.0
58.4
55. 3
57.2

62.4
51.4
42. 8
41. 6
46.4

114 2
108.2
97. 1
83. 6
78.4

58.9
53. 6
47. 5
45.9
50.2

19351936.
1937.
1938.
1939-

58. 7
59.3
61.4
60.3
59.4

49. 7
50. 1
52. 1
48.4
47.1

78,2
80. 1
83. 8
86. 5
86. 6

50. 6
51.0
53.7
53.4
52. 5

1940.
19411942.
1943.
1944.

59.9
62.9
69.7
74.0
75.2

47.8
52.2
61. 3
68.3
67.4

86.9
88.4
90.4
90. 3
90:6

53.
55.
64.
67.
72.

19451946.
1947.
1948.
1949.

76.9
83.4
95.5
102.8
101.8

68.9
79.0
95.9
104. 1
100.0

95.0
101.7
103. 3

90* 9
91. 4
94.4
100.7
105. 0

76.3
83. 7
97. 1
103.5
99.4

90. 6
100. 9
108.5

94. 9
100. 9
104. 1

97.6
101.3
101. 1

95.5
100. 4
104. 1

96. 1
100.5
103.4

1950.
1951.
1952-

111.0

102.8

101.2
114.6

108. 8
113. 1
117. 9

98. 1
106. 9
105.8

111. 3
118.4
126,2

106.0

113.5

106. 1
112.4
114. 6

101. 1
110. 5
111. 8

103.4
106.5
107.0

105. 2
109. 7
115.4

112. 6

49. 2
66. 6

61.8

2
6
9
8
6

111. 1
117.2

NOTE.—Monthly data are available beginning with January 1913 for "all items" and food; September 1940-September 1944 and January 1947 to date for rent;
September 1940 for apparel, and January 1947 for all others.
Source: Department of Labor.

from this the index number of food for that city is
Uses and limitations.—The index measures changes
calculated. Similar calculations are made for for only a limited population group: wage earner
apparel, rent, and for all other groups of items and salaried clerical workers' families living in
priced. The United States index is calculated by urban areas. Other qualities of commodities and
combining city totals. Two-fifths of the weight is weights would have to be used for other income
groups, for single workers, for retired people, etc.
carried by the 12 largest cities; one-fifth by the 9
The "fixed market basket" represents the average
cities selected to represent the 42 cities with popula- quantities bought by all wage earner and clerical
tion of 240,000 to 1,000,000; one-fifth by the 9 cities workers' families, and is not necessarily representaselected to represent the more than 200 cities with tive of the purchases made by any single family.
population of 30,000 to 240,000; and one-fifth by the However, the index is a good measure of average
16 small cities selected to represent the nearly 3,000 changes in prices for goods and services purchased
towns with population ranging from 2,500 to 30,000. by an average wage earner or clerical worker's family.




7

The city indexes cannot be used to measure the
differences in the levels of prices in the various
cities; they indicate only the difference in the rate
of price movement. That is, assume the index for
city A is 113 and that for city B is 115. This does
nbt necessarily mean that prices on the average are
higher in city B than in city A. If prices in city A
were higher than in city B in the base period, the
total cost of the market basket may still be higher
in city A. The indexes do show that prices have
increased more rapidly in city B than in city A since
the base period.

Although attention is paid to quality changes, no
index can take complete account of such changes.
References.—The basic release of the index is the
report entitled "Consumer Price Index," issued by
the Bureau of Labor Statistics toward the end of the
month following the month to which the figures
relate. A detailed description of the Consumer Price
Index and its uses and limitations is presented in
"The Consumer Price Index, A Short Description of
the Index as Revised, 1953"—a multilith statement
issued by BLS in January 1953; and in an article in
the February 1953 issue of the Monthly Labor Review-

WHOLESALE PRICES
Description of series—The Wholesale Price Index,
compiled by the Bureau of Labor Statistics, measures
the general rate and direction of the composite of
price movements in primary markets, and the specific
rates and directions of price movements for individual
commodities and groups of commodities.
The index is based on price quotations for approximately 2,000 commodities selected to represent all
commodities sold on primary markets in the United
States. All types of commodities, from raw mateterials to fabricated products, are included in the
index. For commodities traded on organized exchanges, such as livestock and grains, the quotations
are furnished by the exchanges or other Government agencies, or are taken from published sources.
For some standardized commodities, such as certain
chemicals and specified constructions of cotton gray
goods, quotations are taken from authoritative trade
papers. For the majority of fabricated products,
prices are reported to the Bureau of Labor Statistics
by producers. Prices are quoted at the level of the
first commercial transaction, and, for each commodity, the reporter is requested to quote the price
which he charges to the channel of distribution to
which he sells the largest volume of this particular
commodity. Consequently, the majority of the
quotations in the index are producers' prices, rather
than wholesalers' prices. The prices relate to a
particular day of the month—usually Tuesday of
the week containing the 15th.
Initial contacts with manufacturers to solicit their
cooperation in reporting prices on specified commodities are made by personal interview; subsequent
price reports are mailed to Washington by the reporting firm. Insofar as possible, identical qualities
of the commodities are priced from period to period,
so that the index will measure only real price changes,
not any differences due to changes in qualities or
terms of sale.
8



A revision of this index was introduced with release
of the January 1952 index. The principal changes
from the old series were—
1. Increase in the commodity coverage—the
number of items priced was increased from
approximately 900 to about 2,000.
2. Change in the basis for weights from average sales for 1929-31 to 1947 sales.
3. Change of the base period from 1926 to
1947-49.
4. A modification of the classification system.
The revised index has been linked to the old series
to provide a continuous index.
Statistical procedures.—The individual price series
are combined into the index by multiplying the value
weight assigned each item by its current price relative, and summing to obtain the current aggregate.
The weights in the index are based on the total value
of primary market transactions for commodities in
1947, the latest year for which a complete Census of
Manufactures is available. The weights are based
on 1947 data, shifted to a 1947-49 base (i. e., weights
adjusted by change in item prices from 1947 to
1947-49 average). Within product classes, the total
1947 adjusted weight has been split to reflect more
recent or normal conditions. For example, steel
weights reflect increased importance of alloys since
1947. Each commodity price series in the index has
its own direct weight (i. e., the value of the sales of
that commodity on primary markets in 1947) plus
an imputed weight for other commodities not priced
for the index, but for which it is known, or assumed,
that prices move like the commodity priced. The
current index is obtained by dividing this aggregate
by the aggregate for the base period. In addition to
the comprehensive index, indexes are released each
month for 15 major groups such as farm products
and processed foods, 88 subgroups such as grains
and cotton products, over 200 product classes and

Wholesale Prices
[1947-49=100] 1

Year

comdities

Farm
products

Processed
foods

Other than
farm products
and foods
(industrial)

1926
1927
1928
1929

65. 0
62.0
62. 9
61. 9

55. 9
55. 5
59. 2
58. 6

58. 2
56. 7
59. 4
58. 5

71. 5
67. 2
66. 4
65. 5

1930
1931
1932
1933
1934

56. 1
47.4
42. 1
42. 8
48. 7

49. 3
36. 2
26. 9
28. 7
36. 5

53.3
44. 8
36. 5
36. 3
42. 6

60. 9
53. 6
50. 2
50. 9
56.0

1935
1936
1937
1938
1939

52.0
52. 5
56. 1
51. 1
50. 1

44. 0
45. 2
48.3
38. 3
36. 5

52. 1
50. 1
52. 4
45. 6
43. 3

55.7
56. 9
61. 0
58. 4
58. 1

1940
1941
1942
1943
1944.

51. 1
56. 8
64. 2
67.0
67. 6

37.8
46.0
59. 2
68. 5
68. 9

43. 6
50. 5
59. 1
61. 6
60.4

59.4
63.7
68. 3
69. 3
70.4

1945
1946
1947
1948
1949

68.8
78.7
96.4
104.4
99.2

71. 6
83.2
100.0
107. 3
92.8

60.8
77.6
98.2
106. 1
95.7

71.3
78. 3
95. 3
103.4
101. 3

1950
1951
1952

103. 1
114. 8
111. 6

97. 5
113. 4
107.0

99. 8
111.4
108. 8

105.0
115. 9
113.2

i This does not replace the former Index (1926=100) as the official index of primary market prices prior to January 1952. These data from January 1947 through
December 1951 represent the revised sample and the 1947-49 weighting pattern. Prior to January 1947 they are based on the month to month movement of the
former index. The only official index up to and including December 1951 is the former monthly index (1926=100).
NOTE.—Monthly data are available beginning with 1926.
Source: Department of Labor.

most of the individual series. In addition. 16 special
group indexes (e. g., building materials) are regularlypublished.
Each week the Bureau publishes an index based on
that week's prices for a small sample (about 200) of
the commodities included in the monthly index, and
on an estimate of the prices for all other commodities.
Uses and limitations.—The index is based for the
most part on producers' prices; therefore, it cannot
be used as a measure of price change at the wholesale
market level.
A comparison of the movement of the subgroud
indexes of the Wholesale Price Index and the Consumer Price Index cannot be used as a measure of
the change in retailers' margins for the specified
groups of commodities mainly because the two indexes are based on different weighting patterns, and
the lists of commodities priced are not identical.
The index is designed to measure "pure" price




changes; that is, changes which are not occasioned
by changes in quality, quantity, terms of sale, etc.
Therefore, it cannot be used as a measure of changes
in manufacturers' average realized prices which are
affected by product mix and terms of sale as well as
by price movements.
An individual price series (in contrast to the price
indexes) relates to a single quality and is selected to
represent the price movement of the commodity and
is not necessarily the average price of all qualities of
the commodity.
References.—The basic release of the index is the
report entitled "Wholesale (Primary Market) Price
Index," issued by the Bureau of Labor Statistics
during the second week of the month following the
month to which the figures relate. A detailed description of the index and its uses and limitations is
presented in the February 1952 Monthly Labor
Review and issued as Reprint No. R. 2067,

9

PRICES RECEIVED AND PAID BY

FARMERS

average prices for the State are calculated for each
item. Chain store prices for many items are reported
Description oj series.—The Department of Agri- directly to the Washington office where they are
culture Parity Index, computed by the Agricultural combined with the appropriate State averages based
Marketing Service (AMS),1 measures the changes in on independent store prices. These averages are
prices being paid by farmers for a list of commodities then combined into national averages by weighting
and services used in family living and farm produc- each State average by the estimate of the amount of
tion. The index is composed of five major parts. that commodity purchased by farmers in the desigThe series on prices paid for commodities and serv- nated State. These estimates of purchases are based
ices used in family living accounts for 44.0 percent upon census reports and other available information.
of the total weight; commodities and services used
Subgroup indexes are computed for 15 types of
in farm production, 41.2 percent; interest on inexpenditures, such as food and tobacco, clothing,
debtedness secured by farm mortgages, 3.0 percent;
taxes on farm real estate, 3.8 percent; and rates of farm machinery, and livestock. The 6 subgroup
indexes relating to expenditures for family living are
wages paid hired farm labor, 8.0 percent.
Altogether 344 price series in addition to interest combined into 1 index, and the 9 subgroups relating
on farm mortgage debt, taxes on farm real estate, to expenditures required for producing farm products
and wage rates are currently included in the Parity are combined into another index. These two group
Index. Forty-two of the price series are used in indexes are combined with the indexes for wage rates,
both the Family Living and Production Indexes. interest, and taxes to form the Parity Index.
Relation to other series.—The movement of retail
The Family Living Index includes 194 items and
prices as they affect farmers is frequently compared
the Production Index 192 items.
Prices for most commodities are collected quar- with that relating to urban workers by comparing
terly from independent stores and monthly from the movement of the Consumer Price Index with
chain stores. Prior to March 1953 the index was that of the Index of Prices Paid by Farmers for
based on independent store prices only, but since Family Living. Although the movement of the two
that date combined (independent and chain) price indexes in some periods has been quite similar, there
series have been used. The index changes in the are important differences between the indexes which
interquarterly months are determined largely by account for differences in movements in other periods.
Some of the principal differences are:
changes in chain store prices.
Changes in average costs of electricity and tele1. The commodity coverage of the two indexes is
phone services are based upon an annual survey of not the same and the weights used for individual
20,000 farmers. Data on interest charges are de- commodities differ because one index is based on the
veloped annually on the basis of data obtained from urban family pattern of purchases, the other on the
the Bureau of the Census, special surveys, and lend- farm family pattern.
ing agencies. The tax series is developed annually
2. All expenses for commodities and services purfrom data obtained from the Bureau of the Census chased by urban families are represented in the Conand special surveys. The wage-rate series is based sumer Price Index (CPI). On the other hand, ceron returns from quarterly mail surveys to farmers. tain types of expenses are not represented in the
The index was revised with the release of the Janu- Index of Prices Paid by Farmers for Family Living.
ary 1950 series. The principal differences between For example, medical expenses are not included; nor
the old and revised series are—
are residential rents, since few farmers rent homes
1. Cash wage rates paid to hired farm labor other than those that are rented with the farm. All
were added to the index.
costs of homeownership, including purchase, repairs
2. A weighting pattern based on farmers' and maintenance, and insurance are represented in
purchasing habits during the 1937-41 period the CPI; only costs of building materials for houses
was adopted,
are represented in the farm family-living index.
3. The number of items included in the index Services carry a relatively heavy weight in the CPI;
was increased.
only telephone and electricity costs are represented
Statistical procedures.—Independent dealers mail the farm family-living index.
in
their price reports to the AMS State offices where
3. The Consumer Price Index measures price
i Under the reorganization of the Department of Agriculture which became
changes only; the Index of Prices Paid by Farmers
effective on November 2,1953, most statistical functions of the former Bureau of
Agricultural Economics were reassigned to the Agricultural Marketing Service,
for Family Living reflects differences occasioned by

Parity Index

10



Prices Received and Paid by Farmers
[1810—14= 100]
Prices paid for items
used in

Prices
received by
farmers

Parity ratio1

Production

Parity index
(prices paid,
interest,
taxes, and
wage rates)

99
99
100
100
102

97
98
102
101
102

97
98
101
101
103

103
95
99
101
102

106
97
98
100
99

104
115
143
170
202

104
115
156
180
195

105
116
148
173
197

99
119
178
206
218

94
103
120
119
111

228
164
153
156
156

195
128
127
138
140

214
155
151
159
160

212
124
131
142.
143

99
80
87
89
89

1925
1926
1627
1928
1929

161
158
155
156
154

145
141
141
148
146

164
160
159
162
160

156
146
141
149
148

95
91
89
92
92

1930_
1931
1932
1933
1934

144
124
106
108
122

135
113
99
99
114

151
130
112
109
120

125
87
65
70
90

83
67
58
64
75

1935.—
1936
1937
1938
1939_

124
124
128
122
120

122
122
132
122
121

124
124
131
124
123

109
114
122
97
95

88
92
93
78
77

1940
1941
1942..
1943
1944

121
130
149
166
175

123
130
148
164
173

124
133
152
171
182

100
123
158
3 192
2 196

81
92
104
112
108

1945
1946
1947.
1948
1949.

182
202
237
251
243

176
191
224
250
238

190
208
240
260
251

a 206
2 234
275
285
249

108
112
115
110
99

1950
1951
1952..

246
268
271

246
273
274

256
282
287

256
302
288

100
107
100

Year

Living
1910.
1911
1912
1913
1914

—

1915
1916
1917
1918
1919—

_

1920
1921
1922
1923
1924

...

i

i Ratio of index of prices received by farmers to parity index.
* Includes wartime subsidy payments paid on beef cattle, sheep, lambs, milk, and butterfat between October 1943 and June 1946.
NOTE.—Monthly data are available beginning with January 1910 for the index of prices received by farmers and beginning with January 1937 for the other indexes.
Source: Department of Agriculture.

differences in qualities purchased in various periods,
as well as price changes.
Uses and limitations.—The index is designed to
measure prices for the qualities of the commodities
being purchased currently by farmers; therefore, the
movement of the index may be affected by changes in
qualities which farmers purchase as they adjust to
changing income levels or to changes in qualities
commonly stocked by merchants. That is, if farmers
39448—53

3




purchase better quality merchandise the index will
rise because of this trading up; conversely, the purchase of poorer quality merchandise will depress the
index. Therefore, the use of the index as a measure
of pure price movements—that is, of differences not
occasioned by changes in qualities or terms of sale—
is limited.
References.—See below under "Prices Received by
Farmers."

11

ferences. The index described here measures changes
in prices at the point of first sale, whereas the WholeDescription of series.—The Index of Prices Re- sale Price Index measures them in selected central
ceived by Farmers computed by the Agricultural markets. This series is based on average prices for all
Marketing Service is a measure of the change in of a given commodity rather than prices of specific
average prices of farm products from month to grades or qualities, as is the Wholesale Price Index.
month. It covers the period from January 1910 to Furthermore, commodities traded among farmers
date. It is based on average prices received for all never enter into wholesale trade. Finally, there are
grades and qualities of the important agricultural differences in the weights and base periods used in
commodities at the point of first sale, which generally the two indexes.
is the local market. Tlie base period is January 1910
Uses and limitations.—The index is widely used as
to December 1914, as required by law.
the best measure of changes in average prices received
The price data used in constructing the index are by farmers for commodities sold in local markets. It
obtained chiefly by mail on a voluntary basis from is used in the computation of adjusted base-period
buyers of farm products (such as country mills and prices, which are needed in calculating parity prices
elevators, creameries and milk stations, cooperative under the "new" formula prescribed by the Agrimarketing organizations, and local dealers) and other cultural Adjustment Act of 1938, as amended. It is
persons with a knowledge of farm product prices also used in computing the "Parity ratio" (the ratio
(such as local bankers and well-informed farmers). of the Index of Prices Received by Fanners to the
In recent years reports have been received each Parity Index), to measure whether prices farmers
month from approximately 10,000 such reporters.
receive for farm products are on the average higher
The index is based on prices for about 50 commodi- or lower in relation to prices farmers pay for goods
ties which account for approximately 95 percent of and services than they were in the base period,
the total cash receipts from marketings of all farm 1910-14.
commodities. In addition to the over-all index for
The Index of Prices Received by Farmers is not a
"all farm products," indexes are prepared for "all pure price index in the sense of measuring changes in
crops," for "livestock and livestock products," prices alone. It measures changes in average prices
and for 13 subgroups. Four of these subgroup for all grades and qualities of a given commodity
indexes—fruit, truck crops, dairy products, and rather than changes in prices of specific grades.
poultry and eggs—are published also on a seasonally Consequently, changes in the index may result from
adjusted basis.
price changes for specific grades of a commodity or
Statistical procedures.—The index is basically of the for all grades, from changes in the relative quantities
weighted aggregative type. In combining the United of various grades, or from a combination of these.
States average prices for individual commodities into
As already noted, the index is based on comsubgroup indexes, weights based on average quanti- modities accounting for about 95 percent of the total
ties sold during 1937-41 are used. The subgroup in- value of all commodities farmers have to sell.
dexes are then converted to a 1910-14 base.
Timber and other forest products, greenhouse prodIn combining subgroup indexes into group and all- ucts, and a number of miscellaneous and minor
commodity indexes, the index numbers are weighted commodities are omitted for lack of adequate marketby the percentage which cash receipts from market- ing and price data. These omissions are not sigings for the particular commodity subgroups bear to nificant with respect to the index as a whole.
the total for the same period—1937-41.
References,—The Parity Index and the Index of
A number of revisions have been made in the Prices Received by Farmers are published monthly
index series from time to time. Mainly they have by the Agricultural Marketing Service in Agriinvolved revisions in basic price series or changes in cultural Prices. Historical data appear in the
weights. The most recent major revision was made Department of Agriculture's annual publications,
as of January 1950. This revision resulted in changes Agricultural Statistics and Crops and Markets. A dewhich put the index on a basis more consistent with tailed description of the price series is included in
that for the Parity Index (the Index of Prices Paid The Agricultural Estimating and Reporting Services
by Farmers, Including Interest, Taxes, and Wage of the United States Department of Agriculture, MiscelRates), improved the weighting structure, and made laneous Publication No. 703 of the Department of
minor changes in commodity coverage.
Agriculture. A semitechnical explanation of the
Relation to other series.—This index should not be most recent major revisions is available in the April
confused with the farm product component of the 1950 issue of Agricultural Economics Research, pubWholesale Price Index. There are significant dif- lished by the Department of Agriculture.

Prices Received by Farmers

12



Stock Prices
[Weekly average; 1939=100]
Manufacturing
Year

Composite
index 1

Total

Durable
goods

Nondurable goods

Transportation

Utilities

Trade,
finance,
and service

Mining

1939

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

1940
1941
1942
1943
1944 . . .

94.2
85.7
74. 9
99.2
108. 1

93.4
84.8
75.5
99. 1
106. 9

92.5
81.6
73.7
94.7
104.7

94.2
88.0
77.2
103.5
109.2

99.2
96.5
90.8
125. 1
140.8

99.9
89. 1
69.8
90.5
99.0

90. 4
82.0
71.3
101.0
117.3

75.6
71. 1
59.7
83. 5
93.3

1945 .
1946 . ,
1947
1948
1949

131.2
149.4
130.9
132.7
127.7

129.0
146. 6
132.4
136.8
132. 1

129.0
138.6
119.9
124.3
116.0

129.2
154.5
144. 6
148.6
147.2

190. 0
202.4
149. 1
158. 1
136.0

112. 9
121.0
105.5
99.3
98. 1

149.3
204.3
162. 8
156.9
160. 7

114.3
125.5
117. 2
133. 0
129.4

1950
1951
1952

154. 1
184. 9
195.0

165.7
206. 8
220.2

150.2
178. 5
188. 8

180.2
233. 1
249.3

160.0
199.0
220. 6

108. 9
112. 6
117.9

183.8
207. 9
205.8

143. 5
204. 9
275. 7

1
1

i Includes 265 common stocks, distributed as follows: 14 for mining, 98 for durable goods manufacturing, 72 for nondurable goods manufacturing, 21 for
transportation, 28 for utilities, and 32 for trade,finance,and service.
NOTE.—Monthly and weekly data are available beginning with 1939.
Source: Securities and Exchange Commission.

.STOCK PRICES
Description of series.—These indexes measure issue is changed an adjustment of the index is made
average price movement of 265 of the more active only if such change involves a change in the invested
common stocks listed on the New York Stock capital. The base value of the issue is then revised
Exchange. The stocks, classified in Economic Indi- in the ratio of the new to the old capitalization so
cators only by broad categories, are also classified in that the index will reflect only price movement.
the basic releases under 29 selected industry groups.
Uses and limitations.—This is the only stock-price
These groups and the individual stocks in them index issued by the Federal Government. It is a
were selected on the basis of common-stock trading moderately sensitive weekly index presented in terms
activity on the Exchange in 1949. The selected of categories roughly comparable with the Standard
groups correspond in general to classifications in the Industrial Classification—a feature which facilitates
Standard Industrial Classification. The stocks thus use in conjunction with other series so presented.
selected from a total of approximately 1,000 listed
The indexes will not necessarily reflect weekly
common stocks accounted for about 70 percent of the price movements of stocks not listed on the New
value of common-stock trading activity on the New York Stock Exchange, of the less active stocks so
York Stock Exchange in 1949.
listed, or of those from industries excluded from the
The prices reflected in the indexes are for the last sample because of low volume of trading activity.
sales of the respective stocks during the week as This selectivity of industries should be borne in mind
when using the indexes for the broader industrial
reported in the financial press.
Statistical procedures.—The index for each of the categories presented in Economic Indicators.
29 industry groups measures the total current market
References.—The SEC data are first published in
value of the included issues (i. e., number of shares a release issued each Monday entitled "SEC Indexes
outstanding times price) as a percentage of their of Weekly Closing Prices of Common Stocks on the
total market value in 1939 (computed as an average New York Stock Exchange," showing data for the
of 52 weekly figures). Each specific industry is 2 previous weeks, with percent change. The monthly
weighted in the larger aggregates according to the SEC Statistical Bulletin shows price and change data
value of the selected issues, and not necessarily for the 4 or 5 latest weeks. Data back to 1939 are
according to the value of all listed issues in the available on request. A release entitled "Computaindustry.
tion of SEC Index," which includes a list of the
When the number of outstanding shares of an selected stocks, may be obtained from SEC.



13

EMPLOYMENT AND WAGES
CIVILIAN LABOR FORCE
Description of series—Each month the Census
Bureau publishes estimates of the civilian labor
force—that is, all persons at work or holding a job
and persons who are seeking work. In addition to
the overall figures on employment and unemployment, subgroupings of the data are presented to make
clear changes in the labor-force activity of various
types of persons. Employed persons are classified
by age and sex, by whether they are engaged in agricultural or nonagricultural pursuits, by broad occupational groupings and by number of hours worked
during the week. In addition to age and sex, duration of unemployment is shown for the unemployed.
The estimates are obtained by means of a sample
survey of households, representing all persons in the
continental United States except those living in institutions (such as prisons or homes for the aged). On
the basis of responses to the census interviewers, all
persons 14 years and over in the sample households
are classified as employed, unemployed or not in the
labor force for the calendar week including the 8th of
the month.
Counted as employed are all persons who, during
the survey week, were either (a) "At work"—those
who did any work for pay or profit, or those who
worked without pay for 15 hours or more on a family
farm or business; or (6) "With a job but not at
work"—those who did not work and were not looking
for work but had a job or business from which they
were temporarily absent because of vacation, illness, industrial dispute, bad weather, or layoff with
definite instructions to return within 30 days of
layoff. Also included are persons who had new jobs
to which they were scheduled to report within 30
days.
Included as unemployed are those persons who did
not work at all during the survey week and who were
looking for work. Also included as unemployed are
persons who would have been looking for work except
that (a) they were temporarily ill, (b) they expected
to return to a job from which they had been laid
off for an indefinite period, or (c) they believed no
work was available in their line of work or in the
community.
The sum of the employed and the unemployed
provides the civilian labor force. All other civilians
14 years of age and over are classified as "not in
the labor force" (housewives, students, retired or
disabled persons, those doing less than 15 hours of
unpaid family work, and the voluntarily idle).
14



The sample survey was started in March 1940.
Prior to that date there was no direct enumeration
of the labor force. The estimates shown for 1939
and earlier years have since been prepared by the
Bureau of Labor Statistics, using the same concepts
as those employed by the Census Bureau, and whatever information was available—primarily the 1930
and 1940 Censuses of Population, and employment
trends from BLS and BAE series for intervening
years.
Since the sample survey was instituted in 1940,
two revisions have been made in the series. In
November 1943 an improved sample design was
introduced and the estimates were revised back to
1940 using the 1940 Census of Population figures as
a benchmark for that date. In July 1945 a new
schedule was used which resulted in a more nearly
complete count of employed persons; the estimates
were again revised back to 1940 to take account of
the change in interviewing procedure.
Statistical procedures.—National estimates are prepared by inflating the sample results to independent
estimates of the population by sex, color, and age
groups. The population estimates are obtained by
bringing Census of Population figures up to date by
adding births and net immigration and subtracting
deaths. Starting in January 1953, materials from
the 1950 Census of Population were used in preparing
the estimates. Therefore, the figures from January
1953 on are not exactly comparable with those for prior
months. A further change in estimating procedures
in September 1953 affected somewhat thefiguresfor
agricultural employment.
In order to improve the reliability of the sample
without increasing its size, the Census Bureau is
now engaged in spreading the sample of 25,000
households among 230 areas instead of 68 as in the
past. Figures based on the new sample design will
become available early in 1954.
Relation to other series.—The Census Bureau's estimates of employment, obtained from a sample of
households, differ in a number of respects from estimates of employment prepared from reports of employing establishments and based on payroll records,
such as the Bureau of Labor Statistics current nonagricultural employment series and the Department
of Agriculture estimates of farm employment.
Because of sampling variability, changes in the
various series may not always be consistent. The
census estimates provide information on the work

Civilian labor farce
Civilian labor force
Total labor
force (including
armed
forces) 1

Year

Employment
Total
Total

Agricultural

3

Nonagricultural

Unemployment

Unemployment as percent of total
civilian
labor force

Thousands of persons 14 years of age and over

-

1935
1936
1937
1938
1939

1945
1946
1947
1948
1949-1950
1951.
1952

-

-

—
—

-

—

49, 180

47, 630

10, 450

37, 180

1, 550

3. 2

50, 080
50, 680
51, 250
51, 840
52, 490

49, 820
50, 420
51, 000
51, 590
52, 230

45, 480
42, 400
38, 940
38, 760
40, 890

10, 340
10, 290
10, 170
10, 090
9,900

35, 140
32, 110
28, 770
28, 670
30, 990

4, 340
8, 020
12, 060
12, 830
11, 340

8. 7
15. 9
23. 6
24 9
21.7

52, 870
53, 440
54, 000
54, 610
55, 230

42, 260
44, 410
46, 300
44, 220
45, 750

10, 110
10, 000
9, 820
9, 690
9, 610

32, 150
34, 410
36, 480
34, 530
36, 140

10, 610
9, 030
7, 700
10, 390
9,480

20. 1
16. 9
14. 3
19.0
17.2

56, 030
57, 380
60, 230
64, 410
65, 890

-

49, 440

53,140
53, 740
54, 320
54, 950
55, 600

-

1930
1931.
1932_
1933
1934—

1940
1941
1942
1943
1944

—
-

1929

55, 640
55, 910
56, 410
55, 540
54, 630

47, 520
50, 350
53, 750
54, 470
53,960

9, 540
9, 100
9, 250
9, 080
8,950

37, 980
41, 250
44, 500
45, 390
45, 010

8, 120
5, 560
2, 660
1, 070
670

14.6
9.9
4. 7
1. 9
1.2

65,140
60, 820
61, 608
62, 748
63, 571

53, 860
57, 520
60, 168
61, 442
62, 105

52, 820
55, 250
58, 027
59, 378
58, 710

8, 580
8, 320
8,266
7, 973
8, 026

44, 240
46, 930
49, 761
51, 405
50, 684

1, 040
2, 270
2, 142
2, 064
3, 395

1.9
3.9
3.6
3.4
5.5

64, 599
65, 832
66, 426

63, 099
62, 884
62, 966

59, 957
61, 005
61, 293

7, 507
7, 054
6,805

52, 450
53, 951
54, 488

3, 142
1, 879
1, 673

5.0
3.0
2.7

i Data for 1940-52 exclude about 150,000 members of the armed forces who were outside the continental United States in 1940 and who were therefore not enumerated
In the 1940 census. Thisfigureis deducted by the Census Bureau from its current estimates for comparability with 1940 data.
* Includes part-time workers and those who had jobs but were not at work for such reasons as vacation, illness, bad weather, temporary lay-off, and industrial
disputes.
NOTE.—Monthly data are available beginning with March 1940.
Sources: Department of Labor (1929-39) and Department of Commerce (1940-52).

status of the population: persons employed at more
than one job, either because they hold more than
one job concurrently or because they changed
jobs during the survey week, are counted only once
by the census and are classified according to the job
at which they work the greatest number of hours
during the week. Estimates based on reports from
business establishments and farms, on the other
hand, count persons who work for more than one
establishment as many times as the number of
different payrolls on which their names appear.
The census estimates relate to all types of workers,
including domestic service workers, unpaid family
workers (working 15 hours or more during the week)
and self-employed persons, groups which are generally excluded from employment series based on
establishment reports. On the other hand, the
census excludes workers less than 14 years of age




whereas the payroll-based series have no age exclusions. An additional difference arises from the
fact that persons with a job but not at work are included with the employed in the census estimates,
whereas only part of this group (those receiving pay
while away from work) are likely to be included in
the BLS estimates. Finally, the census estimates
relate to the calendar week including the 8th of the
month, the BLS figures relate to the payroll period
ending nearest the 15th of the month and farmers
report to the Department of Agriculture for a week
ending near the end of the month.
For a number of reasons, the unemployment estimates of the Bureau of the Census are not directly
comparable with statistics derived from unemployment insurance operations. In the first place, some
unemployed persons are not eligible for unemployment insurance, particularly young persons looking
15

for theirfirstjobs, domestic servants, ex-government understand current trends, the summaryfiguresneed
workers,, agricultural workers, and persons who lost to be supplemented by the detailed data. The
their jobs in firms too small to be covered by the information provided regularly on hours worked
various State unemployment insurance laws. Unem- shows the number of full-time and part-time employed persons who have already received the bene- ployed. From time to time additional information
fits to which they are currently entitled are not is provided on the extent of voluntary and involunincluded in the unemployment insurance claims tary part-time employment, and the amount of
figures. Also, the qualifications for drawing unem- underemployment arising from economic causes.
ployment insurance differ from the definition of Similarly, information on changes in the duration
unemployment used by the Census Bureau. For of unemployment adds meaning to the total count
example, persons with a job but not at work and of unemployment.
Since the estimates are prepared from a small
persons working only a few hours during the week
are sometimes eligible for unemployment insurance, sample, the user should not attach significance to
but are classified by the Census Bureau as employed. very small monthly changes. A table showing the
Furthermore, some persons may be reported to the sampling reliability of the estimates is regularly
Census Bureau as not looking for work even though published in the census releases.
they may be registered at public employment offices,
The user should also keep in mind that the inforconsider themselves available for jobs and be eligible mation is collected by personal interview, usually
for unemployment insurance.
with the housewife. She may not, in some cases,
.Uses and limitations:—One of the chief advantageshave exact knowledge for all members of the houseof the census labor force, employment and unem- hold. For this reason, as well as because of the
ployment estimates is that they provide the only relatively small size of the sample, only broad occupacomprehensive figures covering the employment tional and industry groupings of the data are pubstatus of the whole population. The data are col- lished. Finally, the measurement of unemployment
lected monthly and published promptly. The esti- is in some cases difficult, since it depends in part on
mates of unemployment, in particular, are used as a the attitude of the person interviewed. The classicurrent indicator of the general health of the economy. fication of a person as unemployed has been made as
Another advantage of the household enumeration objective as possible, by using the criterion of "lookmethod of obtaining labor force information is the ing for work," but no method has been as yet develr
possibility of relating work status to other personal oped which will insure consistent reporting of acand family characteristics. In addition to broad tivity month after month. Some marginal (usually
occupation and industry groups, classifications can very small) groups may be reported as unemployed
be made by sex, age, and color, by marital status and in some circumstances whereas they would be renumber of children. For example, changes in the ported as not in the labor force in others. Most of
employment of married women, and of married these problems of measurement affect persons whose
women with small children, can be studied. By ask- attachment to the labor force is casual or intering supplementary questions from time to time other mittent, especially married women and youths still
information concerning the family can be similarly in school looking for part-time jobs.
estimated, such as family incomes and the amount of
References.—The regular monthly estimates of the
migration during the course of a year. All these civilian labor force are published by the Bureau of
analyses throw light on the changing size and com- the Census in The Monthly Report on the Labor Force
position of the labor force.
(Current Population Reports, Series P-57), which
It should be noted that in the classification used, includes also descriptions of the data and an indication
anyone who did any work for pay during the survey of the reliability of the estimates. Annual summaweek (or did 15 or more hours of unpaid work in a ries and supplementary information on part-time
family enterprise) is counted as employed. Also workers, income, migration, etc., are published in
counted as employed are those who did not work nor special labor-force reports (Current Population Relook for work but who had definite jobs waiting for ports, Series P-50).
them. (The numbers in these groups are shown
The techniques used in preparing the estimates for
separately in census releases.) Thus the survey the earlier years are described in "Labor Force, Emindicates roughly the total demand for jobs: The ployment, and Unemployment, 1929-39: Estimating
number of persons who have jobs (the employed) Methods," which appeared in the July 1948 issue of
and the number seeking jobs (the unemployed). To the Labor Department's Monthly kafoor Review,
16



Nonagricultural Employment
[Thousands of wage and salary workers
Manufacturing
Year
Total

Contract
construction

Wholesale
and retail
trade

Finance,
service,
etc.

Government
(Federal,
State,
local)

Transportation
and
public
utilities

Mining

Durable
goods

Nondurable
goods

(2)

1, 021

4,664

3, 104

2, 671

3, 711

1, 124

(3)
(2)
(2)
(2)
(2)

848
1,012
1, 185
1, 229
1, 321

4, 623
4, 754
5, 084
5, 494
5, 626

3, 252
3, 284
3, 347
3, 554
3, 679

2, 603
2, 531
2, 542
2, 611
2, 723

3, 998
3, 459
3, 505
3, 882
3, 806

1, 230
953
920
1, 203
1, 092

1919

10, 534

1920...
1921
1922
1923
1924

10, 534
8, 132
8, 986
10, 155
9, 523

(2)
(2)
(2)
(2)
(2)
(2)

1925
1926
1927
1928

9, 786
9, 997
9, 839
9, 786

(2)
(2)
(2)
(2)

(2)
(2)
(2)
(2)

1, 446
1, 555
1, 608
1, 606

5,810
6, 033
6, 165
6, 137

3, 757
3, 990
4, 166
4,322

2, 802
2, 848
2,917
2, 996

3, 824
3, 940
3, 891
3, 822

1, 080
1, 176
1, 105
1, 041

1929

10, 534

(2)

1,497

6, 401

4, 558

3, 066

3, 907

1,078

1930
1931
1932
1933
1934

9, 401
8, 021
6, 797
7, 258
8, 346

(2)
(2)
(2)
(2)
(2)

(2)
(2)
(2)
(2)
(2)
(2>

1,372
1,214
970
809
862

6, 064
5, 531
4, 907
4, 999
5, 552

4, 482
4, 246
3, 952
3, 839
4, 031

3,149
3, 264
3, 225
3,167
3, 298

3, 675
3, 243
2, 804
2, 659
2, 736

1,000
864
722
735
874

1935
1936
1937
1938
1939

8, 907
9, 653
10, 606
9, 253
10, 078

(2)
(2)
(2)
(2)

4, 683

(2)
(2)
(2)
(2)

5, 394

912
1, 145
1,112
1,055
1,150

5, 692
6, 076
6, 543
6, 453
6, 612

4,145
4, 373
4, 588
4, 543
4, 703

3, 477
3, 662
3, 749
3, 876
3, 987

2, 771
2, 956
3,114
2, 840
2, 912

888
937
1,006
882
845

1940_
1941 — *.
1942
1943
1944

10, 780
12, 974
15, 051
17, 381
17, 111

5, 337
6, 945
8, 804
11, 077
10, 858

5, 443
6, 028
6, 247
6, 304
6, 253

1,294
1,790
2,170
1,567
1,094

6, 940
7, 416
7, 333
7,189
7, 260

4, 896
5,167
5, 297
5, 320
5, 308

4,192
4, 622
5, 431
6, 049
6, 026

3, 013
3, 248
3, 433
3, 619
3, 798

916
947
983
917
883

1945
1946
1947_
1948
1949..

15, 302
14, 461
15, 290
15, 321
14, 178

9, 079
7, 739
8, 372
8, 312
7, 473

6, 222
6, 722
6, 918
7, 010
6, 705

1,132
1,661
1, 982
2,169
2,165

7, 522
8, 602
9, 196
9, 519
9, 513

5, 449
6, 207
6, 448
6, 636
6, 736

5, 967
5, 607
5, 456
5, 614
5, 837

3, 872
4, 023
4,122
4, 141
3, 949

826
852
943
982
918

1950
1951
1952

14, 967
16, 082
16, 209

8, 085
9, 071
9, 262

6, 882
7, 011
6, 946

2, 333
2, 588
2, 572

9, 645
10,013
10, 251

6, 894
7, 068
7, 237

5, 992
6, 373
6, 633

3, 977
4,166
4, 220

889
913
872

' Revised series; see Employment and Payrolls, April 1953. Includes all full- and part-time wage and salary workers In nonagricultural establishments who worked
during or received pay for any part of the pay period ending nearest the 15th of the month. Excludes proprietors, self-employed persons, domestic servants, and personnel of the armed forces. Total derived from this table not comparable with estimates of nonagricultural employment of the civilian-labor force reported by the
Department of Commerce (p. 15) which include proprietors, self-employed persons, and domestic servants; which count persons as employed when they are not at
work because of industrial disputes; and which are based on an enumeration of population, whereas the estimates in this table are based on reports from employing
establishments.
»Not available.
NOTE.—Monthly data are available beginning with January 1939.
Source: Department of Labor.




17

NONAGRICULTURAL EMPLOYMENT—SELECTED INDUSTRIES
products, primary metal industries, fabricated metal
(Table on p. 17.)
Description of series.—Current monthly series on products, machinery, transportation equipment, inemployment in nonagricultural establishments, with struments and miscellaneous manufacturing indusrelated information on hours and earnings (see tries. All other manufacturing industries are inbelow), are prepared by the Bureau of Labor Sta- cluded in the nondurable manufacturing estimates.
Statistical procedures.—Sampling is used to collect
tistics. Employment estimates are published for
more than 200 separate industry groups and sub- current data in most industries. In general, the
groups as well as 8 major industry divisions sample of about 150,000 establishments is designed
(manufacturing, mining, trade, etc.). In addition, to obtain reports from most if not all the large
employment indexes for more than 150 specific establishments in each industry but the proportion
industries are published monthly, and estimates of of total employment covered varies considerably
women employed in manufacturing industries are from industry to industry. It is relatively high (68
percent) in manufacturing, for example, and much
available quarterly.
Employment figures represent the total number lower in wholesale and retail trade (19 percent) and
of persons employed in nonagricultural establish- service industries.
In order to compute total employment from the
ments in the continental United States during a
sample reports, month-to-month changes in the
specified payroll period which (for all industries
except Government) is that ending nearest the 15 th sample establishments are applied to a total employof the month. Employed persons include all those ment figure (benchmark) separately for each inwho worked during or received pay for any part of dustry. The benchmark figures are obtained from
the payroll period, including part-time as well as sources which, singly or in combination, insure
full-time, temporary as well as permanent, em- either a complete count of employment for the
ployees. Workers on an establishment's payroll who specified benchmark period, or an estimate of reasonare on paid sick leave, paid holiday or paid vacation, able accuracy. This method takes advantage of
or who work a part of a specified pay period and are benchmark data which are byproducts of other
unemployed or on strike during the other part are governmental functions.
Since 1939 the basic sources of benchmark inforconsidered employed. Persons on the payroll of
more than one establishment during the pay period mation have been periodic tabulations of employare counted each time reported. On the other hand, ment data by industry compiled by State agencies
persons are not considered employed who are laid from reports of establishments covered under State
off, on leave without pay, or on strike for the entire unemployment insurance laws.
Supplementary
pay period. Proprietors, the self-employed and tabulations prepared by the United States Bureau
unpaid family workers, farm workers, and domestic of Old-Age and Survivors Insurance are used for
workers in households are not included. Govern- small-size establishments exempt from State unemment employment statistics refer to civilian em- ployment insurance laws. For industries not
ployees only, but include employees of State and covered by either of the two programs, benchmarks
local governments as well as Federal.
are compiled from other sources: for example, for
Information on employment (as well as on payrolls interstate railroads, from information reported to the
and hours worked) is collected each month from a Interstate Commerce Commission; for State and
sample of establishments under cooperative arrange- local government, from data reported to the Bureau
ments with State agencies (primarily State employ- of the Census; for the Federal Government, from
ment security agencies). The cooperating State data compiled by the Civil Service Commission.
agencies mail questionnaires to the reporting estab- Establishments are classified into the same industrial
lishments and edit them when returned, before groupings for benchmark purposes as they are for
passing the information on to the BLS. To elimi- monthly reporting.
nate duplicate reporting, the same establishment
The most recent benchmark adjustment was to
reports are used for preparing State, area, and na- data for the first quarter of 1951 (published in April
tional estimates.
1953). These revisions were carried back to 1947
Durable goods manufacturing industries include: where appropriate.
ordnance and accessories (except GovernmentRelation to other series.—For a comparison with
operated establishments), lumber and wood prod- the Current Population Survey, see under Civilian
ucts, furniture and fixtures, stone, clay and glass Labor Force, above.
18



Average weekly hours
[Hours per week, for production workers or nonsupervisory employees*]
Manufacturing
Year
Total

Durable
goods

Nondurable
goods

Building
construction

Retail trade 3

1909

51.0

(3)

(3)

(3)

(3)

1914

49.4

(3)

(3)

(3)

O

46.3

(3)

(3)

(3)

(3)

47. 4
43. 1
44. 2
45. 6
43. 7

(3)
(3)
(3)
(3)
(3)

(3)
(3)
(3)
(3)
(3)

(3)
3
(3)
(3)
( )'
(3)

44. 5
45.0
45.0
44. 4
44.2

(3)
(3)
(3)
(3)
(3)

(3)
3
(3)
(3)
()
(3)
3
(3)
(3)
()
(3)
(3)

(3)
(3)

(3)
(3)
(3)
(3)
(3)

.1930
1931
1932
1933
1934

42. 1
40. 5
38.3
38. 1
34.6

(3)
(3)

(3)
(3)

1935
1936
1937
1938
1939

36. 6
39. 2
38. 6
35. 6
37.7

37. 3
41. 0
40. 0
35. 0
38. 0

36. 1
37. 7
37.4
36. 1
37.4

30. 1
32. 8
33.4
32. 1
32. 6

1940
1941„„
1942
1943
1944

38. 1
40. 6
42.9
44. 9
45.2

39. 3
42. 1
45. 1
46. 6
46. 6

37.0
38. 9
40.3
42.5
43. 1

33. 1
34. 8
36.4
38.4
39. 6

4?. 5
42. 1
41. 1
40. 3
40.4

43. 4
40. 4
40.4
40. 1
39. 2

44. 1
40. 2
40. 6
40. 5
39. 5

42. 3
40. 5
40. 1
39. 6
38.8

39. 0
38. 1
37. 6
37. 3
36. 7

40. 3
40. 7
40. 3
40. 3
40.4

40. 5
40. 7
40. 7

41. 2
41. 6
41. 5

39. 7
39. 5
39.6

36. 3
37. 2.
38. 1

40. 5
40. 2
39.9

1919

•„

>1920
1921
1922
1923
1924

•

1925
1926
1927
1928
1929

:

-

1945
1946.
1947
1948
1949
1951

___

i

32. 6
34. 8
33.9

41. 9
40. 0
35. 1

m
m

(3)

«)
(3
«)
(3

28. 9

4

(3)
(3)
(3)
(3)

«

(3)
(3)
t»)

(3)

42.7

» Revised series; see Hours and Earnings—Industry Report, April 1953.
» Hours and earnings data exclude eating and drinking places.
* Not available.
* Data beginning with January 1948 are not strictly comparable with those for earlier years.
NOTE.—Monthly data are available beginning with 1932 for manufacturing industries, 1034 for building construction, and 1939 for retail trade.
Source: Department of Labor.

30448—53


19

In addition to total employment in each industry, incorporated in other Federal statistical series, parBLS also prepares estimates of production-worker ticularly in making current estimates of production,
employment for mining and manufacturing industries. productivity and national income.
The publication of comparable State and local
These estimates are exactly comparable with the
average hours and earning series (see below) which area estimates by the cooperating State agencies
are prepared from information reported on the same using the same concepts and methods provides a
questionnaires as the employment figures.
means whereby business trends can be followed for
In general, BLS employment estimates are com- various sections of the country and for about 100 of
parable with other data collected from establish- the large metropolitan areas.
The national estimates are not all of uniform qualments, such as employment, production, and similar
data obtained by the Census Bureau in the manu- ity, however. In general, those for manufacturing
facturing censuses and annual surveys. Some industries are most reliable. Since "cutoff" samdifferences will be found, however, especially for pling rather than a probability design has been used,
individual industries, caused chiefly by differences in it is not possible to calculate the sampling variability
the industries covered, the business units considered of monthly estimates. Experience with the program
parts of an establishment, and in the industrial has shown that the monthly employment data in
classification of establishments.
some industries tend to have an increasing bias for
More serious differences are found between the the successive months between two benchmarks.
BLS establishment-based series and those based on Although this error cannot be adjusted precisely on a
reports from companies, such as financial reports on current basis, average adjustment is made through
profits, because the industry totals that result when the use of bias adjustment factors before publication.
a single industry classification is assigned to an entire Appropriate changes in employment levels are also
company differ substantially from those in which made, when necessary, at the next revision to new
each establishment of the company has been assigned benchmarks.
to the industry of its principal activity. (See CorReferences.—The basic release of the employment
porate Profits, below.)
series is the BLS Employment and Payrolls Monthly
Uses and limitations.—Current employment statistics are widely used as a timely indicator of changes Statistical Report, which contains national estimates,
in economic activity in various sectors of the econ- State and area estimates, and an explanatory note.
omy. Comparable information for a large number The national employment series for 13 months are
of detailed industries is provided within a few weeks. also reprinted in the Monthly Labor Review. A more
Furthermore, because of the promptness with which detailed technical note on "Measurement of Indusbasic information is supplied in considerable industry trial Employment" appears in the September 1953
detail, the BLS employment estimates are frequently issue of the Monthly Labor Review.

AVERAGE WEEKLY HOURS—SELECTED INDUSTRIES
(Table on p. 19.)
Description of series.—With the employment
figures for the specified payroll period, described in
the preceding section, BLS collects from the sample
establishments total man-hours of production or
nonsupervisory workers actually worked or paid for,
including hours paid for holidays, sick leave, and
vacations taken.
Statistical procedures.—The average hour figures
are obtained by dividing the number of production
and related workers (or nonsupervisory workers in
industries other than mining and manufacturing) into
the total man-hours reported for each industry. The
average hours are normally less than scheduled hours
because of such factors as absenteeism, labor turnover, part-time work, and stoppages.
Uses and limitations.—Changes in hours worked
20



supplement the information on employment, since
frequently hours worked are affected even before employment by changes in economic activity. The
hours figures are used in compiling the average earnings figures discussed below. They also serve as a
basis for current production estimates for some industries (see description of the Index of Industrial
Production, p. 24).
Hours paid for as measured by these series differ
from plant man-hours which do not include hours
paid for vacation, sick leave, or holidays.
References.—The basic release of the average
weekly hours series is the BLS monthly Hours and
Earnings—Industry Report, which includes an explanatory note. A more detailed technical note on
"Hours and Earnings in Nonagricultural Industries"
is also available from the Bureau of Labor Statistics.

Average Hourly Earnings
[For production workers or nonsupervisory emplo3Tees *]
All manufacturing

Durable goods
manufacturing

Nondurable goods
manufacturing

Building
construction

Retail trade 3

Year
1952
Current
prices prices 3
1909.

$0. 193

-

M

Current
prices

1952
prices 3

Current
prices

1952
prices 8

Current
prices

1952
prices 3

Current
prices

1952
prices *

(4)

(4)

(4)

(4)

(4)

(4)

«

(4)

m

(4)

(4)

(4)

(4)

(4)

w

(4)

(4)

(4)

(4)

(4)

(4)

(4)
4
(4)
()
(4)
(4)

(4)
(4)
(4)
(4)
(4)

(4)
(4)
(4)
(4)
(4)

(4)
(4)
(4)
(4)
(4)

o

(4)
(4)

(4)
4
(4)
()
(4)
(4)
(4)
(4)
(4)
(4)
(4)

4
(4)
(4)
()
(4)
(4)

(4)
(4)

(4)
(4)

(4)
4
(4)
(4)
()
(4)
(4)
(4)
4
(4)
()

(4)
(4)
(4)
(4)
(4)

(4)
(4)

(4)
4
(4)
()
(4)
(4)
(4)
(4)

223

$0. 590

1919

477

. 732

1920_
1921
1922
1923
1924

555
515
487
522
• 547

. 735
. 765
• 772
. 813
. 849

1925
1926
1927
1928
1929

547
548
550
562
• 566

. 828
. 823
. 841
.870
. 876

552
515
446
442
532

. 878
. 899
. 866
. 908
1. 056

$0. 497
.472
556

$0. 965
. 969
1. 103

$0. 420
.427
, 515

$0. 816
.877
1. 022

$0. 795

$1. 577

550
556
624
627
633

1. 064
1. 065
1. 153
1. 181
1. 210

.577
586
. 674
. 686
. 698

1. 116
1. 123
1. 246
1. 292
1. 335

. 530
, 529
.577
. 584
. 582

1. 025
1. 013
1. 067
1. 100
1. 113

815
824
903
908
, 932

1. 576
1. 579
1. 669
1. 710
1. 782

w
$1. 542

$1. Oofi

661
729
853
961
I! 019

1. 252
1. 316
1. 389
1. 474
1. 537

. 724
. 808
. 947
1. 059
1. 117

1. 371
1. 458
1. 542
1. 624
1. 685

.
.
.
.
.

1. 140
1. 155
1. 178
1. 232
1. 299

. 958
1. 010
1. 148
1. 252
1. 319

1. 814
1. 823
I. 870
1. 920
1. 989

553
580
626
. 670
' 731

1. 047
1. (M7
1. 02P
1. 0-41
1. 103

i. 023

I. 237
i. 350
l. 401

1. 509
1. 478
1. 471
1. 490
1. 562

1. I l l
1. 156
1. 292
1. 410
1. 469

1. 639
1. 573
1. 536
1. 556
1. 638

. 904
1. 015
1. 171
1. 278
1. 325

1. 333
1. 379
1. 478
1. 381
1. 681
1. 392
1.411 * 1. 848
1. 935
1. 477

2. 034
2. 011
1. 999
2. 040
2. 157

. 783
. 893
1. 009
1. 088
1. 137

1. 155
1. 215
1. 200
1. 201
1. 268

I. 465
I. 59
I. 67

1. 617
1. 63
1. 67

1. 537
1. 67
1. 76

1. 696
1. 71
1. 76

1. 378
1. 48
1. 54

1. 521
1. 51
1. 54

2. 242
2. 24
2. 31

1. 176
1. 26
1. 32

1. 298
1. 29
1. 32

1914

1930
1931
1932__
1933
1934

*

1935
1936
1937
1938
1939.„
1940
1941
1942__
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952

y 086

_

«)
(4

«

(4)
(4)

m
m

«

w

(4)

602
640
723
803
861

2. 031
2. 19
2. 31

(4)
(4)
(4)
(4)

(<)

«
«
0)

(4)
0)
w

(4)
(4)
(4)
(4)
(4)
(4)
(4)

i Revised series; see Hours and Earnings—Industry Report, April 1953.
»Hours and earnings data exclude eating and drinking places.
* Earnings in current prices divided by consumer price index on base 1952=100.
«Data beginning with January 1948 are not strictly comparable with those for earlier years.
NOTE.—Monthly data are available beginning with 1932 for manufacturing industries, 1934 for building construction and 1639 for retail trade.
Source: Department of Labor;




«

(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
4
(4)
()
(4)
(4)

AVERAGE HOURLY EARNINGS—SELECTED INDUSTRIES
paid on an incentive basis. The changing employ(Table on p. 21.)
f Description of series.—The payrollfigureson which ment of workers as between relatively high-paid and
these averages are based are collected by BLS with low-paid work, and relatively high-wage and lowthe employment and hours figures, described above. wage industries, also affects the hourly earnings
They are reported before deductions for taxes, social averages.
Hourly earnings refer to the actual return to the
insurance, etc. They include pay for sick leave,
holidays, and vacations taken, but exclude retro- worker for a stated period of time, and should not
active pay and bonuses, unless earned and paid be confused with wage rates, which represent the
regularly each pay period. Earnings in 1952 prices, rates stipulated for a given unit of work or time.
prepared by the Council of Economic Advisers, are Since certain types of payments (see above) as well
the average hourly earnings figures adjusted for as payments to workers excluded from the production
changes in purchasing power as determined by the worker (or nonsupervisory employee) definition are
not included, the earning series should not be taken
Consumer Price Index, with 1952 = 100.
Statistical procedures.—Average hourly earnings to represent labor costs to the employer.
The fact that large establishments predominate in
are derived by dividing total payrolls by total manhours reported for each industry. Only the sample the BLS sample may affect somewhat the level of
data are used, since there are no benchmarks avail- the average earnings figures for some industries,
but has no measurable effect on the trends in average
able for hours and earnings.
hourly earnings.
Uses and limitations.—Average hourly earnings
References.—The basic release of the average hourly
figures are widely used in collective bargaining, in
"escalating" long-term sales contracts (such as labor earnings series is the BLS monthly Hours and Earncosts for equipment which takes a number of months ings—Industry Report, which also includes estimates
or years to build) and in general economic analysis. of hourly earnings excluding overtime, and an exThe hourly earningsfiguresreflect not only changes planatory note. A more detailed technical note on
in basic hourly and incentive wage rates, but also "Hours and Earnings in Nonagricultural Industries"
such variable factors as premium pay for overtime is also available from the Bureau of Labor Statistics.
and late-shift work, and changes in output of workers

AVERAGE WEEKLY EARNINGS—SELECTED INDUSTRIES
Statistical procedures.—Average weekly earnings
occupational supplies, union dues, or other payroll
are obtained by multiplying average hours and deductions.
average hourly earnings for each industry (see
References.—The basic release of the average
above).
weekly earnings series is the BLS monthly Hours
Uses and limitations.—The average weekly earn- and Earnings—Industry Report, which also includes
ings figures come closer than the hourly earnings to estimates of net spendable weekly earnings in manumeasuring what the worker has to spend, since these facturing, earnings in 1947-49 dollars for selected
figures are affected by changes in the length of the industries, and an explanatory note. A more detailed
workweek. However, they do not represent take- technical note on "Hours and Earnings in Nonagrihome pay, since no deductions have been made for cultural Industries" is also available from the Bureau
income and social-security taxes, group insurance, of Labor Statistics.

22



Average Weekly Earnings
[For production workers or nonsupervisory employees
All manufacturing

Durable goods
manufacturing

Nondurable goods
manufacturing

Building
construction

xietaii trade a

Year
Current
prices
1909

1952
prices 3

Current
prices

$9.84

0)

«

1952
prices *

Current
prices

1952
prices *

Current
prices

1952
prices 8

Current
prices

1952
prices *

m
w

(4)

(*)

w

«
«

(4)

()

(4)
(4)
(4)

(4)

(4)

(4)

(4)

(4)

4
<)

(4)

«

(4)

(4)

(4)

(4)

(4)

$21. 94
22. 07

(4)
(4)
(4)

$34 17
34 27

(4)
(4)
(4)
(4)
(4)

(4)
(4)
(4)
(4)
(4)

39. 92
39. 95
40.76
42. 17

22. 44
22.75
23. 01
22. 88

33. 95
34 16
35. 18
35. 42

(4)
(4)
4
(4)

(4)
(4)
(4)
(4)

4
(4)
(
(4)
(4)
(4)
4
(4)

(4)
(4)

(4)
(4)
(4)
(*)
(4)
(4)
4
(4)
()
(4)

27. 22

42. 14

22.93

35. 50

(4)

(4)

36. 96
36. 42
33. 11
34. 35
36.51

24. 77
21. 28
16. 21
16. 43
18.87

39. 38
37. 14
31. 48
33. 74
37.44

21.84
20. 50
17. 57
16. 89
18.05

34. 72
35. 78
34. 12
34.68
35.81

(4)
(4)
(4)
(4)

$22. 97

(4)
(4)
(4)
(4)

$45.58

(4)
(4)
(4)
(4)
(4)
(4)

(4)
(4)
(4)
4
(4).
()
(4)

20. 13
21. 78
24. 05
22. 30
23. 86

38. 94
41. 72
44. 45
42. 00
45. 62

21. 52
24. 04
26. 91
24. 01
26. 50

41. 62
46. 05
49. 74
45. 22
50. 67

19. 11
19. 94
21. 53
21. 05
21. 78

36. 96
38.20
39. 80
39. 64
41. 64

24.51
27.01
30. 14
29. 19
30. 39

47. 41
51. 74
55. 71
54. 97
58. 11

(4)

0)

$23.14

$44.24

1940
1941 , .
1942
1943.—
1944

25. 20
29. 58
36. 65
43. 14
46. 08

47.73
53. 39
59. 69
66. 17
69. 50

28. 44
34. 04
42. 73
49. 30
52. 07

53. 86 - 22.27
2 4 92
61. 44
69. 59 " 29.13
34. 12
75. 61
37. 12
78. 54

42. 18
44. 98
47. 44
52. 33
55. 99

31. 70
35. 14
41. 80
48. 13
52. 18

60.04
63. 43
68. 08
73. 82
78. 70

23. 50
24.42
25. 73
27. 36
29. 53

44,51
44.08
41. 91
41. 96
44.54

1945
1946
1947
1948
1949

44. 39
43. 82.
49. 97
54. 14
54 92

65.47
59. 62
59. 42
59.76
61. 23

49. 05
46. 49
52. 46
57. 11
58.03

72. 35
63. 25
62. 38
63. 04
64.69

38. 29
41. 14
46. 96
50. 61
51.41

56. 47
55. 97
55. 84
55. 86
57. 31

53. 73
56. 24
63. 30
« 68. 85
70. 95

79. 25
76. 52
75. 27
75. 99
79. 10

31. 55
36.35
40. 66
43. 85
45. 93

46. 53
49. 46
48. 35
48. 40
51. 20

1950 .
1951
1952

59. 33
64 71
67.97

65. 49
66. 17
67. 97

63. 32
69. 47
73. 04

69. 89
71. 03
73. 04

54 71
58. 46
60.98

60. 39
59. 78
60. 98

73. 73
81. 47
88.01

81. 38
83. 30
88.01

47. 63
50. 65
52. 67

52.57
51. 79
52.67

1914. _ ,

11. 01

$29. 13

(4)

1919

22. 08

33. 87

(4)

1920
1921
1922
19231924

26. 30
22. 18
21. 51
23. 82
23. 93

34 83
32. 96
34 09
37. 10
37. 16

(4)
(4)
m

$25. 78
25. 84

$40. 16
40. 12

192519261927
1928

24. 37
24. 65
24. 74
24. 97

36. 87
37.01
37.83
38. 65

26. 39
26.61
26. 66
27.24

1929

25. 03

38. 75

1930 ... 1931
1932
1933
1934 „

23. 25
20. 87
17. 05
16. 73
18.40

1935 , .
1936
1937 . . . .
1938
1939

«
«
4

4)
(4)

(4)
(4)
(4)

i Revised series; see Hours and Earnings—Industry Report, April 1953.
* Hours and earnings data exclude eating and drinking places.
1 Earnings in currcnt prices divided by consumer price index on base 1952-=100.
* Not available.
»Data beginning with January 1948 are not strictly comparable with those for earlier years.
NOTE.—Monthly data are available beginning with June 1914 for all manufacturing Industries, 1923 for durable and nondurable goods manufacturing, 1934 for
building construction, and 1939 for retail trade.
Source: Department of Labor.




23

PRODUCTION AND BUSINESS ACTIVITY
INDUSTRIAL PRODUCTION
Description of series.—The Index of Industrial
Production is computed by the Board of Governors
of the Federal Reserve System. It is designed to
measure changes in the physical volume or quantity
of output of manufactures and minerals. It does
not register changes in the value of such production,
nor does it include other productive activities (such
as construction and public utilities) often regarded
as industrial. The manufacturing and mining
industries covercd by the index produce about onethird of the goods and services in the United States.
The manufactures and minerals indexes are based
on figures compiled by the Bureau of the Census,
Bureau of Mines, Department of Agriculture, Tariff
Commission, Bureau of Labor Statistics, the Internal
Revenue Service, and a few other Government
agencies, and by trade associations and trade journals. The component series are carefully chosen to
represent the industries, industry groups, and other
subdivisions in the index, and where necessary and
possible they are adjusted for under coverage or other
deficiencies. For example, shipment series are
adjusted for inventory changes, where feasible;
value data for price changes; man-hours for estimated changes in output per man-hour.
Both annual and monthly data are utilized. Annual data, which are generally more reliable and
available in greater detail than the monthly data,
are used to compute an annual index and a set of
annual group, subgroup, and industry indexes
measuring year-to-year output changes. Monthly
data are utilized to make a monthly index and group
and other detailed monthly indexes similiar to the
annual indexes. The use of comprehensive annual
indexes to determine levels makes it possible to
employ fewer but more select component series to
represent each industry in the monthly indexes.
Manufactures.—The annual index of manufactures includes about 1,370 detailed product or
industry series, and the monthly index 164 series.
The series selected are iclassified^nto the 21 major
groups for manufacturing of the Standard Industrial
Classification. Indexes are also computed for durable
and nondurable manufactured goods. Series on
quantities of products manufactured or shipped,
or quantities of materials consumed or supplied,
account for about three-fourths of the weights
assigned in the annual index, and about one-half
of the weights in the monthly index.
The
remaining series in the annual index are mostly
24



deflated value figures, estimates based on several
types of data, or adjusted man-hour data, with the
last accounting for 4 percent of the weight. The
remaining components in the monthly index consist
largely of man-hour data adjusted for estimated
changes in output per man-hour to represent output.
The use of so large a proportion of man-hour data
in the monthly index has been questioned, but it
should be remembered that only the current changes
are governed by these man-hour series, with the
index levels for the industries concerned determined
largely by annual data on quantities of products
produced or shipped or other types of data.
Minerals.—The annual index of minerals is composed of about 70 separate series, and the monthly
index of 11 series, classified into the 5 major groups
for mining of the Standard Industrial Classification.
The annual series on minerals, representing the production of all the important minerals, are in physical
volume units, and all but one of the monthly series
are in physical volume units. The exception is the
man-hour series used to represent stone and earth
quarrying, to which less than 10 percent of the weight
of the minerals index is assigned, and which, of
course, is adjusted to annual physical volume levels.
Since its first publication in 1927 the index has
undergone several major revisions. The most recent
revision was completed in 1953, and the revised index
introduced in December 1953. The principal changes
were—
1. Increase in the number of component
monthly series from 100 to 175, and many
improvements in the series used.
2. Use of component series to represent certain industries formerly represented only indirectly.
3. Use of a comprehensive and detailed annual
index, based on about 1,440 series, to check and
correct the annual levels of the individual
monthly measurements.
4. Use of 1947 value added data for calculative
weights, in place of the 1937 value added data
previously employed, for the segment of the
index from 1947 to date.
5. Change of the comparison base period from
1935-39 to 1947-49.
6. Adoption of the latest Standard Industrial
Classification code as the basis for organizing
the index and its components.

Industrial Production
[1947-49=100, seasonally adjusted]

Period

Total
industrial
production

Manufactures
Total

Durable
goods

Nondurable goods

Minerals

1919__

39

38

38

37

45

1920
1921
1922.
1923.
1924

41
31
39
47
44

39
30
39
45
43

42
24
37
47
43

36
34
40
44
42

53
42
45
62
57

1925
1926..
1927
1928
1929

49
51
51
53
59

48
50
50
52
58

49
52
49
53
60

46
48
50
51
56

59
63
64
63
68

1930...
193
1932
1933
1934...

49
40
31
37
40

48
39
30
36
39

45
31
19
24
30

51
48
42
48
49

59
51
42
48
51

1935
1936
1937
1938.
1939

47
56
61
48
58

46
55
60
46
57

38
49
55
35
49

55
61
64
57
66

55
63
71
62
68

67
87
106
127
125

66
88
110
133
130

63
91
126
162
159

69
84
93
103
99

76
81
84
87
93

107
90
100
104
97

110
90
100
103
97

123
86
101
104
95

96
95
99
102
99

92
91
100
106
94

112
120
124

113
121
125

116
128
136

111
114
114

105
115
114

__

1940
1941.
1942
1943
1944
1945.
1946
1947.
1948
1949.

....

1950.
1951
1952...
NOTE.—Monthly data are available beginning with 1919.
Source: Board of Governors of the Federal Reserve System.

The new version of the index is confined for the
present to the period since January 1947. In revising the index for the earlier period use will be made
of the major group components of the benchmark
index of manufactures (computed by Federal Reserve
and the Census Bureau from data of the 1939 and
1947 Censuses of Manufactures, and published in
1952) to determine the 1939 levels of the industry
group indexes relative to 1947. Pending this detailed revision, interim benchmark adjustments have
been made to the old indexes for durable and nondurable manufactures—and also for minerals and
total industrial production—from January 1939 to
December 1946. The old indexes beginning in 1919
have been linked on to the respective revised meas-




ures to form a series of continuous indexes from 1919
to the present.
Statistical procedures.—The method used in combining the individual series is the weighted average
of relatives. This consists of (1) reducing each
series into relatives with the average for the base
period, 1947-49, as 100; (2) multiplying each series
of relatives by a base-year weight factor; and (3)
adding the products (series of relatives multiplied
by weights) for any one month to obtain the index
number for the month. The weights used are percentage weight factors, that is, percentage of the
weight assigned to each series to the total weight
assigned to all series in the base period. Since the
total of the percentage weight factors is equal to
25

100, the sum of the products of all series for any one
month (all series times their respective weight factors) gives the index of industrial production for
that month. The products of the component series
and their weights give the number of points contributed to the index by individual series. This
method of computation facilitates analysis of the
changes in the index. For example, it makes it
possible to observe the points contributed by each
series or group of series, and therefore to determine
what series or group of series are responsible for the
month-to-month changes in the total index or in the
index for any group or subgroup of industries.
The weights used are based on value added—the
difference between the value of products and the cost
of materials or supplies consumed—in individual
mining and manufacturing industries in 1947. The
value added data for mining are based on estimates
prepared by the Bureau of Labor Statistics in connection with its input-output studies. The value
added figures for manufacturing are obtained from
the Census of Manufactures for 1947. However,
since value added data are not available for individual products of each industry, such data are in
most cases estimated on the assumption that they
are proportional to value of the product.
Since the value added data used relate to 1947,
while the component series are expressed as relatives
with the average for the base period 1947-49 as 100,
it is necessary to adjust the 1947 value added for
each series by the ratio of the level of that series in
1947 to the average level of that series in 1947-49.
The value added data so adjusted, expressed as
percentages of the total for all manufacturing and
mining, are the weight factors used in combining the
individual series into the group and total industrial
production indexes.
Components of the index are adjusted for two
kinds of short-time recurring fluctuations—differences in the number of working days from month to
month and seasonal variations. The first adjustment is accomplished by reducing reported quantity
figures to average daily output in the month. For
this purpose, only regular weekend closings—where
in effect—are treated as nonworking days. No allowance is made for holiday shutdowns, whose
effects on production are adjusted by the seasonal
variation factors. No adjustment is needed for the
man-hour series which are reported in terms of rates.
The adjustment for seasonal fluctuations is made
directly for the 21 manufacturing and 5 mineral
major industry group indexes, and the adjusted
indexes for the larger aggregates—such as durable
and nondurable manufactures, manufactures, min26



erals, and industrial production—are obtained as
combinations of these.
Relation to other series.—As an important general
economic indicator, the index of industrial production is related in varying degree to other general
economic indicators. Among the more important
series to which the index is closely related are gross
national product and manufacturers' sales. It
should be observed, however, that these are value
or dollar-volume series, and are therefore influenced
by price as well as quantity changes. The industrial
production index, on the other hand, being a measurement of physical volume, registers quantity changes
only.
Also, the national product statistics relate to output at afinalstage and include trade and services as
well as both "industrial" and "nonindustrial" goods,
whereas the industrial production index is confined
to manufacturing and mining, and reflects activity
at successive stages within these sectors. Other
differences include the fact that as a monthly measure
the production index is available more frequently,
and for the sectors concerned, in greater detail.
The monthly Department of Commerce series on
manufacturers' sales corresponds in coverage to the
manufacturing component of the production index,
and includes successive stages of processing. The
importance assigned to each industry, however, is
proportional to the gross value of sales, rather than
net value added as in the production index, so that
changes in activity at later stages of processing
influence the sales measure more than they do the
production index. This and other factors, including
the influence of price changes on the sales measures,
lead to differences in movements, and indicate why
one (or more) series may be the best measure for a
specific purpose.
Uses and limitations.—The total index of industrial
production is probably most widely used as a business
barometer. Both in whole and in detail it is used in
conjunction with related data on employment, inventories, trade, prices, and other economic variables, in
analyzing short- and long-run developments in the
economy.
The component indexes are used to determine the
areas in which the occurrence of important changes
accounted for the observed changes in the total
index. They are also used in analyses relating to
individual industries. Many companies, for instance,
make continuing studies of their own output and
sales figures in relation to the output movements of
the industry. They also use the industry and product series in studies of potential markets, and in
other types of research. The new index includes

Production of Selected Manufactures
[1947-49= 100, seasonally adjusted]
Durable manufactures
Period

Primary
metals

Nondurable manufactures

Lumber
TransporMachinery2
and
tation
products 1
equipment

Textiles
and
apparel

Petroleum
and coal
products

Food and
beverage
manufactures

Chemicals
and allied
products

1939

53

80

38

48

80

63

66

45

1947
1948
1949
1950
1951
1952

103
107
90
115
126
116

101
106
93
113
113
111

103
104
93
114
130
147

96
102
102
120
135
154

99
103
97
110
106
105

97
104
99
110
122
123

101
99
100
103
105
105

97
103
101
121
136
137

i Except furniture.

s Electrical and nonelectrical.

Source: Board of Governors of the Federal Reserve System.

many more detailed industry and product series than
the old, and this expansion in detail—e. g., for
consumer durable items—greatly facilitates analysis
of current developments in markets for different
types of industrial materials andfinishedgoods.
Because the coverage of the index is limited to
manufacturing and mining, it should not be used as
a measure of total production, or even as a measure
of total production of goods; the important goodsproducing sectors of agriculture, construction, and
utilities are not included. It might be noted, however, that changes in the output of manufactures and
minerals are especially significant, in part because
they account for a large part of variation in the total

of all economic activity. Because it is necessary to
use estimated or approximate data in many cases,
some of the components are less reliable than others.
References.—The index of industrial production is
published monthly in the Federal Reserve Bulletin.
Seasonally adjusted indexes are available for all major
groups and larger aggregates, and separate component indexes of manufactures, minerals, durable
manufactures, nondurable manufactures, individual
manufacturing and mineral industries, and individual
manufacturing and mineral products are also published monthly in the Bulletin, without seasonal
adjustment. The method of constructing the index
is described in the December 1953 Bulletin.

PRODUCTION OF SELECTED MANUFACTURES
The charts and figures on "Production of Selected
Manufactures" presented in the monthly issues of
Economic Indicators are selected from the componentgroup indexes prepared by the Board of Governors of
the Federal Reserve System for the Index of Industrial Production, described above.
The table on "Industrial Production" presents
index figures for total industrial production and for
manufactures (total, durable goods, and nondurable
goods) and minerals. The table on "Production of
Selected Manufactures" presents index figures for 8
of the major components which comprise the index
of manufactures.
The relative importance of each of these 8 component indexes, as well as of the minerals and manufactures indexes, in the over-all Index of Industrial Production may be seen in the following tabulation,
which shows the percent of the weight of each to the
total weight of the index in the base period, 1947-49:
S8448—53

5




Industrial production

Percentage of
total weight
assigned

100. 00

Minerals
Manufactures
Durable manufactures
Primary metals
Lumber and products (except
furniture)
Machinery (electrical and nonelectrical)
Transportation equipment
All other
Nondurable manufactures
Textiles and apparel
Petroleum and coal products,.
Food and beverage manufactures
Chemicals and allied products..
All other

9. 98
90. 02
6. 70

45.17

3. 09
13.68
7. 54
14.16
44. 85
11. 87
2. 50
10.73
6. 84
12. 91

27

WEEKLY PRODUCTION—SELECTED INDICATORS
Steel .
The weekly series on steel production is compiled
by the American Iron and Steel Institute. It includes ingot production by open-hearth, Bessemer,
and electric-furnace processes, and steel for castings,
except that produced in foundries operated by companies which do not produce ingots. The very small
quantity of crucible steel is included with the production of electric furnaces.
The series on "Percent of theoretical capacity" is
the ratio of weekly production to average weekly
capacity as of the first of the year.
During 1953 the estimates of total production and
capacity have been based on current reports from
93 percent of the industry. The estimated 100 percent production is obtained on the basis of the ratio
of the annual production of the reporting companies
to the total production of all companies in the previous year.
With the release of the weekly production figures,
the Institute also published the scheduled operating
rate for the coming week. Also published by the
Institute are monthly estimates of the ratio of production to capacity, calculated in essentially the
same manner as the weekly estimates. The monthly
figures are subsequently revised when the final total
production figures for the year are available.
Other related monthly series, such as iron-ore production, pig-iron production, shipments of steel foldings, and manufactured steel products, are published
in the Department of Commerce's monthly Survey
of Current Business.
Weekly and monthly estimates of production and
percent of operating capacity are issued as mimeographed releases by the American Iron and Steel
Institute. More detailed figures are contained in
the Institute's monthly AIS Form 7. For more complete statistical coverage of the industry, see the
Annual Statistical Report of the American Iron and
Steel Institute, and Business Statistics} 1953, a
supplement to the Survey of Current Business.

The weeklyfigures_arecollected by the institute,
by telegraph, from approximately 90 reporting utilities (either companies or groups of interconnected
companies) representing in the aggregate over 90
percent of the total energy available for public consumption. The estimated 100 percent production
is obtained by applying the ratio of the monthly production of the reporting utilities to the total production of all utilities as reported to the Federal Power
Commission for the previous month.
The weekly series is useful in economic analysis
because it is available promptly and is a reliable
measure of net energy distribution to the public supply. It should be remembered, however, that figures
on total net generation are not a sensitive measure of
important changes in industrial activity, since they
include energy used for nonindustrial purposes, such
as air-conditioning loads and sales to residential and
rural consumers.
In addition to the weekly series, the Edison Electric Institute also publishes a monthly statement on
"Source and Disposal of Energy," for which the data
on generation are obtained from the Federal Power
Commission. The Federal Power Commission issues
a monthly publication on Electric Power Statistics}
with data on production, fuel consumption, requirements, and supply.

Bituminous Coal

The series on the production of bituminous coal,
which includes bituminous coal and lignite, is
compiled weekly by the Bureau of Mines, Department of the Interior. It is a very close approximation of total production in the United States.
The figures are estimated on the basis of car loadings and river shipments. The method of estimation
consists of raising the rail and river shipment figures
by factors to represent the coal that is not transported
by rail or river, such as truck shipments, local sales,
colliery fuel, and coal produced by small mines for
local use. The weekly estimates are adjusted
annually by the actual figures on the production of
bituminous coal and lignite which are collected
Electric Power, by Utilities
annually from all producers by the Bureau of Mines.
The weekly figures shown are the Edison Electric The correction is negligible—within less than oneInstitute's estimates of "net energy for distribution" half of 1 percent of the annual canvass figures.
by all plants that contribute to the public supply. Although bituminous coal is still an important
"Net energy for distribution" may be defined as the industrial fuel, contributing approximately 40 percent
energy sold to ultimate consumers, plus line losses of the total supply of energy from mineral fuels,
and unaccounted for energy; or as net generation, the series on bituminous coal and lignite production
plus net import over international boundaries, less may not by itself be as good an indicator of industrial
energy used by the producer and the distributor. activity as its importance suggests. During normal
The series is not a measure of total use of electric peacetime, coal mines operate at a fraction of their
energy, since it does not include energy generated by capacity, about 3 days a week, and the coal-using
captive plants of industrial establishments.
industries carry considerable stocks which may serve
28



Weekly Production—Selected Indicators
[Weekly average]
Steel
Year

1919
1920
1921
1922
1923
1924
1925
1926
1927
1928
1929
1930
1931
1932
1933
1934
1935
1936
1937
1938
1939
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952__
1

Thousands of
net tons

—

Percent of capacity based on weekly net ton capacity.

745
903
425
765
965
813
975
1,037
965
1,104
1, 212
874
557
293
499
560
732
1,023
1,086
609
1,013
1,281
1, 589
1, 650
1, 704
1, 715
1,529
1,277
1, 628
1,695
1, 496
1, 857
2,018
1, 782

Percent of
theoretical
capacity 1
63.6
75.7
34. 5
60. 9
76.6
63.8
74.2
83. 5
74. 9
83. 9
88.5
62. 5
37. 6
19.5
33. 1
37.4
48.7
68.4
72.5
39.6
64. 5
82. 1
97. 3
96. 8
98. 1
95. 5
83.5
72. 5
93.0
94. 1
81.0
96. 9
100. 9
85.8

* Daily average for the week.

Electric power,
Bituminous
by utilities
Cars and
coal (thou(millions of
sands of short trucks (number)
3
kilowatt-hours)
tons)

(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)
(3)

1,551
1,733
1,714
1,646
1,488
1,544
1, 655
1,793
2, 037
2, 256
2,148
2, 398
2, 684
3,142
3, 552
4,155
4, 385
4, 244
4, 235
4, 821
5, 300
5, 500
6, 183
6, 958
7, 451

1, 512
1,847
1, 356
1, 379
1, 845
1, 573
1,692
1,864
1, 684
1, 631
1, 740
1, 522
1, 243
1,007
1, 090
1,173
1,217
1,432
1,456
1, 139
1,293
1, 503
1, 695
1, 909
1, 907
2, 009
1,891
1,745
2, 058
1, 948
1, 427
1, 687
1, 772
1,542

36, 084
42, 834
31, 079
48, 926
77, 577
69, 280
82, 035
82, 710
65, 410
83, 822
103, 047
64, 538
45, 956
26, 359
36, 924
52, 944
75, 903
85, 656
92, 480
47, 867
68, 794
85, 949
93, 049
20, 830
14, 456
15, 218
15, 094
59, 581
92, 163
82, 340
120, 350
154, 212
129, 828
106, 765

* Not available.

Sources: American Iron and Steel Institute, Edison Electric Institute, Department of the Interior, and Ward's Automotive Reports.

as a buffer between changes in industrial activity as
represented by increases and decreases in coal consumption and by the ups and downs in coal output.
Coal production figures should therefore be analyzed
in conjunction with the related series, also compiled
by the Bureau of Mines, on the consumption of coal
by industries and deliveries to retail dealers, and on
stocks of coal held by industries and retail dealers.
The weekly estimates of production, together with
the series on consumption and consumers' stocks,
are published in the Bureau of Mines multilithed
Weekly Coal Report. A description of the method
used in making the estimates may be found in the
chapter on "Bituminous Coal and Lignite" in the
Bureau of Mines Minerals Yearbook.

Cars and Trucks

This series is an average of the weekly output
of cars and trucks by each of the individual producers




in the United States. It appears in Ward's Automotive Reports, published each Monday, which shows
a breakdown of the weekly total by cars, trucks and
makes, and a similar breakdown for cars produced
in Canada. These series are used by general business analysts as well as by persons especially concerned with the level of activity in the industry,
particularly its suppliers.
In addition to the weekly series, the Automotive
Reports carries current and cumulative monthly
totals. Closely related to these monthly production
totals are the monthly factory sales figures compiled
by the Automobile Manufacturers Association. The
sales figures typically differ somewhat from the
production figures, principally because of the inclusion of some units produced in earlier periods
and the exclusion of some units produced in the
current month.

29

GROSS PRIVATE DOMESTIC INVEST!

Description of series.—Gross private domestic the nonfarm portion of these business inventories is
investment is one of the major components of gross reported accounting data on the value of inventories
national product. The series measures gross fixed at the beginning and end of the period for which
capital formation, which is defined for national the estimates are made. Inventory calculation by
income purposes as including all newly produced individual business firms varies widely in method,
durables acquired by their ultimate business users, both with respect to the scope of the cost elements
included in the inventory account and with respect
and net changes in business inventories.
Three separate series are published under fGross to the valuation procedures used, and numerous
private domestic investment": New Construction, adjustments in the reported data are necessary to
Producers' Durable Equipment, and Change in arrive at an estimate of changes in inventories conBusiness Inventories. The New Construction series sistent with the basic concept. The principal adjustused in computing gross private domestic investment ment, however, is that of removing the price change
is derived from the private construction component element in the reported figures and revaluing invenof the New Construction series described below (p. tory change in current dollars.
34) by adding oil- and gas-well drilling.
Relation to other series.—The relationship between
The quarterly estimates of national income and the Producers' Durable Equipment Expenditures
product, of which these series are a part, are revised series and the durable goods portion of the Expendiannually to reflect more complete data than were tures for New Plant and Equipment series, to which
available when the estimates were made initially. it is most closely related, is discussed in the following
The revised series are published annually in the July section.
issue of the Survey of Current Business and for both The Change in Business Inventories series is most
the Producers' Durable Equipment series and the closely related to the estimates of inventories levels,
Change in Business Inventories series reflect more discussed below (p. 38). These series differ concomplete data and more detailed procedures. In ceptually, however, in that the Inventories series is
recent years revisions in the Change in Business based upon the data as reported by reporting comInventories series sometimes have been quite sizable, panies, whereas for the GNP Change in Business
and have arisen primarily from revisions in the basic Inventories series, OBE adjusts the data reported to
book value data rather than from revision in the reflect a uniform method of valuation. The two
inventory valuation adjustment.
series therefore should not be used interchangeably.
Statistical procedures.—The Producers' Durable
Uses and limitations.—The three series which
Equipment series is estimated generally by use of constitute Gross Private Domestic Investment are
the commodity-flow technique, i. e., by segregating part of the national product accounts. Although
finished producers' durables from total manufactur- relatively small they are important, since they measing output and then tracing their flow and measuring ure an economic factor of crucial importance in
their distributive costs so as to arrive at the final business conditions. While thefigureson the Change
costs to purchasers. Three of the producers' durable in Business Inventories are in the nature of rough
equipment groups—Business Motor Vehicles, Rail- estimates, they are useful indicators of the trends in
road and Transit Equipment, and Ships and Boats— the level of inventory accumulation. Comprehensive
are estimated by other methods.
accounting data on inventories become available
The estimates of producers' durable equipment only after a lag of several years, and current estimates
expenditures are based upon 1939 benchmarks pro- are based upon less satisfactory data than the estivided by the Census of Manufactures of that year mates for past years.
and brought up to date by data from the 1947 census
Finally, the estimates of inventory change included
and 1950 and 1951 Annual Survey of Manufactures, in the series are calculated as the difference between
and from summaries of quarterly reports to the Na- large and possibly volatile inventory totals at two
tional Production Authority. For more recent quar- points in time. Even small errors in the estimates
ters, estimates are made by extrapolating these of total inventories can lead to large relative errors
benchmark estimates largely on the basis of industry in the estimates of inventory change.
sales data, which have significant limitations in such
References.—These series are published quarterly
use.
in the Survey of Current Business. For a full discusThe Change in Business Inventories series meas- sion of the concepts and statistical methods employed
ures physical changes in business inventories valued in these series, see the 1951 National Income Suppleat average prices prevailing during the year.
ment to the Survey of Current Business, particularly
The primary source for estimates of changes in pages 37-39 and 112-125.
30



Gross Private Domestic Investment
[Billions of dollars]

Year

Total gross
private
domestic
investment

N ew constructic>n
Total

Residential
nonfarm

Other

Producers'
durable
equipment

Change in
business
inventories

1929

15. 8

7.8

2.8

5.0

6.4

1930
1931
1932.
1933
1934

10. 2
5. 4
. 9
1.3
2. 8

5. 6
3. 6
1. 7
1. 1
1.4

1. 4
1. 2
.5
,3
.4

4.2
2.4
1. 2
.8
1.0

4.9
3.2
1.8
1.8
2.5

-.3
— 1. 4
-2.6
-1. 6
-1. 1

1935
1936
1937
1938
1939

6. 1
8. 3
11.4
6.3
9.9

1. 9
2.8
3.7
3. 3
4.9

.7
1. 1
1. 4
1.5
2.7

1. 2
1. 7
2.3
1.8
2.2

3.4
4.5
5.4
4.0
4.6

.
1.
2.
-1.
.

1940
1941
1942
1943
1944_

13. 9
18. 3
10. 9
5.7
7. 7

5. 6
6. 8
4.0
2. 5
2.8

3.0
3. 4
1. 8
1.0
.8

2.6
3.3
2.2
1.5
2.0

6. 1
7.7
4.9
4. 1
5. 7

2.3
3. 9
2. 1
9

1945
1946
1947
1948
1949

10.
28.
30.
42.
33.

7
7
2
7
5

3.9
10. 3
13. 9
17. 7
17.2

1. 1
4.0
6.3
8. 6
8.3

2.8
6.3
7.6
9. 1
9.0

7.5
12. 3
17. 1
19. 9
18. 7

-.7
6. 1
-.8
5.0
-2.5

1950
1951
1952_

52.5
58.6
52. 5

22.7
23. 1
23.4

12. 6
11.0
11. 1

10. 1
12. 2
12.3

22. 3
24. 6
25.4

7.5
10. 9
3.7

1.6

9
0
3
0
4

NOTE.—Detail will not necessarily add to totals because of rounding.
Quarterly data are available beginning with 1939.
Source: Department of Commerce.




31

EXPENDITURES FOR NEW PLANT A] D EQUIPMENT
Description• of series.—The series on expenditures The seasonal factors used for adjusting the actual
for new plant and equipment, published jointly by expenditures data for changes due to seasonal fluctuthe Securities and Exchange Commission and the ations are based on the "ratio to moving average"
Office of Business Economics, Department of Com- technique. Adjustments are also made where necesmerce, measures the expenditures by all private busi- sary in the estimates of plant and equipment expendinesses except agriculture, professions, and institu- tures to correct for biases due to changes in the
tions for plant and types of machineiy and equip- business population which are not reflected in the
ment for which the reporting companies maintain constant reporting group data.
Relation to other series.—The SEC-OBE series on
depreciation accounts. Expenditures charged off as
expense during the period in which made are ex- actual plant and equipment expenditures utilizes the
cluded. Estimates are made for both actual plant same definitions and industry classification as those
and equipment expenditures for recent quarters (and of the 1947 Census of Manufactures and the later
calendar years) and anticipated expenditures for the Annual Surveys of Manufactures of the Census
two succeeding quarters (and calendar year). These Bureau. There is a substantial difference between
estimates are based upon information contained in the Census Bureau data on expenditures for plant
the annual reports of virtually all (and in quarterly and equipment and the SEC-OBE manufacturing
reports of approximately half) of the registered series, however, in that the SEC-OBE series uses
corporations to SEC, quarterly reports by a group companywide outlays whereas Census uses outlays
of nonregistered corporations to OBE, and annual of establishments. Thus, the Census annual series
and quarterly reports by Class I railroads to the covers only establishments classified as manufacturing
Interstate Commerce Commission.
whereas the SEC-OBE quarterly and annual series
The last major revision in the series was published cover all activities, manufacturing as well as nonin two parts, the revision for manufacturing indus- manufacturing, of companies classified as manufactries in the December 1951 issue of the Survey of turing and excludes the manufacturing activities of
Current Business and the revision for nonmanufac- companies classified as nonmanufacturing.
turing industries in the August 1952 issue. The
The SEC-OBE series differs somewhat in concept
revision established a benchmark based on gross from the Producers' Durable Equipment and New
capital assets as reported to the Internal Revenue Construction components of Gross Private Domestic
Service for the 1948 tax year, and introduced im- Investment (see p. 30). The principal differences
provements in the estimating procedures being used. are that the SEC-OBE series is confined to nonagriFor example, information contained in the manda- cultural industries, and excludes expenditures of
tory annual reports of corporations registered with institutions and professional persons and outlays on
the SEC was used for the first time and adjustments plant and equipment charged off as expenses during
were made for biases arising out of changes in the the period of the expenditure. The Producers'
business population.
Durable Equipment estimates are derived generally
Because of the method of estimating used, viz, the by use of a commodity-flow technique to arrive at a
extrapolation of benchmark estimates on the basis measure of the output of all types of capital goods
of less than complete current data, lesser revisions destined for use by domestic business. The SECin the estimates of actual expenditures for plant and OBE series measures directly expenditures by users
equipment for any given quarter or year are made to for capital goods for which depreciation accounts
take into account new data as they become available. are maintained.
Statistical procedures.—The benchmark for the
The SEC-OBE series on manufacturers' expendiestimates is the gross capital assets of the full uni- tures for new plant and equipment is directly comverse of companies as derived from reports to the parable in classification and scope with the OBE
Internal Revenue Service for the tax year 1948. series on manufacturers' sales, new orders, and
The estimation of year-to-year and quarter-to- inventories (see p. 38). It has a different scope from
quarter movements in these expenditures are made the Federal Trade Commission-Securities and Exby extrapolating the benchmark estimates on the change Commission financial reports series in manubasis of the annual and quarterly reports received facturing, mainly in that the FTC-SEC estimates
by SEC, OBE, and ICC. A relatively constant of balance-sheet and income-statement items covers
group of reporting companies is used; this group of only corporations.
reporting companies is not a randomly selected
Uses and limitations.—This series is one of the
sample.
very few economic series in which estimates of antic32



Expenditures for New Plant and Equipment
[Millions of dollars]
Manufacturing
Year

Total i
Total

1939

5, 512

194 5
194 6
194 7
194 8
194 9

8,
14,
20,
22,
19,

692
848
612
059
285

195 0
195 1
195 2

20,605
25,644
26, 455

983
790
703
134
149

7, 491
10, 852
11, 994

Public
utilities

Durable
goods

Nondurable goods

756

1, 187

326

280

365

520

590
112
407
483
593

2,
3,
5,
5,
4,

393
678
296
651
555

383
427
691
882
792

548
583
889
1,319
1, 352

574
923
1, 298
1, 285
887

505
792
1, 539
2, 543
3, 125

4, 356
5, 684
6,210

707
929
880

1,212
1, 490
1, 363

3, 309
3, 664
3, 838

1, 943
3,
6,
8,
9,
7,

Transportation
Mining

1,
3,
3,
3,
2,

3, 135
5, 168
5, 784

Railroads

1, 111
1, 474
1, 391

Other

1 Excludes agriculture.
> Commercial and other includes trade, service, finance, communications, and construction.

NOTE.—Thesefiguresdo not agree with the totals included in the gross national product estimates of the Department of Commerce, principally because the latter
cover agricultural investment and also certain equipment and construction outlays charged to current expense.
Detail will not necessarily add to totals because of rounding.
Data on Expenditures for New Plant and Equipment are not available for the years 194(M4.
Sources: Securities and Exchange Commission and Department of Commerce.

ipated events as well as historical events are made.
The series attempts to measure economic phenomena
of great importance in the analysis of business conditions. The reliability of estimates of anticipations
is difficult to ascertain. An estimate of anticipated
expenditures for a period can be different from actual
expenditures for the same period either because the
estimating procedures and statistical techniques
employed are faulty or because the anticipated
expenditures were—for any number of reasons—not
made in fact. In some periods in the past there have
been marked differences between estimates of anticipated expenditures and actual expenditures for the
same period, generally due to unanticipated develop-




ments, such as substantial price changes or the
outbreak of Korean hostilities, which caused businessmen to change their plans. In the postwar
period the deviations between actual and anticipated
expenditures have ranged from 1 to 15 percent.
References.—These estimates are published quarterly in Department of Commerce press releases and
in the Survey of Current Business and in a special
statistical release of the SEC.
For a fuller description of the methods employed
in making the estimates and of the latest revisions
in the series, see the December 1951 and August 1952
issues of the Survey of Current Business.
^

33

NEW CONSTRUCTION
Description of series.—This series represents the field surveys to reflect construction costs. These
monthly dollar value of new construction put in estimates of valuation of work started are then
place. A seasonally adjusted series is also published translated into estimates of the value of work put
currently. The Business and Defense Services in place by the application of typical progress patAdministration, Department of Commerce, and the terns which have been developed for different types
Bureau of Labor Statistics, Department of Labor, and sizes of projects by surveying actual projects.
are jointly responsible for the series, with the former
The second method—reports of physical progress—
having primary responsibility for private non- provides the basis for estimates of construction activresidential construction and the latter for private ity on most Federal public-construction projects as
residential and all public construction.
well as on some State and local jobs receiving Federal
Construction covers the erection of fixed structures aid. Progress reports are supplied by the Federal
and utilities. It includes building and nonbuilding agencies administering the various programs.
structures such as dams, reservoirs, docks, highways,
The third method—based on financial reports—is
airfields, and utility lines. Installed service facilities used for estimating most utility construction. The
which become integral parts of structures are in- method is to apply a monthly trend pattern to an
cluded, but movable equipment and machinery are estimated annual total based on the previous year's
not included. Drilling of oil, gas, and water wells, level and other information on anticipated activity.
digging and shoring of mines, and operations which The trend data are based on Dodge reports of conare an integral part of farming such as plowing, tract awards and quarterly reports of some types of
terracing, and digging drainage ditches, are not companies to the Securities and Exchange Commisconsidered as construction. Major additions and sion. These monthly estimates are revised when
alterations are counted as new construction, but the financial reports become available after the end
maintenance and repairs are not.
of the year. Construction expenditure estimates for
The distinction between private and Federal, telephone and telegraph are based on monthly estiState, and local public construction is made on the mates received from the companies.
basis of ownership, not source of funds. ResidenMonthly estimates of farm construction are
tial construction includes nonhousekeeping facilities prepared by projecting annual estimates for the
such as hotels and dormitories as well as dwelling preceding year on the basis of the trend of farm
units.
income and applying a seasonal pattern to the annual
totals.
Statistical procedures.—Three general methods are
used in making the estimates of new construction
Relation to other series.—This series is one of the
activity, depending on the availability of sources of components in the Gross National Product series.
data on different types of construction.
The definition of construction used in the New
The first method—converting data on work Construction series is more inclusive than that in
started to estimates of work put in place—is used some of the series pertaining to labor. The Nonfor most types of private and non-Federal public agricultural Employment series contains a comconstruction. Information compiled by the F. W. ponent for employment in contract construction
Dodge Corp. on contract awards for private non- only, excluding employment on construction perresidential and State and local public construction formed by force account. The series on Average
in the 37 Eastern States is adjusted to allow for Weekly Hours and Average Hourly and Weekly
projects not included in the Dodge reports—chiefly Earnings cover contract construction of buildings
Small projects and work done by a firm's own force. only.
Aliowance is also made for construction in 11 Western
Uses and limitations.—Although the New ConStates not covered by Dodge by applying the ratio struction series indicates the current volume of this
of valuation of building authorized in these States segment of economic activity, it does not serve the
to the total valuation of permits in the entire country same purpose as would a series on new work started.
for each of several types of construction. An esti- The future trend in the series is determined to a
mate of the valuation of dwelling units started is considerable extent by past commitments made.
obtained by multiplying the number of units reThe figures cannot be used as an indicator of the
ported in the New Housing Starts series (p. 36) by physical volume of construction without extensive
valuation figures reported in building permits, the adjustments for changes in prices and wage rates,
latter having been adjusted on the basis of periodic technological changes, and other relevant factors.
34



New Construction
[Monthly average, millions of dollars]
Total new
construction

Year
1915
1916
1917
1918
1919
1920
1921.
1922
1923
1924
1925.
1926
1927
1928
1929
1930
1931
1932
1933
1934
1935
1936
1937
1938
1939
1940
1941
1942
1943
1944
1945
1946
1947.
1948
1950.
1951
1952

—
•

—

-

:

-

_

:

-

272
321
381
426
525
562
500
637
778
867
953
1, 007
1, 003
970
899
728
536
295
240
310
353
541
5»3
582
683
723
996
1,173
692
438
469
1, 000
1, 391
1, 806
.1, 899
2, 371
2, 575
2, 720

Private construction
Total
private
212
262
274
240
360
450
370
497
642
709
775
828
802
763
692
490
314
140
103
126
167
248
325
297
366
421
517
285
165
182
270
803
1, 105
1, 404
•1, 365
1, 788
1, 797
1, 818

Residential
(nonfarm)
102
115
99
76
154
168
175
280
367
422
460
467
430
397
302
173
130
52
39
52
84
130
156
166
223
249
292
143
74
68
92
335
526
715
689
1, 050
914
925

Federal, State,
and local 1

Other
110
147
175
164
206
282
195
217
276
287
315
361
372
365
390
317
184
87
63
74
82
118
169
131
142
172
225
142
91
114
178
469
579
689
676
738
883
893

60
59
107
186
165
113
130
140
135
158
178
179
201
207
207
238
222
155
137
184
186
293
258
285
317
302
479
888
527
256
200
197
287
402
534
583
778
902

i Includes public residential construction.
NOTE.—Detail will not necessarily add to totals because of rounding.
Monthly data are available beginning with 1939.
Sources: Department of Commerce and Department of Labor.

Also, since the series does not include maintenance factors as weather or the labor and materials supply
and repair, it cannot be related directly to the total situation. The indexes used in adjusting to eliminate seasonal variation' may also be obsolete.
use of construction labor and materials.
References.—Data used in this series are published
Because of the many different sources of data, and
the various estimating procedures used, the error in in more detail by type of construction, ownership,
the estimates cannot be statistically measured. and geographic location in Construction and Building
Year-to-year trends are probably quite good but Materials, a monthly publication of the Department
caution should be exercised in drawing conclusions of Commerce, and in Construction, a monthly publication of the Bureau of Labor Statistics.
from relatively small month-to-month changes.
More detailed descriptions of the sources of data
While extensive adjustments are made for undercoverage of the source data now used, there is no used and the methods of compiling the estimates of
satisfactory factual basis for making these adjust- expenditures for new construction are contained in a
ments, and much reliance is placed on judgment and supplement to Construction and Building Materials
opinion. The construction patterns used in translat- published each May, and in an article on "Estimating work started into work put in place may be obso- ing Expenditures for New Construction" published
lete and do not reflect short-run changes due to such in the Monthly Labor Review for February 1950.




35

NEW HOUSING STARTS
Description of series.—This series, prepared by the an estimate of the number of private units started
Bureau of Labor Statistics, represents the number in rural non-permit-issuing places. Thisfigureadded
of nonfarm dwelling units on which construction is to that for permit-issuing places gives the total
number of private nonfarm units started.
started in the United States each month.
Information on number of public units started is
For the purpose of this series the dwelling unit is
defined as a dwelling place containing permanent obtained directly from the sponsoring Federal, State,
cooking facilities, i. e., accommodations with house- and local agencies. Thisfigureadded to the estimate
keeping facilities designed for family living. Units for private units gives the estimate of the total
such as transient hotels and dormitories which lack number of nonfarm dwelling units started each
housekeeping facilities and such dwellings as trailers, month.
The seasonally adjusted annual rate of starts of
houseboats, sheds, and shacks are not included.
Temporary dwellings built just before and during private units published currently is computed each
World War II and the temporary reuse units built month by dividing the estimate of private starts for
during the veterans' emergency housing program of that month by the respective seasonal index and
1946-47 are not included.
multiplying the result by 12.
Dwelling units are classified as public or private
In order to obtain a preliminary estimate by 15
on the basis of ownership. Those owned by agen- days following the end of the month, all permit
cies of Federal, State, or local governments are reports received at that time, supplemented by telecounted as public.
graphic and telephone reports as necessary, are
Statistical procedures.—Each month a question-classified into estimating cells. The percent change
naire is mailed to some 6,000 local government offi- from the previous month is computed for identical
cials throughout the country who issue building per- reporting places and thisfigureis applied to all places
mits. About 2,500 of these are in urban places and in the class, except all large cities and high activity
the rest are in incorporated places under 2,500 popu- places for which actual reports are required. Since
lation, plus some counties and townships which the field surveys in non-permit-issuing areas are not
require permits. Information is requested, among completed in time, a preliminary estimate for such
other things, on the number of dwelling units for areas is made by projecting the previous month's
which building permits were issued during the figure on the basis of the trend shown by rural nonmonth.
farm places for which permits are issued.
Reports from permit-issuing places are classified
Relation to other series.—Data compiled for this
by type of place, size, geographic area, and whether series are used in the preparation of estimates for
inside or outside a metropolitan area. Reports in the series on New Construction, described above.
each class are weighted to account for places not
The series on New Housing Starts has a limited
reporting, and added to give the total number of relationship to Census of Housing figures. Units
units for which permits were issued. Adjustments started should not be added to Census inventory
are made to allow for difference in time between figures without an adjustment to allow time for
issuance of permit and start of construction and for completion. Also, although new construction usually
permits not used. The result is an estimate of pri- accounts for the greater part of the difference in invate units started in permit-issuing places.
ventory reported in successive housing censuses, there
Information on new housing starts in rural non- are other changes too, such as demolition, disaster
farm portions of the country not covered by building losses, additions and losses due to conversions, and
permits is obtained byfieldsurveys in the non-permit- changes in classification as farm or nonfarm. The
issuing parts of a sample of 96 counties. This sample census also includes certain types of places where
was selected by classifying all counties into 96 groups people live which would not be counted as dwelling
according to such characteristics as size, whether units under the definition for the New Housing
more urban or rural in character, winter temperature, Starts series.
extent of previous building activity, and racial comThe Bureau of Labor Statistics also publishes data
position of the population, and drawing one county on building authorized for all reporting places.
at random from each group. The number of starts These figures differ from the New Housing Starts
reported in each sample county is weighted to rep- series in that they represent totals taken from buildresent all counties in the group from which it was ing permit reports without any adjustment for lag
drawn, and the weighted figures are added to give and lapse.
36



New Housing Starts
New nonfarm housing units started
Year

Publicly
owned

Total
1920
1921
1922
1923
1924

247,
449,
716,
871,
893,

000
000
000
000
000

1925
1926
1927
1928
1929

937,
849,
810,
753,
509,

000
000
000
000
000

1930
1931
1932
1933
1934,

330,
254,
134,
93,
126,

000
000
000
000
000

1935
1936.
1937.
1938.
1939.

221,
319,
336,
406,
515,

000
000
000
000
000

5,
14,
3,
6,
56,

300
800
600
700
600

1940.
1941.
1942.
1943.
1944.

602,
706,
356,
191,
141,

600
100
000
000
800

73,
86,
54,
7,
3,

000
600
800
300
100

1945.
1946.
1947.
1948.
1949.

209,
670,
849,
931,
1, 025,

300
500
000
600
100

1,
8,
3,
18,
36,

200
000
400
100
300

1950.
1951.
1952.

1, 396, 000
1, 091, 300
1, 127, 000

43, 800
71, 200
58, 500

NOTE.—Monthly data are available beginning with 1939.
Source: Department of Labor.

Uses and limitations.—This series serves as an im-run changes in the time of starting construction after
portant guide in the formulation of national housing permits are issued, and use of obsolete data in
policy and as an indicator of a substantial part of all classifying areas into the various groups used in the
building activity and related economic trends. One estimating procedure. The latter is in process of
deficiency, which affects its use as a timely indicator, being corrected by rebasing the classifications on
is the fact that the revised estimate, made 3% months more up-to-date information, and the estimating
after the month affected, may differ fairly substan- procedure for both permit and nonpermit areas is
tially from the preliminary estimate. For the 4-year being improved.
period 1949-52 these changes averaged 3.2 percent,
References.—Data presented in this series are pubbut ranged from an increase of 12.8 percent in the
lished" in somewhat greater detail in Construction,
final estimate over the preliminary to a decrease of 6.1
published monthly by the Bureau of Labor Statistics.
percent. Increases have been slightly more frequent
A more detailed technical description of the methods
and larger than decreases.
used was presented in an article on "Estimating NaThe revised or final estimates are subject to two tional Housing Volume" in the October 1949 issue of
kinds of errors. Thefirst,amounting to about 2 perthe Monthly Labor Review. The seasonal adjustcent, is error due to sampling in nonpermit places and
ment is described in more detail in an article on
lack of complete information reported from permitissuing places. The amount of the second type of "Method of Compiling Seasonally Adjusted Annual
error cannot be measured. It stems from a variety Rates of Housing Starts" in the August 1952 issue of
of sources, such as building without permits, short- Construction.



37

INVENTORIES AND SALES
ventories series are important economic indicators,
reflecting the level of economic activity at the three
major stages of the distributive process. The sales
Description of series.—Total business sales and series reflect the demand for goods and services at
inventories are estimated monthly by the Office of these three stages, and constitute a basic measure of
Business Economics, Department of Commerce, by the state of business for the periods covered. The
summing the estimates computed separately for inventories series reflect the net result of a combinamanufacturing, retail trade and wholesale trade. tion of at least two factors, viz, the effect of recent
The sales estimates include all business receipts of actual sales levels on the stocks of sellers at various
the reporting companies, not just receipts from sale stages of distribution and the sales levels expected
of merchandise. In the manufacturers' series, in- by these sellers during the immediate future.
ventories are valued at book value. In the retail and
The monthly estimates are tested against more
wholesale trade series, inventories are valued at cost. comprehensive data when those data become availThe estimates are adjusted for seasonal variation.
able at some later time. The estimates for such
Statistical procedures.—The estimates of manu- aggregates as total manufactures' sales have in the
facturers' and wholesale monthly sales and end-of- past proved generally accurate, but preliminary
month inventories are made by extrapolating bench- estimates, especially, are subject to changes.
mark estimates: the Internal Revenue Service's
References.—Sales and inventory data for manuStatistics of Income, 1949, Part II, for manufacturers,facturers, wholesale trade and retail trade are
and a modified 1948 Census of Wholesale Trade base published monthly in the form of press releases and
for wholesalers. As new annual data become avail- in the Survey of Current Business. Retail sales
able the benchmark estimates are extrapolated to
estimates are also published in a separate Monthly
more recent annual estimates which in turn are
Retail Trade report by the Bureau of the Census.
extrapolated on the basis of monthly data reported
More complete descriptions of the various series
to the Census Bureau and OBE. The estimates are
have been presented in issues of the Survey of Current
revised as more comprehensive data become availBusiness: for Manufacturers, October 1951, October
able. A sample survey being initiated by Census
1952, and December 1953; for Wholesale Trade,
will soon provide direct estimates for wholesale trade.
August 1948, October 1951, October 1952, and
Monthly estimates of retail sales, unadjusted for
December 1953; and for Retail Trade, September
seasonal variation, are derived directly from a
1952 and November 1952. The Bureau of the
monthly sample survey conducted by the Census
Census has also issued a "Description of the Sample
Bureau. A random sample, stratified by size and
for the Monthly Retail Trade Report."
industry group, is used. The estimates are computed directly from the reported sales of stores in
Department Stores
the sample essentially by weighting the reported
Description of series.—Monthly indexes of departsales of each member of the sample by a value dependent upon its probability of selection. These ment store daily average sales and end-of-month inestimates are not linked to a benchmark. Adjust- ventories are prepared as a joint product of the
Federal Reserve Board's Division of Research and
ments for seasonal variation are made by OBE.
In attempting to relate these series to each other, Statistics and the research departments of the 12
it must be recognized that the different basic units Federal Reserve district banks. The coverage and
of measurement used (e. g., company or establish- collection methods and the procedures used in comment) can affect the totals, and to a lesser extent puting these indexes are described in detail in the
the movements, which a given series reflects. For December 1951 issue of the Federal Reserve Bulletin.
example, the wholesale trade and retail trade sales
Relation to other series.—'The index of departmentseries described above are based upon the establish- store sales is closely related in scope to the^Comment unit of classification, whereas the manufac- merce (Census and Office of Business Economics)
turers' sales series is based upon the company unit series on department-store sales. The series are not
of classification. The Office of Business Economics completely comparable. The Commerce series inadjusts the wholesale series to remove the major clude sales taxes in the total receipts figure; the
sources of duplication so that they can be summed Federal Reserve sales index is based upon a receipts
to obtain a series for total business sales.
figure from which sales taxes are excluded. The
Uses and limitations.—The monthly sales and in- Census dollar-volume series, which is unadjusted
44

Total Business, Retail, and Manufacturing




Inventories and Sales
Total business 1
Inventories 3

Year

Sales»

Retail
Inventories 8

Sales 5

Manufacturing
Inventories 3

Sales *

Department stores

New
orders 3

Millions of dollars
1925
1926
1927
1928
1929
1930
1931__
1932
1933
1934..
1935
1936
1937..
1938
1939
1940
1941
1942
1943
1944
1945-.
1946
19471948
1949..
I960..
1951
1952

(5)
(fi)

W
(fi)

„

(fi)
(5)
(fi)
(fi)
(6)
(fi)
(6)
(6)
18, 920
20, 051
22, 176
28, 780
31, 091
31, 343
31, 059
30, 893
42, 942
50, 605
55, 647
52, 264
62, 423
8 74, 059
74, 757

m
w
w
(B)
m

«fij
c
w

«
«

m

w
« 802
10,
12, 134
15, 811
18, 623
21, 920
23, 785
23, 852
27, 150
33, 156
36, 438
34, 664
39, 425
• 44, 454
45, 554

(5)
(fi)

«

(6)
(6)

w

(6)
(')
(fi)

(6)
(6)

w
«

5, 276
5, 534
6, 119
7, 776
8, 023
7, 561
7, 640
7, 948
11, 852
14, 060
15, 828
15, 311
18, 652
• 20, 754
20, 804

«

(6)
(5)
(fi)
(6)
(6)
(fi)
(fi)
(5)
(6)
(5)
(5)
(fi)
(fi)
3, 503
3, 865
4, 606
4, 768
5, 270
5, 851
6, 503
8, 541
9, 967
10, 877
10, 893
11, 974
fl 13, 185
13, 674

Inventories 4

Sales 8

Index 1947-49=100
(5)
12, 466
12, 089
12, 206
12, 775
11, 265
9, 105
7, 332
8, 146
8, 718
9, 098
10, 676
12, 012
10, 750
11, 465
12, 819
16, 960
19, 287
20, 098
19, 507
18, 390
24, 498
28, 920
31, 734
28, 972
34, 118
43, 039
43, 824

(5)
5, 137
5, 225
5,488
5, 859
4, 759
3, 585
2, 565
2, 857
3,601
4, 194
5, 008
5, 485
4, 487
5, 112
5, 859
8, 172
10, 430
12, 820
13, 782
12, 873
12, 617
15, 917
17, 630
16, 416
19, 312
22, 334
23, 043

(5)
(5)
(fi)
(8)
(6>
(6)
(5)
(5)
(6)

w

(5)
(5)
(5)
(4)
5, 354
6, 806
9, 803
13, 345
12, 705
11, 906
10, 532
13, 694
15, 622
17, 350
15, 903
20, 967
24, 431
23, 603

48
48
48
48
48
44
39
31
29
31
31
33
39
35
35
38
46
63
55
58
59
77
93
107
100
109
129
118

36
37
37
37
38
35
32
24
24
27
29
33
35
32
35
37
44
50
56
62
70
90
98
104
98
105
109
110

* Also includes -wholesale, rot shown separately in this table. Revised salesfiguresfor manufacturing and wholesale trade will appear in the December 1953,
Surrey of Current Business; revised inventoryfiguresfor manufacturing and wholesale and retail trade will appear in the January 1954 issue of the Survey.
1 Book value, end of period, seasonally adjusted.
i Monthly average for year.
< Average of end-of-month book value.
• Not available.
• Revised series beginning with 1951; not comparable with previous data. See Survey of Current Business, September and November, 1952, for detail.
NOTE.—Monthly data are available beginning with 1919 for department stores and beginning with 1939 for all others. Also, quarterly data for manufacturing
inventories and sales are available beginning with 1926.
Sources: Department of Commerce and Board of Governors of the Federal Beserve System.

for seasonal variation, measures total sales during a Considerable use is made of the indexes at the local
calendar month, whereas the Federal Reserve unad- level, especially in the department-store field.
The department-store sales and inventories injusted index measures daily average- sales on the
trading days in the month. All other things being dexes are useful as indicators of the relative sales and
equal, the Census estimates will vary with the num- inventories positions of this limited, although imber of trading days in the month; the department- portant, segment of retail trade. However, one
store sales index should not be affected by changes should not attribute to the department-store indexes
in the number of trading days in the month. OBE the characteristics of all retail trade. Comparison
of month-to-month changes in department-store
adjusts the Census series for seasonal variation and
sales with month-to-month changes in total retail
for number of trading days in the month. The
sales shows that, while changes in the two series have
Commerce adjusted dollar series is, therefore, com- been almost always in the same direction, the magniparable in this respect with the Federal Reserve tudes of the changes are substantially different for a
adjusted index of department-store sales.
majority of the months for which data are available.
Uses and limitations.—Economic Indicators pub- References.—The indexes of department-store sales
lishes the national indexes of department-store sales and inventories are published monthly in the Federal
and inventories. Indexes for the 12 Federal Re- Reserve Bulletin. A detailed description of the series
serve bank districts and for some cities or areas with- appeared in the December 1951 issue of the Bulletin,
in those districts, as well as for the Nation, are com- and an explanation of "Adjustment for Seasonal
puted and published by the Federal Reserve System. Variation" in the June 1941 issue.



39

MERCHANDISE EXPORTS AND IMP
Description of series.—This monthly Bureau
of the Census series on exports gives the value
of merchandise (except in-transit merchandise)
shipped from the United States to foreign countries.
Exports of Alaska, Hawaii, and Puerto Rico to
foreign countries are shown as United States exports.
Shipments between the United States and its Territories and possessions are not regarded as exports or
imports. Both Government and non-Government
exports are included. The former include Mutual
Security program military and economic aid, and
Department of the Army civilian supply shipments,
but shipments to United States Armed Forces and
diplomatic missions abroad for their own use are
excluded. Also excluded are exports of gold and
silver, oil and coal bunkers laden at United States
ports on vessels in foreign trade, and a number of
items of relatively small importance such as lowvalued or noncommercial shipments by mail and
gifts valued below $100.
Except for Department of Defense shipments as
explained below, exportfiguresare obtained from the
Shippers' Export Declaration which exporters are
required to file with the collectors of customs. These
shipments are valued at the time and place of export—that is, actual selling price, or cost if not sold,
including inland freight, insurance and other charges
to the place of export. Transportation and other
costs beyond the United States port of exportation
are excluded. For exports made by the Department
of Defense of grant-aid military equipment and supplies under the Mutual Security Program and for
other Department of Defense shipments such as
those under the Civilian Supply Program, information is compiled by the Bureau of the Census from
the records of the Department of Defense. In most
instances, these records show values f. o. b. point of
origin. These are adjusted to show value at the
United States port of exportation.
The monthly series on imports gives the value of
"general imports" into the United States, that is,
merchandise released from customs custody immediately upon arrival, plus merchandise entered into
customs bonded warehouses on arrival. As in the
case of exports, Alaska, Hawaii, and Puerto Rico
are included with continental United States, and
both Government and non-Government shipments
are recorded. Similarly, the exclusions with respect
to in-transit shipments, gold and silver, and low-value
items apply.
Imports are valued in accordance with the Tariff
Act of 1930 which provides that the value of imported merchandise shall be the foreign or export
40



value, whichever is higher. In general, they approximate those f. o. b. the exporting country. Transportation costs and United States customs duties
are therefore excluded. The values given in the
published statistics are those reported by importers
on the Bureau of Customs Import Entry Form.
Relation to other series.—Concurrently with the publication of monthly totals for exports (including reexports) and general imports, the Bureau of the
Census also shows exports of domestic merchandise
and imports for consumption. The latter includes
imports for immediate consumption, plus withdrawals for consumption from customs bonded warehouses. The difference between total merchandise
exports and imports should not be confused with the
more inclusive Gross National Product series of Net
Foreign Investment, which is a measure of the excess
of goods and services transferred to foreigners over
those acquired from foreigners (see p. 4).
Uses and limitations.—These overall series provide
accurate monthly indicators of the movement of
merchandise exports and imports. They do not
distinguish between Government and non-Government transactions. Although the exports are divided
into "Grant-aid" and "Excluding grant-aid," the
latter also includes some Government-sponsored exports, as noted in the table. The import totals include private shipments and those under Government sponsorship, such as purchases of strategic materials and reverse lend-lease. When United States
trade statistics are compared with those of other
countries, special attention needs to be given to the
extent to which the series being compared differ as
to valuation and coverage. Changes in exports relative to imports may indicate significant changes in
our merchandise trade with other countries, but do
not necessarily reflect changes in the balance of payments of the United States, which must take nonmerchandise items into account.
References.—-Preliminary totals for exports (including reexports) and general imports are published monthly in the Bureau of Census release,
FT 900-P, "Preliminary (Estimated) Export and
Import Totals." Compiled totals for exports and
general imports, exports of domestic merchandise,
imports for consumption, and Department of Defense shipments of grant-aid military equipment and
supplies are published shortly afterward in the
monthly release FT 900, "Total Trade." Cumulative totals are provided in the "Quarterly Summary
of Foreign Commerce of the United States," which
also contains index numbers for the several export
and import series. Detailed commodity by country

Merchandise Exports and Imports
[Monthly average, millions of dollars]
Merchandise exports
Year
Total1
1915
1916
1917
1918
1919
1920
1921
1922
1923
1924
1925.
1926
1927
1928
1929
1930
1931
1932
1933
1934
1935
1936
1937
1938.
1939
1940
1941.
1942
1943
1944
1945
1946
1947
1948
1949
1950
1951.
19521

....

Grant-aid
shipments2

296
457
520
512
660
686
374
319
347
383
409
401
405
427
437
320
202
134
140
178
190
205
279
258
265
335
429
673
1, 080
1, 188
817
812
1, 278
1, 054
1,004
856
1, 253
1, 265

62
411
863
942
463
54
96
«

(3)

24
89
166

Excluding
grant-aid
shipments

367
262
217
247
354
757
1, 182

(3)
(3)

833
1, 164
1, 099

Merchandise
imports

Excess of exports ( + )
or imports (—)

Total
148
199
246
253
325
440
209
259
316
301
352
369
349
341
367
255
174
110
121
138
171
202
257
163
193
219
279
230
282
327
347
412
480
594
552
738
914
893

+ 148
+ 258
+ 274
+ 259
+ 335
+ 246
+ 165
+ 60
+ 31
+ 82
+ 57
+ 32
+ 56
+ 86
+ 70
+ 65
+ 28
+ 24
+ 19
+ 40
+ 19
+3
+ 22
+ 95
+72
+ 116
+ 150
+ 443
+ 798
+ 861
+470
+400
+ 798
+ 460
+452
+ 118
+ 339
+ 372

Excluding
grant-aid
shipments

+ 88
+32
-65
-80
+7
+ 345
+ 702

(3)
P)

+ 95
+250
+ 206

1 Includes shipments under special programs such as those grant-aid programs listed in footnote1 below as well as other grant-aid programs such as ECA (Marshall
Plan); other less important programs such as Surplus Incentive Material, Reorientation and Rehabilitation programs; and programs such as UNRRA, International
Refugee Organization, etc. which were grant-aid only in part.
3 Except for Army Civilian Supply exports for 1943-46 for which information is not available,-the figures shown for 1947 and prior years include exports under
the following programs (dates shown are the approximate periods the programs were in operation): Lend-lease (1941-47); Greek-Turkish Aid (1947-52); Unite^ States
Foreign Relief <1947—4S>; Interim Aid (1947-48); and Army Civilian Supply (1943-present).
Figures are not shown for the years 1948-49 because separate information on ECA (Marshall Plan) economic aid exports is not available and these shipments
represented most of the grant-aid shipments during that period.
Figures for the years 1950-52 include only the Department of Defense shipments of grant-aid military supplies and equipment under the Mutual Security Program—the only important grant-aid program during that period for which separate export information is available. During this period ECA and Mutual Security
Program economic aid exports were important, but by 1952 they were much less important than the military grant-aid exports shown. Army Civilian Supply shipments were also relatively unimportant by 1952. More precise information on military and other grant-aid extended to other countries by the United States is
provided in the baJancc of payments statistics.
»Not available.

NOTE.—Monthly data are available for all years shown In table.
Source: Foreign Commerce and Navigation of the United States and other Bureau of the Census publications and tabulations.

data are also published by the Census Bureau. A
monthly pamphlet, "Foreign Trade Statistics Notes/'
contains supplementary information on such items
as unusual transactions appearing in the statistics,
changes in the types of shipments included in the
statistics, special problems of valuation, commodity
classification, and the like. A comprehensive dis-




cussion of the scope and content of United States
foreign trade and shipping statistics is available in
Foreign Commerce and Navigation of the United
States, last published in 1946. A complete list of
all Census publications in the field of foreign trade
is available in the Catalog of United States Foreign
Trade Statistical Publications.
41

PURCHASING POWER
NATIONAL INCOME
Description of series.—National income is the plement to the Survey of Current Business, 1951. The
aggregate of earnings by labor and property from the following indicate briefly the types of estimating
current production of goods and services by the procedures used:
Nation's economy. It is the sum of five major
"Compensation of Employees"—reliable data
items: (1) compensation of employees, (2) proprieare available each year from the social-security
tors' income, (3) rental income, (4) net interest, and
system, with current monthly estimates resting
(5) corporate profits.
chiefly on employer reports to the Bureau of
"Compensation of employees" is the sum of wages,
Labor Statistics on employment and earnings.
salaries, and certain supplements, such as employer
"Proprietors' Income"—estimated from incontributions to social insurance.
come tax returns to the Internal Revenue Ser"Proprietors' income" measures the monetary
vice, usually obtained every second year, with
earnings and income in kind of sole proprietorships
current quarterly data derived from analysis of
(including doctors, lawyers, and other self-employed),
trends in sales and corporate profits in indipartnerships and producers' cooperatives, exclusive of
vidual industries.
capital gains or losses. The supplementary income
"Rental Income"—estimated from a variety
which individuals obtain from renting property does
of Census and BLS data on average rents paid
not appear here, but under rental income of persons.
at various dates and Census and Internal
"Rental income" consists of (1) net money income
Revenue Service data on the distribution of
of persons from rental of real property, (2) estimated
property ownership and rental income between
net rental value to homeowners of their homes, and
persons and business.
(3) royalties received by persons from patents,
"Net Interest"—estimated from reports to the
copyrights, and rights to natural resources.
Internal Revenue Service, Bureau of the Cen"Net interest" measures both the money interest
sus, Board of Governors of the Federal Reserve
and the imputed interest accruing to the Nation's
System, and other agencies on interest and debt.
residents from private business and from abroad,
Relation to othqr series.—The relation of national
minus Government interest disbursements to busiincome to gross national product is discussed
ness, which appears as part of business incomes.
Imputed interest consists of the value of financial above (p. 4); and the relation to personal income
services received by persons without explicit pay- is defined below (p. 47).
Uses and limitations.—The national income measment and property income withheld by life-insurures earnings from current output and is a useful
ance companies and mutual financial intermediaries
measure of the rate of flow of such earnings. The
on account of persons.
"Corporate profits" are the earnings of corpora- movements of this series correspond with movements
tions organized for profit, measured before Federal in production. However, the value of the national
and State profit taxes, but without deduction of income series lies more in the components than in
depletion charges and exclusive of capital gains and the total. It may mean little to know that national
losses. (For a more extended discussion of corporate income (unadjusted for price changes) has gone up;
but it may be very important to know the relative
profits, see the following section.)
"Corporate inventory valuation adjustment" contribution of wages and profits to that increase.
The chief cautions for use result partly from the
measures the excess of the value of change in the
volume of corporate inventories (in terms of average definitions used, and partly from the nature of the
prices during the period) over the change in terms basic data. With respect to the first, care must be
of book values. This adjustment is required since, taken not to interpret movements in the series as
as is customary in business accounting, corporate measuring something other than they are intended
profits are reported inclusive of inventory profits or to measure. For example, variations in wages and
loss, whereas only the value of the real change in profits do not necessarily indicate changes in the
inventories is counted as current output in the welfare of workers or in the ability of corporations to
national product.
provide new capital. For such purposes, these variaStatistical procedures.—The methods of estimation tions must be considered in the light of other factors
employed in the very complex area of national income such as the cost of living and the cost of new plant
are described in detail in the National Income Sup and equipment. With respect to the second—which
42



National Income
[Billions of dollars]

Year

Total
national
income

Compensation of
employees

Proprietors'
(business,
professional,
farm)
and rental
income

Corporate profits and inventory
valuation adjustment
Net interest
Total

Profits
before
taxes

1929.

87.4

50. 8

19.7

6.5

10.3

1930.
1931.
1932.
1933
1934.

75.0
58. 9
41.7
39. 6
48. 6

46. 5
39.5
30. 8
29.3
34. 1

15.7
11.8
7.4
7.2
8.7

6. 2
5.9
5.4
5.0
48

-2.0

1935
1936.
1937
1938.
1939.

56. 8
64.7
73. 6
67.4
72.5

37. 1
42. 7
47. 7
44. 7
47.8

12. 1
12. 6
15. 4
14.0
14.7

4.5
4. 5
4.4
4.3
4.2

3.0
4.9
6. 2
4.3
5.8

3.2
5.7

1940.
1941
1942.
1943.
1944.

81.3
103. 8
137. 1
169.7
183.8

51.8
64.3
84.9
109. 2
121. 2

16.3
20. 8
28. 4
32. 8
35. 5

4. 1
4. 1
3.9
3.4
3. 1

9.2
14. 6
19. 9
24.3
24 0

9.3
17.2
21. 1
25. 1
24 3

1945
1946.
1947.
1948.
1949.

182.7
180.3
198.7
223. 5
216. 3

123.0
117. 1
128.0
140.2
139.9

37. 5
42.0
42. 4
47. 3
42. 1

3.0
2.9
3. 5
4.3
5.0

19. 2
18.3
24.7
31.7
29.2

19.7
23. 5
30.5
33. 8
27. 1

1950.
1951.
1952.

240. 6
278.4
291. 6

153.4
178. 9
193. 2

45.4
50.7
51. 2

5.7
6. 4
7.0

36.0
42.4
40.2

Inventory
valuation
adjustment

41.0
43.7
39. 2

6.6
1. 6

-2.0
1. 1

9. 8
3.3
-.8
-3.0
.2
1.7

6.2

3.3
6. 5

* Less than $0.05 billion.
NOTE.—Detail will not necessarily add to totals because of rounding.
Quarterly data are available beginning with 1939.
Source: Department of Commerce.

is particularly applicable to the current data on
proprietors' earnings, rental income, net interest, and
the inventory valuation adjustment—it should be
recognized that many of the available data permit
only fair approximations of the phenomena being
measured, and therefore too great reliance should not
be placed on these statistics as instruments of precise
measurement.
References.—Quarterly data appear regularly in




the statistical section of the Survey of Current Business. For annual data, preliminary estimates appear
in the February issue, revised estimates in the July
issue. Historical data for 1929-48 appear in the
1951 National Income Supplement to the Survey, and
for 1949-52 in the July 1953 issue of the Survey.
A detailed discussion of the technical aspects of the
estimates is given in the 1951 National Income
Supplement.

43

CORPORATE PROFITS
Description oj series.—The corporate profits series national income purposes, and profits of these comof the Office of Business Economics, Department of panies are removed from the tax-return tabulations.
Since the tax-return tabulations are not available
Commerce, contains profits estimates for past years
and recent quarters for all United States corporations, until more than 2 years after the close of the year
estimates of the distribution of those profits between to which they refer, other bases for the estimates for
dividends and retained earnings, and estimates of the most recent 2 years and for quarters must be
corporate tax liability. The national income concept used. These estimates for current periods are made
of profits of OBE is used in this series. This concept by extrapolating the benchmark estimates, i. e., the
of profits differs from the conventional accounting latest estimates based upon Internal Revenue taxconcept of profits (which is used in the Internal return tabulations. The extrapolators are based
Revenue Service tabulation of profits and in the upon regular quarterly reports from manufacturing
financial reports series of the Federal Trade Com- corporations to FTC and SEC and from publicmission and Securities Exchange Commission) in utility corporations to Federal regulatory agencies,
that dividends received by corporations are deducted and upon nongovernmental surveys and miscelfrom profits (and dividends) to obtain unduplicated laneous sources of varying reliability. When the
totals reflecting income originating in United States Internal Revenue tabulations of tax returns for a
corporations; profits are calculated inclusive of de- given year become available, the estimates for that
pletion, which is not considered an element of capital year are revised to conform to the Internal Revenue
consumption in the national income and product tabulations.
The series on "Corporate tax liability" is derived
accounts; capital gains and losses are eliminated from
profits because they do not measure gains or losses by procedures generally similar to those described
originating in current production; and adjustments for corporate profits.
Relation to other series.—-The corporate-profits
for international flows affecting profits are made.
series is designed primarily to measure the contriThe estimates are based largely on tabulations from
income-tax returns and from reports to the SEC, bution of corporate profits to the national income.
It is, therefore, as consistent with the concepts and
FTC, and other regulatory agencies.
other series which are a part of the national income
The corporate profits series as initially published
accounts as the basic data permit, and can be used
are revised to reflect more comprehensive data when
in conjunction with the other national income series
those data become available. Since the data become
(e. g., net interest, proprietors' and rental income,
more comprehensive in stages, i. e., more and more
compensation of employees, etc.) with confidence of
data become available periodically until the complete
conceptual comparability.
Internal Revenue tabulations are published, several
The corporate-profits series is, as it must be, based
revisions are made before "final" estimates are pubupon reports from companies rather than establishlished. Some revisions, though minor, are made even
ments. This results in some noncomparability with
after the tabulations are available.
series based upon reports from establishments.
Statistical procedures.—The annual data published Furthermore, surveys based upon the establishin the corporate profits series are, except for the 2 or ment unit of classification are not confined to es3 most recent years, based upon tabulations by the tablishments of corporations but include establishInternal Revenue Service of unaudited corporate- ments of other forms of organization as well. The
income-tax returns. The data in these tabulations corporate-profits series, or any other series based
are adjusted in various ways to make them com- upon company reports, cannot safely be assumed to
parable, statistically and conceptually, with other be directly comparable with these establishment
entries in the national income accounts. The im- series unless the reports on the different bases have
portant accounting conceptual adjustments are sug- been reconciled. These factors are more important
gested by the statement above of differences between when series for specific industries are being comthe conventional accounting concept of profits and pared, however, than when the broad aggregates
the national income concept. Another important published in Economic Indicators are compared.
adjustment of the tabulations is the audit adjustment
The series on Expenditures for New Plant and
which makes allowance for additional profits dis- Equipment (p. 32) and Manufacturers' Inventories
closed by auditing of the income-tax returns by and Sales (p. 38) are also based primarily upon
Internal Revenue. Mutual insurance companies company reports. All three series are produced
are not considered part of the corporate universe for for recent periods by extrapolating benchmark esti44



Corporate Profits
{Billions of dollars]
Corporate profits after taxes

Corporate
profits
before taxes

Corporate
tax
liability

9.8

1.4

8.4

5.8

2.6

3.3
8
-3.0
.2
1.7

.8
.5
.4
,5
.7

2.5
-1.3
-3.4
-.4
1.0

5. 5
4. 1
2. 6
2. 1
2. 6

-3.0
— 5. 4
-6.0
-2. 4
-1. 6

3. 2
5.7
6. 2
3. 3
6.5

1.0
1.4
1. 5
1.0
1. 5

2. 3
4.3
4. 7
2. 3
5.0

2.9
4. 6
4.7
3.2
3.8

6
-.3

9.3
17.2
21. 1
25. 1
24.3

2.9
7.8
11. 7
14. 4
13. 5

6.4
9.4
9.4
10. 6
10.8

4.0
4.5
4.3
4. 5
4.7

2.4
4. 9
5. 1
6.2
6. 1

1945
1946
1947
1948
1949

19. 7
23. 5
30. 5
33.8
27. 1

11.2
9. 6
11.9
13.0
10.8

8. 5
13. 9
18.5
20.7
16.3

4.7
5.8
6. 6
7. 2
7.5

3. 8
8. 1
12.0
13. 5
8.8

1950
1951
1952_

41.0
43.7
39.2

18.2
23.6
20. 6

22.7
20. 1
18. 6

9. 1
9.2
9. 1

13. 6
10. 9
9.5

Year

1929
1930
1931
1932
1933_
1934
1935
1936
1937
1938
1939
1940
1941
1942
1943
1944

...

Total

Dividend
payments

Undistributed profits

W

-.9
1.2

* Less than $0.05 billion.
NOTE.—See table p. 43 for profits before taxes and inventory valuation adjustment.
Quarterly data are available beginning with 1939.

Detail will not necessarily add to totals because of rounding.

Source: Department of Commerce.

mates based upon Internal Revenue Service tabula- annual estimates for past years. There are two
tions of income-tax returns. The Plant and Equip- principal reasons for this: (a) quarterly income
ment Expenditures and the Inventories and Sales statements, upon which the quarterly series must be
series differ from the corporate-profits series in that based, are inherently less reliable than annual income
they cover unincorporated as well as incorporated statements because they are affected by seasonal
influences that are not completely accounted for in
businesses.
Uses and limitations.—The corporate-profits series company reports and (6) wide gaps in the financial
is an important economic indicator, reflecting the data available quarterly make the underlying basis
state of health of a substantial part of the Nation's of the quarterly estimates weaker than that of the
business community. Certain limitations of the annual estimates, even before the Internal Revenue
series require that it be used with caution, however. tabulations become available.
References:—The corporate-profits series is pub(1) As its title indicates, the series measures only
the profits of corporations. It does not, therefore, lished quarterly in the Survey of Current Business.
A complete statement of the methods and the
portray fully the profit position of all business.
(2) The total corporate-profits series is too gen- sources of data used in preparing these estimates is
eral to provide any indication of the profit positions presented in the 1951 National Income Supplement
of specific industries. In some situations knowledge of the Survey of Current Business, pages 84-90.
of the profits experience of specific industries is vital The statement on procedures for preparing recent
year and quarterly estimates, described in detail on
to correct economic analysis.
(3) The quarterly corporate-profits estimates are pages 88-89, is still generally accurate, although
less reliable than the annual estimates, especially the some relatively minor revisions have been made.




45

Personal Income
[Billions of dollars]

Year

1929

Labor income
(salaries,
Total perwages, and
sonal income other labor
income)1

50. 5

85. 1

Proprietors' income

Farm

Dividends
and personal
Business,
interest
professional,
and rental
1
income

Transfer
payments

5. 7

14. 1

13.3

1. 5

12. 6
11. 1
9. 1
8. 2
8.6

1. 5
2. 7
2. 2
2. 1
2.2

1930
1931
1932
1933
1934.-,

76. 2
64. 8
49. 3
46. 6
53. 2

46.3
39. 2
30. 5
29. 0
33. 8

3. 9
2.9
1. 7
2. 3
2. 3

11. 8
8.9
5.7
4. 9
6.4

1935
1936
1937
1938
1939

59. 9
68. 4
74. 0
68. 3
72. 6

36. 8
42. 1
45. 9
42. 8
45. 7

4. 9
3. 9
5. 6
4.4
4. 5

7. 3
8. 8
9.8
9. 6
10. 2

8. 6
10. 1
10. 3
8. 7
9. 2

2.4
3. 5
2. 4
2.8
3.0

1940
1941
19421943
1944

78. 3
95. 3
122. 7
150. 3
165.9

49. 5
61. 5
81.4
104. 5
116. 2

4. 9
6.9
10. 5
11.8
11.8

11.3
13.9
18. 0
21. 1
23.7

9.4
9.9
9. 7
10. 0
10. 6

3. 1
3. 1
3.2
3.0
3. 6

1945
1946
1947
19481949

171. 9
177. 7
191. 0
209. 5
205.9

116. 9
111. 1
122. 3
134. 9
134.2

12. 5
14. 8
15. 6
17. 7
12.8

25.0
27. 2
26. 8
29. 6
29.3

11. 4
13. 2
14. 5
16. 0
17. 1

6.2
11.4
11.8
11.3
12.4

1950
1951
1952

226. 7
254. 3
269. 7

146. 5
170. 7
184. 9

13. 3
15. 5
14.8

32. 1
35. 2
36. 1

19. 6
20. 5
21. 0

15. 1
12. 5
12. 9

i Excludes social insurance contributions of employees and, beginning January 1952, of self-employed persons.
NOTE.—Detail will not necessarily add to totals because of rounding.
Monthly data are available beginning with 1929.

'

Source: Department of Commerce.

PERSONAL INCOME and PER CAPITA DISPOSABLE INCOME
"Dividends and personal interest" is the sum of
(Discussion of these two series is here combined in
money dividends and the net interest component of
one section, because of their close relationship.)
Description of series.—Personal income is composed national income, plus net interest paid by the
of income received currently by individuals, by un- Government.
"Transfer payments" include payments not resultincorporated businesses, and by nonprofit institutions (including pension, trust, and welfare funds). ing from current production, such as social-security
This income is here divided into labor income, pro- benefits, military pensions, corporate gifts to nonprietors' income, dividends and personal interest, and profit institutions, direct relief, and consumer bad
transfer payments. Although most of the income is debts. This component does not include Governin monetary form, there are important exceptions— ment interest.
chiefly estimated rental value to owner-occupants of
Disposable personal income is equal to Pertheir homes and value of food consumed on farms. sonal Income less taxes on individuals (including
"Labor income" is principally wages and salaries, income, property, and other taxes not deductible as
less contributions which are made from employees' business expense), customs receipts, and other genpay for social security.
eral Government revenues received from individuals
"Proprietors' income" is the sum of unincorporated as individuals.
business and rental income as defined above in the
"Disposable personal income in 1952 prices" is
section on National Income (p. 42). In the present the preceding series valued in 1952 prices by dividseries, however, the income of farm operators is ing the series in current dollars by an overall
shown separately.
price index (with 1952—100) for personal consump46



Per Capita Disposable Income
Total disposable personal Per capita disposable perincome (billions of dollars)1
sonal income (dollars)1
Year
Current
prices

1952
prices 3

Current
prices

1952
prices 3

Population
(thousands)3

1929

82. 5

127.3

677

1, 045

121, 881

1930
1931.
1932
1933
1934

73. 7
63. 0
47. 8
45.2
51. 6

119. 1
113. 5
97. 8
97. 0
104.7

598
507
383
360
408

966
914
783
773
828

123, 188
124, 149
124, 949
125, 690
126, 485

1935
1936
1937
1938
1939

58.0
66. 1
71. 1
65. 5
70.2

115. 5
130. 6
135.4
127. 7
138.2

455
516
551
504
536

906
1, 020
1, 050
982
1, 055

127, 362
128, 181
128, 961
129, 969
131, 028

1940
1941
1942
1943
1944

75.7
92. 0
116. 7
132.4
147.0

147. 9
169.4
191. 3
198. 5
210. 3

573
690
865
968
1, 062

1, 119
1,271
1,418
1, 451
1, 519

132, 122
133, 402
134, 860
136, 739
138, 397

1945
1946
1947
1948
1949

151. 1
158. 9
169. 5
188.4
187.2

208. 7
204.2
198. 2
208. 6
209. 9

1, 080
1, 124
1, 176
1, 285
1, 255

1,
1,
1,
1,
1,

492
445
375
423
407

139, 928
141, 389
144, 126
146, 631
149, 188

1950
1951
1952

205. 8
225. 0
235. 0

225. 7
229. 6
235.0

1, 357
1, 458
1, 497

1, 488
1, 488
1, 497

151, 677
154, 360
156, 981

* Income less taxes.
s Dollar estimates in current prices divided by an overall implicit price index for personal consumption expenditures.
This price index is based on Department
of Commerce data, shifted from a 1939 base.
* Including armed forces overseas. Annual data as of July 1.
NOTE,—Quarterly data are available beginning with 1939.
Sources: Department of Commerce and Council of Economic Advisers.

tion expenditures. As a result, the income difference, for example, between 1939 and 1952 is far less
in real terms than is indicated by comparing the
current dollar estimates of 70.2 billion and 235
billion, respectively. Prices were so much lower in
1939 that the income for that year should almost be
doubled for comparison with real income in 1952.
"Per capita disposable personal income" is obtained simply by dividing the disposable personal
income series by the total midyear population.
Relation to other series.—Personal income differs
from national income by including transfer payments
and Government interest and by excluding contributions to social insurance (by employee and employer), the inventory valuation adjustment and corporate profits tax liability and undistributed corporate profits.
Uses and limitations.—The estimates for personal
income and its components and for disposable income
provide a measurement of trends in spending power
of individuals. The inclusion of substantial nonmonetary items—imputed rent, interest, food, fuel—
should be noted for some purposes, but the effect of




including these items should not be overemphasized.
They tend to make the income estimates generally
more stable, but should have little effect on the
ability of the estimates to show when a change is
occuring and the direction of the shift.
Disposable personal income gives a more direct
measure of income available for spending, since it
approximates take-home income, than does personal
income. For measuring changes, in real terms, in
consumers' buying power, the estimates of disposable
income in constant prices are to be preferred.
References.—Monthly data on personal income and
quarterly data on disposable personal income appear
regularly in the statistical section of the Survey of
Current Business. Preliminary annual estimates
appear in the February issue, and revised estimates
in the July issue of the Survey. Historical data for
1929-48 appear in the 1951 National Income Supplement to the Survey of Current Business, and for 191952 in the July 1953 issue of the Survey. The supplement also contains a detailed discussion of the
statistical procedures used.
47

CONSUMER INCOME, SPENDING, AN ) SAVING
Description of the series.—" Disposable personal in- ment stores, sales-tax receipts, and other source
data.
come" is discussed in the preceding section.
Relation to other series.—Estimates of personal con"Personal consumption expenditures" is the sum
of money and imputed expenditures made by con- sumption expenditures will show much the same
sumers (individuals, nonprofit institutions such as trends from quarter to quarter as the figures for
hospitals, etc.) for goods and services. The expen- total retail sales. However, personal consumption
diture total covers total purchase cost to consumers, expenditures also include a wide variety of services
including general sales taxes. The full cost of auto- and such items as food produced and consumed on
mobiles, refrigerators, furniture, and the like is in- farms which are outside of retail trade. Conversely,
cluded in the period when sold—quarter or year— retail trade includes some commodity items, such as
regardless of when payments are made or completed. building materials, gasoline and trucks, which are
The purchase of homes is not included as an expendi- not part of personal consumption expenditures.
ture: instead the estimated rental value to the
The estimate of personal net saving and the liquid
homeowner is included if he occupies the home.
savings estimate of the Securities and Exchange Com"Durable goods" are those items which generally mission differ in level and trend. The chief reason
last more than 3 years in use. "Nondurable goods" for the difference is the inclusion in the personal net
are items with a shorter life. "Services" include saving series (and not in the liquid savings estitelephone, electricity, shoe repair, gas and water, mates) of net purchases of nonfarm residences and
and also such items as the expense of handling life net increases in persons' equities in farms and other
insurance, and banking services furnished without unincorporated businesses. (For a detailed reconpayment (such as free checks where a minimum ciliation of the two series, see table 6, p. 14, of the
balance is maintained).
July 1953 issue of the Survey of Current Business.)
"Personal net saving" is equal to disposable perUses and limitations.—The estimates of personal
sonal income less personal consumption expenditures. consumption expenditures represent a generally useAs such, it conceptually includes not merely cash and ful, reliable measure of trends in consumer purbank deposits but changes in reserves of life-insurance chases. They may be used to study trends in the
companies, farmers' purchases of land and tractors, ratio of wages, or more generally of income, to expendietc.
ture, and to review the division of the national outStatistical procedures.—Personal consumption exput between consumer takings, business capital
penditures for goods are estimated for benchmark formation, and Government defense or other exyears from the value of the output of specified items penditures.
as reported in the Census of Manufactures, less the
The estimates of personal saving are among the
portion of this output bought by business and gov- least satisfactory of the significant series which
ernment or exported. To the consumer portion of appear in the national income accounts. They are
manufactured products is added the value of non- the residual from two larger estimates. The errors
manufactured consumer goods (for example, non- and limitations present in the hundreds of seriesf
processed foods) to derive producers' output for developed for other purposes, which must be used at
consumers. Successive adjustments are added for present in estimating the national income do not
transportation, imports and exports, wholesale and completely cancel out. To this extent these errors
retail inventory changes, wholesale and retail mark- are transmitted into the saving estimate. Quarter to
ups, and sales taxes. Transportation charges are quarter changes are, however, subject to revision as
computed from ICC and other data on transporta- better data become available.
tion. Wholesale and retail markups are derived from
References.—Quarterly data appear in the statisCensus of Business and Internal Revenue Service tical section of the Survey of Current Businessm
data. For service items a great variety of sources Preliminary annual estimates appear in the February
and procedures are used.
issue and revised estimates in the July issue of the
Current estimates of consumption expenditures Survey. Historical data for 1929-48 appear in the
rest chiefly on the month-to-month trends shown 1951 National Income Supplement to the Survey of
by the retail salesfigures,by kind of store, reported Current Business, and for 1949-52 in the July 1953
in the Census Bureau's Monthly Report on Retail Survey. The Supplement also contains a detailed
Trade, by Federal Reserve Board data for depart- discussion of the technical aspects of the estimates.

48



Consumer Income, Spending and Saving

\

[Billions of dollars]

Year

1929

___

Disposable personal
income 1

Less: Personal consumption expenditures
Total

Durable
goods

Nondurable goods

Services

Equals:
Personal
net
saving

Net saving
as percent
of disposable
income

82.5

78.8

9. 4

37.7

31. 7

3.7

4.5

1930
1931
1932
1933
1934

73.7
63.0
47.8
45.2
51. 6

70.8
61.2
49.2
46. 3
51. 9

7. 3
5. 6
3. 7
3. 5
4. 3

34. 1
29.0
22.7
22. 3
26.7

29. 5
26. 6
22.8
20. 6
20.9

2.9
1. 8
-1.4
-1.2
-.2

3. 9
2. 9
-2. 9
-2. 6
—. 5

1935
1936
1937
1938
1939

58.0
66. 1
71. 1
65. 5
70.2

56.2
62. 5
67. 1
64.5
67.5

5. 2
6. 4
7. 0
5. 8
6, 7

29.4
32. 9
35.2
34,0
35. 3

21. 7
23. 3
24. 9
24.7
25. 5

1.8
3. 6
3. 9
1.0
2.7

3.0
5.4
5. 5
1. 5
3.8

1940
1941..
1942
1943--1944

75. 7
92.0
116. 7
132.4
147.0

72. 1
82.3
91.2
102.2
111. 6

7. 9
9. 8
7. 1
6. 8
7. 1

37. 6
44.0
52. 9
61.0
67. 1

26. 6
28.5
31. 2
34. 4
37.4

3.7
9.8
25. 6
30.2
35.4

4. 9
10. 6
21. 9
22.8
24. 1

1945
1946
1947
1948
1949

151. 1
158.9
169. 5
188.4
187.2

123. 1
146. 9
165. 6
177.9
180. 6

8. 5
16. 6
21. 4
22. 9
23. 8

74.9
85.8
95. 1
100. 9
99.2

39. 7
44.5
49. 1
54. 1
57.5

28.0
12.0
3.9
10. 5
6.7

18.5
7. 6
2.3
5. 6
3.6

1950
1951--..
1952..

205.8
225.0
235.0

194. 6
208. 1
218. 1

29. 2
27. 3
26. 7

102. 6
113. 4
118.8

62.7
67.4
72.7

11.3
16. 9
16. 9

5. 5
7.5
7.2

»Income less taxes.
NOTE.—Detail will not necessarily add to totals because of rounding.
Quarterly data are available beginning with 1939.
Source: Department of Commerce.




49

FARM INCOME
Description of series.—The farm income series, com- keted or the time it was marketed, it sometimes is
puted by the Agricultural Marketing Service,1 is a necessary to impute figures on the basis of patterns
measure of the amount of cash received by fanners for and relationships found in earlier periods or in census
the commodities they sell and for participation in data. In the absence of a midmonth price, a season
certain Government farm programs. Estimates are average price is used. When the marketing of an
made monthly and for calendar years and are avail- individual commodity is completed and more comable annually back to 1910. The series includes cash plete information becomes available, the monthly
receipts from all sales except those from livestock and annual estimates are revised.
Cash receipts from farm marketings include
sold by one farmer directly to another farmer in the
same State. It represents gross receipts of farm moneys received from nonrecourse loans made by
operators, including any share going to landlords, the Commodity Credit Corporation in connection
without any deduction for expenses incurred. Gov- with price supports. These are included in cash
ernment payments included in the series represent receipts in the month in which the loans are made.
all money received by farmers directly from the If redeemed later, they are treated as an offset to
Federal Government in connection with farm pro- cash receipts in the month in which redeemed.
grams, such as rental and benefit, conservation, Slight variations from this procedure are necessary
price-adjustment, parity, and production payments. in the case of wheat and cotton. Also the procedure
is not applicable to tobacco.
These payments to landlords also are included.
Estimates of cash farm income are revised as more
The series is built up almost entirely from data
collected for other purposes. In the past some in- complete data become available, sometimes within a
come data have been obtained by interview surveys, few months after they are first published but in any
but the surveys have been limited in scope and case at the end of the marketing year. They are
infrequent. Consequently, it has been necessary to also revised every 5 years following the agricultural
consider agriculture as one big enterprise and to census. No major conceptual change has been made
develop income estimates from estimates of quantities in the series since 1936 when" the work on "income
marketed and average prices. The basic data are parity" gave impetus to getting more complete and
collected by the Agricultural Marketing Service in better income data. As a result the estimates were
connection with other series. Information on Gov- extended back to 1910, put on a calendar-year basis,
ernment payments comes from the records of the and generally improved in comparability.
The Parity Index, which is used to convert the
Commodity Stabilization Service (formerly part of
farm income series from current dollars to 1952
the Production and Marketing Administration).
Approximately 165 commodities or commodity dollars, is discussed above in the section on prices.
Relation to other series.—The estimates of cash
groups are represented in the series. Cash receipts
from "all farm marketings7' and from "livestock and farm income form the basic core of several other
livestock products" and "crops" are computed and income series. "Realized gross farm income" is
published monthly by States. Monthly estimates obtained by adding to cash farm income the market
for 12 commodity groups also are published for the value of home consumption of farm products and the
United States. A further breakdown by individual rental value of farm dwellings. By subtracting farm
commodities is published for the United States and production expenses one gets the amount of "realized
for each State on an annual basis.
net income of farm operators." Adjustments of
Statistical procedures.—In general, estimates of realized net income for the net change in inventories
cash farm income are derived by multiplying quan- held on farms and the addition of farm wages of
tities marketed each month by midmonth prices. laborers living on farms gives the "net income of
With minor exceptions, this procedure is followed persons on farms from farming." The further
commodity by commodity and State by State. addition of farm wages of nonresident laborers, net
Calendar-year estimates are a summation of the rent paid to nonfarm landlords, and interest paid on
monthly estimates, and United States totals are a farm-mortgage debt provides an estimate of "net
summation of the State figures. In case adequate income from agriculture." In most instances, corredata are not available on either the quantity mar- sponding series on a purely cash basis can also be
computed.
Under the reorganization of the Department of Agriculture which became
The series on "realized net income of farm opereffective on November 2, 1953, most statistical functions of the former Bureau
ators" differs from the Commerce Department series
of Agricultural Economics were reassigned to the Agricultural Marketing
Service.
on "net income of farm proprietors" to the extent Of
1

50



Farm Income

Year

1910
1911
1912
1913,
1914.
1915
1916
1917.
1918.
1919.
1920
1921.
1922
1923.
1924.
1925.
1926.
1927.
1928.
1929.
1930.
1931
1932.
1933.
1934.
1935.
1936.
1937.
1938.
1939.
1940.
1941.
1942.
1943.
1944.
1945.
1946.
1947.
1948.
1949.
1950.
1951.
1952.

Farm income
Parity index
Farm income
(monthly av(prices paid,
(monthly average, millions interest, taxes, erage, millions
of current
and wage rates)
of 1952
dollars)
1952 = 100 1
dollars) 2
482
465
501
520
503
533
645
895
1, 122
1,214
1, 050
676
715
796
850
918
879
894
916
942
754
531
395
453
563
637
720
763
679
715
755
968
1, 345
1, 667
1, 763
1, 844

2, 111

2, 502
2, 539
2, 344
2, 384
2, 757
2, 721

34
34
35
35
36
37
40
52
60
69
75
54
53
55
56
57
56
55
56
56
53
45
39
38
42
43
43
46
43
43
43
46
53
60
63
66
72
84
91
87
89
98
100

* Converted from the reported base, 1910-14=100, to the base 1952=100.
' Farm income in current dollars divided by parity index on base 1952=100.
NOTE—Farm income includes cash receipts from marketings and Government payments.
Monthly data are available beginning with 1924, but with the exception of 1950, 1951, and 1952. .they do not agree with the latest annual totals.
Source: Department of Agriculture.

the adjustments for the net change in farm inven- These other series, however, are prepared only on
an annual basis.
tories, which are reflected in the latter series.
Uses and limitations.—There is widespread interest References.—Current estimates of farm income
in estimates of farm income as an important measure appear in The Farm Income Situation published by
of the general condition of agriculture. The series is the Agricultural Marketing Service of the Departthe most current indication of the flow of cash funds ment of Agriculture. Historical data can be found
to that segment of the economy. Its use is limited in the Department's annual publication, Agricultural
though in that it measures gross cash farm income. Statistics. For a detailed discussion of procedures,
Because it measures gross cash income, it is not as see The Agricultural Estimating and Reporting Services
good a measure of the farmer's economic position as of the United States Department of Agriculture)
some of the net income series referred to above. Miscellaneous Publication No. 703.




51

CREDIT, MONEY, AND FEDERAL FINANCE
BANK LOANS AND INVESTMENTS
Description of series.—"Commercial banks" are in reports for the banking system are available. The
general distinguished from other lending institutions June and December estimates are later replaced by
by the fact that they accept deposits subject to check "benchmark" figures for all commercial banks.
or withdrawal on demand. Mutual savings banks These benchmarks are compiled by the Federal
are not included, nor are savings and loan associations Deposit Insurance Corporation on the basis of comor various other financial institutions which do not pulsory "call reports" filed by all banks subject to
receive demand deposits even though referred to as Federal supervision (National banks, State member
banks.
banks, and nonmember insured banks) with one or
The "Weekly reporting member banks" comprise another of the Federal bank supervisory agencies;
some 400 selected member commercial banks in (or and of information obtained from State banking
with head offices in) approximately 100 cities, ac- authorities and other sources for the relatively few
counting currently for over half of the total com- uninsured banks. These final June and December
mercial banking resources. The cities comprise the figures, being normally for a day other than Wednesmore important banking centers within each Federal day, replace rather than revise the earlier estimates.
Reserve district; and within each city the banks Interim monthly estimates are revised only when
comprise a voluntary sample, usually accounting for some substantial error of estimate is suggested by
over 90 percent of member bank resources. The the benchmarks.
coverage of the weekly series was last substantially
Prior to 1947 each of the Federal supervisory
revised in 1947 and carried back one year, with an agencies prepared separately a series of semiannual
increase of about 15 percent in loans and investments "all bank" statistics. Since 1947 a single series has
of reporting banks.
by agreement been prepared by the FDIC. The
The category of "Bank loans" reported for all Federal Reserve monthly estimates for all comcommercial banks covers all loans and discounts. mercial banks have been published only since 1948.
The "Business loan" category reported for the weekly
Relation to other series.—The Federal Government
banks is the major component of bank loans and publishes a variety of statistical series covering all
includes commercial, industrial and agricultural or part of the banking system. For purposes of
(other than real estate) loans. Monthly estimates general analysis, these will not necessarily lead to
for all commercial banks are not available, but the significantly different conclusions, but the differences
weekly banks currently account for about 70 percent should be kept in mind. Thus, the all-commercialof all such business loans.
bank series should be distinguished from the someMonthly figures shown in both series are as of the what larger "all bank" series which includes some 500
last Wednesday of the month except that final June mutual savings banks; and from various smaller
and December figures for "all commercial banks" aggregates such as national banks and insured
are as of the last day of the month.
commercial banks. The all-commercial-bank aggreStatistical procedures.—The "All commercial bank"gates here are for continental United States, and the
and "Weekly reporting member bank" series are unrounded figures differ slightly from totals which
closely related. The weekly series is based on include banks in the possessions, published by the
weekly reports filed with Federal Reserve banks Comptroller of the Currency and the FDIC.
and compiled cooperatively by these banks and the
The weekly series covers a substantial segment of
Board of Governors. Published figures are simple the total commercial banks and includes most of
aggregates for the reporting banks. The monthly the larger banks in larger cities. Although the series
estimates for all commercial banks are prepared, is not identical in coverage with any published call
also by the Federal Reserve System, on the basis report aggregate, it is similar in movement to the
of the weekly reports, monthly reports from all aggregate for all member banks other than "country"
other member banks, and other information. Esti- banks. A recently developed Federal Reserve series
mates are made for nonmember banks, accounting showing changes in business loans by type of business
currently for about 16 percent of commercial bank of borrower weekly from 1951 is based on a subcredit, on the basis of the relationship between the sample of the weekly reporting banks and ties in
movement of "country" member banks (those out- with the business-loan figure here published.
side the major cities) and that of the nonmember
Uses and limitations.—The all-commercial-bank
banks, as determined semiannually when complete figures are useful as a measure of general trends in
52



Bank Loans and Investments
[Billions of dollars]
All commercial banks
Investments

End of period 1

Weeklyreporting
member
banks—
business
loans 3

Total
loans and
investments

Bank loans

1914—June 30

16. 9

13.2

3.7

0.8

2. 9

1915—June
1916—June
1917—June
1918—June
1919—June

23
30
20
29
30

17.5
20.4
23. 9
27.4
31.8

13. 5
15.8
18. 2
20. 1
22.4

4.0
4.6
5.7
7.3
9.4

.8
.8
1.5
3.2
5. 1

3.2
3. 9
4. 1
4. 1
4.3

1920—June
1921—June
1922—June
1923—June
1924—June

30
30
30
30
30

36.3
34.2
33. 9
37. 1
38. 1

28. 1
26. 1
24. 7
26. 9
27. 6

8.2
8. 1
9.2
10.2
10. 5

3.7
3.4
4.0
4.7
4.4

4.4
4.8
5.3
5. 5
6. 1

1925—June 30
1926—June 30
1927—June 30
1928—June
1929—June

41.2
43. 5
45. 1
48. 5
49.4

29. 6
31.4
32.2
34. 0
35.7

11.7
12. 1
12. 9
14. 5
13.7

4.6
4.6
4.6
5.2
4.9

7.0
7.5
8.4
9.3
8.7

1930—June1931—June__
1932—June_
1933—June..
1934—June___

48. 9
44. 9
36. 1
30.4
32.7

34. 5
29.2
21.8
16.3
15.7

14.4
15.7
14.3
14,0
17.0

5.0
6.0
6.2
7.5
10.3

9.4
9.7
8. 1
6.5
6.7

1935—June
1936—December
1937—December
1938—December
1939—December

34. 6
39. 5
38.3
38. 7
40. 7

14. 9
16. 4
17. 1
16.4
17.2

19.7
23. 1
21.2
22. 3
23.4

12.7
15. 3
14.2
15. 1
16. 3

7.0
7.8
7. 1
7.2
7. 1

5. 1
4.2
4.7

1940—December
1941—December
1942—December
1943—December
1944—December

43. 9
50.7
67.4
85. 1
105.5

18.8
21.7
19.2
19. 1
21.6

25. 1
29.0
48.2
66.0
83. 9

17.8
21.8
41.4
59.8
77.6

7.4
7.2
6.8
6. 1
6.3

5.3
7.1
6.3
6.4
6.5

1945—December
1946—December
1947—December.
1948—December
1949—D ecember

124.0
114.0
116.3
114.3
120.2

26. 1
31. 1
38. 1
42. 5
43.0

97.9
82.9
78.2
71. 8
77.2

90. 6
74.8
69.2
62. 6
67.0

7.3
8. 1
9.0
9.2
10.2

7.2
»11. 3
14.7
15. 6
13.9

1950—December
1951—December
1952—December

126. 7
132.6
141.6

52.2
57.7
64.2

74.4
74.9
77.5

62.0
61.5
63.3

12.4
13. 3
14. 1

17. 9
21. 6
* 23.4

_____

___

Total

U. S.
Government
securities

Other
securities

i June dates prior to 1936 because end-of-year data not available for U. S. Government obligations; December dates thereafter, For weekly reporting member
banks, Wednesday date nearest end of year.
® Not available prior to 1937; includes agricultural loans.
' Series revised to extend coverage; previousfiguresnot entirely comparable.
NOTE.—Detail may not add to totals because of rounding.

Monthly data are available beginning with October 1917.

Source: Board of Qovernora of the Federal Reserve System.

bank credit. The weekly series is more frequent
and more prompt than that for all commercial banks.
It is available in greater detail, including a total for
"business loans"—a significant current indicator of
business activity. The weekly series also is a more
sensitive indicator of developments in the short-term
money market, because it covers the larger banks in




the more important centers. It is not supposed to
reflect developments in the smaller centers.
References.—The monthly estimates for all commercial banks appear initially about a month after
the date of the report in a set of releases of the
Board of Governors of the Federal Reserve System
(G7, G7a, G7b) showing the major balance-sheet
53

The Wednesday data for the weekly reporting
items and changes during the past month and year
for all banks, all commercial banks, and for member member banks appear initially on the following Wedbank categories. The Federal Reserve Bulletin also nesday in a release of the Federal Reserve Board
carries the estimates for recent months, with call (H.4.2) showing changes in assets and liabilities over
report data for selected years back to 1939. Although the last week and year. A simultaneous release
the estimating procedures for the monthly estimates (H.4.2a) shows assets and liabilities by Federal
are not described in any publication of the Board, the Reserve districts. Data for New York City and
composition of the current all-bank call report data Chicago are available the day after the date of the
is indicated in notes to the statistical tables in the report (H.4.3). The Bulletin carries the weekly data
annual reports of the Federal Deposit Insurance and monthly averages for the last 3 months. The
Corporation. All-bank statistics are also discussed series is discussed fully in Banking and Monetary
in Banking and Monetary Statistics, published by theStatistics; recent revisions are explained in the Federal Reserve Bulletin for June 1947 and April 1953.
Federal Reserve Board in 1943.

CONSUMER CREDIT
Description oj series.—These series are estimates
of total short- and intermediate-term consumer
credit, and of major types. Federal Reserve publishes additional detail by type of credit and by type
of financial institution or retail outlet to which the
debt is owed.
"Consumer credit" is defined as "all credit used to
finance the purchase of commodities and services for
personal consumption or to refinance debts originally
incurred for such purposes." Credit covers both
loans and sales involving deferred payment. Personal
consumption is defined so as to exclude consumption
not only by businesses but by nonprofit organizations.
The estimates exclude home-mortgage credit, which
is traditionally considered separately.
"Installment credit," accounting for the bulk of
consumer credit, is that scheduled to be repaid in
two or more payments. Installment credit classified as "Automobile paper" and "Other consumer
goods paper" includes credit for the purchase of, and
secured by, such goods regardless of whether originating as loans or as credit sales, and regardless of
whether the paper is held by a merchant or a financial institution. "Repair and modernization loans"
includes such loans held byfinancialinstitutions but
not by merchants. "Personal installment loans'9
covers loans by financial institutions for all other
consumer purposes, such as to consolidate debts, to
pay medical expenses, or for education. Consumers'
"noninstallment credit" is classified by Federal
Reserve into three types: charge accounts; single-payment loans; and service credit, which includes consumer debts to a variety of creditors, including hospitals, doctors, utilities, and service establishments.
The definition of consumer credit cited above is
followed in general but not rigidly in the construction
of the series. In the absence of sufficiently refined
data, certain arbitrary decisions must be made. For
example, all bank credit to farmers is excluded even
54



though an undetermined part is for consumption. On
the other hand, all credit for the purchase of automobiles by individuals is included even though an
undetermined part of the use is for business purposes.
The consumer credit series have recently undergone
a thorough revision involving a revision of concepts,
adjustment to the latest Census benchmark (1948),
and improved estimating techniques involving some
new current data. The revision involved an upward
adjustment of about 7 percent in the figure for total
consumer credit as of December 31, 1952, with
greater relative changes in component series. Prior
to the revision, the data were classified on the basis of
the type of firms originating the credit, and a major
distinction was made between loan credit and sale
credit. The data are now presented in terms of the
financial or other institutions holding the paper,
regardless of origin.
Statistical procedures.—The consumer credit series
are aggregates of separate estimates of the consumer
credit held by a number of different types of creditors—financial institutions, retail and service establishments, and others. The procedures are complex,
and vary for the different groups.
In general, estimates for retail trade are based on
the 1948 Census of Business, which provides information on credit held by the various retail lines.
These figures have been adjusted to exclude estimated amounts of nonconsumer credit. Monthly
figures are then arrived at by estimating, on the
basis of sample monthly data, what change has taken
place since the benchmark date. For the more important credit-granting lines, monthly data on credit
receivables are collected from a sample of the firms.
For other lines, monthly receivables are estimated by
means of a formula based on sales during the previous
few months. Annual sample data on receivables,
collected from many lines, provide a basis for correcting the monthly estimates,

Consumer Credit
[Millions of dollars]

End of year

1929.
1930
1931_
1932
1933.
1934
1935
1936
1937
1938
1939
1940
1941
1942
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952

Total
consumer
credit
outstanding
6, 444
5, 767
4, 760
3, 567
3, 482
3, 904
4, 911
6, 135
6, 689
6, 338
7, 222
8, 338
9, 172
5, 983
4, 901
5, 111
5, 665
8, 384
11,570
14, 411
17, 104
20, 813
21, 468
25, 827

Installment credit

Total

3, 151
2, 687
2, 207
1, 521
1,588
1, 871
2, 694
3, 623
4,015
3, 691
4, 503
5, 514
6, 085
3, 166
2, 136
2, 176
2, 462
4, 172
6, 695
8, 968
11,516
14, 490
14, 837
18, 684

Automobile
paper 1

Noninstallment credit

Other Repair and
consumer moderni- Personal
goods
zation
loans
loans2
paper 1

(4)
(4)
(4)
0)

(4)

0)

(4)
m

«
«

1,497
2, 071
2, 458
742
355
397
455
981
1, 924
3, 054
4, 699
6, 342
6, 242
8, 099

«

(4)
(4)
(4)
(4)
(4)

(4)
(4)
(4)
W

1, 620
1, 827
1, 929
1,195
819
791
816
1, 290
2, 143
2, 842
3, 486
4, 337
4, 270
5, 328

(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)

298
371
376
255
130
119
182
405
718
843
887
1,006
1,090
1,406

(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)

1, 088
1, 245
1,322
974
832
869
1,009
1, 496
1, 910
2, 229
2, 444
2, 805
3, 235
3, 851

Total

3, 293
3, 080
2, 553
2, 046
1, 894
2, 033
2,217
2,512
2, 674
2, 647
2,719
2, 824
3, 087
2,817
2, 765
2, 935
3, 203
4,212
4, 875
5, 443
5, 588
6, 323
6, 631
7, 143

Charge
accounts
1, 602
1,476
1,265
1, 020
990
1, 102
1, 183
1, 300
1,336
1,362
1,414
1,471
1, 645
1, 444
1,440
1,517
1, 612
2, 076
2, 353
2,713
2, 680
3, 006
3, 096
3, 342

Other 3

1, 691
1,604
1, 288
1, 026
904
931
1, 034
1,212
1, 338
1, 285
1, 305
1,353
1,442
1, 373
1,325
1,418
1, 591
2, 136
2, 522
2, 730
2, 908
3,317
3, 535
3, 801

i Includes all consumer credit extended for the purpose of purchasing automobiles and other consumer goods and secured by the items purchased.
* Includes only such loans held byfinancialinstitutions; those held by retail outlets are included in "other consumer goods paper."
3 Single payment loans and service credit.
< Not available.
NOTE.—Revised series; see Federal Reserve Bulletin, April 1953 and November 1953. Detail will not necessarily add to totals because of rounding.
Monthly data are available beginning with 1929.
Source: Board of Governors of the Federal Reserve System.

For most types of financial institution, benchmark
data are provided by the 1950 registration of installment credit grantors under Regulation W and by
annual or more frequent statistics on a complete
coverage basis. Monthly data on receivables are
available from reporting samples of various types of
lenders.
Service credit is in general based on less substantial data. The methods vary among the different
types. Although virtually complete monthly data
are received for telephone bills, the largest category
(medical debt) is based on an annual sample survey
of consumers, and is "moved" by statistics of industrial illness.
Uses and limitations.—The widespread interest in
consumer credit is due in part to its importance as
a source of consumer purchasing power, and especially its significance in the market for consumer
goods frequently bought on the installment plan.
In part it is due to the fact that consumer credit
reflects one aspect of the financial position of consumers. Consumer credit is also an important




element in the demand for funds in the financial
community.
In the face of problems of adapting available data
to the precise definition of consumer credit outlined
above, Federal Reserve points out that the estimate
of total short- and intermediate-term consumer
credit probably understates somewhat the true
total. Problems of definition and estimation are
discussed fully in the descriptive material on the
series, cited below.
References.—The data appear originally in a
monthly release entitled "Consumer Credit (Short
and Intermediate Term)," which shows credit by
type, with change during the month and year. Installment credit is further classified by holder.
Tables in the Federal Reserve Bulletin give back
data and more detailed cross-classification by type
and holder. The April 1953, issue of the Federal
Reserve Bulletin explains the recent revision and
gives monthly data back to 1939 (and in less detail
to 1929). A supplementary technical discussion of
estimating methods is available in pamphlet form
from Federal Reserve.
55

BOND YIELDS AND INTEREST RATES
3-Month Treasury Bills

Corporate Aaa Bonds (Moody's)

This is a measure of the currently prevailing
This series measures the average rate at which
3-month Treasury bills have been issued during the maturity yield on long-term corporate debt of the
highest quality, as reflected in the yields of selected
month.
bonds rated Aaa by Moody's Investors Service.
An average discount rate is computed for each
It is an unweighted average of three averages
weekly issuance, on the basis of the varying rates at
which portions of the issue are awarded, in order, to computed separately for industrial, railroad, and
the highest bidders. The monthly figure is a simple public-utility bonds. Each of these component
average of the average rates for the four or five series in turn is an unweighted average of the yields
of the selected bonds comprising these series.
issues during the month.
Monthly figures are averages of daily figures,
The series is useful as a measure of a short-term
rate on relatively riskless borrowing. Issuance computed from closing prices.
The plan of the index calls for 10 bonds in each of
rates, while related to, are typically not identical
with market rates on outstanding issues of com- the 3 industrial categories. However, there are not
necessarily 10 suitable issues in each category; curparable maturity.
The monthly averages appear in the Federal Re- rently only 6 railroad and 4 industrial bonds are
serve Bulletin, and in an advance monthly Federal covered.
This index is a useful general indicator of the level
Reserve release, G 13. Rates for the individual
and movement of average yields of selected bonds of
issues appear in the Treasury Bulletin.
the highest grade with sufficiently long maturities
Taxable Bonds
and other features to afford an adequate measure of
The "Old series" is the average yield of all taxable long-term interest rates. It is not a measure of
Treasury bonds due or callable in from 12 to 20 average yield of all Aaa bonds available to the
years. There are 4 such bonds currently, all bearing investor.
a 2%-percent coupon. The "New series" by definiThe daily Aaa corporate bonds yield averages are
tion measures the yield of bonds due or callable in published in Moody's Bond Survey, a weekly publica20 years or more—but at present only a single issue, tion, which includes from time to time the list of
the 3%-percent 30-year bond issued in May 1953, is bonds. A brief statement may be found in Business
covered. Prior to the appearance of this issue there Statisticsy 1958, a Supplement to the Survey of
was a single series covering bonds not due or callable Current Business, and Moody's will supply a similar
before 12 years.
short statement on request.
Both series are based on daily closing-bid quotations in the over-the-counter market as reported to
the Federal Reserve Bank of New York by leading Prime Commercial Paper
This series measures the prevailing rate on prime
dealers in New York City. The old series is an
unweighted average of the yields of the four issues 4 to 6 months commercial paper.
included. The new series was begun and the old
The Federal Reserve Bank of New York deterseries redefined in order not to destroy the homo- mines the prevailing daily selling rate quotation of
geneity of the group of bonds comprising the old New York City dealers handling the bulk of the
series.
volume of commercial paper of the inventory type.
These indexes measure the interest rates on the The bank receives less frequent reports from dealers
highest grade of long-term investments of different outside New York, which occasionally necessitate
maturity classes, which are normally below that on retroactive revisions of the series. Monthly figures
are averages of weekly prevailing rates.
the highest grade of corporate securities.
The series is useful as a measure of the cost of
The series are published in the monthly Treasury
Bulletint with an advance release in the monthly open-market short-term credit available to large
Federal Reserve release (G 13) entitled Open Market business borrowers of the highest credit standing.
Money Rates. The series are discussed in the
It is published in the Federal Reserve Bulletin and
Treasury Bulletin, March 1944, and in current in the advance Federal Reserve monthly release,
footnotes to the Bulletin tables.
G 13.

56



Bond Yields and Interest Rates
[Percent per annum]
U. S. Government security
yields
Year

3-month
Treasurybills *

Taxable
bonds 2

Corporate
Aaa bonds
(Moody's)

1919.

5. 49

1920.
19211922.
1923.
1924-

6.
5.
5.
5.
5.

12
97
10
12
00

1925.
1926.
1927.
1928.
1929-

4.
4.
4.
4.
4.

88
73
57
55
73

1930.
1931.
1932.
19331934.

1. 402
.879
.515
.256

4.
4.
5.
4.
4.

55
58
01
49
00

1935.
19361937.
1938.
1939.

. 137
. 143
.447
.053
.023

3.
3.
3.
3.
3.

60
24
26
19
01

19401941.
1942.
19431944.

.014
. 103
.326
.373
.375

2. 46

2. 84
2.77
2. 83
2. 73
2. 72

19451946.
1947.
1948.
1949.

.375
.375
.594
1. 040
1. 102

2. 37
2. 19
2. 25
2. 44
2.31

2. 62

1950.
19511952-

1.218

2. 32

2. 62
2. 86

1. 552
1. 766

2. 47
2. 48

2. 57
2. 68

2. 53
2. 61
2. 82

2. 66

2. 96

' Rate on new issues within period.
' Old series; 2 ^ percent bonds, 15 years and over prior to April 1952; 12 years and over beginning in April.
NOTE—Monthly data are available beginning with 1931 (scattered issues beginning December 1929) for 3-month Treasury bills, November 1941 for Government
taxable bonds (old series; new series of ZH percent bonds of 1978-83, first issued in 1941), 1919 for Corporate Aaa bonds (Moody's) and 1890 for prime commercial paper,
4-6 months.
Source: Board of Governors of the Federal Reserve System.




57

MONEY SUPPLY
Description oj series.—These data measure the deposits due to foreign banks, has been calculated
supply of money as an aggregate of several types of for selected dates back to 1929, it has appeared
assets of the highest liquidity* The concept includes currently as a monthly series only since 1949. Prior
not only pocket money but bank deposits, both to that year Federal Reserve published a less comdemand and time, as well as deposits in the Postal prehensive table for deposits and currency.
Savings System. The table in Economic Indicators Relation to other series.—The money supply aggrecovers "privately held" deposits and currency (in- gate shown here is quite different from the wellcluding the holdings of States and political subdi- known "Money in Circulation" figure published
visions but excluding those of banks) and deposits monthly by the Treasury. The latter covers only
to the credit of the Federal Government. The table coins and paper money, and consists of the total
is derived from a Federal Reserve tabulation of outside the Treasury and the Federal Reserve banks,
"Deposits and currency," which covers in addition less an estimate of the amount of coin held abroad.
cash held by the Treasury and net deposits due to The money supply data differ in that they add bank
deposits, but exclude currency held by the banks.
foreign banks.
This table, and the more detailed Federal Reserve
Monthly estimates are for the final Wednesday of
the month, except that the June and December deposits and currency table, are derived from data
estimates are later replaced by reported figures as of in general available in other banking or Treasury
statistics. Because of adjustments and special groupthe last day of the month.
Statistical procedures.—The bulk of the aggregate ofings of items, however, the component series of these
deposits and currency consists of deposits in com- two tables cannot necessarily be identified precisely
mercial banks. Monthly estimates of these deposits with series found elsewhere.
are prepared in approximately the same manner as
Uses and limitations.—The data on deposits and
those for loans and investments, discussed above. currency permit an adequate measurement of the
Data for the "weekly reporting member banks" are level and general trend of the supply of money as one
combined with monthly reports from other commer- of the important factors affecting the functioning
cial member banks, and an estimate is made for of the economic system.
nonmember banks on the basis of the reports from the
There is no one accepted definition of money. The
"country" (generally smaller) member banks. Semi- Federal Reserve presentation of deposits and curannual "all bank" figures later replace the Wednes- rency makes it possible for the user to adapt the data
day figures for June and December. The monthly to his particular use by excluding one or more comestimate for deposits in mutual savings banks, which ponent series. Thus the Economic Indicators excludes
are largely outside the Federal Reserve System, is deposits of foreign banks and Treasury cash holdings.
based on monthly statistics of the National Asso- A more restrictive definition of money supply exciation of Mutual Savings Banks covering the bulk cludes time deposits. On the other hand, a broader
of mutual savings banks deposits. Figures for definition might include savings and loan shares
United States Government cash holdings are taken or Government savings bonds, for which data are
from the Daily Statement of the United States Treasavailable elsewhere.
ury. Preliminary figures for Government bank
References.—The money supply data come from a
deposits are estimates based also on the Treasury monthly table entitled "Consolidated Condition
Daily Statement, subject to later correction on the Statement for Banks and the Monetary System"
basis of bank records. Currency outside banks is in the Federal Reserve Bulletin, showing deposits and
based on the Treasury figures for currency held out- currency detail and data for related asset and capital
side the Treasury and the Federal Reserve System, accounts of the banking and monetary institutions.
from which are deducted monthly estimates of cash The basis for the table is discussed in the Federal
held by the commercial and savings banks.
Reserve Bulletin for January 1948. Historical data
Although the present series on deposits and cur- to 1892 are available in Banking and Monetary
rency, including cash held by the Treasury and net Statistics.

58



Money Supply
[Billions of dollars]

Total deposits and
currency

End of period

U. S.
Government
deposits1

Total excluding U. S. Government deposits
(privately held money supply) 3

Total

Currency
outside
banks

Demand
deposits
adjusted 3

Time
deposits

4

1903—June
1904—June
1905—June
1906—June
1907—June

11.5
12. 0
13. 2
14. 1
15. 1

0. 1
. 1
. 1
. 1
,2

11. 3
11. 9
13. 2
14.0
14. 9

1.5
1.6
1.6
1.8
1.7

6. 0
6. 3
7. 1
7.5
7. 9

3.8
4. 0
4.5
4.8
5.4

1908—June
1909—June
1910—June
1911—June
1912—June

14.7
15. 8
17. 0
17. 8
18. 9

.1
.1
. 1
. 1

14. 6
15.7
16. 9
17. 7
18.8

1.7
1.7
1.7
1.7
1.8

7.4
7. 8
8.3
8. 7
9.2

5. 5
6. 3
6. 9
7.3
7.9

. 1

19.4
20. 0

1.9
1.5

9. 1
10. 1

8.4
8.4

. 1
1. 1
1. 6
1.0

20. 6
24.2
27.3
29. 9
34. 6

1.6
1. 9
2.3
3.3
3.6

9.8
12.0
13. 5
14. 8
17. 6

9.2
10. 3
11.5
11.7
13.4

(5)
fi

1913—June
1914—June

19. 4
20.0

()

1915—June
1916—June.
1917—June
1918—June
1919—June

20. 7
24.3
28.4
31. 5
35.7

(5)

1920—June
1921—June.
1922—June
1923—December.^
1924—December

39.9
37.8
39. 0
43. 5
47. 1

.3
.5
.2
.3
.3

39.6
37.4
38.8
43.2
46.8

4. 1
3.7
3.3
3.7
3.7

19. 6
17. 1
18.0
19. 1
20.9

15. 8
16. 6
17.4
20.4
22. 2

1925—December
1926—December
1927—December
1928—December
1929—December

50.
51.
54.
55.
54.

3
1
1
7
7

.3
.3
.3
. 3
.2

50.0
50.9
53.8
55.4
54. 6

3.8
3.8
3.7
3. 6
3.6

22. 3
21. 7
22.7
23. 1
22.8

23. 9
25. 3
27.4
28.7
28.2

1930—December
1931—December
1932—December.
1933—December
1934—December

53. 6
48. 4
45.4
42. 6
48. 1

3
.5
.5
1.0
1.8

53.2
47.9
44.9
41.5
46.3

3.6
4. 5
4.7
4.8
4.7

21.0
17.4
15.7
15.0
18. 5

28. 7
26.0
24. 5
21. 7
23. 2

1935—December
1936—December
1937—December
1938—December
1939—December

52. 7
57. 6
56. 8
59. 9
64.7

1. 5
1.2
1. 0
1.8
1.5

51. 3
56.4
55. 8
58. 1
63. 3

4. 9
5.5
5. 6
5.8
6.4

22. 1
25.5
24.0
26.0
29.8

24.2
25.4
26. 2
26.3
27. 1

1940—December
1941—December
1942—December
1943—December
1944—December

71. 1
79. 1
100. 5
123.4
151.4

1. 1
2.8
9.2
11.0
21. 2

70. 0
76.3
91.3
112.4
130.2

7.3
9. 6
13. 9
18.8
23.5

34.9
39.0
48.9
60. 8
66.9

27.7
27.7
28.4
32.7
39.8

176.4
167.5
172. 3
172.7
173. 9

25.6
3. 5
2. 3
3.6
4.1

150.8
164.0
170.0
169. 1
169. 8

26.5
26. 7
26.5
26. 1
25.4

75. 9
83. 3
87.1
85.5
85.8

48.5
54.0
56.4
57.5
58.6

180.6
189. 8
200.4

3.7
3. 9
5.6

176. 9
186.0
194.8

25.4
26.3
27.5

92.3
98.2
101.5

59.2
61.4
65.8

1945—December
1946—December
1947—December
1948—December
1949—December

___

_

1950—December
1951—December
1952—December

1 Beginning with 1916, includes U . S. Government deposits at Federal Reserve banks; beginning with 1938, includes U . 8. Treasurer's time deposits open account.
Includes deposits and currency held b y State and local governments.
* Demand deposits other than interbank and U . S. Government, less cash items reported as in process of collection.
* Includes deposits in commercial banks, mutual savings banks, and the Postal Savings System other than interbank time deposits, tTnited'States Treasurer's
time deposits open account, and postal savings redeposlted In banks.
• Less than $50 million.
1

NOTE,—Detail may not add to totals because of rounding.

Monthly data are available beginning with 1943.

Source: Board of Governors of the Federal Reserve System.




59

FEDERAL BUDGET RECEIPTS AND E2
Description oj series.—Budget receipts represent
the cash income of the Federal Government and are
derived from various kinds of taxes, fees, fines, proceeds from the sale of property, etc. Budget expenditures represent current payments for Government programs, including grants and contributions
and capital outlays. Budget expenditures are payable out of budget receipts or out of borrowing.
Transactions of trust funds are excluded from budget
receipts and expenditures.
Budget expenditures, budget receipts, and the
public debt are compiled daily from records of the
United States Treasury and published in the Daily
Statement of the United States Treasury. The
figures are compiled from the latest daily reports received by the Treasurer of the United States from Government depositaries, Treasury disbursing officers,
and the Departments of the Army and the Air Force.
For disbursements made by Treasury disbursing
officers, thefiguresfor expenditures represent checks
issued, but where checks-issued data are not available
currently (now over 50 percent of the total expenditures), thefiguresrepresent checks paid, as reported
in daily transcripts received from Treasury depositaries. A few items included in budget expenditures
are in the form of debt issuances (for example, Armed
Forces leave bonds issued in 1947) or increases in the
public debt (such as the current increase in redemption value of savings bonds).
•''Budget expenditures7' cover the general fund,
the special funds, and the revolving and management funds. Expenditures for the revolving and
management funds are on a net basis; that is, the
collections received by each fund are deducted from
the total of the payments made for goods and services received, and the resulting figure is shown as the
expenditure. Where the collections are larger than
the payments from such a fund, the net amount
included in the expenditures is a negative item.
Budget expenditures do not include retirement of
Government debt, nor do they include net investments in United States Government securities
(which occur sometimes in the case of Government
corporations). "Major national security programs"
is a special classification of budget expenditures first
published by the Bureau of the Budget in 1952, in
the 1953 Budget Document. It comprises: (1) Military services, including Armed Forces, stockpiling
of strategic and critical materials, selective service,
and the National Advisory Committee for Aeronautics; (2) international security and foreign relations, including military and economic assistance;
(3) development and control of atomic energy; (4)
60



civil defense; (5) merchant marine; and (6) defense
production and economic stabilization activities.
"Budget receipts" include all money paid into
the Treasury to the credit of the general fund and
of special funds. They do not include money obtained from borrowing; nor do they include receipts
of revolving and management funds, since these
funds are reported on a net basis in the expenditure
figures.
"Budget surplus or deficit" represents the difference between the budget receipts and budget expenditures.
The "public debt" is affected not only by the
budget surplus or deficit, but by other factors as
well. The amount which it is necessary to borrow
or which it is possible to repay is also influenced by
the amount of the Treasury cash balance; the result
of trust-fund transactions; the use of Government
corporation borrowing directly from the public as a
means of financing budget expenditures of the corporations (and vice versa in the case of direct repayments of borrowing by the corporations); and the
change in the amount of checks outstanding and
other items in process of clearance through the
accounts.
In these tables the amounts refunded by the Government (principally for the overpayment of taxes)
are reported as deductions from total budget receipts
rather than as expenditures. Investments in revolving and management funds, and dividends and
repayment of investment in such funds are excluded
from both receipts and expenditures.
Relation to other series.—Annual data on receipts
and expenditures of the Government are also reported by the Treasury Department in the Combined
Statement of Receipts, Expenditures, and Balances
of the United States Government. The receipts
data in the Combined Statement include those collections which have been credited in the accounts of
the Treasurer of the United States, and the expenditures data include the checks which have been issued
during the fiscal year in payment of Government
obligations. The figures reported in the Combined
Statement are not available until several months
after the close of thefiscalyear to which they relate.
They differ somewhat from those in the Daily
Statement of the United States Treasury, principally
because the greater time lag in publication makes it
possible to include only those transactions which
occurred in the particular fiscal year.
Data on tax receipts of the Government are also
published monthly by the Internal Revenue Service,
and appear in the Treasury Bulletin. The Internal

Federal Budget Receipts and Expenditures
[Billions of dollars]
Budget expenditures
Year

Major national
security
programs 1

Total

Fiscal year 1929

3. 1

Fiscal
Fiscal
Fiscal
Fiscal
Fiscal

year
year
year
year
year

1930
1931
1932
1933___
1934

3. 3
3. 6
4. 7
4. 6
6.7

Fiscal
Fiscal
Fiscal
Fiscal
Fiscal

year
year
year
year
year

1935
1936
1937
1938
1939

Fiscal
Fiscal
Fiscal
Fiscal
Fiscal

year
year
year
year
year

1940
1941
1942
1943
1944

9.2
13.4
34. 2
79. 6
95. 3

Fiscal
Fiscal
Fiscal
Fiscal
Fiscal

year
year
year
year
year

1945
1946
1947
1948
1949

Fiscal
Fiscal
Fiscal
Fiscal

year
year
year
year

1950__
1951
1952
1953

_

(3)
(3)

Net budget
receipts

Budget surplus ( + ) or
deficit (—)

Public
debt
(end of
period) 2

3. 9

+ 0. 7

16.9

4. 1
3. 1
1.9
2. 0
3. 1

+.7
5
-2.7
-2. 6
—3. 6

16.2
16. 8
19. 5
22. 5
27.7

1.1

3. 7
4. 1
5.0
5. 8
5. 1

-2. 8
-4.4
-2. 8
-1. 2
-3.9

32.
38.
41.
42.
45.

1.6
6. 5
27.5
73.6
88. 2

5.3
7.2
12. 7
22. 2
43.9

-3. 9
-6. 2
-21. 5
-57.4
-51.4

48. 5
55. 3
77.0
140. 8
202. 6

98. 7
60. 7
39. 3
33.8
40. 1

88.7
47.2
20.9
16.4
19. 1

44. 8
40.0
40.0
42. 2
38. 2

-53. 9
-20. 7
+8.4
-1.8

+.8

259. 1
269. 9
258.4
252.4
252. 8

40.2
44. 6
66. 1
74.6

17.8
26.4
47. 2
52.8

37.0
48. 1
62. 1
65. 2

-3. 1
+3.5
-4. 0
-9. 4

257.4
255. 3
259.2
266. 1

6. 5
8.5
7. 8
7.0
9.0

h
h
h

(3)

«)
(
3

e)

8
5
1
0
9

1 Includes expenditures for military services, international security and foreign relations, development and control of atomic energy, promotion of the merchant
marine, promotion of defense production and economic stabilization, and civil defense. Data not available for years prior to 1939.
2 Includes guaranteed securities, except those held by the Treasury. Part of total shown is not subject to statutory debt limitation.
»Not available.

Norn—Detail will not necessarily add to totals because of rounding.
For data beginning with 1789, see "Historical Statistics of the United States, 1789-1945," Series P 89-103.
Sources: Treasury Department and Bureau of the Budget.

Revenue series is based upon reports of the District
Directors of Internal Revenue. It is not directly
comparable with data on tax receipts reported in
the Daily Statement series, since withheld taxes
deposited by employers on a current basis with
depositaries are not recorded and reported by District
Directors until quarterly tax returns are filed, but
are reported in the Daily Statement when the deposit
is made. Amounts collected directly by District
Directors are recorded and reported when collected
for the internal-revenue series, but are not included
in the Daily Statement series until they are received
and acknowledged by a Federal depositary.
Uses and limitations.—Data on budget receipts
and expenditures are useful in appraising the impact
of Federal financial operations. For purposes of
economic analysis, however, they have limitations,
some of which have been corrected by deriving other
statistical series from the budget receipts and
expenditures data. For example, the series on
Federal cash receipts from and payments to the
public (see the following section) is based upon the




data on budget receipts and expenditures, together
with trust fund transactions, with certain adjustments to arrive at the cash flow of funds to and from
the public.
Budget receipts and expenditures are also the basis
for the Government accounts included in the Department of Commerce income and product statistics
(see p. 42 and p. 4). Since budgetary figures
are reported on a cash rather than an accrual accounting basis, the budgetary figures are adjusted
to the accrual accounting basis used in the income and
product accounts; for example, corporation profits
taxes are adjusted to show tax liabilities instead of
tax collections. The expenditure data are also
adjusted for the lag between production of goods
ordered by the Government and the actual payment
for those goods by the Treasury.
References.—The basic release of the budget
receipts and expenditures data is the Daily Statement
of the United States Treasury. A description of the
basis was published in the Annual Report of the
Secretary of the Treasury on the State of the
Finances for Fiscal Year 1952, pages 501-504.
61

FEDERAL CASH RECEIPTS FROM AND PAYMENTS TO THE PUBLIC
Description of series.—This series is derived from difference between the two series is that receipts
the same sources as the series on budget receipts and from the exercise of monetary authority (i. e.,
expenditures, described above. The Government is seigniorage) are included in cash operating income,
defined to include transactions of the Treasurer of but excluded from receipts from the public. The
the United States as agent for certain quasi-govern- figures published in Economic Indicators have been
mental corporations, such as the Federal Deposit adjusted to the concept of receipts from the public.
Uses and limitations.—The series on receipts from
Insurance Corporation, home-loan banks, Federal
land banks, etc. These transactions are excluded and payments to the public measures the flow of cash
from the series on budget receipts and expenditures. between the public and the United States GovernThe public is defined to include individuals; banks, ment as a whole more accurately than does the series
including the Federal Reserve and Postal Savings on budget receipts and expenditures. Thus, for
Systems; businesses; private corporations; State, purposes of economic analysis it is a somewhat better
local, and foreign governments; and international and more complete measure of the economic impact
of Federal financial transactions. However, certain
organizations.
In deriving this series, the transactions of trust Federal financial operations which are not measured
funds are added to those included in budget receipts by this series or by the series on budget receipts and
and expenditures. Intragovernmental transactions expenditures also influence economic activity. For
(for example, payments of interest on securities held example, Federal guaranties and insurance of private
by trust funds which are budget expenditures and also loans have relatively little effect on payments to the
trust-fund receipts) are then eliminated to obtain public but have a significant effect on economic
receipts from and payments to the public. Receipts activity. Similarly, the enactment of large approof the Government from the exercise of its monetary priations for defense after the attack on Korea stimuauthority (mainly seigniorage on silver) are ex- lated business activity long before the authorized
cluded, because they are not cash received from the funds were spent and reported as payments to the
public. A few items included in budget expenditures public.
which are in the form of debt issuances or increases
References.—Current quarterly data on Federal
in the public debt are also excluded from this series. cash receipts from and payments to the public are
The most important of these is the current increase prepared for Economic Indicators. The related series
in redemption value of savings bonds. At the time on Treasury cash income and outgo is published
of redemption the amount of interest paid is included monthly in the Treasury Bulletin. Annual data for
as a payment to the public.
both series, by fiscal years back to 1929, are pubThe excess of receipts or payments is sometimes lished in the Statistical Abstract.
referred to as the cash surplus or deficit.
The adjustments made in the figures for budget
Conceptual and statistical revisions of this series receipts and expenditures to obtain the concept of
were made in 1947. A few changes have been made cash receipts from and payments to the public are
since then to reflect similar changes made in the con- listed in detail in an annual release of the Bureau
cept of budget receipts and expenditures, such as of the Budget entitled "Receipts From and Paythe change in the reporting of refunds of receipts.
ments to the Public, Supporting Tables." These
Relation to other series.—This series is similar toadjustments are also summarized in tables 1 to 5,
the series on cash operating income and outgo pub- "Treasury Cash Income and Outgo," of the monthly
lished monthly in the Treasury Bulletin. The only Treasury Bulletin.

62



Federal Cash Receipts From and Payments to the Public
Federal cash
receipts from
the public

Year

Federal cash
payments^ to
the public

Excess of receipts ( + ) or
payments ( — )

Billions of dollars
Fiscal years
192 9

3.8

2.9

+ 0.9

193 0
193 1
1932...
1933...
193 4

4. 0
3.2
2. 0
2. 1
3. 1

3. 1
4. 1
4. 8
4.7
6. 5

+.9
-1. 0
-2.7
-2. 6
-3.3

193 5
193 6
1937...
1938...
1939

3. 8
4. 2
5.6
7.0
6. 6

6.3
7. 6
8.4
7.2
9.4

-2.4
-3. 5
-2.8
-. 1
—2. 9

1940...
194 1
194 2
194 3
194 4

6. 9
9.2
15. 1
25. 1
47. 8

9. 6
14. 0
34. 5
78.9
94.0

-2.7
-4. 8
-19.4
-53. 8
-46. 1

194 5
1946—
1947
1948—
1949—

50.2
43. 5
43. 5
45.4
41. 6

95.2
61.7
36.9
36.5
40. 6

-45.0
-18.2
+ 6. 6
+8. 9
+ 1.0

195 0
195 1
1952—
1953

40. 9
53.4
68.0
71.3

43.2
45. 8
68.0
76.6

-2.2
+ 7.6
+. 1
-6.3

Millions of dollars
Calendar years
1943 1
194 4

88, 987
94, 810

194 5
1946.
194 7
194 8
194 9

49,
41,
44,
44,
41,

423
441
282
922
346

86,142
41, 399
38, 616
36, 897
42, 642

195 0
195 1
1952.
1

37, 863
48, 131

42, 419
59, 278
71, 339

41, 969
58, 034
72, 980

First year for which data are available.

NOTE.—Detail will not necessarily add to totals because of rounding.
Sources: Bureau of the Budget and Treasury Department.




O

63


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102