The people's voice., 1958-10-03


Then the reluctance of people tC
buy appeared to fade again. Produc
ton began to make slow comeback
BY August the index had climbed
back to 1877. This was within 95 pei
cent of the average for the first six
months of last year, a period in which
output remained on the highest level
it has ever achieved, although slight
ly below the peak of December 1856
when it hit the lat mark.
During May and June of this year
the rate of unemployment moved
down from 7.5 per cent in April to
7.2 per cent in May, and then to 6.8
per cent in June. Up to that point
there appeared to be fairly close
correlation between the rate of in
dustrial production and the rate of
employment-the lower production,
the higher unemployment, and vice
versa.
But then something went haywire.
In July the rate of unemployment
moved up to 7.3 per cent, while the
industrial index rose to 1873. And in
August the rate of unemployment
rose to a new peak, while industrial
production rose 4 more points. For
men workers the August unemploy-
ment rate was 7.9 per cent; for
women 7.3 per cent.
CHANGES IN LABOR FORCE
The high rate in August is ex-
planned partly by seasonal changes
in composition of the labor force. For
one thing, actual unemployment fell
by 100000 to 4.7 million in August
as most of the young entrants into
the summer labor market either found
jobs, or ceased to look for them, thus
ruling themselves out of the labor
force. Many went back to school.
This narrowed the base for figuring
percentage of unemployed.
A further explanation is found in
the Census Bureau report on the
labor force. 1t points out:
"On a seasonally adjusted basis,
there has been comparatively little
change since May in the rate at which
new unemployment has been develop
ing each month, but the current vol
ume is somewhat lower than recorded
in the early months of the year. Long
term unemployment (that lasting Is
weeks or longer), on the other hand
has continued to rise after allowance
is made for normal seasonal develop
ments.
"The dip in the actual number of
ong-term unemployed from the post
war peak of 10 million in April to
,65O,00O in Agust was smaller than
usual for this period of the pear"
In other words, employment did
not rise as much as it usually does
July and August. AS mat
,er of fact August is usually the |
month of highest employment.
There is another ominous phase of
he situation. Women are becoming
4 larger proportion of the labor force,
IS many wives and daughters are
'orced to become breadwinners. In |
he last year two-thirds of the net
addition to the labor force were
STABLE PRICES ESSENTIAL
By now it has become perfectly
lear that if approximately full en-
,loyment is to be reached production
will have to achieve higher levels than
t has ever reached before. This is
rue, not only because technology
narches onward displacing men with
nachines, but because the working
orce continues to grow. In the last
welve months the labor force has in
reased by 1,073,000 persons. At the
anne time 1,018,000 fewer persons
re employed than in August last
ear. This means that unemployment
as increased by 100000.
But economists are wondering how
luch production can continue to rise,
initiation breaks loose again. And it
will not advance rapidly, if
eople resenting price rises decide
ot to purchase as freely.
In either case, unemployment would |
ot be markedly decreased, and might S
) increased considerably U