Production

M production, which had fallen very sharply in the final 4 months of 1937, experienced but slight variation during the first half of 1938. In the absence of the seasonal expansion usual during this period, the adjusted Federal Reserve index drifted moderately lower through May. In that month the production of nondurable goods turned upward, and was followed in July by an increase in the output of durable goods. For the remaining months of the year, production of both types of products rose to a point substantially higher than the low of the second quarter; although by the end of the year, total volume of manufacturing output was about 5 percent less than the 1937 average, on a seasonally adjusted basis. Despite the marked recovery in manufacturing operations in the last 6 months of the year, the volume of factory output for 1938 ŵ as nearly one-fourth below that of 1937, according to the Federal Reserve index. Data recently made available by the Bureau of the Census indicate that in 1937 the value of product of all manufacturing industries was 60.7 billion dollars. This was nearly twice the value of output in 1933, and only about 11 percent less than the 1929 value. As prices in 1937 averaged considerably lower than in 1929, the volume of output in 1937 was apparently not far below the 1929 peak, although on a per capita basis it was definitely lower. The population increase in the 8 years was about 7 percent. Only a few major industries produced a larger volume of products in 1938 than in 1937; and, with few exceptions, these gains were small. The changes in the available series for a wide range of industries are shown in figure 9. The difference in the declines in the durable and nondurable goods industries is clear from this chart. Fluctuations in Durable Goods.