B U S I N E S S

Consumer Goods Move Better Further increase also shown in new construction;

revival in textiles is set for the fa l l ; more spending reported

C O N T I N U E D heavy outlays for new ^cons t ruc t ion and further inventory curtailment in wholesale a n d retail lines are encouraging developments at this time which offset less favorable news in the bus ; <ess world. ^Production of consumer goods is reported as swing­ing upwards once more, and some pick­up is now seen for textiles in the fall.

These hopeful signs on the other hand are modified by more careful ex­amination. There was a gain of 5% in new construction during July over June, but for most major types of building the increases were about seasonal. The new construction total of $3.5 billion for July also included private residential work of $1.2 billion, while no" gains were registered by industrial building. However, new construction for the first seven months totaled $20.L billion, a heavy if not a record total,

Inventories for all industry dropped about $1.3 billion during June to $78.2 billion, the latter $4.1 "beloxv October 1953. The Commerce Department re­port said this was nothing to cheer about although it showed that business­men were continuing to br ing their stocks more in line with current sales. But inventories remain high in relation to sales due to smaller volume turnover this year than last.

More Spending Reported. Grow­ing indications that the business decline had run its course were seen as third quarter got under way, according to Guaranty Trust. I t finds tha t indus­trial production was steady, that some employment trends were better, and that consumers appeared to be spending more freely. Business confi­dence, it said, to judge from the be­havior of the stock market, was on the rise. Everywhere, interest seemed to be shifting from concern over recession lo speculation as to timing and pace of recovery. Owing to vacations and other factors, it was difficult to gage indus­trial trends in July.

As to government expenditures on defense and other needs, Indications are that such spending will continue to de­crease in the months ahead. A Wash­ington dispatch to the Wall Street Jour­nal said that in a memo t o heads of departments, agencies, and bureaus, President Eisenhower had demanded further cuts in the $65.5 billion budget this year, and even deeper cuts next year.

Just prior to this, announcement was

made that new contracts totaling more than $200 million had been given by the Air Force to various suppliers. This is part of $1 billion to be awarded over next three months.

Chemical Employment. Figures now available for May and June indicate that chemical processing industries have

not yet reached the turning point as far as labor is concerned. The general group of chemicals and related products lost some 10,300 workers in May, and preliminary report by Labor Depart­ment indicates these industries lost a n additional 4900 in June. Total for latter month was 775,000, down 28.7% since June 1953. Employment in or­ganic chemical plants was 297,200 in May, a decline of 1300 workers from the previous month . Total for inorganic plants on the other hand remained un­changed at 93,400. These employment trends in chemical industries are some-

C&EN CHARTS,.

P R O C E S S I N D U S T R I E S ' T R E N D

EMPLOYMENT, Chemicals THOUSANDS OF WORKERS

7 0 0 -CHEMICALS A N D ALLIED PRODUCTS

600

200-

100

INDUSTRIAL INORGANIC CHEMICALS

J I L I I I I I I I I ! I 1 I I I I

JUNE 7 7 5 . 9

REVISED SERIES

mm MAY 297.2

REVISED SERIES

MAY 93.4

REVISED SERIES

' ' t I 1 I 1 1 1 I 1952 1953 1954

PHENOLIC PLASTICS f a n d Other T a r Acid Resins) PXODUCTION. MILLIONS Of POUNDS

™fe MAY 35.0

20 11 I I I 1 M I I I I I I I I I 1 I 1 1 1 I 1

WOOD PULP PRODUCTION. A l l SHADES. THOUSANDS OF SHORT TONS

\nH// MAY 1572

1 I Ι Μ Μ I I I I M i l l 1

G U M A N D WOOD ROSIN STOCKS. END Of QUA8TOS.

THOUSANDS OF DRUMS Of 520 POUNDS

|

• i l l • i l l 2*φ QTB

800.9

Jj STEEL OPERATIONS m c m CAPACITY

3 3 1 6 C H E M I C A L A N D E N G I N E E R I N G N E W S

what in reverse of general industry. | All nonfarm employment increased j slightly between May and June.

Gum and Wood Rosin. Supplies of both descriptions gained slightly dur­ing second quarter to 800,950 drums, still was some 16,000 drums below stocks reported at same time in 1953. The seasonal gain in stocks from the first to second quarter this year was 26,000 drums, almost the same quar­terly gain as a year ago. Season for these products begins with April. Ac­cording to trade reports rosin and tur­pentine have been moving in very good volume this season.

Steel Opera t ions . Slight improve­ment in production brought steel oper­ating rate up one point in June to 729c of industry's capacity. This is 25 points below the average rate of June 1953, but steel-making capacity measured in tons is greater this year than it was in 1953 or 1952. Operating rate therefore is not a true gage of actual steel pro­duction, of this industry's output of coal chemicals, or of its use of chemicals in finishing steel products. Iron Age says outlook for steel during second half is favorable, even if industry entered period with shrunken order backlogs. Plants expect to obtain enough business to maintain operations at levels which prevailed in first half.

Wood Pulp. Production for first five months was 7,433,000 tons, according to American Paper and Pulp Assn., out­put in May being year's best so far at 1,572,000 tons. This increase, it says, is primarily due to expansion of exist­ing producing facilities. Production from new mills which recently started operations is not yet reflected in in­dustry's statistics. Consumption of pulp for the five-month period showed only a slight rise of 2000 tons over the same time last year. This was accompanied by a more substantial rise in inventories, April to May, amounting to 13,000 tons.

Phenolic Plastics. An improvement in May brought production of these resins to around 162.6 million pounds for first five months of the year. This compares with 188.7 million for corre­sponding period of 1953, and probably reflects more than anything else the general curtailment in industry. May production was roughly 35 million pounds, a rise of 4.5 million over April bu t still under the 38.2 million turned out in May 1953. While consumption of phenolic resins has fallen in some lines, increases have taken place in others, such as in tooling. Phenolics and epoxies dominate in this field.

CHART CREDITS: Chemical Employ­ment—U< S. Department of Labor; Gum and Wood Rosin-U. S. Department of Agriculture; Steel Operations—Ameri^ can Paper and Pulp Association; Phe­nolic Plastics—U'· S. Tariff Commission.

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