Major Industry Groups-South Compared With the Nation

The similarity of industrial development in the South and the Nation during the war years tends to minimize the possibility that expansion of war facilities in the South resulted in a permanent relative gain in manufacturing employment. There has, however, been a broadening of the importance of southern industries in the Nation's economy. In 1939, almost half of the workers in the lumber industry and over two-fifths of those in the tobacco and the textile-mill products groups were in the Southern States (tables 2 and 3). The southern sections of the petroleum, furniture, and chemical industries each employed about a fourth of the United States total for these industries. The only other really important industry was food processing which employed over a sixth of the United States. total. At the 1943 peak, the South accounted for an even greater share of those employed in each of these outstanding groups with the exception of chemicals. In addition, such manufacturing groups as transportation equipment and paper also had over 15 percent of their employees located in the South and 8 of the remaining 11 smaller groups increased in importance.

TABLE 3.-Manufacturing employment in the South as percent of United States total, by industry group, for selected periods

1 See table 1, footnote 1, for date of 1939 regional estimates. See table 2, footnote 1, for basis of 1939 United States estimates.

2 8-month average.

3 Not strictly comparable with later periods.

Much of the diversification acquired during the war period was carried over into 1946. Whereas in 1939, 5 of the 20 major manufacturing groups had 5 percent or less of their employment in the South,

only 3 were in this position in 1946. The southern industry groups that had always loomed large in the national economy continued to hold their own; the increased importance of many of the other industrial groups makes the South less vulnerable to economic disturbances. Such diversification makes for a healthier postwar situation.

Trend of Employment in the South, by Industry Group

War expansion caused many changes in the industry group pattern within the Southern Region. The largest group was textile-mill products which in 1939 furnished only slightly less than a third of all factory employment (table 4). The lumber and food-processing groups were next and together employed about a fourth of the total. Chemical products, furniture, apparel, and the iron and steel products. groups accounted for another fourth.

By 1943, all groups showed aggregate increases in average employment varying from a few hundred in the automobile industry to a gain of 443,000 in the transportation-equipment group. The outstanding relative and aggregate increases occurred, of course, in transportation equipment; this group rose to second place in 1943 when it accounted for one-sixth of all workers. Because of the absorption of such a large part of the labor supply in transportationequipment manufacture, the only other increases in this period

were in such war-essential groups as iron and steel products, the machinery groups, nonferrous metals, and chemical and rubber products.

TABLE 4.-Manufacturing employment in the South, by major industry groups, for selected periods

In 1946, the aggregate average employment in all industry groups, except miscellaneous industries, was above the prewar level and for 10 of the major groups was above the 1943 levels. As regards total regional employment, the largest relative decrease between 1939 and 1946 was in textile-mill products-from 31 to 26 percent (chart 2).

Postwar Highlight in Southern Employment

A year after the war's end, the employment total of 2,315,000 for the South represented an over-all net decrease of 148,000 or 6 percent (table 5). Only six major groups-transportation equipment, electrical machinery, iron and steel, automobiles, chemical products, and machinery except electrical-employed fewer people in August 1946 than on VJ-day. Contractions in the shipbuilding and aircraft industries alone accounted for almost 70 percent of the gross decrease. Disregarding this expected sharp contraction in the transportationequipment group, the employment rise for the year is about 3 percent.

TABLE 5.—Estimates of total manufacturing employment in the South for selected months,

by industry i

1 Estimates for industry groups are adjusted to levels indicated by 1944 unemployment compensation data of the Bureau of Employment Security of the Federal Security Agency.

* See table 1, footnote 1, for date and source of prewar data.

Month of wartime peak employment in the South.

Not strictly comparable with later periods.

Immediate reductions in employment in the 1 month following VJ-day amounted to an over-all loss of 215,000 workers, or 9 percent of all employment. The most severe cut occurred in the transportation-equipment group in which almost 40 percent were laid off. Employment was reduced by about one-third in the iron and steel, electrical machinery, and automobile groups; the chemical-products group declined by 15,000 or more than 8 percent. An offsetting seasonal gain of over 4 percent in the food processing industry and slight increases in the tobacco, paper, and printing industries were the only upward tendencies.

Owing to the Nation-wide steel strike, employment in the South, as in the Nation, reached a postwar low in February 1946 despite the fact that many industries were already well established in their reconversion adjustment. Only the iron and steel, machinery, transportation-equipment, automobiles, chemical products, tobacco, and the seasonally affected food groups continued at a lower employment level than in the September 1945 cut-back period.

From the February low to August 1946, declines were limited to the transportation-equipment and chemical-products groups. As the employment drop for the chemical products group was partially seasonal, the major single retarding factor in the recent employment upswing in the South was the continuing contraction in shipbuilding and aircraft.

Postwar Highlights—South and United States, by Industry Group

The employment changes in industry groups in the South in the first year of peace were somewhat akin to those in the United States. For both the United States and the South, iron and steel, the machinery groups, transportation equipment, and chemicals showed employment losses. But most of the percentage decreases were less severe nationally than in the region. In nine groups, national gains were greater than those in the South. In five-nonferrous metals, leather, miscellaneous, paper, and printing and publishing-the South showed greater proportionate increases over the period than the Nation. Although the South's automobile industry was small, it was the one industry in the region which showed an opposite trend to that in the Nation.

Employment in Southern States

The manufacturing economy of component States of the Southern Region was affected in varying ways by wartime expansion. Expansion of plant facilities in the less industrialized States brought later, and for the most part, proportionately greater peak employment. As the war ended, many of these shifts in importance and in industrial pattern were not maintained.