Sources: Statistical Abstract of the United States and Survey of Current Business.

1. Employment dependent on exports

The importance of the United States export trade is also well illustrated by the employment dependent on it. Secretary Weeks of the Department of Commerce stated that in 1952 there was an estimated employment attributable to exports of 2,150,000 nonagricultural employees. The Department of Agriculture estimates agricultural employment dependent on exports in 1952 at 870,000, or 10 percent of total agricultural employment of 8,670,000.3 The estimate of 2,150,000 in 1952 for nonagricultural employment attributable to exports is equivalent to 4 percent of total nonagricultural employment and is larger than employment in that year of 1,351,000 in the public utility and communications industries, 1,382,000 in railroads or 2,028,000 in the manufacture of iron and steel and their products.* An earlier but more detailed estimate of nonagricultural employment (direct and indirect) attributable to exports prepared in the Department of Labor for the year 1947 follows:

Letter by Sinclair Weeks, Secretary of Commerce, to Representative Daniel A. Reed, dated May 18,

1953.

3 Farm Labor, Bureau of Agricultural Economics, U. S. Department of Agriculture, October 9, 1953. Survey of Current Business.

'Described in Public Advisory Board of Mutual Security GIM-19 November 24, 1952.

42493-54-pt. 2- -2

The table shows that employees dependent on exports exceeded 10 percent of total employees in 17 of the 35 industries listed and that the amount of employment dependent on exports was the highest (in descending order) in the following manufacturing industries: Iron and steel, textile mill products, other machinery except electrical, food and kindred products, chemicals, and motor vehicles. (See also chart II.)

2. Relative importance of exports of various products

Exports are, of course, of varying importance in different commodities and products. Exports of certain agricultural products have been traditionally important. The ratio of exports of selected important agricultural commodities which were exported in large amounts to total production has been as follows:

Exports of selected important raw materials (nonagricultural commodities) and semifinished goods also constitute a high proportion of total production as will be seen from the following:

Exports are of great importance in relation to production of machinery. This is shown in the following table (see also chart III):

C. UNITED STATES EXPORTS IN THE PREWAR AND POSTWAR PERIODS

1. Commodity exports

The following table prepared in the Department of Commerce shows total share of exports (in current dollars) of United States merchandise for a representative 3-year prewar period and 6 postwar years. The table is broken down into five product classifications and shows amounts and percent of distribution.

The increased value of United States exports in the postwar period as compared with the prewar period reflects not only an increased volume of exports but also, of course, a much higher price level, This will be noted from exhibit I, attached, which shows the quantity, unit value and value of exports for the years 1947 to 1952, inclusive, and the first 6 months of 1952 and 1953, respectively, in percent of the 1936-38 average. Exhibit I shows that in terms of the 1936-38 average the value of 1952 exports was 514 percent as against a quantity of 250 percent and a unit value of 205 percent.

The extraordinary increase in exports in the postwar period was due to the pentup demand for goods after the war in foreign countries and the fact that the United States, at least at the beginning of this period, was about the only source of supply to meet those demands. Foreign countries, to meet financing of exports, were unable to export sufficient goods to the United States and United States private investment and donations were not sufficient to meet the gap between exports and imports. The very large demand by foreign countries, especially in 1947, was therefore met by United States governmental financial assistance and the drawing down of gold and dollar assets held by foreign countries in the United States. Beginning in 1948 there was a steady decline in United States exports in part brought about by recovery of production in countries whose economies were adversely affected by the war. This trend continued, although imports into the United States increased until the outbreak of the Korean emergency in June 1950. This emergency greatly stimulated both exports from and imports into the United States. The upsurge of exports caused by fears of shortages and of increased price levels ended in 1952 due in part to exchange and import regulations in foreign countries and allocation and export control in the United States.

As far as the changes in classes of various exports are concerned, the most striking increase in amount has been experienced in finished manufactured products. This has been caused by the ability of other countries to increase imports for their economic development, the fact that after the war the United States was the principal source of exports of this category, and also in 1951 and 1952 by military shipments. The value of postwar exports of these products was from 4 to 6.5 times as high as in the prewar period.

Exhibit II attached shows the value of principal exports (in current dollars). for 1936-38 average and 6 postwar years. It indicates that the increase in the value of exports of manufactured goods from the prewar period to 1950 and 1952, respectively, was as follows:

Exhibit II also shows that the value of exports of certain products such as textiles, passenger cars and engines and turbines was lower in 1950 than in 1947. This is probably due, among other things, to the resumption of large manufacturing operations in foreign countries. The increase from the prewar to the postwar period, however, is understated since many items formerly classified in commodity or product groups are now due to security reasons classified as a "special category." Foodstuff exports have also shown a very large increase from prewar to the postwar period, not only absolutely, but also in relation to total exports. Exports of foodstuffs, crude and manufactured, accounted for roughly one-tenth of total exports in the prewar period, but were over one-fifth in the years 1947 and 1948. Since then manufactured foodstuffs have declined to approximately their prewar ratio of total exports. Crude foodstuff exports in relation to total exports are still well above the prewar average. The very large increase in foodstuffs is due also to disproportionately high prices in 1947 and 1948 which have declined, however since this period. Grains and preparations averaged 13 percent of total exports in 1947-49 as against 8 percent to 10 percent in the following years, contrasted with only 4 percent in the prewar period. The large increase in grain exports is in part accounted for by poor wheat crops in Italy and France in the postwar period, a decline in Argentinian wheat crops and the decline in European east-west trade. In 1952, however, European production reached prewar levels. In this connection it should be noted that wheat and flour exports had a value of $489 million in 1950 and $941 million in 1952, increases of 700 percent and 1,450 percent, respectively, over the 1936-38 average of $61 million. In contrast, in 1947 and 1948 exports of these products were $1,294 million and $1,393 million, respectively.

Crude materials and semimanufactured products have declined in relative importance from the prewar period, in which they accounted for 40 percent of total exports, to the postwar period. This relative decline is probably due to a number of factors such as the need of the importing countries to turn to nondollar areas for these materials, and shortages in the United States. Raw cotton exports show a relative decline in the postwar period. Cotton exports were about 11 percent of total exports in the prewar period, but in 1951 and 1952 were only 7.6 percent and 5.7 percent, respectively. Cotton export prices were relatively high so that the quantity of export cotton shipped in the postwar period exceeded only in 1950 the prewar average. Cotton exports were relatively low in 1947 and 1948 when textile exports were high due to a relatively low production in Europe and in Japan. Conversely, when foreign textile production resumed large operations, United States textile exports declined and cotton exports increased.

Tobacco exports varying from $287 million in 1948 to $382 million in 1951 (1952 exports were $304 million) were only about twice prewar exports. This relatively small increase in value-volume was only slightly higher than in the prewar period is due primarily to a decline in the United Kingdom market due to import restrictions.

The exports of petroleum products have also not kept up with total exports, These exports were about 11 percent of total exports in the prewar period and were only 5 percent of these exports in the 1947-52 period. This relative decline

is primarily due to the development of oil resources in the Near East and in South America.

2. Geographical exports

The geographical distribution of United States exports in the prewar and postwar period is shown in exhibit III which shows large increases in the value of exports to practically all areas and the distribution of these exports in percent of total. This exhibit also shows that the continental European countries, which took 25.4 percent of United States exports in the prewar period, accounted for 30.4 percent in 1947, largely due to United States Government aid and loans. They declined, however, in 1952 to 21.2 percent. The exports to Western European countries after the war shifted to capital goods and certain raw materials; the exports of consumption goods and raw materials available to foreign countries outside the dollar area declined in relative importance. Exports to the European non-OEEC countries declined due to export control against the Iron Curtain countries and exports in this classification for 1951 and 1952 included, in substance, only the exports to Spain, Yugoslavia, and Finland. It should also be noted that exports to the United Kingdom, which accounted for 16.8 percent of exports in the prewar period declined to about 5.9 percent in the postwar period. This decline was due to the severity of the dollar gap the United Kingdom had to face after the war and to the stringent importing controls.

Latin American countries after the war became relatively more important as a market for United States exports, their share of total United States exports increasing from 18.3 percent in the prewar period to over 28 percent in the 1950-52 period. This was caused by the ability of Latin American countries to purchase more goods in the United States due to increases in the quantity and especially in the prices of commodities they exported to the United States such as petroleum, coffee, and sugar. The Latin American countries also had large balances of liquid dollar assets in the United States after the war and European sources were unable to meet the demands for manufactured goods from these countries.

Canada has increased its share of United States exports from 15.6 percent in the prewar period to 22 percent in 1952. This increase is due to the rapid growth of the Canadian economy, closer integration of the United States and Canadian economies and stronger demand in the United States for Canadian products. The Far East took approximately the same proportion of United States exports in the postwar period as in the prewar period. This is largely due to United States Government aid.

Although Australia and Oceania have increased exports to the United States in the postwar period sharply, their share of United States exports has declined from approximately 3 percent in the prewar period to about 1.5 percent in the postwar period. This is explained by the willingness of Australia and New Zealand to contribute dollar exchange to the sterling area reserves. Africa and the Near East have increased their exports of raw materials to the United States and increased their share of United States exports slightly.

3. First half 1953 exports

During the first 6 month of 1953, United States merchandise exports were $8,030 million as against exports of $7,962 million for the equivalent 1952 period. Eliminating military shipments and supplies shipped under the mutual security program, exports for the first half of 1953 were only $6,129 million, as against $7,256 million in the comparative 1952 period. The reduction in commercial exports is accounted for by a sharp decline in agricultural exports of over 30 percent from $1,991 million to $1,377 million. As far as wheat is concerned, this is due to comparatively high United States prices and the availability of wheat from other sources, and, as to cotton, to large cotton inventories in Europe, the latter arising from a downward turn in European textile production in 1952. On the other hand, nonagricultural exports of $4,410 million, after excluding special category exports, in the first half of 1953 declined by only 10 percent in comparison with exports of $4,865 million in the comparative 1952 period. Machinery and automotive exports during the first 6 months of 1953, which were practically the same as in the comparative 1952 period, reflect in part deliveries delayed by the steel strike in the summer of 1952 and a strengthening of foreign dollar exchange positions.

*Business Information Service, International Trade Statistical Series, September 1953.