Evening star., 1949-07-03
Summer S!ackening
Speeds Up General
Business Decline
By Richord Fiske
Assoe;oted Press Business Writer

NEW YORK, July "A sum-
mer lull added it's heavy hand to
the Nations declining economy
this week.
School was out and graduates
were in the job market. Many
plants were shutting down for
annual vacation periods.
There was an increasing tense
ness as neither labor nor man
agement showed any inclination
to give an inch in their nego-
tiations.
These trends added up to a
mild wallop at national econ
omy already weary from another
rise in unemployment, another
drop in production, another week
of declining retail sales.
Among the weeks events, how
ever. that could lead to better
days was congressional action on
the public housing bill.
Construction awards already
were rolling along at a fair pace.
The Administrators housing bill
would filter additional millions of
dollars into building.
Federal Cash to Help.
Additional dollars for building
mean more business in the Ma
tion's steel mills, metal industries,
cement plants and lumber yards.
1t also will take up a lot of the
unemployment slack.
The death of all consumer
credit controls at midnight
Thursday was Of much less i'm
portance. But many business
men believe 1t will have a good
psychological effect and there
were some who believed removal
of the restrictions coupled with
vigorous sales campaigns would
loosen consumer pure strings con-
siderably.
Most felt that the used-car
trade would be the first of the
large markets to gain.
June graduations befogged the
unemployment picture. The wave
OF graduates seeking jobs rolled
unemployment to a seven-year
high of 3,77S,000.
Actually the figures were better
than expected by some Govern
ment experts who feared unem-
ployment would top the 100000
mark in June.
The Census Bureau added that
there was an upswing in nom
agricultural employment during
June, the first since December.
Two out of three of the school,
age job seekers found work. And
the numbers Of Americans en-
ployed rose to 59,619,000. This
was 100000 less than in June
of 1948-a boom year.
Distortion of Data Feared,
Care in evaluating unemploy-
ment figures was urged by Sales
Management" magazine. which
said distorted unemployment
news" scares consumers and de-
presses retail sales.
Much Of the decline in retail
sales" the magazine added, may
be attributed to lack of security
and specifically to unfounded
hysteria about unemployment"
1t predicted July retail sales for
the Nation would drop 6 per cent
below the comparable month last
year.
While most economists clung to
their beliefs that the business de-
cline still would go on, they con-
tinued to predict there was no
real serious depression in the
offing.
The National City Bank of New
York noted in its monthly letter
that despite the continued bust
ness decline, consumption already
Is exceeding production In a mum
ber of lines. That eventually
would mean an increase in de-
mand in those products.
Automobile production, which
has been a star performer on the
good business side of the ledger
fell from grace this week, but there
were extenuating circumstances.
Automobiles rolled off the as
sembly lines at a 2O-year-high OF
153,001 units last week. This
weeks figure was 146,188 but heat
walkouts in various plants caused
the slump.
Steel operations dropped to 7ss
per cent Of capacity, of for the
11th week and the lowest since
April IL. 1948. Business loans were
down for the 23rd consecutive
week.
And the Governments income
hit . f1ve-year low due to the
194S income tax cut and the
economic downturn