ECONOMIC

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The unemployment rate for adult males would then be about 2 percent. Ifthe labor force consisted of an equal number of young men and adult men,the average unemployment rate would be 6% percent. But if it consisted offive times as many adults as youths, the average rate would be 32/3 percent.This illustrates how changes in the composition of the labor force cangreatly change the overall unemployment rate that is associated with a constantcondition of maximum employment for each group of the labor force.TABLE 7.—Unemployment rates by sex and age, selected years, 1956-73[Percent)Sex and age 1956196519721973All civilian workers:ActualStandardized for age and sex 14.14.14.54.35.64.94.94.1Males:16-19 years20-24 years25-54 years55 years and over.11.16.93.03.514.16.42.73.315.99.23.13.213.97.32.52.5Females:16-19 years20-24 years25-54 years55 years and over.11.26.34.13.315.77.34.32.816.79.34.93.515.28.44.42.81 The standardized rate was computed by assuming that the age-sex composition of the labor force remained unchangedfrom 1956 to 1973.Sources: Department of Labor (Bureau of Labor Statistics), and Council of Economic Advisers.One way of seeing how labor force composition affects the aggregate unemploymentrate is to weight the actual unemployment rates for each agesexgroup by the composition of the labor force at a specific time. If eachage-sex group shown in Table 7 is weighted according to its importancein the labor force in 1956, when unemployment averaged 4.1 percent, onefinds that the overall unemployment rate in 1973 would also have averaged4.1 percent rather than the 4.9 percent actually experienced. This wide dis-TABLE 8.—Composition of the civilian labor force, selected years, 1956—73[Percent]Sex and age 1956196519721973Total civilian labor force100.0100.0100.0100.0Both sexes 16-19 years..6.57.99.39.5Adult women20-24 years25-54 years55 years and over..Adult men20-24 years25-54 years55 years and over..29.43.720.65.264.15.245.613.331.84.521.26.160.26.641.711.934.36.122.16.156.47.738.110.634.66.322.45.955.88.037.810.0Note.—Detail may not add to totals because of rounding.Source: Department of Labor, Bureau of Labor Statistics.60
crepancy reflects the large increase in the proportion of the labor force madeup of women and young workers of both sexes, two groups whose unemploymentrates are substantially higher than the national average. Thehigher than average unemployment rates for women and for teenagers areclosely related to their labor force participation patterns. In addition totheir jobs, people in these groups have responsibilities in household managementor schooling, which tend to weaken their attachment to the laborforce. Since a new entry or a reentry into the labor force is generally followedby a period of searching, and hence unemployment, these groups havehigher unemployment rates almost by definition. Even among persons intheir early twenties, there are many who have not yet developed an attachmentto a specific occupation and who thus change their jobs frequently.Teenagers, persons in the 20 to 24 age group, and women 25 or olderaccounted for only 41 percent of the civilian labor force in 1956. By 1973they accounted for 52 percent (Table 8). The gap between the actual unemploymentrate and the fixed-weight unemployment rate follows thischanging proportion closely. The difference between the two rates was 0.2percentage point in 1965, 0.5 point in 1969, and 0.8 point in 1973.A number of other aspects of the employment situation suggest that ifwe were not at "maximum employment" in 1973 we were at least veryclose to it (Table 9). The average duration of unemployment declined, andthe proportion of the unemployed who were without jobs for 5 weeks orless was high, indicating a large turnover among the unemployed and relativelyshort durations of search for work. Only 38.7 percent of the unemployedhad lost their last job, which was nearly the same as the proportionin 1968, when the overall unemployment rate was 3.6 percent. AsideTABLE 9.—Aspects of labor utilization, selected years, 1948-73PeriodUnemployment rate(percent)TotalAdultmalesJob losersas percentoftotalunemploymentAverage monthly labor turnoverrate in manufacturing(per 100 employees)QuitsLayoffsNew hiresRatio ofhelp-wantedads to nonagriculturalemploymentAverageweeklyovertimehours inmanufacturing1948195319553.82.94.43.22.53.80)C 1 )0)3.42.81.9.6] .6.50)3.63.01.03.86.770)0)0)19595.54.70)1.51.02.6.732.7196519661967196819694.53.83.83.63.53.22.52.32.22.1C 1 )0)41.338.035.91.92.62.32.52.71.41.2.41.2.23.13.83.33.53.7.911.071.001.061.133.63.93.43.63.6197019711972197324.95.95.64.93.54.44.03.244.346.343.238.72.11.82.22.71.81.6L.I.92.82.53.33.9.86.76.913 1.073.02.93.53.81 Not available.2 Preliminary.311-month average.Sources: Department of Labor (Bureau of Labor Statistics) and The Conference Board.527-867 O - 74 - 561
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ECONOMICTRANSMITTEDTO THE CONGRESSF
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CONTENTSPageECONOMIC REPORT OF THE
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ECONOMIC REPORT OF THE PRESIDENTTo
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of the inflation rate of 1973, and
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or permit incentives—including hi
Page 16 and 17: people of an easy time. Like our pa
Page 19: THE PRESIDENT:LETTER OF TRANSMITTAL
Page 22 and 23: CHAPTER 3. INFLATION CONTROL UNDER
Page 24 and 25: Page7. Unemployment Rates by Sex an
Page 26 and 27: Page53. Maximum Percent Change in E
Page 28 and 29: We have specific problems, too, asi
Page 30 and 31: This curtailment of supply does, of
Page 32 and 33: consumption we would not have chose
Page 34 and 35: outside the food and fuel sectors a
Page 36 and 37: about $14 billion from deficit to s
Page 38 and 39: 8 percent, at annual rates. Continu
Page 40 and 41: A third method, which seems to have
Page 42 and 43: DEVELOPMENT OF LOW-COST ENERGY FOR
Page 44 and 45: would otherwise have been invested
Page 46 and 47: TRANSPORTATION REFORMLast year the
Page 48 and 49: constraints. Restrictions on entry
Page 50 and 51: In early 1974 the Commerce Departme
Page 52 and 53: Consumer SpendingConsumer expenditu
Page 54 and 55: Chart 1Changes in GNP, Real GNP, GN
Page 56 and 57: During the fourth quarter the downt
Page 58 and 59: A number of points may be noted abo
Page 60 and 61: income do not appear to have played
Page 62 and 63: Chart 2Changes in Real GNPPERCENTUN
Page 64 and 65: of essentially declining participat
Page 68 and 69: from job losers, the remainder of t
Page 70 and 71: to maintain a somewhat larger work
Page 72 and 73: Chart 3Changes in Selected Price Me
Page 74 and 75: TABLE 12.—Changes in selected pri
Page 76 and 77: production workers, and it is sensi
Page 78 and 79: the profits that companies report a
Page 80 and 81: Two measures of changes in income t
Page 82 and 83: About $8 billion of the growth in e
Page 84 and 85: effect of covered wage and employme
Page 86 and 87: Since these apparent stabilization
Page 88 and 89: MONETARY POLICY AND FINANCIAL MARKE
Page 90 and 91: lation requiring ceilings on all CD
Page 92 and 93: TABLE 19.—Offerings of new securi
Page 94 and 95: CHAPTER 3Inflation Control Under th
Page 96 and 97: (A more detailed presentation of th
Page 98 and 99: ate of advance in grocery store foo
Page 100 and 101: to the economy but also in the sens
Page 102 and 103: were imposed, limiting prices to th
Page 104 and 105: spurring of domestic inflation by e
Page 106 and 107: was more than twice as high in 1973
Page 108 and 109: wage increases in many cases, const
Page 110 and 111: TABLE 26.—Behavior of items in co
Page 112 and 113: Chart 6Changes in RelatedWholesale
Page 114 and 115: and natural gas. A complex set of f
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CHAPTER 4Energy and AgricultureFOR
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al gas have contributed to the low
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TABLE 30*—Wholesale prices, all i
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tion sector, which in 1972 accounte
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United States on oil imports, OPEC
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of old oil and prices of imported a
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LONG-TERM PROSPECTSThe price of imp
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important that the higher costs be
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improving the environment. The fund
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pollutants into the atmosphere will
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of research and rapid mechanization
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lion in fiscal 1972. Actually the a
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a minimum income. Unless prices fal
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The Administration supports the exa
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and estimates of some of these effe
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Since families typically pool their
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ability were not perfectly correlat
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Farm wages and farm income received
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TABLE 37.—Average usual weekly ea
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Chart 9Real Incomes for Men in Diff
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ecause they have acquired more expe
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whose owners or white workers have
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Several factors can be mentioned to
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y social pressures, however, which
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TABLE 42.—Relation of wage and sa
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ferences in their mix of occupation
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for public housing may be valued by
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8 to 20 percent for black females.
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sufficiently high to cover the addi
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TABLE 45.—Federal Government tran
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given to the problems of poverty du
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TABLE 47.—Trends in the employmen
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enefit increases greater than the i
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(Table 45). Medicare is chiefly des
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Public assistance is specifically d
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Then, subtracting equation (4) from
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policies, and the tensions among co
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In the fourth quarter the dollar ro
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which include trade, grants and oth
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tarily by foreign central banks, ev
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ply of oil, and by domestic price c
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in the United States. In view of th
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TABLE 52.—U.S. balances on intern
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esult from changes in market value
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TABLE 54.—Major changes in capita
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attempt was made to agree on a code
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The official price of gold was rais
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system, these demand changes were a
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What Pressures Should Be Exerted on
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The composition of reserves among d
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prices of approximately the same or
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tained, they would probably be felt
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Reducing Nontariff BarriersIn order
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Structural problems. Agreements on
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arrangements which are designed to
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capital and the means of putting th
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Canada and four smaller countries u
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currencies have appreciated relativ
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Effective Changes in Other Currenci
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Activities of the Advisory Committe
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Appendix BREPORT TO THE PRESIDENT O
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Report to the President on the Acti
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govern the exploitation of the reso
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Manpower and Social Affairs Committ
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Junior Staff EconomistsJames S. Fac
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Appendix CSTATISTICAL TABLES RELATI
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PRODUCTION AND BUSINESS ACTIVITY:Pa
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NATIONAL INCOME OR EXPENDITURETABLE
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TABLE C-2.—Gross national product
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TABLE C-3.—Implicit price deflato
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Page 263 and 264:
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TABLE C—8.—Gross national produ
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TABLE C-10.—Gross national produc
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TABLE C-12.—Personal consumption
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TABLE C-14.—Relation of gross nat
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TABLE C—16.—Relation of nationa
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TABLE C-18.— Total and per capita
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TABLE C-19.—Sources of personal i
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TABLE C-21.—Saving by individuals
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POPULATION, EMPLOYMENT, WAGES, ANDP
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TABLE C-24.—Noninstitutional popu
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TABLE C-26.— Selected unemploymen
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TABLE C—28.—Unemployment insura
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TABLE C-29.—Wage and salary worke
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TABLE C-31.—.•Average weekly ea
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TABLE C-33.—Changes in output per
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TABLE C—35.—Industrial producti
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TABLE C-37.—Capacity utilization
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TABLE C—38.—New construction ac
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TABLE C-39.—New housing starts an
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TABLE C-41.—Sales and inventories
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TABLE C-43.—Manvjacturers* new an
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TABLE O45.—Consumer price indexes
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TABLE C—47.—Consumer price inde
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TABLE C~49.—Wholesale price index
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TABLE C-50.—Wholesale price index
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194819491950.,1951195219531954Yearo
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TABLE C-53.—Commercial bank loans
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TABLE G-54.—Total funds raised in
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TABLE C-56.—Federal Reserve Bank
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TABLE C-58.—Bond yields and inter
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TABLE C-59.—Short- and intermedia
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TABLE C-61.—Mortgage debt outstan
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TABLE C-63.—Net public and privat
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TABLE C-65.—Federal budget receip
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TABLE C-66.—Relation of the Feder
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TABLE C-68.—Receipts and expendit
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TABLE C-10.—State and local gover
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TABLE C-72.—Estimated ownership o
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CORPORATE PROFITS AND FINANCETABLE
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TABLE C-76.—Relation of profits a
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TABLE C-77.—Sources and uses of f
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TABLE C-79.—State and municipal a
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TABLE C-81.—Business formation an
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Year1929...1933...1939...1940...194
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TABLE C-85.—Indexes of prices rec
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TABLE G-87.—Comparative balance s
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TABLE G-88.— U.S. balance of paym
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TABLE C-90.— U.S. merchandise exp
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TABLE C-92.—International reserve
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TABLE G-94.—International investm
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TABLE C-96.—Consumer price indexe
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ECONOMIC

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