Evening star. [volume] (Washington, D.C.) 1854-1972, 1954-08-25
u. 5. Business Level
Called About Even;
Unemployment Rises
BY the Associated Press

Business sailed along about on
even seasonal keel from spring to
early summer, the Commerce De-
partment says. with free SPEND
ing public making up for purse
Tightening by the Federal Gov
eminent.
The Nations total production
Of goods and services turned up
q little bit in the second quarter
of the year, after nine months, Of
decline. the department said in
the August number of its month";
ly business survey made public
yesterday.
It added that July retail sales
were about average for the sea-
son despite sharp drop during
the month in auto sales. But
employment continued to drift
downward through July" with
most of the payroll trimming in
manufacturing.
The Federal Reserve Board
meanwhile released study of
employment and unemployment
trends that said the pattern of
the recent business downturn
was closely similar to that in the
1948-49 recession.
Durable Goods Hurt.
Industries and areas most de-
pendent on employment in dur
able goods factories and tex
tiles mills suffered most, the
Reserve Board said, while en-
ployment was most stable in the
South Central. Mountain and
Pacific States and in metropoli-
tan centerS for trade and serv-
ices like New York City, Los
Angeles and Boston.
The Commerce Department
said defense OUTLAWS declined by
an annual rate of about sos
billion from the second quarter
Of 1853. when military spending
reached an all-time peak of
$54.25 billion a year. Through
the second quarter of this year
defense spending was at an an
nual rate of $44.75 billion.
In the second quarter of this
year the decline was still sharp,
though less steep-about $2.25
billion annual rate, compared
with a decline in defense spend
ing in the first quarter of the
year OF nearly $3.75 billion, an
nual rate.
Spending Stays High.
But the big help came from
the public.
It's spendable income in the
first half of this year was slightly
more, despite doubled unemploy-
n1ent, than in the first half Of
last year. The income boost
came from tax cuts. increased
unemployment payments and
fatter corporation dividends.
Personal spending rose con-
siderably.
Spending for personal con-
sumption thus went up just over
BIS billion during the second
quarter of 1854. balancing out
the decline in defense spending
and leaving a little over to help
turn the national product total
upwards.
The Reserve Board study or
employment trends said the
business downturn stenamed
mainly from efforts by business
men to unload inventories and
from the reduction in defense
spending.
Unemployment Growing.
In both cases, the board said,
durable goods production was
= mainly affected. Large declines
In enjoyment consequently took
place in industries producing
steel, ordnance, machinery, mo-
tor vehicles and other fabricated
metal products, the board said.
Employment also sank in the
coal mining industry and in rail-
reading.
Despite the contraction in en-
ployment and increased idleness
wages advanced over the year
because, the Reserve Board said
corporation profits continued
high, demand in many quarters
aside from durable goods con.
tinued strong. and productivity
continued To increase