Milford chronicle., 1956-05-18
Philadelphia Federal Reserve Bank
Reports On Current Trends

Business activity in the Third
Federal Reserve District continues
near the high level reached last
year. Considerable optimism pre-
walls in most sectors of the local
economy regarding prospects for
the current year. Among the
brightest spots in the 1856 outlook
are the increased capital spending
plans of manufacturers in the
Philadelphia metropolitan area and
their expectations of higher pro-
duction trends during the current
and final quarters of this year.
These developments were discussed
in the April issue of our Business
Review. About the only signs Of
weakness and hesitation are in
automobiles and housing. Even in
these areas current activity COM
pares favOrably with other recent
years, except 1855, and prospects
seem to be improving slowly as
the spring season progresses.
Labor market changes in lead
ing industrial areas of this dis
trict have continued narrow in re-
cent months. AS of mid-March
there were only three major areas
Atlantic City in New Jersey and
Scranton and Wilkes-Barre in
Pennsylvania the num-
ber of job seekers substantially
exceeded the number of job oppor-
tunities. In the case of Atlantic
City, early spring normally is O.
period of slack employment. But
the convention business is ex-
pected TO bring some improvement
shortly, with employment prospects
tors take over in late June. Both
Scranton and Wilkes-Barre have
long been distress" areas where
the unemployed from anthracite
mines have not been readily alb
sorbed by the labor needs of other
local industries. Johnstown, a
steel and soft coal center in
Pennsylvania, has materially re-
duced its labor surplus since last
fall Improvement there has re-
fiected mainly expanding activity
in steelmaking, although recently
there have been increased demands
for workers in apparel, trade, and
transportation All other major
areas in this district have main
tanned a fairly we'll balanced la
Dor market status.
Factory activity, as measured by
production-worker hours, is little
below the 1855 peak reached last
December but is above year-ago
levels in all our major industrial
areas. Since last spring, recovery
in employment has been at some
what slower pace than the gains
in working time. From the stand
point of both employment and
working time, improvement in the
durable goods industries has been
more pronounced than in nom
durables. In the district as a
whole, very few individual lines
have entirely recovered all of the
ground lost in the 1953-54 recess
sion. The apparel and rubber in
dustries are about the only ones
where employment has come back
to or sUrpasses progression
levels. But there have been moder-
ate gains in primary metals, fab
ricated metals, chemicals and cleo
trical machinery. The textile and
transportation equipment indus
tries seem to have made about
the least progress of any of our
more important lines. In the lat
ter group, prospects for shipbuild-
ing have frightened considerably
but the outlook for air craft re-
mains uncertain
Basic steel capacity in this dis
trict is continuing to expand. Last
year we experienced one of the
sharDest tonnage gains Of any
steelmaking area being exceeded
only by additions made in the
Buffalo region. Third District out
put of ingOts and steel for castings
increased A per cent during 1855.
compared with a nationwide gain
of Der cent, and some further ex-
pansion is, in prospect over the re-
maiEde!' of the current year. Steel
mills have been operating above
their rated capacity almost con-
tinuously since last October and
with the new facilities that have
come into production since last
October and with the new facilities
that have come into production in
our area the tonnage increases
have hean impreesive
BituminOus coal production has
heen showing large vear-to-vear
increases since the early months of
1855. rejecting the RISING trend in
consumption bv heavy Industry and
the electric utilities. These gains
have occurred in sDite of snnt
shnrtag res nf coal cars. which from
time ta time have limited mining
Cperatinns to tho c~nacitv Of exist
ir0 etora"o facilities. Tn the an
thrnoito folds of pnnnsvIvaria. it'c
Sound Crndit Tn,noxfon4