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Index of Consumers' Prices in Large Cities, November 19461
RETAIL prices of consumer goods in large cities rose 2.2 percent between mid-October and mid-November, bringing the consumers' price index for the United States to the highest level on record. On November 15 the index was 151.7 (1935-39 equals 100), 1.5 percent higher than in June 1920, the peak after World War I.
In mid-November consumers' prices were 13.8 percent higher than on June 15, 1946, and 53.9 percent higher than in August 1939. In the year between November 1945 and November 1946 food prices rose 34 percent, clothing 13 percent, and housefurnishings 15 percent. Residential rents, however, advanced only slightly, and gas and electricity costs declined about 2 percent.
Retail food prices to moderate-income families in large cities advanced 4.3 percent between mid-October and mid-November. Higher prices were reported for all major food groups except eggs and dairy products, but sharp increases in prices of fats and oils, meats, and fruits and vegetables were chiefly responsible for this advance. Average retail prices of fats and oils rose 65 percent, as prices for lard increased 104 percent, shortening 66 to 85 percent, and oleomargarine 56 percent. Meat, poultry, and fish averaged 9.1 percent higher in
1 The "consumers' price index for moderate-income families in large cities," formerly known as the "cost of living index," measures average changes in retail prices of selected goods, rents and services, weighted by quantities bought by families of wage earners and moderate-income workers in large cities in 1934-36. The items priced for the index constituted about 70 percent of the expenditures of city families whose incomes averaged $1,524 in 1934-36.
The index only partially shows the wartime effects of changes in quality, availability of consumer goods, etc. The President's Committee on the Cost of Living has estimated that such factors, together with certain others not fully measured by the index, would add a maximum of 3 to 4 points to the index for large cities between January 1941 and September 1944. If account is taken of continued deterioration of quality and disappearance of low-priced merchandise between September 1944 and September 1945, which was estimated at an additional 1⁄2 point, the total large-city adjustment would be 432 points. If small cities were included in the national average, another 1⁄2 point would be added, making the total approximately 5 points. The indexes in the accompanying tables are based on time-to-time changes in the cost of goods and services purchased by wage earners and lower-salaried workers in large cities. They do not indicate whether it costs more to live in one city than in another. The data relate to the 15th of each month, except those for January 1941, in tables 1 and 2. They were estimated for January 1, 1941, the base date for determining allowable "cost of living" wage increases under the Little Steel formula and under the wage-price policy of February 1946. January 1, 1941, indexes in tables 1 and 2 have been estimated by assuming an even rate of change from December 15, 1940, to the next pricing date.
Food prices are collected monthly in 56 cities during the first 4 days of the week which includes the Tuesday nearest the 15th of the month. Aggregate costs of foods in each city, weighted to represent food purchases of families of wage earners and lower-salaried workers, have been combined for the United States with the use of population weights. In March 1943, the number of cities included in the food index was increased from 51 to 56, and the number of foods from 54 to 61. Prices of clothing, housefurnishings, and miscellaneous goods and services are obtained in 34 large cities in March, June, September, and December. In intervening months, prices are collected in 21 of the 34 cities for a shorter list of goods and services. Rents are surveyed semiannually in most of the 34 cities (in March and September, or in June and December). In computing the all-items indexes for individual cities and the rent index for the average of large cities, because of the general stability of average rents at present, the indexes are held constant in cities not surveyed during the current quarter. Prices for fuel, electricity, and ice are collected monthly in 34 large cities.
mid-November than in mid-August. Fresh fruits and vegetables advanced seasonally 2 percent, while canned and dried fruits and vegetables rose 8 and 27 percent, respectively. Egg prices dropped 6 percent to an average of 70 cents per dozen. Butter prices declined 7.7 cents per pound from an all-time high average of 96 cents in midOctober.
Clothing prices increased 1.0 percent on the average, as higher prices were reported for nearly every type of apparel. In midNovember, higher price tags were found on men's suits, broadcloth shirts, cotton work clothing, undergarments, and socks, than in midOctober. Prices for women's cotton dresses and gloves were also consistently higher in mid-November. The cost of leather footwear for all members of the family rose during the month and shoe repairs were also generally higher.
Average retail costs of housefurnishings and miscellaneous goods and services increased 0.9 percent each between October and November. Prices for sewing machines, vacuum cleaners, electric refrigerators, stoves, felt base floor covering, mattresses, cotton sheets, and' blankets rose in most cities. Bedroom and living-room suites advanced in some cities and declined in others. The increase in the cost of miscellaneous goods and services was due primarily to higher prices for cigarettes, cigars, gasoline, beauty shop services, and newspapers. New automobile prices also rose during the month.
Fuel, electricity, and ice costs rose 0.3 percent on the average. Retail coal prices advanced somewhat in 17 cities. Electricity costs declined 5 and 7 percent in Portland, Oreg., and Portland, Maine, as lower rates became effective. A rebate was allowed to consumers of gas in Detroit.
Rents were not surveyed in November.
2 In a number of cities in September and October the Bureau was not able to obtain an adequate number of price quotations for some meats because of the severe shortage. For those meats in the cities where an adequate number of prices could not be collected during these months, prices were held unchanged at August levels to allow the computation of the index. For meats in the cities where an adequate sample of prices could be obtained, prices in September and October were compared directly with prices for the last month in which sufficient quotations were secured to compute a reliable meat index. The November index, based on the usual number of quotations, reflects the correct level of prices, and the full price change that occurred from mid-August to mid-November.
TABLE 1.-Indexes of consumers' prices for moderate-income families and percent changes, November 15, 1946, compared with earlier periods
TABLE 2.-Percent increase in consumers' price index from specified dates to November
15, 1946, by cities
TABLE 3.-Percent change in consumers' price index, Oct. 15 to Nov. 15, 1946, by cities and groups of items