OTHER INDUSTRY DIVISIONS

Trade. The Northwest has always been a mercantile shipping and trading center not only for the interior of these States, but for Alaska and the Far East. Wholesale and retail trade in the Northwest accounted for a little more than a fourth of the region's employment before the war and was second only to manufacturing. From September 1939 to December 1946, there was a continuous growth in trade amounting to an increase of over 40 percent. By the latter date, it provided employment for 232,000 people. All types of trade took on more workers, but the marked increases were in restaurants and in department and drygoods stores.

Eating and drinking establishments hired 27,000 additional workers between September 1939 and September 1945, bringing the total to over 45,000. Even with a slight decrease from the latter period to December 1946, employment was double the prewar total. General merchandise stores added about 12,000 workers between September 1939 and September 1946, to bring the total to 39,000. Retail food and liquor stores and independent wholesale stores also hired more people. Seasonal increases continued the upward trend in most groups between September and December 1946.

Trade in the Pacific Northwest had a somewhat stronger relative position during the war than did trade in the rest of the Nation. Average employment was 20 percent greater in 1944 than in 1939, as compared with an increase of 9 percent in the Nation as a whole. By 1946, however, the regional increase was only slightly greater than the increase in the Nation. The general trend in the region, nevertheless, was still strongly upward.

Service and miscellaneous industries.-Service establishments, a source of relatively steady and increasing employment, accounted for about 15 percent of all workers in the Pacific Northwest in 1946. Employment increased about 55 percent between September 1939 and September 1946, and this level was maintained until the end of the year.

In the postwar period, the service industries in the Northwest have made the second largest gain among the industry divisions. They have also shown a considerably greater relative expansion than has the similar group in the entire United States. They employ half again as many workers as in 1939, as compared with an increase of slightly more than a third in the rest of the Nation. The relative importance of service employment in the economy of the Northwest, its steady wartime expansion, and its continuing postwar increases are encouraging.

Transportation and public utilities.-Transportation and public utilities, accounting for approximately 14 percent of nonagricultural workers, employed 118,900 people in December 1946. In 1939, these industries were the third largest employer in the region, but after the war, with the more rapid growth of service, they dropped to fourth place. The division as a whole gained in employment steadily through the war years, and in 1946 the number of workers was about 30 percent greater than in 1939, slightly less of an increase than in the entire United States. The mining and the transportation and public utilities divisions were the only two in which the relative increase in employment was greater in the Nation than in the Northwest region.

Street railways, trucking, water transportation, and stevedoring constituted about two-fifths of total division employment in December 1946. The work is quite seasonal in nature, with peak periods occurring in July and August. In 1944 the variation between the high and low months was about 8,000 workers. In these industries, also, the general trend has been upward.

Interstate railways employed another third of the workers in transportation and public utilities, or about 37,900 in December 1946. To meet the demands of war, railway employment increased around 10,000 between 1939 and 1943. Only small increases occurred in the following years, and during 1946 a slight down trend was evident.

For most of the war years, communications had a work force of about 13,000 and public utilities had around 8,000. With the end of the war, however, the availablility of men and materials, coupled with the delayed demand for service, resulted in a sharp increase in employment in communications. The total rose 42 percent from August 1946 to December 1946.

Construction. The construction industry is one of the smaller components of nonagricultural employment in the Northwest. It accounted for about 6 percent of all employment before the war. However, construction workers experienced the second largest wartime expansion, ranking next to manufacturing in relative increase over prewar employment. The increase of 130 percent in average annual employment from 1939 to the peak in 1944 was much greater than the increase in the United States as a whole, due to a greater volume of war-plant and war-housing construction. In 1945, employment in this division was reduced but was still 31 percent above the 1939 level. By 1946, as materials for private building became available, construction employment increased considerably throughout the country. Relative expansion in the Northwest was 64 percent, as compared with 32 percent in the whole United States. In

this area, as in the United States as a whole, construction should prove a source of increased labor demand for some time in view of the large backlog of demand for housing and other types of private construction which were postponed during the war.

Finance. In 1939, about 26,200 workers or about 4 percent of total workers in the region, were employed in finance, insurance, and real estate. Slight increases occurred in 1944 and again in 1945, but it was not until 1946 that many additional workers found employment in these industries. In December 1946, the persons thus employed totaled about 33,400.

Mining. Mining is the smallest of the major industry divisions and accounts for less than 1 percent of the region's workers. It is the only major group that employed fewer people in the war and postwar years than in 1939. Difficulty in securing labor, suspension of gold-mining activities, and the closing of several chrome mines were some of the factors involved in this decrease. By 1945, annual average employment was 40 percent below the prewar level. By the end of 1946, however, 4,600 workers, or 75 percent of the prewar total, were employed in mining.

THE PROPORTION of relatively high-wage employments on the West Coast is greater than in the remainder of the country. This employment pattern is reflected in the extent of urbanization in the area 2 which in itself is a factor helping to account for the region's high level of money income. Another important factor affecting the income level of the region is the existence of a wage differential which tends to favor West Coast workers. In almost all industries, and for similar occupations in similar industries, West Coast wage rates are higher than in any other region in the country.

Expanding industry and employment in the Pacific States during the past several decades has led to a competition for workers, in spite of the large numbers who have migrated to the area over the years. The variety and abundance of economic resources and the initiative of the population have enabled the region to absorb the in-migrants at relatively high rates of remuneration. A greater proportion of the population is in the most productive age range than is in the group of younger dependents. The large proportion of older persons with independent incomes and the expenditures of the large numbers of tourists help to support the important trade and service industries.

The growth in the aggregate amount of income payments in these States has been a natural accompaniment to the increase in population and economic activity. The region experienced the greatest rate of income growth of any large area in the country, both in the prewar and in the war years, exceeding even the substantial increases in the Southern States. The West Coast share of the country's total income payments increased steadily from 1929 to 1944, and the general level of this proportion appears to have been maintained since the end of the war.

The decrease in income from war manufacturing, at the end of World War II, was largely offset by increases in mustering-out pay

1 Prepared by Solomon Shapiro of the Bureau's Labor Economics Staff. The State income data used in this article have been published or made available by the National Income Division of the Office of Business Economics of the U. S. Department of Commerce. The cooperation of this Division is gratefully acknowledged.

2 While urbanization in the States of Washington and Oregon was somewhat below the level for the United States in 1940, California, with about 70 percent of the Pacific Coast population, had 71 percent of its population living in cities in that year.

'See Regional Wage Differentials, by Harry Ober and Carrie Glasser, Monthly Labor Review, October 1946.

'State income payments represent income received in the various States by individuals, from payers either within or outside the State. These payments include certain "nonproductive" receipts which are included in money income, such as social-security benefits and relief payments. They exclude certain items of income, like business savings, which accrue to, but are not received by, the population. Certain imputed Items, such as products consumed on the farm, are also included.

See Income in the South, Monthly Labor Review, October 1946.

ments, unemployment benefits, and payments in trade, service, and other civilian industries. As a result, aggregate income payments in the fourth quarter of 1945, the most recent period for which data are available, were only 5 percent below the peak of war production. Further expansion in the civilian segments of the economy since 1945 has enabled the region to keep the approximate income relationship to the rest of the country which it achieved at the height of war production.

Because of its strategic location with respect to the Pacific theater of war, and the availability of resources for shipbuilding and other war manufactures, the West Coast was the scene of tremendous war activity. This was particularly so in the Seattle-Tacoma area in Washington, the Portland-Vancouver area in Oregon and Washington, and the San Francisco and Los Angeles areas in California. The presence of various embarkation points on the Coast resulted in a concentration of military personnel, while the increase in war manufacturing caused the migration of hundreds of thousands of workers to the region. The consequent increase in the flow of income caused even the nonmilitary segments of the economy, such as trade and service, to increase at a faster rate than in the rest of the country.

The spectacular expansion of the shipbuilding and aircraft industries on the West Coast helped to bring war manufacturing pay rolls from 5 percent of the area's total income payments in 1940 to about 20 percent in 1944. In 1945, when war manufacturing sharply declined, trade and service pay rolls increased almost 9 percent, which offset about a fifth of the decrease in war manufacturing. Federal Government pay rolls contributed about 9 percent of the total increase in income between 1940 and 1944; these continued to increase in 1945 and offset about 3 percent of the decrease in war manufacturing in that year.

The increase of 1,239 million dollars in military payments was about 12 percent of the total increase in income payments between 1940 and 1944; by the end of the period this type of payment constituted over 7 percent of total income. The inclusion of mustering-out pay raised this percentage to over 8 in 1945. Agricultural income also contributed about 12 percent of the increase in total income payments in the region between 1940 and 1944. A slight decline was experienced in 1945, even though this type of income continued to increase in the other States. A somewhat greater relative increase in farm production expenses in the Pacific States largely accounts for the decline.

U. S. Bureau of Labor Statistics Bulletin No. 826, Impact of the War on Employment in 181 Centers of War Activity, 1945.