TEXAS BUSINESS REVIEW Bureau of Business Research The University of Texas Vol. XVI. No. 4 May, 1942 A Monthly Summary of Businese and Economic Conditions in Texa3 and the Southwest Bureau of Business Research, The University of Texas, Austin, Texas J.:.ut...1.:d. a.;. •o>-:u:i..i cluu W.1Lltc1 too Ahr 7, 19:-:h, l!.t the y,i.at ..,ffic6 a;1 Au~tin. Tt!xa.• • ·~mlt· t Alit •f Au.:~•t ... 4, 19.i7i Mc. A L"L EN Dl~TRIBUTION OF ~ERAGE FAM~LY DOLLAR AMONG FIVE PRINCl\AL BUDGET ITEMS IN TE X~S CITIES c::J I 0 0 D ll!2"ill UN T 111111111 Cl 0 1" IM G-CH CO\TI ~ UTILITI [I STATE souHt:~uuou 01 ~U"ll Hll I it I lHCM c1i·si or t1111G snnn. BURfAU or BUSINESS RESEARCH MERCEDES THE UNIVERSITY Of" TEXAS TEN CENTS PER COPY ONE DOLLAR PER YF..AR TEXAS BUSINESS REVIEW f iN,P' EX£S OF :B»usJNESS 1A·cT1v .1rY .l.N ltXAS ~\\':t'RAGC ·MONTH' -Or •1030 • 1100 ~. ··wit 11 ,G" .t 11• '('Wl"\.OYMl:lllT----UI 'l'A 'f A 0\.L. S 2~ l TEXAS BUSINESS REVIEW Business Review and Prospect Physical output of industry and trade in the Nation during the past few !"eeks .has r~mained a?out. stati?nary according to Barron s busmess mdex, which 1s adjusted for population growth, long-t~rm trend, and seasonal variation. On May 25th, the mdex stood at 108.0, as compared with 107.8 on April 2.0th. Thus, it a~pea~s that the sharp rise in the production of war material~ is still being approximately offset by a . c.o~respondmg decline in the production of goods for c1v1han use. It is probable that this situation W:ill continue _f?r a few more weeks, after which the mdex measurmg total physical production in the country at large should show a strong and sustained rise. The recent announcement of an impending order by the W. P. B., designed to limit new plant expan~ion to establishments already under way and to those which are indispensable in the production of an adequate supply of essential war materials, is expected to have far-reach­ing results. For example, t~ere will be less co~petition for steel plates between ships and new factories; the pressure on the machine !ool industry will be ~ased but will remain strong; machme tools which otherwise w~uld have been needed for new plants will under the revised plan be used to increase the output in pre.sent plants and those which can be converted; raw matenals such as copper, which would have gone .into the buildin~ o_f new plants, will under the prospective plan .be used m . the existing plants and those well advanced m construction. Finally, the proposed plan shoul~ prove a boon to small industrialists who can do a good 1ob on war contracts but not good enough to have competed with a n~w fact~ry and new equipment. Thus, many compan~es which might otherwise have been forced out of busmess may be revived by the pressure that Donald Nelson's order will create for maximum utilization of existing facilities. Other developments of far-reaching significance are proceeding at a rapid rate under the stress of war, and many of these will exert a profound influence on the peace-time economy whi~h will follo~. For. example, precision tools far superior to those h~th~rto ~n use a're rapidly bein~ developed; great emphasis 1s be!n.g placed upon the training of large numbers of techmc1ans and workmen· new materials and new plant capacity for producin~ them are being perfected. Included in the category of these new activities are not ?nly the ma?y­fold expansion of aluminum and magnesmm producllon. and the development of plastics and synthetic rubber but also the expansion of the older products such as new alloys of steel and other metals; new substitutes for tin, chromium, and nickel for protective coatings; resin­bonded plywoods and other wood products; new paper and other substitutes for rubber and cork in many of their uees; new uses of textile fibers to replace burlap and silk and wool. TEXAS BUSINESS Readjustment resulting from the conversion of civilian activities to war work noted above with respect to the Nation as a whole has its counterpart in Texas with the result that the sharp gains in the output of the war industries are about offset by declines in numerous civilian industries. As in the country at large, more­over, there are indications of a positive sustained upward trend in Texas industry and trade which should soon become apparent. The composite index of industry and trade in Texas during April remained practically unchanged from the preceding month but was twenty-four points, or more than twenty-two per cent, above April last year. INDEXES OF BUSINESS ACTIVITY IN TEXAS April 1942 April 1941 March 1942 Employment ·-----------·--------------­-113.3 97.6 113.1 Pay Rolls ------------------------------­Miscellaneous Freight Carloadings 152.7 107.7 150.2 (Southwest District) -------------------­106.6 Runs of Crude Oil to Stills. _______________ 189.0 Department Store Sales_______ _______________ 120.0 Consumption of Electric Power __________ 173.1 75.2 212.8 114.0 151.9 110.7 202.0• 120.5 168.8* COMPOSITE INDEX --------------------­ 135.2 111.2 135.4* •Revised. Employment in Texas non-agricultural industries in­creased only slightly from March to April, but total pay rolls increased from 150.2 per cent to 152. 7 per cent of the 1929 level, or a gain of 1.6 per cent during the month. Electric power consumption for all purposes-­industrial, commercial, and domestic-increased more than the normal seasonal amount from March to April causin~ this component of the index to rise from 168.8 to 173.1. The remaining three components of the busi­ness index showed varying amounts of decline after adjustment for seasonal variation was made. Depart­ment s~ore sales changed only slightly, the index having moved down one-half point from 120.5 to 120.0. The index of runs of crude oil to stills dropped substantially from 202.0 to 189.0, and miscellaneous freight carload­ings from 110.7 to 106.6. FARM CASH INCOME Cash income from agriculture in Texas during April continued the sharp year-to-year increase observed in each of the preceding months of the current year. As computed by this Bureau, farm cash income for the month of April totalled $49,199,000 compared with $30,­681,000 during the corresponding month of 1491 (see footnote at bottom of table) , an increase of more than sixty per cent. During the first four months of the current year, the computed aggregate cash income from For Other TeXQ.$ Da1a, See Statistical Tables at the End of This Publication TEXAS BUSINESS REVIEW Texas agriculture was $160,379,000, or nearly seventy per cent greater than the $94,968,000 for the correspond­ing period of 1941. INDEX OF AGRICULTURAL CASH INCOME IN TEXAS Average month 1928-'32=100% April March April Cumulative Income Distric t 1942 1942 1941 Jnn.·Apr., 1942 Jan.·Apr., 1941 (000 Omitted) 1-N 141.7 112.5 $18,154 $8,585 -·--------251.9 1-439.4 182.3 15,455 9,200 ----·---253.5 225.4 133.6 14,966 10,129 2 -------------187.6 3 --------189.6 189.6 103.5 7,258 4,631 4 -------252.2 219.1 128.6 26,029 12,036 5 ------------113.6 111.2 75.4 4,788 3,161 233.6 159.5 10,445 7,9606 ------------217.3 169.0 126.5 10,157 7,115 7 ---------·---181.2 193.2 106.5 11,718 6,935 8 -----------158.9 230.8 118.0 16,108 9,788 9 ---------182.4 10 -----------141 .7 181.3 115.0 7,741 5,654 ------238.8 10-247.1 119.7 17,560 9,774 TATE __ 197.3 205.3 123.0 160,379 94,968 Non:: Fnrm cuh income as computed by this Bureau underetatee actunl farm cash income by from 6 to 10 per cent. This situation resu1t1 from the fact that means of securing complete local marketings, especially by truck, hnve not yet been fully de•eloped. In addjtion, means hnve not yet been develo)Jed for computing cub income from all ag:riculturol specialties of local importance in scattered areu throughout the State. Thie situation, however, doee not impair the accuracy of the indexes to any appreciable extent. Contributing most to this year's April increase in farm cash income over a year ago was the sharp rise in the returns from the sales of cattle-$20,526,000, com­pared with $11,978,000--an increase of more than seventy-one per cent. Incomes from the other classes of livestock-calves, sheep, and hogs--showed relatively little change. Substantial gains in farm cash income were also derived from eggs, which during April this year brought the farmers of the State $5,866,000 compared with $2,644,000 during April last year, or an increase of 122 per cent; from milk and milk products which brought $5,678,000 compared with $4,007,000 during April last year, an increase of forty per cent; and fruits and vege· tables, from which $4,284,000 was derived during April this year compared with $2,238,000 during the cor· responding month last year, a gain of ninety per cent. Although the outlook for crops is not optimistic in the areas which were subjected to excessive rains and flood conditions during the past few weeks, the general agricultural situation for the State as a whole appears relatively favorable. This situation is especially true with respect to livestock and livestock products of which the marketings and prices are expected to be well maintained. F. A. BUECHEL What of Further Industrialization in Texas A comprehensive view of the potentialities of the chemical industry in Texas has to comprehend the broad pattern of industry in general and the chemical aspects of industry in particular. The chemical industry in Texas can no more be lodged within the confines of water-tight compartments than can the oil industry. Provincialisms in science and technology and industry can have hut little place in the world of today. Abso­lutely indispensable is a point of view that is at once inclusive and comprehensive and at the same time sub­stantial and tangible if the challenges of the times are to he met positively and effectively. But it is precisely the gravity of these challenges that calls in no uncertain terms for a reappraisal of the present situation, for the marshalling of the best knowledge attainable, nnd for the highest possible contributions from research. And can anyone question the magnificient opportuni­ties these challen11:es bring to Texas, if Texas is to take a position of leadership commensurate with the array of natural resources which the State has to offer those in­dustries that are assuming a predominant position in the American economy. Most difficult of problems, however, is that of getting before Texas leadership a proper appreciation of the patterns and quantity of the natural resources of the State and of the part these natural resources can well play in the evolving pattern of industrial needs. To attack these vital problems successfully will de· mand a sure knowledge of the characteristics and in­herent qualities of industry on the one hand and the relationships of industrial growth to natural resources on the other. An historical perspective of the chemical industry, as is also the case with industry in general, reveals a definite succession of patterns of impingements of institutional factors and forces as they have reacted upon various groups of the world's natural resources. The intricate interrelations exemplified in the growth and extension of the chemical industry, the wide rami· fications manifested in its several lines of development, and the revolutionary effects wrought by its progressive developments upon an ever widening theater of opera· tions furnish materials vital for the study and analysis of the fabric of institutional factors provided on a scale equalled perhaps by no other phase of industrial evolu· tion. The dynamics of the chemical industry is a function of the dynamics of science and technology; the dynamics of science and technology applied to the study and utilization of natural resources is the basic factor of the human quest for the conquest of scarcity, and from the point of view of human welfare is to be regarded as obviously a positive institutional factor. The "statics" of an industry, whether the chemical or some other industry, if continued for any considerable TEXAS BUSINESS REVIEW period of time, and manifested in rigid control features, by cartel!! or other organized methods, have to be seen as institutional factors of the negative sort, bent upon the maintenance of scarcity. It may be surprising to con­ sider the maintenance of scarcity through such organized means as cartels as a manifestation of the institutional factor of price economy. The philosophy of scarcity stems from the limited concepts of the Middle Ages. But the modern world cannot be circumscribed by the narrow knowledge-range of even the 18th century; the world of the 20th century is a function of the growth of science and the problems engendered by the application of a continuously evolving science to the ever-widening utili­ zation of natural resources on a world-wide scale. Seen in the time perspective, the dynamics of science and technology in association with the evolution of what is ordinarily regarded as chemical industries constitutes one of the most magnificent chapters in human history; this perspective is one of the indispensable factors re­ quired in appraising the potentialities of the chemical industry in Texas. For it must be realized that we are £ace to face with new problems, whose solution requires considerably more than the application of conventional methods. The frontier of today consists not in the sub­ jugation of new lands but in a comprehension of the new problems and the mastery of new technologies for deal­ ing with these problems. The new frontiers of knowl­ edge are no less fascinating than the western frontier of a century ago. And in a broader, in a more fundamental sense, the historical development of an industry is more than a mere listing of gadgets as they have appeared on the industrial stage and a compilation of production data; basically, the study of the growth of industry belongs to the field of social institutions, in which supply and demand curves and price data tell us little of what the fundamental factors of the industry really are. There is, however, another phase of industry study which also has been too much smothered by the con­ventional though superficial methods that pass for in­dustry analyses. This phase is concerned with funda­mental features of the natural resources utilized and the technologies employed in utilizing natural resources in modem industry. Natural resources are earth materials, and as such the investigation of their characteristics and properties has been carried out in the natural sciences. To attempt to analyze or evaluate natural resources without the knowl­edge and methods embodied in the natural sciences and the use of the scientific method is of course an impossi­bility; such superficialities obviously cannot contribute to progress, and they are likely to delay or retard. A similar line of reasoning is obviously applicable to analyses and evaluations of technologies, for these likewise are based primarily upon the natural sciences. The social scientists have in general taken for granted both natural resources and technology, and the field of raw material!! as well, except for a type of price studies of the latter. Social scientists, such as Veblen, for instance, primarily concerned with the evolution of institutions have clearly seen certain phases of the natural resources picture and of technology because of the force of impact of these subjects upon modern economic trends. To such institutional economists must go credit for calling for a more complete evaluation of the place of natural resources and technology in social development. But even the institutional eco­nomist is in no position to analyze or evaluate the funda­mental factors inherent to natural resources and tech­nology, unless he has the adequate scientific ground­work and is willing to use the scientific method; and when he attempts to deal with natural resources and technology without a scientific background he neces­sarily relies upon opinion rather than science. Reliance on opinion inevitably means reliance on biases of one sort or another rather than upon an objective point of view, the aim of which is truth and comprehensive understanding. Even the institutional economists have failed generally to recognize that science itself is an institutional factor and that the drama of the growth of the sciences is part and parcel of institutional and social development. In today's world a lack of knowledge of the natural sciences and a lack of appreciation of their place in modern society is nothing less than tragedy. One aspect of the tragedy is, and it is rather obvious, that the use of unscientific methods in dealing with science or the fields for which science only provides the background must result in confusion and waste motion. The other aspect is that scientific studies and analyses of natural resources and technology not only contribute to a comprehensive understanding of these fundamental factors as related to industry, per se, but also that such studies provide in themselves magnificient opportunities for an understanding of the "particular go" of things in today's world. Without such studies we are like fishes with poor eyesight becoming adjusted to the darkness of underground caves. Furthermore, the full-fledged use of the scientific method in the social sciences is still to be realized. Fortunately, we have available the results of scientific investigations which give a comprehensive view of natural resources and of technology, and the great in­vestigators in these fields have always been concerned with the vital consequences of their scientific knowledge as it pertains to human welfare. Unfortunately, many of the results of these scientific investigations have not yet reached the text-book stage. Moreover, we have only begun to appreciate, for instance, the vital significance of contributions made by the great body of American scientists, and of what these contributions mean to the American people and the American way of life. Per­haps the stress of emergency and crisis will aid in crystallizing some of these bigger concepts in such a manner that henceforth they cannot be pushed aside or relegated to inconspicuous places. Every period has TEXAS BUSINESS REVIEW its own problems to solve, and the challenges of the time can neither be by-passed nor solved by rote. But of what concern are these things to the problems of Texas industry or more particularly the chemical industry of the State? What are the resources of the Texas chemical industry? One basic factor is the vast and complex background of scientific knowledge of natural resources and the technology for utilizing such resources which has been patiently worked out by the preserving leaders of science during a long period of time in the past; this knowledge is one of the greatest of our resources, one that is absolutely necessary in appraising our potentialities. Another basic factor has to do with the requirements for materials, and for what kind of materials will be required in the near future. Ours is an industrial age, an age of multiple industries, each a complex within itself, but all complexly interrelated. From the stand­point of basic economics the future of our raw materials like cotton and wood pulp, or petroleum and natural gas, or the brines containing both metals, like mag­nesium, and non-metals, like common salt or potash, will have to be appraised in what they can contribute to modern industry which in the nature of the case cannot stand still. And modern industry is concerned with what the large groups of raw materials can contribute: hydro­carbons and free carbon; cellulose and lignin, starches and fats; the light metals like aluminum and magnesium; the steel alloys and the non-ferrous metals; and the alkalies and brines. The long-range solution of the agricultural surpluses of grains, of corn and wheat, lies in what will be done industrially, for instance, with the starch materials thus produced in large volume, and the industrial solution apparently will be through the agency of modern industrial chemistry. We shall have to reappraise the consumption poten­tialities for our most common raw materials in terms of how modern technology can and will make them fit into industrial demands. "Old" industries fall into a static attitude by endeavoring to maintain their former holds or position in the market. "New" industries are dynamic partly because they are based upon a con­tinually evolving technology-that is, they partake more of the nature of modern science which is ever on the march-partly because they can advantageously meet the new demands of the market. And the new demands of the market in turn are dependent funda­mentally upon a wider and more effective use of the world's natural resources--for material goods and material welfare inevitably rest upon the materials and forces of nature. As to problems of marketing Texas products, the basic consideration concerns what industry in the future will be, what raw materials it will require, and where it can get these raw materials most ad­vantageously. The mere exchange features or even the engineering problems in providing transportation facili­ties are minor factors in comparison with the problem of getting at the potential demands of industry and the questions as to what regions and what natural resources will be able to supply these demands. Still another basic factor in appraising the potentiali­ties of Texas industry consists in what raw materials Texas has to offer modern industry, and from a broad point of view, it consists in what Texas materials can contribute to the expanding chemical industry, consid­ering the chemical industry in the broad sense. The effective use of cellulose materials in the pro­gressively advancing demands of industry in such lines as pulp and paper, in rayon and other synthetic fibers, in plastics and synthetic wood materials is by and large a chemical problem, and will become even more so in the future. The American oil industry has become within recent years a full-fledged, synthetic organic chemical industry. Our great oil refineries have grad· ually been transformed into vast and complex chemical plants producing high-octane aviation gasoline, toluene, butadiene, alcohols, glycerine, and even such products as phenol and ethylene in comparatively large amounts. Most of these substances are to be regarded as raw materials for still further chemical developments than have hitherto been made of them. Even a dim perception of the potentialities thus being brought into the realm of actuality surpasses the limits of scientific imagination of even a few years past. And there are other raw materials that will have to be reappraised. What, for instance, may well be the results of the wide scale application of the process of "molecular distillation" to the industrial uses of vege­table oils? We are told that Russia is successfully making synthetic rubber from white potatoes, by trans­forming the starch of the potato to ethyl alcohol by fermentation, and then producing butadiene from the alcohol by a catalytic process. Concerning our problem of synthetic rubber Sydney Self has recently written as follows in The Wall Street Journal, May 5, 1942: Oil and chemical research men, working on synthetic rubber, are embarrassed by the fact that they have the key to a magic cupboard filled with treasures, and scant time to explore it. They are haunted by the knowledge that new test-tube cfi&. coveries lie just around the corner. Specifically they are afraid that any new synthetic rubber plant built today may become obsolete overnight. It bothers the chemists and engineers to set up an industry to make good synthetic rubber, which they now can do, when they know that before they can get it working they are almott bound to find a way to make a better synthetic rubber. Normally the pattern of research is to follow good ways by better ways, with plenty of time for tests and orderly develop· ment. But war calls for production instead of experiment&· tion. There isn't time to wait for the latest new ideas. Yet new ideas are born faster than ever. For example, although the first half of this nation's 700000 ton synthetic rubber program is going ahead as fast as loufble, because the armed forces must have an ample supply o rubber soon, regardless of cost, the remainder of the program may await development of new ideas. If it could be called delay it is a strategic delay actually designed to attain the final goai more quickly. . There is a good ~ossibility. that a synt~etic rubber plant started six months hence wtll come mto production more quickly, provide a much larger output and cost a great deal less than any already under construction. Chemists are talking today of future plants w~ich might double the quantity and cut the cost in half. There is also every reason to believe that the quality of the synthetic rubber that will be turned out finally will be far TEXAS BUSINESS REVIEW mperior to any of the types made now. This is simply the rule of IJllthetic chemistry, which mean.a that it is composed mainly of carbon and hydrogen molecules, just as natural rubber is made up of theee qualitiee. Organic chemicals can be made from coal or from oil or from vegetable matter, but petroleum is the molt plentiful and convenient raw material source of synthetic rubber. The main type of synthetic rubber planned under the U. S. program ia called "buna" which starts with a basic raw material called butadiene made chiefly from petroleum. The other in­oedient is Btyrene, widely uaed as a plastic and which is made from either coal or oil. Butadiene ia one of the hundreds of organic compounds which are found in petroleum or made by re-arranging the petroleum molecules. There are excellent proceues for making butadiene, now in operation; ~l'OCCt!llell which involve several laborious and ~en­live etepa of piecing the molecular building blocks together. However, in half a dew.en laboratories, all of which have been concentrating on this vital problem for the last year or so, aeveral atartling new synthetic rubber methods already have i-n found. Big advances are being made in quality. For example, while better butadiene-making procesees are under way it has been found that it may not be necessary to use butadiene at all to make rubber. There are other petroleum compounds, other "dienea" perhaps, that can be re-arranged to give even better typea of rubber than the buna type. What we are seeing now under the stress of war de­mands is the emergence of a new industrial pattern in the United States, a pattern which will provide the bases and establish the broader outlines for industrial develop­ments during the next decade or so. Of course, this evolving industrial pattern is being paralleled by funda­mental adjustments in American economic life. And these new patterns are being set by the "new" industries-those embracing the light metals as alum­inum and magnesium, the new developments in steel alloys, as exemplified by beryllium to take one example, the new fields in synthetic organic chemicals using raw materials provided by petroleum and natural gas, the new fields in synthetic fibers and plastics. Some of the "old" industries, like petroleum refining, are being transformed, lock, stock and barrel, by the wide-scale !ldaptation of new processes; other "old" industries, less adaptable for one reason or another, will have increas­ingly hard going in years to come. How Texas will fit into this evolving pattern of American economy will not he determined by grandiose expressions or by window-dressing labels; there is no royal road to getting these tasks done. But the time has come to take stock of the factors that can contribute in a worthwhile manner to a concrete realization of the magnificient potentialities that already are appearing on the horizon. Foresight based on full knowledge is more satisfying them hindsight is likely to be. ELMER H. JoHNSON Texas Statistical Council Proceedings Proceedings of the May I, 1942, meeting of the Texas Statistical Council have been published and will be sent to all members of the organization. The program included addresses presented by Mr. B. F. Vance, State Administrator, Agricultural Adjust­ment Administration, College Station; Mr. C. J. Cramp­ton, State Director, Contract Distribution Division, War Production Board, Houston; Mr. James H. Bond, State Director, U.S. Employment Service, Austin; Mr. Frank Scofield, State Administrator, Defense Savings Staff, Austin; Mr. Hulon Black, Director, The University of Texas Development Board; Mr. Henry W. Rahn, Tech­nical Director, Southern Alkali Company, Corpus Christi; and Mr. Elmer H. Johnson, Bureau of Business Research, The University of Texas. Mr. W. L. Pier, Vice Presi­dent, Fort Worth National Bank, Fort Worth, and Mr. Richard B. Johnson, U.S. Bureau of Foreign and Domes­tic Commerce, Dallas, were the discussion leaders. Those, other than members of the Council, who desire copies of the Proceedings are asked to communicate with Dr. F. A. Buechel, Secretary of the Texas Statistical Council. There is also a limited number of the Pro­ceedings of the October 24, 1941, meeting available for distribution which may be had upon request. CLARA H. LEWIS Demand for Cotton in War Time World wars such as we are now in have a tremendous effect on the demand for cotton, botb. in terms of quan­tities used and qualities required. Cotton and cottonseed are two of the world's most vital war commodities. As was pointed out in my article in the March number of the REVIEW, they are major sources of four vital commodities-food (cottonseed oil), fiber, high protein feed, and high explosives. Notwithstanding this greatly increased need for these products of cotton, occasioned by war, the records show that the world consumption of raw cotton actually de­clines during a world war. From the beginning of the first World War in 1914 to the year 1918-19, the world consumption of all cotton declined about twenty-five per cent. This contradictory situation is true because Europe outside of Russia still has over fifty per cent of the world's cotton spinning spindles and grows less than one per cent of the cotton it consumes. Moreover, Japan, the second largest cotton consuming country in the world, grows only a small per cent of its normal consumption and is on the wrong side in this war to get substantial imports. It seems possible, then, that the blockade may reduce world cotton consumption during this war to an even greater extent than during the last war. Foreign consumption of United States grown cotton has been greatly reduced now as compared with the last war. The low of foreign consumption of United States cotton during the first World War occurred during the year 1918-19 with 4,300,000 bales, and foreign con­sumption of United States cotton will scarcely exceed a million bales this year. In spite of the drastic decline in foreign consumption of United States cotton, it is possible world consump­tion of our cotton during this war will probably not reach as low a level as during 1918 because of the great increase in consumption in the United States. Cotton consumption in the United States increased from 5,600,000 bales in 1914 to 6,800,000 bales in 1917. So far during this war United States consumption has in­creased from 6,900,000 bales during 1939-40 to 9,700,­000 bales this past year, a prospect for over 10,500,000 bales this year, and a prospective demand at least for over 12,000,000 bales next year. CHANGING DEMAND FOR QUALITIES The above are extremely important facts to be taken into account in shaping cotton production programs in the United States, both as to quantities and qualities to be produced. It seems evident from the demand for cotton in the United States that production should be increased to a prospective 13,500,000 bales to insure against a short crop due to bad yields. Moreover, it is impossible to grow a crop all of which is suitable to meet United States demands as to grade and staple. The fact is United States mills in the main are set up to manufacture both the medium grades and staple lengths of cotton. According to a survey made by the United States Department of Agriculture in 1928, over sixty-three per cent of the cotton being consumed in the United States mills was Middling and Strict Middling, and two other grades, Strict Low Middling and Good Middling, step that up to about eighty-four per cent. According to the above authority, eighty-five per cent of the cotton consumption in the United States is % to and including li2 inch. The requirements of the war have increased the demand for cotton 1n inch and longer, but have likewise tended to decrease the demand for the shorter staples. The fact is, foreign markets took the big end of our highest grades and lowest grades and off-colored cottons and short staples. American cotton growers need to take these facts into account in selecting seed to be planted and in choosing methods of harvesting. During the first World War, Low Middling went as low as 1,000 points off Middling, and Good Ordinary to over 1,500 off. A. B. Cox COTTO BALA CE HEET FOR THE UNITED STATES AS OF MAY 1 (Jn Thou ands of Running Bal Except as Noted ) Yea r 1932-1933 1933-1934 1934-1935 1935-1936 1936-1937 1937-1938 1938--1939 1939-194{) 1940-1941 1941-1942 -----­----­--·-·--­ Carryover Aug. 1 9,682 8,176 7,746 7,138 5,397 4,498 11,533 13 033 10,596 12,367 l mpor11 to May I• 96 112 83 102 167 99 108 123 119 t Final Ginnings 12,710 12,664 9,472 10,417 12,130 18,242 11,621 11,477 12,287 10,489 Total 22,488 20,952 17,301 17,657 17,694 22,839 23,262 24,633 23,002 22,856 Consump -tion to May l 4,219 4,458 4,116 4,658 6,017 4,430 5,153 5,955 6,993 8,245 Exports to May 1 6,521 6,485 3,986 5,167 4,762 5,034 2,964 5,695 885 t Total 10,740 10,943 8,102 9,825 10,779 9,464 8,117 11,650 7,878 8,245 Balance May l 11,748 10,009 9,199 7,832 6,915 13,375 15,145 12,983 15,124 14,611 •Jn 500-pound bales. fFigurea not available. The cotton yea r bec"ins August 1. TEXAS BUSINESS REVIEW ' EMPLOYMENT AND PAY ROLLS IN TEXAS April, 1942 Estimated Number of Percentage Change Estima ted Amount of Pcrceutnro Clurngo Workera Employed* from from Weekly Pay Roll from from March April March April March April Mnrch April1942(1) 1942C2> 1942 1941 1942(1) 1942C•l 1942 1941 MANUFACTURING All Manufacturing Industries _153,981 154,449 + 0.3 + 9.1 3,577,652 3,664,009 + 2.4 +26.3 Food Products Baki ne 6,986 7,012 + 0.4 + 8.4 162,678 168,089 + 3.3 +18.2 Carbonated Beverages------2,567 2,612 + 1.8 -10.4 67,027 69,507 + 3.7 -3.7 Confectionery 991 903 8.9 + 6.4 10,456 9,541 8.7 + 6.7 F1our Milling ---·-----------­ 1,972 2,123 + 7.7 + 12.8 37,206 39,967 + 7.4 + 17.9 Ice Cream -------1,114 1,114 ± (S) + 14.4 22,652 23,830 + 5.2 +22.4 Meat Packing -------------­ 5,338 5,265 1.4 +10.5 134,122 140,160 + 4.5 +42.9 Textiles Cotton Textile Mills 7,183 7,104 1.1 + 4.9 132,087 133,415 + LO +28.8 Men's Work Clothing ____ -----· 4,343 4,502 + 3.7 + 16.4 58,919 65,921 + 11.9 +39.6 Forest Products - Furniture ------------2,099 2,114 + 0.7 3.3 37,186 38,268 + 2.9 7.1 Planing Mills 2,189 2,251 + 2.8 + 3.0 54,248 56,408 + 4.0 +35.1 aw Mills __ 17,518 17,223 1.7 + 4.6 235,220 230,938 1.8 + 8.4 Paper Boxes 645 636 1.5 + 3.6 11,907 10,695 -10.2 -4.0 Prin.tin({ and Pnblishing ommer ial Printing ______ 2,368 2,451 + 3.5 + 1.7 60,042 66,780 + 11.2 + 16.3 Newspaper Publi bing _____ 4,917 5,186 + 5.5 + 5.4 119,283 125,384 + 5.1 + 0.2 Chemical Prodncts Cotton Oil 3,212 2,549 -20.7 3.7 32,210 27,866 -13.5 +16.8 Petroleum Refining _______ 22,213 22,271 + 0.3 + 9.7 902,553 865,296 -4.1 +23.2 Mills ----------­ 'tone and Clay Products Brick and Tile 2,103 2,231 + 6.1 + 3.6 29,099 32,927 + 13.1 +18.5 Cement 1,346 1,251 7.1 +25.6 45,156 44,577 1.3 + 48.9 Iron and teel Products Structural and Ornamental Iron_ 2,546 2,600 + 2.1 + 8.4 58,806 60,586 + 3.0 +24.6 NON MANUFACTURING Crude Pe troleum Production _ 30,406 29,928 3.7 0.7 1,101,873 1,077,762 2.2 + 6.1 (4) (4) co (<) Quarrying + 1.6 +27.2 6.8 +54.5 (0 (0 co (<) Public Utilities _ + 1.2 + 7.4 + 1.5 + 13.8 Retail Trade _ 187,100 188,216 + 0.6 4.4 3,601,665 3,662,627 + 1.7 + 3.4 Wholesale Trade 64,093 64,798 + 1.1 + 6.1 1,992,437 1,988,059 + 0.3 + 9.4 Dyeing and Cleaninar ____ 2,427 2,558 + 5.4 + 7.8 39,081 40,785 + 4.4 + 19.0 Hotels ------------------------15,825 15,655 Ll 0.2 196,319 194,131 1.1 + 3.6 Power Laundries _ 11,658 12,395 + 6.3 +13.1 155,390 170,805 + 9.9 +20.3 CHANGES IN EMPLOYMENT AND PAYROLLS IN SELECTED CITIEs c•> Employment Pny Rolls Employment Pay Rollo Percentaee Change Percentage Change Percentage Change Percentage Change Ma r., 1942 Apr., 1941 Mnr., 1942 Apr., 1941 Mar., 1942 Apr., 1941 Mar ., 1942 Apr., 1941 to to to to to to to to Apr., 1942 Apr., 1942 Apr., 1942 Apr., 1942 Apr., 1942 Apr., 1942 Apr., 1942 Apr., 1942 ± (3) Abilene -------+ 10.6 0.3 + 16.8 Galveston + 3.5 + 31.6 6.6 + 45.4 Amarillo ------5.2 1.9 0.4 + 13.6 Houston + 0.6 + 9.5 + 0.9 + 20.7 Au tin 1.1 + 7.9 2.0 + 5.7 Port Arthur____ + 0.5 + 0.5 3.9 + 18.5 Beaumont + 10.5 + 138.6 + 24.5 +243.0 San Antonio ____ + 6.6 + 2.1 + 20.3 CO) Dallas -----= 2.6 + 0.5 0.1 + 16.0 Shennan ---------+ 4.9 3.7 + 8.4 + 11.1 El Pao ----+ 0.6 + 10.5 + 4.3 + 26.3 Waco + 4.8 + 12.8 + 4.7 + 21.9 Fort Worth _ + 1.4 + 12.5 + 8.0 + 39.8 Wichita Fall _ 10.8 8.9 17.0 + 2.2 STATE + 0.1 + 15.5 + + 41.4 -------1.7 ESTIMATED NUMBER OF EMPLOYEES IN NONAGRICULTURAL BUSINESS AND GOVERNMENT ESTABLISHMENTSc7> 1940(1) 1941 (1) 1942 1940Cll 19•11 (1) 1942 January ----------944,000 1,052,000 1,115,0000) July -----------------------------983,000 1,101,000 February ---------943,000 1,092,000 1,131,000(1) August -----------------------988,000 1,113,000 March --------%5,000 1,086,000 l,153,00QC2l September ____________________ l,009,000 1,134,000 April ---------%3,000 1,097,000 October ___________________l ,022,000 1,141,000 May ------------983,000 1,077,000 November _______________l ,048,000 1,161,000 June 982,000 1,084,000 December _______________l,084,000 1,177,000 •Doe1 not include proprieton~ 6rm membeu, officere of corporation1, or other principal executives. Factory employment excludes also office, aalee, technical and pofe11ional personnel. O> Revi1od. <•>subject to revi1ion. <•>No change. <4) ot available. Le a than l / 10 of one per cent. C'7)NBot includinLagbself5-eml?l~yed pe?M>ns, casual workers, or domestic eervanta, and e:s:clueive of military and maritime pononnel. Theae fi.curee are furuU.bed by t he ureau o1or tah1tic1, U.S. Department of Labor. ~epared hfrom .reJt~Ttl from rqreeubeolitative Texa1 e1tablilhmena to the Bu_reaa of Buaineu Reeearch coOperatinc with the Bureau of Labor Stat:Utica ue to t • nauona •mereency, P 'caHen of data for certain indutriee i1 b eing withheld until further notice. · APRIL RETAIL SALES OF INDEPENDENT STORES IN TEXAS Percentage Change1 lo Dollar Salea No. of April, 1942 April, 1942 Year 1942 Firmt from from from Reporting April, 1941 Mnrch, 1942 Ycnr 1941 _ (1) TEXAS 1,119 + 2 + 5 STORES GROUPED BY LINE OF GOODS CARRIED: _ (l) APPAREL 124 + 12 +20 Family Clothing Stores -----------------­32 + 19 + 4 + 23 Men's and Boys' Clothing Stores ------43 -1 4 +18 Shoe Stores 15 + 16 + 8 +24 Women's Specialty Shops 34 +16 2 +19 AUTOMOTIVE* 77 -70 + 3 -69 Motor Vehicle Dealers 73 -71 + 3 -71 COUNTRY GENERAL ---·----------------------­104 +18 + 2 +21 DEPARTMENT STORES _ 57 + 12 + ro + 16 DRUG STORES -----------------------------------146 +16 -1 +12 DRY GOODS AND GENERAL MERCHANDISE __________________ 28 + 12 + 1 + 22 FILLING STATIONS 48 -10 -6 + 7 FLORISTS 24 -9 +27 -10 FOOD• -----------·---166 +28 + 6 + 26 Grocery Stores __ ---------50 +35 + 10 +27 Grocery and Meat Stores -------------------------------·--·­108 +25 + 4 + 25 FURNITURE AND HOUSEHOLD*-----------------------­68 -1 -9 + 8 Furniture Stores 58 + 1 -7 + 9 JEWELRY . 28 +11 +13 +13 LUMBER, BUILDING, AND HARDWARE* 205 +18 3 +22 Fann Implement Dealers -------­10 + 9 4 + 28 Hardware Storee -----64 + 12 1 +26 Lumber and Building Material Dealers ___ _ 128 + 22 4 +18 RESTAURANTS 30 + 15 1 +12 ALL OTHER STORES -------14 + 24 -20 +44 TEXAS STORES GROUPED ACCORDING TO POPU­LATION OF CITY: All Stores in Citiee of­ Over 100,000 Population 175 1 + 4 1 50,000-100,000 Population 123 + 8 + 4 + 1 2,500-50,000 Population --------­544 4 -4 + 2 Less than 2,500 Population 277 + 9 +13 + 2 •Croup total include kinds of bu1iness other than the clueificatious Hated. Cl)Change of leS& than .5%. Non;: Prepared from reports of independent retail stores to the Bureau of BusincM Research coiipernting with the United States Bureau of the Ccneue. TEXAS CHARTERS April 1942 April 1941 M arch 1942 COMMODITY PRICES Domestic Corporations: apitaliza tion• --­umber --------------­ 508 56 1,021 89 742 89 April 1942 April 1941 March 1942 lassifi ation of new Corporation : Wholesale Prices : Banking-Finance ----­Manufacturing ------­Merchand i ing ------­Oil Public rvice ------­Real E tate Building ____ 1 7 13 2 0 15 3 15 26 8 0 11 1 4 11 4 0 55 U. . Bureau of Labor tatistics (1926= 100% ) Farm Prices U. . Department of Agriculture (1910--14= 100% ) ----------­ 98.8 83.2 110.0 97.6 146.0 Tra nspo rtation 1 2 4 u. . Bureau of Labor tatistics All Other 17 24 10 (1926= 100% ) ----------104.5 74.4 102.8 um ber capitalized at 5,000 umber capi talized at more Foreign orporation ( umber) less than 100,000 or 29 1 9 29 3 23 54 2 8 Retail Prices: Food (U.. Bu reau of Labor Sta-ti tic , 1935-39= 100% ) _____ 119.6 Dep't. tores (Fairchild's Publica­tions, Jan. 1931= 100% ) --------­113.4 100.6 95.5 118.6 112.5 •In thouunda. an: Compiled from records of the Secretary of State. APRIL RETAIL ALE OF I DEPENDE T STORES PETROLEUM I TEXAS Daily Average Production Number Percentage Chanee o! In Dollar Sal.,. (In Barrels) Firm• April, 1942 April, 1942 Re· from from porting April, 19-ll March, 1942 April April March 1942 1941 1942 TOTAL TEXA 1,119 + 2 + 5 Coastal Texas• ---------218,690 249,010 262,000 TEXA TORE GROUPED BY East Central Texas ____ 78,270 76,550 86,000 PRODUCT G AREAS: -East Texas --------------209,970 344,880 312,300 District 1----------82 18 + 1 Amarillo 23 -13 -11 North Texas ------------137,560 137,115 146,450 Pampa 16 -31 + 2 Panhandle -----------------83,270 177,850 84,800 Plainview 15 -7 -5 Southwest Texas ____ 143,300 192,660 187,450 _ (]) All Others 28 -3 West Texas ------------177,350 226,000 213,250 -10 D~ritt ~ m +14 STATE ------------------1,048,410 1,296,500 1,292,250 -12 Lubbo k 10 +10 +19 7 UNITED STATES _______ 3,484,610 3,620,910 3,740,300 All Others 19 District 2 ____ 80 + 17 1 Abilene 10 + 2 2 • Includea Conroe. + 34 + 3 NOTE: From American Petroleum Institute. Wicruta Fall --------10 All Others 60 +14 -2 See accompanying map showing the oil producing districts of Texu. Di trict 3 36 + 4 +m Di tri t 4 237 + 13 4 Gasoline sales as indicated by taxes collected by the State Dallas 37 Comptroller were: March, 1942, 121,240,000 gallons; March, 1941, -10 2 Denton 15 +