TEXAS BUSINESS REVIEW VOL. XLIV, NO. 10, OCTOBER 1970 Lcli!or. St~nley A. Arbingast; Associate Editor, Robert H. Ryan; Managing Editor, Graham Blackstock l:drtorwl Board: Stanley A. Arbmgast Chairman· John R 'I J c· h Bl k , , . Jo er . ones: rra am ac stock Stockton· F · B M . R b R · · CONTENTS ARTICLES 245: 248: 25 1: 258: The Business Situation in Texas , by John R. Stockton Texas Construction, by Robert :vi. Lockwood Texas in the Seventies: 9. A New Era for Forestry, by Nelson T. Samson Securities Registration in Texas, Fiscal 1970, by Ernest W. Walker TABLES 246: 24 7: 248: 250: 258: 259: 259: 25LJ : 260: Selected Barometers of Texas Business Business-Activity Indexes for Twenty Selected Texas Cities Estimated Values of Building Authorized in Texas One-Family, Two-Family, and Apartment-Building Dwelling Units Authorized in Standard Metropolitan Statistical Areas Securities Registration in Texas, 1969-1970 Securities Registration in Texas, Renewals, Fiscal Years 1969-1970 Dollar Value and Percent Increase of All Applications and Original Applications Authorized for sale during Fiscal 1960-1970 Number and Dollar Volume of Applications Withdrawn, Fiscal 1969-1970 Local Business Conditions Barometers of Texas Business (inside back cover) CHARTS 245: 24 7: 249: 24'1: 249: 25 2: 25 2: 253: 253: 254: 259: Estimated Personal Income, Texas Industrial Production : Total Manufactures, Texas Total Building Authorized, Texas Residential Building Authorized, Texas Nonresidential Building Authorized, Texas Apparent Consumption of Timber Products, by Volume Apparent Consumption of Timber Products, by Percentage Texas Lumber Production Texas Pulpwood Production Pulpwood Consumption in the United States Securities Registration in Texas , ranc1s . ay, o ert H. yan; Robert B. Wllliamson · ' BUREAU OF BUSINESS RESEARCH Business Research Council: James R. Bright, Abraham Charnes, Lawrence L. Crum, Jared E. Hazleton, George Kozmetsky Director: Stanley A. Arbingast Special Research Associate: Joe H. Jones Assistant to the Director: Florence Escott Statistician: John R. Stockton Consulting Statistician: Francis B. May Systems Analyst: David L. Karney Cooperating Faculty. Charles T. Clark, Lawrence L. Crum, Clark C. Gill, William T. Hold, Robert K. Holz, Jerry Todd, Ernest W. Walker, Robert B. Williamson Administrative Assistant: Margaret Robb Research Associates: Graham Blackstock, Margaret Fielder, Carolyn Greene, Letitia Hitz, Ida M. Lambeth, Robert M. Lockwood, Robert H. Ryan, Charles P. Zlatkovich Research Assistants: Edward Hildebrandt, Ralph Samford Statistical Associate: Mildred Anderson Statistical Assistants: Constance Cooledge, Glenda Riley Statistical Technicians: Kay Davis, Lydia Gorena Computer Assistants: Lawrence Grossman, Jr., Charles Jordan Cartographers: Penelope Lewis, James Weiler Librarian: Merle Danz Administrative Secretary: Jeanette Pryor Administrative Clerk: Nita Teeters Senior Secretary: Rita Relyea Senior Clerk Typists: Deborah Frishman, Stella Saxon Senior Clerk: Salvador B. Macias Clerks: Robert Jenkins, Karen Schmidt Offset Press Operators: Robert Dorsett, Daniel P. Rosas COVER DESIGN BY CHARLOTTE HAGE Published monthly by the Bureau of Business Research, Graduate School of Business, The University of Texas at Austin, Austin, Texas 78712. Second-class postage paid at Austin, Texas. Content of this publication is not copyrighted and may be reproduced freely, but acknowledgment of source will be appreciated. The views expressed by authors are not necessarily those of the Bureau of Business Research. Subscription, $4.00 a year; individual copies 35 cents. The Bureau of Business Research is a member of the Associated University Bureaus of Business and Economic Research. THE BUSINESS SITUATION IN TEXAS John R. Stockton Even though a feeling of optimism pervades the air and the belief is becoming prevalent that the worst of the slowdown in business is over, statistical data on the performance of business do not point with certainty to this conclusion, for either Texas or the United States. Some of the business barometers for Texas and for the country as a whole show definite signs of improvement, but many uncertainties persist and the balance is still rather precarious. The most comprehensive measure of total economic activity in Texas is provided by the estimates of changes in personal income to individuals. The average level of this index for the first eight months of 1970 was 6 percent above that of the same period last year. The last four months, however, registered an increase of only .3 percent over the first four months of 1970. Out of these eight months, four showed an increase over the previous month, three decreased, and one month was unchanged. The latest month, August, was 1.1 percent below the level of December 1969. The only conclusion from this barometer that seems tenable is that very little change occurred in the economy of the state during the first eight months of 1970. Industrial production is one of the most sensitive indicators of changes in the economy, and this series shows essentially the same trend in Texas as the income data. The average for the last four months was 1.2 percent below the average for the first four months, although the August value was 1.2 percent above the value for December 1969. Four of the months in 1970 have registered increases over the previous month and four have declined. The August index increased 2 percent over July, to the highest point reached since February of this year. The index of industrial production for the United States also has been fluctuating within a rather narrow range. The August index declined .1 percent from July, dampening the hopes of many observers that the July increase would continue and could be interpreted as a signal that a definite upward trend had been established. Four out of the last five months have shown a decline. All of the decline in August occurred in the manufacture of durable goods and the output of utilities. The output of consumer goods changed very little in August. The value of new construction authorized in Texas declined 6 percent in August, and the average value for the first eight months of this year was 3 percent below the same period of last year. Since the cost of housing has increased during this time, the figures represent an even greater percentage of decline in the physical volume of construction. The only major category of construction to show any appreciable increase in August was multiplefamily dwellings, with an increase of 9 percent over July. The year-to-date figure for this category, however, was 12 ESTIMATED PERSONAL INCOME, TEXAS Index Adjusted for Sea3onal Variation -1957-1959= 100 1964 1965 1966 1967 1968 1969 1970 SOURCE: Quarterly measures of Texas personal income made by the Office of Business Economics, U.S. Department of Commerce. Monthly allocations of quarterly measures, and estimates of most recent months, made by the Bureau of Business Research with regression relationships of time, bank debits. and manufacturing employment. OCTOBER 1970 percent below the value for the same period of 1969. It appears that the only hope for the construction industry is a loosening of credit. The recent cut in the prime rate has raised hopes that more money will be available for housing. Homebuilders are becoming more optimistic as the tight money situation eases. The Council of Housing Producers says members expect to build about one third more houses in 1970 than in 1969. However, builders of expensive houses have reported difficulties in finding buyers. The construction industry is one of the most strategic factors in the business situation at the present time. It employs an important segment of the labor force and furnishes the demand for great quantities of materials. A sound construction industry is an essential part of the basis for any sustained growth in the economy. The price inflation and the shortage of credit have been felt by this industry more than by other portions of the economy. A strong recovery in construction is dependent on an increase in the supply of funds, and the Texas economy is as vulnerable to the problems of the construction industry as any region. Consumer spending for goods and services represents the largest portion of the total income generated by the economy, but is the area of the economy for which satisfactory current data are most difficult to obtain. Though total consumer spending is subject to less violent changes than other segments, particularly industrial production and construction, consumer purchases of nondurable goods and services tend to maintain their volume better than purchases of durable goods. Information on retail sales in Texas is provided by the United States Department of Commerce, but no current information is available on expenditures for services. Furthermore, the data on retail sales are two months later than information on most other portions of the Texas economy. Retail sales for the first six months of 1970 were 3 percent greater than for the first six months of last year. If allowance is made for the increase in retail prices this dollar volume of sales represents a smaller physical volume of business than was transacted last year. Sales of nondurable-goods stores held up better than total sales, with an increase of 7 percent. No information is available for sales of durable-goods stores, but they probably showed a decrease even without adjustment for the rise in prices. Information on retail sales for the United States indicates that sales continued sluggish through July and August. Retail trade has shown no real improvement since last spring. In spite of the poor showing of retail sales so far this year, the prospects for consumer spending are considered good by many economists, since the level of consumer income has remained high throughout 1970 to date. With a slower rate of spending, savings have been accumulating at a much faster rate than is usual. The percentage of personal income saved is at the highest level in nearly twenty years. These accumulated savings are available for consumer spending, and businessmen are hoping that consumers will lead the way to an upturn in business activity. The survey of consumer buying intentions published by the Commerce Department shows anticipated automobile purchases increasing 4 percent in the third quarter of 1970. It is hoped that this improvement will continue into 1971. Unless the strike against General Motors is settled soon, however, this increase is not likely to materialize. Another view of the future demand for automobiles is found in the survey of consumer attitudes released by the Research Center of the University of Michigan, which found that more families in August than in May felt that the present was a bad time to buy a car. As with many economic indicators, the prospects for future car sales are not very clearly indicated. The slowdown in business has inevitably affected government revenues, with the result that the federal deficit continues to grow in spite of the attempts to reduce expenditures. The easier money policy of the Federal Reserve has begun to be felt as more money has been funneled into the market ; so some easing of interest rates was not unexpected. The timing of the reductions in interest rates, however, was something of a surprise, but in spite of the uncertain character of the recovery of business to date, it appears that some increase in the supply of credit was due. The easing of credit should furnish a healthful climate for the nurturing of whatever mild upturn in business may have developed. However, in the early stages of a recovery movement it does not take much bad news to turn a SELECTED BAROMETERS OF TEXAS BUSINESS (Indexes-Adjusted for seasonal variation-1957-1959= 100) Percent change Year-todate Year-to-average date Aug 1970 1970 Aug July average from from Index 1970 1970 1970 July 1970 1969 Estimated personal income 219.lp 226.Sp 221.3 -3 6 Crude-petroleum production 124.7p 119.3p 121.2 5 7 Crude-oil runs to stills 134.3 135.0 133.7 -1 -1 Total electric-power use 2so.2P 219.2P 261.0 •• Industrial electric- power use 23 l.9p 222.4p 226.9 4 5 Bank debits 297.1 339.9 303.7 -13 10 Urban building permits issued 201.5 197.9 188.0 2 -2 New residential 144.1 163.0 143.5 -12 -8 New nonresidential 292.5 261.6 261.6 12 3 Total industrial production l 79.3p l 75.3p 177.8 2 4 Total nonfarm em ployment 150.3p 150.3p 150.2 •• 4 Manufacturing em ployment 149.1 P 150.3P 152.9 -1 •• Total unemployment 109.5 115.1 94.4 -5 29 Insured unemployment 89.8 85.6 71.0 5 69 Average weekly earn- ings-manufacturing 150.4p 148.2p 149.1 4 Average weekly hours-manufacturing 97. 8p 98.0p 99.0 •• -2 P Preliminary. ** Change is less than one half of 1 percent. TEXAS BUSINESS REVIEW BLSI ESS-\CTIYITY I ·oFXES T;"f)R T\\F TY SFT ECTFD TEXAS CITIFS ( \ll stee.. ··or seasonal variation-1957-1959= I 00) Percent change Year-to date Year-to average Index AugP 1970 July 1970 date average 1970 Aug 1970 from July 1970 1970 from 1969 Abilene Amarillo Austin Beaumont 136.0 199.5 298.6 169.9 149.4 208.6 341.3 178.3 142.0 202.9 336.9 179.8 -9 -4 -13 -5 •• 6 6 7 Corpus Christi Corsicana 143.5 170.0 166.8 170.8 160.1 164.9 -14•• 1 5 Dallas 329.3 372.5 334.7 -12 7 El Paso 159.5 176.2 158.9 -9 4 Fort Worth 172.6 192.1 184.9 -10 4 Galveston 118.5 129.0 130.8 - 8 4 Houston 257.8 301.0 275.2 -14 7 Laredo Lubbock 268.2 200.6 271.9 200.3 256.6 171.5 - 1 •• 8 2 Port Arthur 116.9 123.9 119.6 -6 1 San Angelo 163.2 177.4 173.1 - 8 4 San Antonio 217.7 251.4 219.3 -13 7 Texarkana 224.5 221.1 217.7 2 -II Tyler 174.3 179.8 177 .6 - 3 I Waco 203.4 210.4 200.7 -3 8 Wichita Falls 131.5 149.0 132.0 -12 6 p Preliminary. * • Change is less than one half of 1 percent. prospective upturn into a sharp decline. It is to be hoped that nothing serious interferes with the favorable developments beginning to appear in the business news. The effects of a major strike on the overall business situation can easily be exaggerated, but developments in the international situation can have substantial effeC't. Any foreC'ast of the development abroad is always subject to a high risk of error. Expenditures of business c·oncerns for new plants and equipment have been scaled dO\\·n from eJrlier exped:itions. In spite of this downward revision of the estimates. total capital expenditures for 1970 are now expeC'ted to be S80.56 billion, an increase of 6.6 percent over 1969. Although this expansion would be smaller than the l 1.5 perC'ent increase registered in 1969. it would make this year's expenditures the largest amount ever spent for capital items by American business. The expenditure on capital goods is one of the most dynamic segments of the economy and in recent years this steadily increasing investment has rnntributed substantially to the inflationary pressures on the economy. The expenditures of businesses on capital goods Jre more stimulating to business than the same amount spent by consumers. As long as capital spending c·ontinues to increase , the total level of business aC'tivity is not likely lO show a serious dedine. The downward revisions of the figures for capital expenditures that have oc·curTed JS the year 1970 has progressed have not been surprising. since commitments are neC'essarily made considerably in Jdva1Ke and are subjec't to revision JS the outlook for business changes. Projected capital increases for 1970 over 1969 had OCTOBER 1970 been 7.75 percent in May and 9.75 percent in February. Actual capital outlays in the second quarter of 1970 were .5 percent lower than expected in May and scheduled outlays for the second half have been revised downward about 2 percent. The decline in the economy can be traced in the successive reductions in these anticipated expenditures. but the relative strength of this portion of the economy is an important factor in the mildness of the decline in total business to date. In August 1970. 3.9 percent of the Texas labor force was unemployed, compared with 2.8 percent a year earlier. This August percentage, however, was an improvement over the 4.1 percent unemployed in July and the 4.5 percent in June. These figures are definitely encouraging indicators of a slight improvement in the business situation during the summer. The rate of unemployment of the labor force is one of the simplest and most direct measures of the state of the e.:onomy. The growing concern about declining business activity has somewhat shifted attention from the problem of inflation. but for most of 1970 the continual rise in the price le\el in spite of the slowdown in business has been a source of worry to economists. The Consumer Price Index for August was still rising, but the increase of .2 percent was the smallest month-to-month change since December 1968. With adjustment for seasonal variation in prices it was the smallest increase in three years. For the past three months the rate of increase in prices has been slowing dO\\·n. giving a sound basis for concluding that the worst of the inflation might be past. A summary of all of the measurements of business for August provides a basis for cautious optimism. The decline seems to be fairly well stabilized, although no indication of a strong rise appears for the immediate future. A modest rate of recovery should be generally satisfactory; it is important that nothing interrupt the upward movement now under way before it gathers enough momentum to withstand bad news and unfavorable developments. If the present improvement can be maintained, while the price lewl is kept simultaneously under .:ontrol. the prospects for 1971 .:an be C'Onsidered to be noticeably brighter. The recovery movement is still not strong, however, and the threat of inf!Jtion has not completely subsided. I~DUSTRIAL PRODUCTION TOTAL MANUFACTURES.TEXAS lnde~ /t.d)usred for Se•son•I V•riat1on-I957 ·1959 •JOO 350 I I 300 I I ! 300 250 I 250 200 200 AA 150 150 l.----r' I 100 I I 100 I I I I I 1957 1958 1959 1960 1961 1962 1963 1964 196.5 1966 1967 1968 1969 1970 XOTE: S~c!e ;are;a• :nd.1cate per1od.1 of dech1 e of toUt.\ busine•• ac11v1ty rn 1he Vmtrd St11.te1 SOURCE ~Meral Re•ene B•nk oi D.1.lla1 247 TEXAS CONSTRUCTION Robert M. Lockwood Although the adjusted index of urban building permits for new residential construction fell off 12 percent in August for the second straight month, the index of total construction in Texas was buoyed 2 percentage points above the July level by the second straight rise in urban nonresidential permit issues and by a disaster-stimulated surge in additions, alterations, and repairs. The relatively healthy urban nonresidential sector is running 3 percent ahead of January-August 1969, but sluggish 1970 homebuilding ·has depressed the index of the first eight months 2 percent below that for January-August 1969-even with consideration of seasonal influences. The tailing-off of new-construction urban permit values by $11. 2 million from July levels was not necessarily significant. The decline of almost $6 million in residential construction authorized, however, ran counter to the seasonal norm, as indicated by the slump in the seasonally adjusted index of 11.6 percent. The $5.2-million dip in permits covering new nonresidential construction, on the other hand , failed to equal the usual decline at this time of year. Besides the strength of nonresidential building activity, the category of additions, alterations, and repairs rose $2.4 million , further offsetting the decline of more than 4 percent in the unadjusted total and accounting for the seasonally adjusted rise of almost 2 percent in the index of total construction authorized in the state during August. The most striking trend in urban residential construction apparent in a comparison of January-August 1970 with the same period last year is the performance of housing construction outside the standard metropolitan statistical areas, which contain all but about 3 million Texans. Throughout the state both the value and the number of dwelling units declined: the single exception was one-family dwelling units, which increased in number. Outside the metropolitan areas, however, both the number and the value of single-family houses gained over the first eight months of 1969. The trend toward more but less expensive housing was uniform throughout the state, although some areas demonstrated greater extremes than others. Among the twenty-three reported metropolitan areas, fifteen exhibited a drop in the indicated average cost per unit for singlefamily housing for the first eight months of the year. Including all of the state's largest population centers, these fifteen SMSA's accounted for $236 million of the $350 million in permits issued for one-family homes. Their permits covered 15 ,925 units of the state total of 22,43 2. Houston, with about 2,300 homes valued at some S48 million, showed a decline of 20 percent in both number and value of units and therefore reflected little change from January-August I 969 in average value per unit. Only seven SMSA's demonstrated a trend toward more expensive housing: Abilene, Amarillo, Galveston-Texas City, Laredo, Odessa, Texarkana, and Waco. Representing about 821 ,000 persons, these areas recorded only 695 single-family homes valued at $ 12,338,000 during JanuaryAugust 1970, an indicated average value per unit of roughly S 1 7 ,800. This figure compares with an average of about 5)20,500 for Houston and $ 14,800 for the fifteen areas which reflected declining average values. Across the state about 34 percent of the number of units and 55 percent of the value of all housing authorized during the first eight months of 1970 were attributable to one-family homes. Multiple-family units accounted for approximately 6 7 percent of the number and 45 percent of the value of building permits issued during January-August 1970. Although the January-August 1970 growth of urban nonresidential construction, compared to the same period last year, has been erratic, the nonresidential sector has blunted to a considerable extent the yawn-provoking homebuilding activity. These differences have rarely been considerable. For example, both residential and nonresidential indexes have risen in eight of the last twelve months, although the index of total construction activity ESTIMATED VALUES OF BUILDING AUTHORIZED IN TEXAS* Percent change Jan-Aug 1970 Aug Jan-Aug Aug 1970 from 1970 1970 from Jan-Aug Classification (thousands of dollars) July 1970 1969 ALL PERMITS 194,899 1,S62,226 -4 -2 New construction I 70,S86 1,392,167 -6 -3 Residential (housekeeping) 83,32S 689,066 -7 -8 One-family dwellings 46,329 379,1 SS -16 -4 Multiple-family dwellings 36,996 309,911 9 -12 Nonresidential buildings 87,261 703,101 -6 4 Hotels, motels, and tourist courts 64S 26,424 -87 42 Amusement buildings l,2S9 40,963 -40 21S Churches 2,130 24,873 -22 3 Industrial buildings 16,370 79,337 94 -10 Garages (commercial and private) l,4SO 11,911 -19 10 Service stations 933 9,S14 -39 -22 Hospitals and institu!ions 6,67S 79,644 -26 20 Office-bank buildings 22,026 147,307 S2 6S Works and utilities 2,87S 30,722 164 24 Educational buildings I 0,071 99,S84 -S7 -3S Stores and mercantile buildings 20,300 I 32,S36 -2 -2 Other buildings and structures 2,S27 20,286 12 -S2 Additions, alterations, and repairs 24,313 I 70,0S9 11 SMSA vs. NON-SMSA Total SMSAt 178,S?? 1,394,863 -2 -3 Central cities lOS,392 993,S 81 -17 -I Outside central cities 73,l 8S 401,282 33 -6 Total non-SMSA 16,322 167,363 -24 10,000 to S0,000 populati.on 8,S39 88,9S2 -23 -6 Less than I 0,000 population 7,783 78,411 -26 12 * Only buildings for which permits were issued within the incorporated area of a city are included. * * Change is less than one half of I percent. t Standard metropolitan statistical area as defined in 1960 Census and revised in 1968. Source: Bureau of Business Research in cooperation with the Bureau of the Census, U.S. Department of Commerce. TEXAS BUSINESS REVIEW which includes additions, alterations, and repairs-has risen only half the time. During the last three months, the nonresidential index has risen twice in contrast to declines in two of the last three months in both residential and total construction indexes. The structure of planned expenditures in the nonresidential sector exhibited no broad changes from 1969 over the first eight months of this year. The same five categories led in values authorized in both instances: office-bank buildings (which rose to first place from third); stores and mercantile buildings (second); educational buildings (which dropped to third from first in 1969); hospitals and other institutional buildings (which rose from fifth to fourth) ; and industrial buildings. Although the nonresidential values through August gained only about 4 percent this year (some $24 million), the distribution of values was considerably different. The largest increase-$58 million in office-bank buildings-was almost precisely offset by a $54-million drop in school buildings. Works and utilities construction picked up $28 million, in addition to another $26 million or so in hospitals, amusements buildings, hotels, and churches. These gains were partially offset by various declines, the most significant of which were $9 million in industrial buildings and $2.6 million in stores. Remarkably, however, the five leading nonresidential sectors accounted for almost precisely identical totals in both eight-month periods: $533 million in 1969 and $538 million in 1970. A pair of natural disasters, twelve weeks and five hundred miles apart, have measurably affected the construction economy of the state during 1970. An estimated $135 million in damage has been attributed to the May 11 tornado in Lubbock, with a metropolitan-area population of about 176,000. A study recently completed by the Lubbock Economic Council sets out some remarkable facts concerning the effects of this tornado. The real-property loss in Lubbock came to about $64 million, on a total real-property base of $786 million. The number of business firms damaged or destroyed was set at 513. The Council estimates that $55-60 million will be spent on rebuilding, a sum equivalent to about two years' building permits at the 1969 rate. Most of the smaller repair projects ought to be completed this year. With the time involved in completing plans, settling insurance claims, and making financial arrangements, the larger rebuilding projects will begin in 1971. The entire rebuilding program is projected over five to eight years. Since the storm, building permits have been issued at the rate of about $1 million per week. The 1970 total is projected at $40 million, or about 37 percent over the 1969 total of $29 million. For 1971 the estimate is $50 million, 72 percent above that for 1969. A comparison of the May-August 1969 and May-August 1970 figures for additions, alterations, and repairs in Lubbock provides a striking measure of the significance of the tornado. This category of construction permits amounted to less than $100,000 in May 1969 (in the Lubbock SMSA); the May 1970 figure was $1.7 million. The June figures were about $104,000 in 1969 and about $2.5 million in 1970. In July 1969 the permits for additions, alterations, and repairs fell to about $46,000; the July 1970 total was $2 million. The August 1970 figure was more than $2.1 million, considerably more than the $436,000 for August of last year. The Lubbock SMSA, ranging in May-August 1969 from a low of 0.07 percent to a high of less than 2 percent of the total state authorization for additions, alterations, and repairs, accounted for 8.2-9.1 percent of this category of building permit values during the same four months this year. During May-August 1970, therefore, Lubbock SMSA permits for additions, alterations, and repairs amounted to about $8.3 million. Although some of this work is not TOTAL BUILDING A THORIZED , TEXAS* /nde::r; Adj u sted for Seasonal Varlat1on-19S7-1959 1 JOO 3$0 I 3$0 300 I I 300 2$0 I 2$0 200 I I •.J ·wvi .J 200 1$0 I ~ A. 11.A ..Aflli I .NU .J VlA ' MV If.' 1$0 100 . }Yiv'LA V"'V A I\ W¥1t .. v I Ii' ' 100 $0 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 Includes add1hons, aherations, and repair• NOTE: Shaded a r eat indicate p.enodt of decline of total but•nett activity '"the United State• RESIDENTIAL B ILDING AUTHORIZED, TEXAS* lnde::r: Adjusted for Seasonal Variat1on-19S1-J9S9~JOO 3503.50 300300 200200 I I Al I'\/\ I\ 150I.SO .A • ..WN 1 I • r•,,., J wi.. ~i'iA ,J A...~ ·""' \ ,. """"' 1957 1951 19.59 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 • Lxclude• add1Uon•, alter attonl, and r epur • the Unued Sui.tes NOTE: Sbded areas lndicate periods of d ecline of total bus1ne1s activity m ONRESIDE TIAL B ILDING AUTHORIZF.D,TEXAS• /nde:r: Adjusted loT S e • aon•I V•t1• tion-I951-1959~100 --- '50'50 .. •OO 3$03$0 300300 l IA I 111. I'll 2502$0 • J I ~II ~ ./I 200 200 ~ I u \II 111 1$0 'I I In ~ '"' I II I 1$0 IA..,, ,, VI 11 1W\1 N' I , ./I ~II I/\ I II V fl, I 100 100 •r ·v l"'I v ., ... $0$0 19.51 1951 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 £xcludes .add1t1on1. alterauons, .and rep;i.1r1 NOTE: Sh.aded &Tea• indicate penod• o i dechne of total busme•• acb.,,,1ty m the United State• OCTOBER 1970 related to the storm, most of it clearly is. The 1970 four-month total increased almost 13 times over the 1969 total, from $654,000 to $8.3 million, and the ratio of the Lubbock SMSA value to that of the entire state rose from less than 0.8 percent to 8.8 percent. On August 3 Hurricane Celia invaded the Texas coast at Corpus Christi, the center of a population concentration of close to 300,000. Housing especially was hard hit by the storm. In Portland, for example, a relatively small community adjacent to Corpus Christi in San Patricio County, about 1,700 homes were damaged or demolished, along with 26 businesses. During August the city authorized almost $700,000 in additions, alterations, and repairs, a type of permit which normally is not even applied for in this relatively new community. Through September 13 the Small Business Administration office in Aransas Pass had accepted applications for 623 home loans totaling $3.7 million and 141 business loans aggregating $3.1 million. This office also served Ingleside and Port Aransas. For the communities of Sinton, Taft, Odem, and Edroy, and adjacent rural areas, all affected by the hurricane, the Small Business Administration, through September 5, handled 1,335 loan applications totaling almost $4 million. In the Corpus Christi SMSA, which does not include quite all of the area affected by the storm, the additions, alterations, and repairs category in July 1969 amounted to considerably more ($560,000) than in July 1970 ($412,000), whereas in August 1970, the month of Hurricane Celia's visit, this sector rose to almost $800,000 over the figure of $265 ,000 for August of I 969. New construction, on the other hand, which amounted to $1.8 million in July 1969 and $1. 7 million in August 1969, dropped from almost $ 2 million in July 1970 to $931 ,000 in August 1970. One of every twenty-three or twenty-four persons in the state were affected by these two disasters. The economies of two areas holding close to half a million persons will be altered noticeably for the next several years by the pattern of reconstruction and recovery which follows all major disasters. From the point of view of economic observers, these misfortunes occurred in a year in which the construction industry was already affected by a welter of shifting and contradictory influences. Although some, at least, of the rebuilding programs in the Lubbock and Corpus Christi areas will stimulate the construction economy, the outlook for this sector still is uncertain throughout the state. (Concluded p. 257) ONE-FAMILY, TWO-FAMILY, AND APARTMENT BUILDING DWELLING UNITS AUTHORIZED IN STANDARD METROPOLITAN STATISTICAL AREAS, AUGUST I970t (Values in thousands of dollars) One-family dwelling units Two-family dwelling units Apartment-building dwelling units Percent Percent Percent change change change Jan-Aug Jan-Aug Jan-Aug 1970 1970 1970 from from from Jan-Aug Jan-Aug Jan-Aug Aug 1970 Jan-Aug I 970 1969 Aug 1970 Jan-Aug 1970 1969 Aug 1970 Jan-Aug I 970 1969 No. No. No. No. No. 0 . No. No. No. Standard metropolitan of of of of of of of of of statistical area Value units Value units Value units Value units Value units Value units Value units Value units Value units Abilene .... 81 4 645 25 -40 .. -34 47 4 68 -100 -100 Amarillo .. ... 709 29 3,319 116 -28 -36 -100 -100 100 20 -92 -86 Austin .. .......... .. .. 3,318 168 24,269 1,185 -18 -10 395 26 2,577 188 3 2 340 28 19,658 1,904 -50 -47 Beaumont-Port Arthur- Orange ....... 650 43 3,992 241 -36 -31 59 6 -73 -63 2,913 367 17 Brownsville-Harlingen- San Benito .. 237 29 1,561 198 37 50 -JOO -JOO 4 1,902 221 -44 -26 Corpus Christi .... 187 18 7,228 617 -5 JO 103 12 164 200 1,963 268 -5 -25 Dallas ......... ..... . . 8,801 604 102,618 6,883 -2 II 147 8 2,880 210 -28 -31 14,286 1,32 1 87,878 11 ,599 2 -8 El Paso ..... ........ . . 1,916 128 17,732 1,227 -3 10 85 10 100 14 -84 -77 260 32 8,004 894 -3 -16 Fort Worth .. .. .. 3,900 245 35,863 2,224 -10 -7 131 8 2,566 306 47 87 597 77 16,498 1,968 -61 -66 Galveston-Texas City 292 16 2,382 -18 136 -23 -100 -100 386 84 1,089 222 -53 -35 Houston .... 5,876 287 47,553 2,3 15 -20 -20 230 16 1,128 108 39 35 7,770 1,105 85,212 10,788 -22 -34 Laredo 269 34 1,579 185 113 59 9 1 8 1,663 52 Lubbock .......... 949 43 6,704 310 -10 2 130 10 273 20 -51 -64 592 63 3,660 378 l ,198 779 McA llen-Pharr-Edinburg .. 355 30 3,169 329 -2 II 20 8 111 24 411 47 116 81 Midland. 155 6 1,610 60 19 25 40 2 -33 .. 50 4 -93 -96 Odessa ... 122 5 1,186 49 15 9 200 20 82 150 1,306 128 San Angelo . 186 JS 1,513 121 -18 -6 17 2 -51 80 2,544 449 287 410 San Anto nio ... 2,600 213 19,85 7 1,915 14 25 350 44 -37 19 2,241 216 7,882 759 -18 -40 Sherman-Denison .. 535 31 3,391 213 -15 -7 102 12 -92 83 3,571 309 86 23 Texarkana 99 II 917 85 43 15 75 22 -94 -87 Tyler .. 540 30 3,8 11 186 24 31 130 8 1,080 113 38 47 Waco ... 242 12 2,310 99 -27 -32 110 290 20 31 11 1,965 200 6,147 594 303 179 Wichita Falls 345 28 2,712 216 22 60 -100 -100 2,070 334 367 486Total SMSA's . . 32,383 2,029 295,920 18,935 -8 2 1,248 94 I 0,973 I ,000 15 4 28,532 3,138 255,676 31,440 19 27 Outside SMSA's 7,440 470 53,783 3,497 6 11 347 42 1,444 192 -2 -17 885 11 2 16,053 1,821 16 12 State Total ... 39,823 2,499 349,703 22,432 6 4 1,595 136 12,417 1,192 -13 -6 29 ,4 I 7 3,249 271,729 33,261 17 26 t Metrop~litan areas are listed in accordance with J968 Bureau of the Census definition. This table includes only the cities reporting in metropolitan areas. **Change 1s less than one half of 1 percent. TEXAS BUSINESS REVIEW TEXAS IN THE SEVENTIES 9. A NEW ERA FOR FORESTRY Nelson T. Samson• The decade of the seventies will usher in a completely new era in Texas forestry. Forest practices will become more intensive, wood-using industries will expand in size and diversify in output, smaller, locally owned units will be absorbed by larger, national, multiproduct complexes, wood procurement will become more difficult, new products will appear, environmental management and recreational planning will influence policies, harvesting systems will be revolutionized, and perhaps most important will be a change in forest-management policies. An increased national demand for forest products is expected in the next decade. While some forest products will increase in demand, others will continue to lose rank in the marketplace. with a resulting steady but not spectacular expansion. Figure 1 indicates that forest-product consumption has not shown dramatic growth since the peak of the virgin-timber cutting in the first decade of this century. The 190 7 peak in apparent consumption 1 of timber products. 13,380 million cubic feet. was followed by a steady decline, which reached bottom in the depression year of 193 2. when the apparent consumption dropped to 8.380 million cubic feet. The 1907 level of consumption has never been reattained. but hopefully it will be reached in the seventies. To properly evaluate this historical trend one must look at the product mix , which has shown significant changes. Logs for lumber production have made up approximately 50 percent of apparent consumption for the past seventy years with the exception of the depression years, when building was sharply curtailed. In 1900 fuelwood. a major product of our forests. made up about 40 percent of total consumption, but now its share of demand has dwindled to below 6 percent. Plywood and pulpwood. which were hardly measurable at the turn of the century. have picked up fuelwood's loss and now constitute 9 percent and 31 percent respe..:tiYely of apparent consumption. 1\liscellaneous forest products2 have declined in • Forest Eco nomist. Stephen F. Austin Stare UniYersity. Nacogdoches. Texas. I .>..pparent consumption is domestic production plus or minus the difference between imports and exports. 2 ~liscellaneous forest products include cooperage logs. poles and piling. fenct' posts. he\\·n ties. round mine timbers. box bolts. excelsior bolts. chemical wood. shingle bolts. and miscellaneous items. importance until they now make up only about 4 percent of consumption. It seems evident that increases in the use of some forest products will come at the expense of others, thus tending to restrain the net increase in demand. With very little volume left to squeeze out of fuelwood and miscellaneous forest products, it appears that lumber will suffer relatively from the expected expansion of plywood and pulpwood. Some regions and states will benefit more than others because of their proximity to markets, the condition of their forest land, or other related characteristics. The rate of increase in Texas wood-products production should be greater than that of the country as a whole or that of the South as a region. Since World War I Texas forests have received little pressure for production of wood crops. The demands of local industries were small in relation to the volume of wood available, the eastern markets were being supplied by timber closer at hand, and the westward thrust of industry did not begin until the fifties. when much of the industrial holdings were looked upon as future reserves. The increased demand on the forests in the fifties was cushioned by the upsurge in the use of residues, which bought more growing time for the forests of the state. Changes in the tempo of demand for forest land and forest products became evident in the sixties. with the beginning of the pine-plywood industry, the great expansion of the pulp and paper industry, and the influx of large, nationally oriented wood-products corporations. Texas has a big stake in the products of her forests. Wood-using industries add more than S750 million to the state·s economy each year. give employment to more than 40.000 people. and have invested more than S0.5 billion in plant and equipment and another S0.5 billion in land. Ac.:ording to a 1965 survey conducted by the Texas Forest Service3 the industry is composed of: 141 pineywoods sawmills 46 chipping plants 45 wood-treating plants 3 H. B. Sorenson and \V. A. Smith. "Texas Wood-A Surging Industry:· Texas A~ric11/r11ral Progr ess, Vol. 12, No. 3 (March 1966). p. 4. OCTOBER 1970 23 post-and pole-processing plants 9 building-felt mills 8 charcoal plants 5 container-veneer plants 5 hardwood-plywood plants 5 paper mills 3 pine-plywood plants 2 cooperage plants 2 particleboard plants fiberboard plants Figure 1 APPARENT CONSUMPTION OF TIMBER PRODUCTS By Volume l illlO•oOt .... ~I fo ol .. ' ' v ,1,...---~ ;:}-/ : MISCfllANfOUsv ~ / \ ! -\ \\ /, //Hr:._~ "-"' .\ ' ~ ,.. vv ~ -\-/ -/ ' II"" v-~I\. /A'! 0 .._.,.. •:; \ ' . '\::. "/ / r:'lf ...~ -·-. .L - i-.:/ \. A, I'.. . v \./\ ,,_,..__, fUUWOOO . ' ' / v ""' \, I . v 0.. / V ,... v _L/ v IV SAwtoot . ,,... / ' \/ ' ' ' 0 Figure 2 APPARENT CONSUMPTION OF TIMBER PRODUCTS By Percentage ,...... - ....... • "fUfLWOOO V rv /V \ v In addition, there are 500 furniture and fixture plants, 125 paper-converting establishments, and over 700 miscellaneous small industries which use wood as a raw materiat.4 The lumber industry, which has been the mainstay of the fores t-products industry in Texas since the turn of the century, has been dwindling in importance. From a peak production of 2, 197,233,000 hoard feet in 1907 it has declined to an average of less than 1 billion board feet during the sixties. In 1909,799 sawmills were operating in Texas. but by 1968 this number had dropped to fewer than 160. 4 Information com piled hy the author. Nationally the per capita use of lumber dropped from 526 board feet in 1906 to a low of I 02 board feet in 193 2. From 1932 to 1950 it steadily climbed back to 269 board feet, but has been declining ever since to an estimated 1969 figure of 21 l board feet. The increase in population has not been sufficient to offset the drop in per capita use. Much of the decline in lumber usage has been associated with replacement by substitute materials, some forest-based, like plywood and particleboard, and some nonforest-based, such as steel and cement. Also contributing to the decline in the use of lumber are changes being made in building methods. Lumber has been strongly dependent upon residential housing. In 196 2 new residential construction was the most important market for lumber, making up about 38 percent 5 of total use.The amount of lumber needed for future demand, however, will depend upon the type of dwellings being built. Some types of residential construction require larger quantities of lumber than others. In 1962 the U.S . Forest Service estimated that one-and two-family units required 11 , 190 board feet of lumber per dwelling on the average, while multifamily units averaged 4,500 board feet and mobile homes I ,800 board feet. 6 In recent years the trend has been away from one-and two-family homes toward multifamily dwellings and mobile homes. In 1962 multifamily units constituted 29 percent of residential construction. By the first half of 1969, however, this proportion had increased to 45 percent. Many reasons explain the swing toward multifamily units: rising land costs in urban areas often make the investment in land too great for the construction of single-family residences, the cost of apartment renting has been rising less than the cost of home ownership, and the increased difficulties encountered in commuting have been causing many people to live in city apartments, offsetting the higher rental cost by elimination of commuting. The increase in older-age groups is also leading to more apartment living, since they cherish their freedom of movement, have little need for large quarters, and dislike house and yard maintenance. Mobile homes have made an even more dramatic impact upon the housing industry and thereby upon the lumber industry. In 1969 mobile homes accounted for 92 percent of the sales of all housing units under S 15,000. An estimated total of 428,000 mobile homes were sold that year. The popularity of mobile homes can be attributed to their low cost in relation to a single-family home, their ease and simplicity of financing, and the deficit of desirable housing of other types in price ranges which low or medium-income families can afford. Young married couples buy almost half of all mobile homes sold. Mobile homes have special appeal to this group because they cannot afford a single-family house, own little or no furniture, do 5 Dwight flair and Alice 1-1. Ulrich. Th e Demand and Price Situation for Forest Products, I w;.i (Forest Service, U.S. Department of Agricult ure, Miscellaneous Public"tion No. 983, 1965), p. 6. 6 Timber Trends in tile United Stutes, I C)l\5 (Forest Service, U.S. Dep"rtment of Agriculture, Forest Resource Report No. 17, i:e bruory 1965). p. 19. All forest-resource d"ta used, unless otherwise specified, should be credited to the U.S. Forest Service. TEXAS BUSINESS REVIEW not want time taken up with housework, or have limited need for space and like the compactness. These trends in housing demands will tend to moderate the demand for lumber. but should strengthen the demand for other wood products. such as plywood, particleboard, and composition board. Most of the large-scale replacement opportunities have already been completed, and this. together with the release of pent-up demands for housing in the seventies, will strengthen the position of lumber in the marketplace. The remaining permanent mills should strengthen their economic position, while the smaller, portable mills without debarking and chipping facilities will disappear from the scene. Lumber production in the seventies should stabilize at about I billion board feet annually. The sixties also witnessed in Texas the addition of multiproduct, nationally oriented corporations. such as Owens-Illinois, in Orange, Jasper, and Keltys: International Paper Company, in Nacogdoches: Georgia-Pacific, in New Waverly: and U.S. Plywood, in Diboll and Camden. These companies, plus some progressive local organizations. brought a more competent level of forest management to the state, with results which will become more evident in the decade to follow. Softwood plywood production came to the South in December 1963 and tended to crowd into the West Gulf region, since this area had the most suitable timber supply. Until this time the industry had been concentrated in the Northwest, where large, high-quality timber could still be found in abundance. With the development of high-speed lathes capable of operating on smaller-diameter. woods-run logs and with breakthroughs in glueing techniques the industry headed south. Since its beginning in December 1963 it has grown at a rapid rate and now accounts for almost 20 percent of national production. fr;~·· 3 TEXAS LUMBER PRODUCTION Many factors favor the South over the West for future expansion: the way in which the industry developed favored consolidation of many mills under large corpora·· tions with well-established distribution channels and competent administrative management: the more favorable shipping costs encouraged growth to the southeastern and southcentral markets. which provide approximately 30 percent of the nation's population, lower wage scales. lower fuel costs. and lO\\·er mill-construction costs. Texas should be a leader in future plywood expansion in the South. Between l 9 5 5 :rnd 1965. according to the U.S. Forest Service study of timber trends. Texas softwood volume rose OCTOBE R l 970 40 percent. In 19 5 5 trees above fifteen inches in diameter totaled about l. l billion cubic feet, or 24 percent of the softwood inventory. In l965 trees of these sizes made up 29 percent, or l .8 billion cubic feet. These are the sizes of trees needed by the Southern Pine plywood industry, which makes Texas the logical location for the next jump in softwood-plywood production. Texas has three pineplywood plants operating, with an annual capacity of around 210 million square feet. An additional three mills, representing an investment of over S l l million, are under construction. By 1971, when the current construction is completed, over 1,200 employees will be working in softwood plants and capacity should reach 550 million square feet annually. New uses for plywood in shipping, manufacturing, and construction plus completely new products developed by the combination of plywood with plastics, aluminum, and paper will open up entirely new fields in the seventies. Texas pulp and paper production has been steadily increasing from a 1950 capacity of 970 tons per day to a 1968 figure of 5 .500 tons per day, or an increase of almost six times in a period of less than twenty years. 7 Pulpwood production in Texas has likewise been increasing at a rapid rate, having quadrupled since World War II. Almost half of the increase has been brought about by the use of hard woods and residues which were formerly considered waste material from the production of lumber. The impact of residue use on the raw-material needs of the pulp and paper industry nationwide can be seen from the accompanying graph. Figure 4 TEXAS PULPWOOD PRODUCTION Tho uu1•cl1 tt.o..1ondt olcouh of cord• , 000 ,000 I , --A-, "" 300 /, , 300 , 00 I , " 00 I I I , I I I , 000 ,,.. I / ' ..oo -_,800 I I ~A "00 ' I / I ' '""' ' '500 J ' I I"'\... / I I uoo ' II .\ [" 1300 J RESIDU ES ' II 1\.\ I I { " 00 ,.-:--./'\\ I / j \ "\, _,.,-f ' uoo ' II \. " 00 HARDWOOD '/ 'I ...... I J ' •oo ;,; .... __... v . 100 -...,, /, . ' ::·~ PINE 500 "' •OO 300 3 ,00 , •oo ' 0 7 R. C. Beltz. So11ri1ern Pulp\\'ood Prod11ctio11. 1968 (Fores1 Service . U.S. Department of Agriculture, Forest Service Resource Bulletin. SO-IS. 1969). p. 21. 253 The nationwide production of pulp chips from residues in 1969 amounted to 18,500,000 cords. Texas forests are growing at the rate of 0.6 cords per acre annually. This means that the use of chips preserved from cutting the equivalent of the growth on over 30 million acres of forest land. Stated another way, it is the equivalent of clearcutting almost 3 million acres of Texas timberland. During the past three years Texas has been in the forefront in appropriation of expansion funds for the pulp and paper industry. 8 The raw-material outlook for the industry is excellent. Softwood growing-stock volume has increased 40 percent during the last decade and 55 percent of it is in trees six to twelve inches in diameter, which are highly suitable for intensive management. Hardwood growing stock over the last decade has decreased slightly, but a considerable volume of sound wood is available in rough and rotten hardwood which was not tallied. According to the U.S. Forest Service annual growth exceeds annual drain by 202.3 million cubic feet. The wood fiber available is greatly in excess of the current demand and should provide all that is needed for the expansion plans of the next ten years. New products in the pulp and paper industry should Figure 5 PULPWOOD CONSUMPTION IN THE UNITED STATES '"" ""' ....... ' 00Ft==t==J,__::-ll_Ti--:::+=t==f==f=!=1r:=Cc 111TTTTl"' '"' ---r----~ "k,__~i--~o+, ±,.:+,,+++-+-+~f'.__ =-+--+--l--11--1--+-,,.::--'°,:-::-oo:-:::--+--l--l-"'H •O~t-------f"'.._+1--._-"'!~-1--f--t---J--+--+--f--J--+--+-t--+-+-, r--1- ,.,__ +--l--l--l--1--l--+-1-1--1-1--1--+--P*--l--l--+--1--I New products in the pulp and paper industry should become commonplace during the seventies. The nonwoven paper revolution got its start in 1966, when Scott Paper Company offered its $1.25 paper dress "Duraweve" as an advertising gimmick aimed mainly at the disposable medical-products market. Within six months 500,000 dresses were sold. Mars Manufacturing Company, of Asheville, North Carolina, brought out a paper shift dress and sold $750,000 worth in six months. Paper dresses and other clothing items are now available in almost all large department stores. Paper diapers such as Proctor and Gamble's "Pampers" are accepted items. Paper disposable medical products are a $300-million annual market. Paper has exploded into the market of mass feeding and mass housing in restaurants, hotels, hospitals, schools, and institutions. The Armed Services are researching the use of paper in bedding, curtains, underwear, field gear, fatigue 8 F. Gantzhorn, "Texas, Alabama, Louisiana-A Billion-Dollar Triumvirate," Pulp and Paper, November 2 7, 1967, p. 46. uniforms, and assorted medical products. You can buy paper garbage bags, paper furniture (widely used by the Bureau of the Census), paper houses, and paper with a life expectancy of four hundred years. The overall market for paper disposables in 1969 exceeded a billion dollars. The seventies should witness an explosion in new paper products. As a result of increased operating rates, the higher selling price of paper, the improved rate of worker productivity, and the favorable rate of capital investment the capacity of Texas mills should increase to over 8,500 tons a day during the seventies. The industry should also achieve added stability as a result of new sources of earnings based on land development, mineral utilization, real-estate ventures, and increased merger activity. Associated with the pulping expansion has been a strong trend toward a greater use of residues for pulping. From a negligible amount in 1955 residue use has grown to a 1968 production of 701,400 cords, which made up almost 28 percent of the pulpwood production for that year.9 Despite the fact that most of the large producers of residues are already selling all they can produce and lumber production is not expected to increase markedly it is well within reason to anticipate an annual ·residue production of 1 million cords by 1980. Increased plywood production, changes in utilization standards, and greater salvage of chippable material currently being left in the woods will make larger contributions to residue production. Because of the increased installation of continuous digesters huge quantities of sawdust will also become economically usable for pulping. Miscellaneous wood products, such as poles, piling, posts, and fuelwood, have b.een declining rather steadily over the years as a result of their susceptibility of replacement by substitute materials. They now constitute only about 4 percent of the timber cut each year. Since most of the substitution has already occurred, it appears that the drain from these souces will stabilize around 5 percent of the timber cut each year. Research and development will play an increasingly important role in the future of the forest-products industry. It has often been stated, and is probably true, that most of the profits in the pulp and paper industry ten years from now will come from products which have not yet been discovered. While an increasing population plays a part in market demand, evidence suggests strongly that it may not be the dominant part. Throughout the twentieth century in America the great expansion of the pulp and paper industry has been mostly the result of an increased use of paper by each individual rather than the result of an increase in population. During the period from 1925 to 1968 population growth accounted for only 18 percent of the increased consumption with the remaining 8 2 percent attributed to the increase in per capita use. Choosing other time periods will yield results of different magnitude, but in almost every case population expansion will be found to be the minor element in the growth of this industry. In the seventies research will be essential for continued growth, 9 R. C. Beltz, Southern Pulpwood Production, 1968, p. 6. TEXAS BUSINESS REVIEW new-product development will become an integral part of any research program. advertising will take on added importance. and merchandizing will require greater attention. The policies developed in the seventies must give more consideration to per capita use and place less emphasis upon an anticipated population explosion. Lumber is a good example to examine. In the short period from 1950 to 1960 lumber lost 26 percent of its market because of a decreasing per capita use. About 53 percent of the loss was offset by consumption from an increasing population, but even the high population growth of that period was not sufficient to make up the loss arising from a smaller use of lumber by each individual. Without more research, better advertising, new products, and enlightened merchandizing the population growth in the decade ahead may not be great enough to offset the losses to substitutes and changing technologies. All of the rosy predictions enumerated above are also dependent upon a strong upsurge in management polkies. Business as usual will not be sufficient to meet the needs of the seventies. The problems from an industrial standpoint are twofold: more wood fiber must be grown ; the wood fiber produced must be available to industry. For all practical purposes, forestry to support these industries must be practiced within the Piney Woods of East Texas, which extend along the eastern edge of the state in a strip from 80 to 120 miles in width from the Red River on the north to the prairies of the Gulf on the south. They comprise an area larger than the states of Massachusetts and Vermont combined and their daily growth is sufficient to build 5 ,000 average single-family homes. Forests cover 61 percent of the land area of East Texas, almost all of which is available for timber growing. The total acreage of commercial forest land today ( 11.5 million acres) is about the same as it was a decade ago. In recent decades the loss of commercial forest land to expanding cities, highways, water impoundments, and airports has been offset by the reversion of abandoned agricultural land to forest use. Abandonment has slowed down, however, and since little more agricultural reversion is likely to occur more wood must be grown on less land. This is true for Texas as well as for most of the other areas of the East. To the outright loss of timber-growing land must be added the loss due to economic unavailability. As cities and towns expand, the forested areas surrounding them take on new value for real-estate development and their value increases accordingly. The consequent increase in tax assessments ultimately makes the practice of forestry uneconomical. A similar phenomenon occurs in areas in the vicinity of large water impoundments. Not only is the submerged area lost to timber growing, but owners in the surrounding areas begin to view their holdings as sources of income from recreation, which is generally considered incompatible with timber harvesting. Texas is not making full use of its forest land. In fact , it is not growing more than one third of its potential. The average growth rate in East Texas is 0.6 cords per acre annually after deducting for mortality. 10 A reasonable goal would be an average growth rate of I cord per acre annually by I980 for the East Texas area. Achievement would require better fire , insect . and disease protection, the use of genetically superior tree stock for planting, a realistic thinning program. the use of fertilizers on the better sites, and an enlightened utilization program aimed at recovering more of the fiber which is grown and harvested. Mortality from uncontrolled fires accounts for about 100 million cubic feet of wood annually. This loss combined with other losses from fire-a slowing down of the growth rate of trees that survive, the ill effect upon wildlife production, and the deteriorating influence upon the soil, the air, and the water affords a more realistic estimate of the loss. Currently the cost-benefit ratio of fire protection is estimated at 1 :4, which should justify added expenditures in the seventies. As long as the cost of control plus the value of the Joss is less than the value of the material gained it will pay to protect the forest from fires. More intensive control of insect and disease losses also can add to the wood available for use. The timber-trends study estimated annual mortality from insects at 95 million cubic feet and from disease at 58 million cubic feet. 11 The addition of associated losses would greatly enlarge these figures. Unknown causes which make up more than half of all mortality losses are principally made up of crowding and suppression, which could be greatly reduced by thinning and other management techniques. The production of more wood per acre would result from a wider use of genetically superior planting stock. Genetic research has developed progeny from superior trees, which have been planted in orchards and are now producing large quantities of improved seed. One of the leaders in this program is International Paper Company, which has announced that it is going to harvest 3.8 million acres of their land in nine Southern states and replant them with a new strain of super-trees it has been developing in its research program. It has been estimated that by the end of the seventies growth from plantations should be more than one tenth of all growth. 1 2 Fertilization of forest land is just emerging from the experimental stage and should make big strides in the seventies. In addition to improving growth by manipulating the genetic make-up of our trees and by changing the species which are to be grown on a particular site, we can also increase yields by manipulating the site itself. The addition of a few essential elements, such as nitrogen, phosphorus, and potassium, which are commonly deficient in land which has reverted from agricultural use, will normally yield good results. As the economics of fertilization becomes better known the practice should become widespread on the better sites. The need for more wood from less land should I 0 H. D. Sternitzke , East Texas Pineywoods (Forest Service, U.S. Department of Agriculture, Forest Service Resource Bulletin SO-JO, 1967), p. 7. llTimber Trends in the United States, 1965, p. 182, Appendix Table 35. I 2The South's Third Forest, A Report of the Southern Forest Resource Analysis committee, 1969, p. 17. OCTOBER 1970 hasten the use of this silvicultural tool. All of this know-how is already available, but until now the need has not been sufficiently acute to stimulate foresters into concerted action. This intensive program should become reality in the seventies. The wood fiber that is produced must be available to industry. This need will be one of the most acute forest-industry problems to be solved in the seventies. Conflicting use desires and changing ownership patterns will make wood procurement a test of managerial skill and resourcefulness. The demand for outdoor recreation has been growing rapidly as a result of the trend to greater affluence, more leisure time, longer vacations, shorter work weeks, greater retirement income, more dependable means of travel, and better facilities. As the urban population grows, the pace of day-to-day activities increases and living becomes more congested, pressu1e is generated to get away from it all, to relax in the woods, or to forget troubles by hunting, fishing, or picnicking. The public lands in Texas are feeling this pressure and many areas have been set aside for recreational use only. The remaining public acreage, including that retained in multiple use, is experiencing policy modification which will cause an estimated I 0-to 13-percent drop in its productive capacity. These same pressures are beginning to be felt by private forest holdings in Texas and the eventual impact may be substantial. Some 22 million acres of pulp-andpaper-company forest in the South are now open to hunting and fishing. Many more millions of acres of private woodlands in other industrial, farm, and miscellaneous ownerships are also open to the public. The number of acres of forest land set aside for single-purpose use, such as recreation, will increase in the seventies as a result of the Supreme Court's "one person-one vote" ruling. City residents will have a widening influence on public policies and if they desire public land to be set aside for recreational use they now have the vote with which to obtain their wish. Similar restrictions on harvesting of timber crops will result from the urgent need for water conservation and environmental planning. The time has come when forestry decisions must be based upon total environmental management instead of only sound silvicultural techniques. Pulp mills in the South will not be able to obtain sufficient wood from their own holdings to meet their needs in the foreseeable future. Mill requirements have been expanding more rapidly than land acquisition and develop ment, a situation which will require the purchase of more wood from outside sources. In 1968 pulp companies in the South were growing 45 percent of their requirements, but were actually obtaining only 25 to 30 percent of their mill requirements from their own lands. It is estimated that they will be able to obtain about 38 percent of their require ments from their own lands by I 980, still leaving a large amount to be obtained on the open market. The economic and social conditions of the past two decades have influenced the ownership pattern of forest land in the South. In 1952 farm ownership in the South accounted for 46.7 percent of the commercial forest land , but by 1962 only 29.2 percent was farmer-owned. Miscellaneous private ownership in 1952 accounted for 27.4 percent of the acerage but by 1962 it had risen to 33.8 percent. During this time Texas followed the trend of the South. Following 1962, however, the forest industry in Texas began a serious program of land acquisition which temporarily slowed down the trend toward miscellaneous private ownership of forest lands. It is anticipated that the seventies will witness an acceleration in the rate of acquisition by miscellaneous private owners and a slowdown in fee simple acquisition by forest industries. The characteristics of this new ownership class are different from those of former owners. In 1967 a study was conducted in East Texas covering the sales of forest land made during 1965 and 1966. 13 Information obtained by questionnaires from both the buyer and the seller of each tract provided interesting information. The educational level attained by the new owners was found to be significantly higher than that of the sellers. Educationally, at least, it may be assumed that the new owners are better equipped to evaluate alternative users of their land, tend to have a better knowledge of its true value, and should be more prone to listen to management advice. The income level of the buyers also was found to be higher than that of the sellers. While 61 percent of the sellers had incomes exceeding $6,000, the buyers' incomes exceeded that figure in 97 percent of the cases. The new owners are not under the same financial pressure to sell their timber. This more affluent group includes a greater percentage of absentee owners, who normally will not be as concerned about property-tax increases as are local residents. Such nonresident ownership tends to create an atmosphere conducive to higher taxes, which could add to the cost of growing timber on all private lands. The reasons given for ownership also varied. The sellers generally had owned the land for a considerable period of time and had acquired it by inheritance or as an adjunct to their main occupation. To many of them the woodlot was an occasional source of ready cash for the purchase of a washing machine or a car, or for an addition to the house. The new owners, in most cases, purchased the land not as a source of primary income, but for other reasons, such as esthetics, the joy of ownership, a tax write-off, or for other objectives which were not related to timber production. Current income from the land was often not sought or desired. How will these changes affect management in the seventies? Over 65 percent of the commercial forest land in East Texas is owned by private landowners, many of whom know little about forestry, have no interest in selling forest crops, and feel that timber harvesting and their main reason for owning the land are not compatible. In order to obtain the timber on these holdings industry may have to control their logging more closely, make lighter and more frequent cuts, lop the tops so that the logging residue is less visible and will deteriorate more rapidly, use smaller equipment so 13 L. Levens, "An Analysis of Changes in Forest Land Use Intention in Southeast Texas," unpublished master's thesis, Stephen F. Austin State University, Nacogdoches, Texas, 1967. TEXAS BUSINESS REVIEW that damage to the residual stand will be kept to a minimum, reinstitute the practice of having Conservation Foresters who work directly with the landowner and inform the landowner of the income-tax implications of his cutting. All of these things will increase the cost of the wood to the company, but it seems the only choice is between higher-cost wood or no wood. For many years foresters have dealt unsuccessfully with the problem of the small woodlot owner. He is constantly pointed out as the main problem in producing the wood fiber deemed essential. Free advice has been heaped upon him, extension-services assistance has been widespread, governmental . subsidies have been handed out, college programs in farm forestry have been made available, short courses, symposiums, seminars, demonstrations, farm forties, and innumerable other schemes have been tried and the problems still remain. The seventies will hopefully witness significant progress in handling these properties as industry finally decides that the only solution is industrial management of the lands for the small owner. Industry is well equipped for the job, having the trained personnel, the organization, and most of all, the need for the wood. Alpine -KVLF Amarillo -KIXZ Austin -KNOW Austin -KOKE Austin -KVET Ballinger -KRUN Big Spring -KBST Big Spring -KHEM Bowie-KBAN Brownsville -KBOR Brownwood :--KBWD Carrizo Springs -KBEN Conroe -KMCO Cuero -KCFH Dalhart -KXIT Dallas -KBOX Dallas -KRLD RADIO STATIONS AIRING TEXAS BUSINESS REVIEW INTERVIEWS Denison -KGCC Fort Worth -WBAP Freeport -KBRZ Galveston -KGBC Gonzales -KCTI Henderson -KGRI Henderson -KWRD Houston -KILT Houston -KLEF Houston -KODA Houston -KTHT (now KULF) Huntsville -KSAM Kermit -KERB La Grange -KVLG Lampasas -KCYL Lufkin -KRBA Monahans -KVKM Navasota -KWBC Odessa -KOYL Odessa -KQIP Pecos -KIUN San Angelo -KPEP San Antonio -KEEZ Sherman -KDSX Shreveport -KEEL Stephenville -KSTV Texarkana -KATQ Tyler -KOOK Uvalde -KVOU Victoria -KNAL Victoria -KVIC Waco -KAWA Weatherford -KZEE Weslaco -KRGV Wichita Falls -KWFT TEXAS CONSTRUCTION (Concluded) Construction remains at the mercy of forces ranging, at one extreme, from the quite deliberate adjustments to the mechanism controlling interest rates to the wholly mindless OCTOBER 1970 occurrence of natural catastrophes at the other extreme. The downward adjustment of prime interest rates in late September, like several other recent tendencies in the state and national economies, is too recent and too tentative to be said to imply an early upswing in either residential building or urban construction generally. time, illustrates this concept, since renewals in mutual investment companies increased that year 62.1 percent over SECURITIES REGISTRATION IN TEXAS renewals in 1968. FISCAL 1970 There is sufficient reason to believe that the worst is over insofar as the market is concerned. If this is true the relative importance of renewals should decrease again Ernest W. Walker during l 971; however, because of the time lag between Fiscal 1970 marked the first decline in the volume of recovery in the general market and its effect upon renewal securities certified for sale by the State Securities applications, we should not expect a major reversal in Commissioner since 1963. The decline came as no surprise, renewals. In other words, if the market continues to recover since the market for securities during the year was we should not see a decline in the relative status of renewals extremely depressed. As a matter of fact , it is surprising until the third or fourth quarter of 1971. that the volume remained above the $I-billion mark. While Total applications approved declined $393.4 million the decrease was expected. an analysis of the various during 1970, a drop of 32.8 percent. An examination of the components of the total reveals some major changes that activity by quarters reveals that the decline in subsequent were quite unexpected. quarters was at an increasing rate except in the last quarter The data in Table I reveal that the total dollar volume of (Figure I). For example, decreases of 5.2 percent, 14.7 all types of securities offered for sale during 1970 decreased percent, and 10.7 percent occurred in the second, third, $330 million, a drop of 21.5 percent. Of the two types of and fourth quarters--the activity of each quarter declining securities approved for sale, original applications or renewal in comparison to the activity of the preceding quarter. It applications, renewals will ordinarily increase in volume at a may be significant that the decrease in the fourth quarter more rapid rate during a depressed market than during a was not as great , in volume or in percentage, as that of the bull market. This trend prevailed during 1970, when third quarter. While it is too early to make a prediction, it is renewals rose not only in dollar volume but relatively as believed that the downward movement has been reversed well. In fact , the size of the relative increase was unusually and that improvement should develop during the rest of large, for example, 33 percent of all applications in 1970 as 1970 and 1971. compared to only 22 percent in fiscal 1969. Renewals An examination of the various components of the total resulting from all corporations except mutual investment reveals that original applications approved for sale (by companies increased 90. 2 percent, while renewals from Texas companies as well as foreign companies) experienced mutual investment companies increased only 16.5 percent. the greatest relative decline, accounting for $331. 2 million, The increase for corporations other than mutual investment or 84 percent of the total. It is also interesting to note that companies was not unusual, but the scant increase in 59 percent of this decrease came in the second half of the applications by mutual investment companies was wholly year; but since the decrease in the fourth quarter was only unexpected, since as a general rule the volume of renewals slightly less than that of the third quarter, it appears that in these organizations rises rapidly in a depressed market . companies are beginning to go back into the market for The year 1969, when the market was depressed most of the funds. Table l SECURITIES REGISTRATION IN TEXAS, 1969-1970 (Millions of dollars) First half Percent Second half Percent Full year Percent 1968-1969 1969-1970 change 1968-1969 1969-1970 change 1968-1969 1969-1970 change Original applications Mutual investment companies 203.3 215.7 6.1 217.5 142.9 -34.3 420.8 358.6 -14.8 Other corporate securities Texas companies 149.2 71.7 -51.9 161.8 72.5 -55.2 310.9 144.2 -53.6 Other companies 222.0 163.0 -26.5 244.2 138.6 -43.2 466.2 301.6 -35.3 Subtotal 371.2 234.8 -36.7 406.0 -48.0 211.1 777 .1 445.9 -42.6 Total original applications 574.5 450.5 -21.6 623.5 354.0 -43.2 1197.9 804.5 -32.8 Renewal applications Mutual investment companies 176.4 190.1 7.7 146.1 185.7 14.8 322.5 375.8 16.5 Other corporate securities Texas companies 1.5 1.0 -33.3 5.4 8.3 53.7 6.9 9.3 34.8 Other companies 2.1 2.6 23.8 2.2 9.4 327.3 4.3 12.0 179.0 Subtotal 3.6 3.6 0 7.6 17.7 132.9 11.2 21.3 90.2 Total renewals 180.0 193.7 7.6 153.7 203.4 32.3 33.7 397.1 19.0 GRAND TOTAL 754.4 644.2 777.2 557.4 -28.3 1531.6 1201.6 -21.5 258 TEXAS BUSINESS REVIEW The data indicate that approved applications of Texas companies, which fell 53.6 percent, decreased substantially more than those from other corporations, which declined only 35.3 percent. One explanation of this difference is that the stock of smaller companies, such as most of the Texas corporations. is not as acceptable generally as that of larger corporations. As a consequence, small corporations are more hesitant about going to the market. In all likelihood, the volume of stock submitted for approval by Texas companies will be greater than that of other corporations once the market rights itself. A paradox seems to exist in the relationship between the volume of securities approved for sale and the number of licenses issued. That is to say, while volume was declining, licences increased 1,28 7 or 14 percent in 1970 as compared to 1969. It should be pointed out, however, that the increase in 1970 was approximately one half of that experienced in 1969. The data in Table 4 reveal that the number, as well as the dollar value, of withdrawals showed a sizable growth during 1970, reaching their highest level of the past ten years. While the reason why each request was withdrawn cannot be ascertained, it can be assumed that the depressed market played a major role. Rather than continue to offer Table 2 SECURITIES REGISTRATION IN TEXAS RENEWALS, FISCAL YEARS 1960-1970 Renewals All applications Renewals as percent Years (Millions of dollars) (Millions of dollars) of total 1960 264.1 70.1 26.5 1961 351.6 83.1 23.6 1962 357.3 100.5 28.1 1963 249.3 97.9 39.3 1964 321.1 104.7 32.6 1965 385.1 101.8 26.4 1966 539.9 146.8 27.2 1967 624.2 162.0 26.0 1968 1,087.7 214.3 19.7 1969 1,531.6 333.7 21.8 1970 1,201.6 397.1 33.0 Table 3 DOLLAR VALUE AND PERCENT INCREASE OF ALL APPLICATIONS AND ORIGINAL APPLICATIONS AUTHORIZED FOR SALE DURING FISCAL 1960-I970 (Millions of dollars) Total applications Original applications Percent Percent Dollar increase over Dollar increase over Year value previous year value previous year 1970 1,201.6 -21.5 804.5 -32.8 1969 1,531.6 40.8 1,197.9 37.2 1968 1,087.7 74.3 873.4 90.0 1967 642.2 15.6 462.2 17.6 1966 540.1 40.2 393.l 38.8 1965 385.1 19.9 283.3 30.9 1964 321.1 28.8 216.4 42.9 1963 249.3 -30.2 151.4 -41.0 1962 357.3 1.6 256.8 - 4.4 1961 351.6 33.1 268.5 38.4 1960 264.1 194.0 the securities at depressed prices, companies presumably withdrew them, with the idea that they could be reoffered at a better price at a later date. It is important to note that general market conditions govern the characteristics of the securities market in Texas. Though the volume of securities offered for sale in Texas is off, the Texas market continues to be relatively strong. In spite of definite evidence that the volume of securities approved for sale will increase during 1971 , we should not expect a major recovery until the last half of fiscal 1971. Table 4 NUMBER AND DOLLAR VOLUME OF APPLICATIONS WITHDRAWN FISCAL 1969-1970 1969 1970 Withdrawals Withdrawals Number Amount Number Amount Amendment 0 0 0 0 Coordination 142 $62,386,599 293 $169,999,571 Notification 0 0 2 825,000 Qualification 23 5,901,180 26 7,778,213 Renewals 1 271,450 3 241,094 166 $68,559,229 324 $178,843,878 Figure I SECURITIES REGISTRATION IN TEXAS BY QUARTERS 8\ FISCAL 'i EARS 1968-19i0 ..uu.....1 1o10111 ....1 .•llltlu• "' 1960.1970 IOitli••• •' nths for 1957-1959 e'cept \\·here other specific·ation is made: all e'cept annual inde,es are adjusted for seasonal \·ariaticrn unless otherwise ncHed. Emplc1yment estimate» are c·ompikd by the Te,as Emplcn-ment (\1mmission in c·,1operation \1·ith the Bureau of Labc1r Statistics of the l'.S. Department of Labcir. The symbcils used bdo\1· impc1se qualifications as indicated here: p-preliminary data subjec't to reYisiclll: r-reYised data: *-dollar totals for the fiscal year to date: 7-employment data for wage and salary \\·orkers only. Year-to-date average Aug July Aug 1970 1970 1969 1970 1969 GE ERAL BUSINESS ACTIVITY Estimates of personal income (millions of dollars, seasonally adjusted) s 3,144p 3,25 5P $ 3,001 r $ 3,178 $ 2,987 Income payments to individuals in U.S. (billions, at seasonally adjusted annual rate) .. . . s 807.4p s 803.3p $ 758.5r s 795.2 s 738.4 Wholesale prices in U.S. (unadjusted index) 117.2P l 17.7p 113.4r 116.8 112.3 Consumer prices in U.S. (unadjusted index) 136.0 135.7 128.7 134.1 126.5 Newspaper linage (index) .. 131.8 139.3 119.7 125.9 126.5 Sales of ordinary life insurance (index) 254.9 270.8 236.2 251.7 235 .6 PRODUCTION Total electric-power use (index) ... 280.2p 279.2p 280.4r 261.0 247.8 Industrial electric-power use (index) 23 l.9p 222.4p 221.7r 226.9 216.3 Crude-oil production (index) .. l 24.7p l l 9.3p 11 7 .or 121.2 113.3 Average daily production per oil well (bbl.) s 17.5 16.4 15.9 17.0 15.5 Crude-oil runs to stills (index) .. 134.3 135.0 136.7 133.7 135.4 Industrial production in U.S. (index) .. 169.0p 169.2p 174.3r 169.8 172 .2 Texas industrial production-total (index) l 79.3p l 75.3p 175 .7r 177 .8 171.3 Texas industrial production-total manufactures (index) 198.0p 196.8p l 99.2r 199.2 192 .7 Texas industrial production-durable manufactures (index) 203.6p 204.3p 208.2r 213.8 216.6 Texas industrial production-nondurable manufactures (index) 194.3p l 9 l.8p 183.4r 189.5 178.8 Texas industrial production-mining (index) 137.7p 128.7p 127.3r 132.3 124.7 Texas industrial production-utilities (index) 260.0p 260.1 p 253.9r 258.3 246.3 Urban building permits issued (index) .. 201.5 197.9 174.0 188.0 191.6 ew residential building authorized (index) 144.1 163.0 120.7 143.5 155.2 New nonresidential building authorized (index) 292.5 261.6 254.4 261.6 252.9 AGRICULTURE Prices received by farmers (unadjusted index. 1910-14= I 00) 280 272 272 276 264 Prices paid by farmers in U.S. (unadjusted index, 1910-14=!00) 389 389 374 387 371 Ratio of Texas farm prices received to U.S. prices paid by farmers 72 70 73 71 71 FINANCE Bank debits (index) 297.1 339.9 270.4 303.7 276.9 Bank debits, U.S. (index) 364.0 352.2 326.7 346.1 313.4 Reporting member banks, Dallas Federal Reserve District Loans (millions) . . . . .. s 6,126 $ 6,042 $ 6,032 s 6,033 $ 6,083 Loans and investments (millions) . . . . .. s 8.785 s 8,617 s 8,499 $ 8,626 $ 8,707 Adjusted demand deposits (millions) .. . . s 3,336 $ 3,190 s 3,366 $ 3,277 $ 3,341 Revenue receipts of the state comptroller (thousands) $313,904 $225,634 $274,906 $275,913 $235,749 Federal Internal Revenue collections (thousands) $512,789 $299,65 I $510,757 $812,440* $735,564* Securities registrations-original applications Mutual investment companies (thousands) s 8,555 s 42,124 s 46,772 $358,594* $420,808* All other corporate securities Texas companies (thousands) .. s 10,714 $ 24,007 $ 51,647 $144,211 * $310,905* Other companies (thousands) . . .. $ I 0,466 $ 27,675 s 18,736 $301,713* $466,169* Securities registrations-renewals Mutual investment companies (thousands) $ 30,305 s 38,521 s 23,770 $375,779* $322,537* Other corporate securities (thousands) s 0 $ 841 s 522 $ 21,359* s 11,184* LABOR Total nonagricultural employment in Texas (index)t l 50.3p l 50.3p 147.3r 150.2 145.1 1anufacturing employment in Texas (index)T .. . 149.1 p 150.3P 157.0r 152.9 153.6 Average weekly hours-manufacturing (index)t . . 97.Sp 98.0p 99.8r 99.0 100.9 Average weekly earnings-manufacturing (index)t I 50.4p 148.2p 145.8r 149.t 143.2 Total nonagricultural employment (thousands)t . 3,733.0p 3,732.0p 3,657.5r 3,706.2 3,580.1 Total manufacturing employment (thousands)t 727.7p 732.5p 766.2r 740.8 744.5 Durable-goods employment (thousands)t . 397.1 p 402.0p 435.5r 410.9 422.2 ondurable-goods employment (thousands)t 330.6p 330.5p 330.7r 329.9 322.3 Total civilian labor force in selected labor-market areas (thousands) . . . . . . .. 3,505.2 3,519.9 3,339.4 3,488.9 3,357 .8 onagricultural employment in selected labor-market areas (thousands) . . . . . . .. 3,292.0 3,285.4 3,163.6 3,286.4 3,111.6 Manufacturing employment in selected tabor-market areas (thousands) . . .. 620.1 627.5 632.7 635.2 617.7 Total unemployment in selected labor-market areas (thousands) . . . . .. 135.4 146.1 92.8 118.9 91.3 Percent of labor force unemployed in selected labor-market areas . . ... 3.9 4.1 2.8 3.4 2.7 BUREAU OF BUSINESS RESEARCH RETURN REQUESTED THE UNIVERSITY OF TEXAS AT AUSTIN SECOND-CLASS POSTAGE PAID AT AUSTIN, TEXAS AUSTIN, TEXAS 78712 Business & Social Science Libr. M. B. 22L~ FACULTY MAIL ATLAS OF MEXICO Michael E. Bonine James P. Weiler Research Associate Chief Cartographer Bureau of Business Research Bureau of Business Research Robert K. Holz Clark C. Gill Associate Professor of Geography Professor of Curriculum and Instruction College of Arts and Sciences College ofEducation Stanley A. Arbingast Professor ofResources Graduate School ofBusiness Director, Bureau ofBusiness Research One of the best mediums for telling the story of a country graphically is maps. This concept has motivated the Bureau of Business Research at The University of Texas at Austin in establishing its series of atlases, the first of which was the Atlas of Texas, an attractive and comprehensively informative book. No. 2 in the series is the Atlas of Mexico, just off the press, equally enjoyable to look at, and equally comprehensive in its range of facts. The currency of this collection of maps is symbolized by the covers, which reproduce an official Apollo 9 space photograph (Number 3012), on the front , and, on the back, a contour diagram of the photo which provides names of the salient physical features and cities caught in the picture. Inside, the Atlas presents 193 easily readable maps -many in color-which tell in rich detail the story of Mexico as it is today. This description of our neighbor south of the Rio Grande includes information on practically all segments of her economy: the physical setting (location, political divisions, physiography, topography, geology, climate); population (distribution of both urban and rural populations in various decades; projections; marriage, birth, and mortality rates; literacy; homes according to amenities; student populations; educational institutions; educational status; languages); agriculture (areas cultivated, production, irrigation, separate crops, pest damage, fertilization); transportation, services, and commerce (highways, railways, air routes and flights, automobiles and trucks, truck freight, number and kinci of establishments for theaters, sports, hostelries, medical and other professional services, commercial activities, construction, trade); industry (petroleum products, mining, manufacturing). This comprehensive array of graphically presented information is concluded by an Appendix, with seven charts, which summarizes verbally and statistically the basic economic facts relative to Mexico, and by a helpful selective Bibliography. The Bureau believes that the Atlas of Mexico is a fitting expression of the strong and continuing interest in Mexico prevalent at The University of Texas at Austin, and that it will fill a frequently expressed need among geographers, historians, anthropologists, economists, other academicians, businessmen, and all those with a special interest in Mexico. 138 pp. $ 10.00 (Texas residents pay $.43 sales tax.) BUREAU OF BUSINESS RESEARCH GRADUATE SCHOOL OF BUSINESS THE UNIVERSITY OF TEXAS AT AUSTIN