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Show TO STANDARD Jonuaty 1. inventories are not likely to be repeated in 1976. There may be some stockpiling early in the year to hedge against the debilitating effects of a possible protracof the nation's 'trucking ted tie-u- p industry by the Teamsters early next spring, but for the most part- labor negotiations during the year ahead do not involve industries which would require 1976 Babson Continued from Page 1 inventories had to be corrected. It was this move to replenish stocks of raw materials and finished goods which brought about the unexpectedly early and steep business climb starting in the second quarter of 1975. Such pronounced swings in business intensive strike-hedg- e inventory accumulation. Moreover, the somewhat more liberal consumer spending pattern nor extensive is neither deep-roote- d enough to encourage merchants to load up. And manufacturers and retailers still haunted by memories of the surplus goods of the past 18 months are not anxious for a repeal of 'hat fiasco. Industrial Production The last major cyclical uptrent in industrial production peaked in the latter part of 1973. Except for a moderate adjustment, factory operations were sustained near that top level for almost a year owing to the scramble for inventories. Finally, however, the stagnation in consumer demand forced a drastic liquidation of surplus stocks during the second half of 1974 and triggered the nosedive in production. In the six months encompassing the final quarter of 1974 and the first quarter of 1975, the economy was battered by an awesome sequence of events: Production curtailments, shortened workweeks, employe layoffs, and plant dosings. But since the upturn last May, the Federal Reserve Index of Industrial has advanced Production steadily and somewhat more steeply than UINTAH BASON AREA VOCATIONAL CENTER WINTER QUARTER CLASS SCHEDULE Course Tlf Electric Systens Ford Motor Proaraa 4 4 Cycle Diesel Engines Theory Cycle Diesel Engines Lab Wonen's Auto Building Construction Mlllvork 4 Cabinet Electricity 4 Hiring Apprent. Flushing Apprenticeship Appliance Repair efrlgeratiouAir Conditioning Welding Intermediate Arc Welding Advanced Arc Welding Typewriting Beginning Type Type Type Intermediate Advanced RefresherSpeed Building Type Shorthand Century 21 - Basic Theory Gregg Refresher Shorthand Personal Shorthand Secretarial Secretarial Skills Secretarial Skills Legal Secretary Medical Secretary Technical Secretary ' Police Secretary Educational Secretary Banking Secretary Office Practice Clerical Clerical 4 Civil Service Training Accounting Introductory Accounting Intermediate Accounting Accounting Marketing Restaurant 4 Fast Foods Service Basic Marketing Fundamental Salesmanship - tion may not exceed ' dose the ' to-- 3 the comparisons are economy. likely to be most impressive during the first four months since corresponding 1975 figures were in the cyclical trough of the recession. Thereafter, gains will narrow even as factory operations strikes. continue to make progress-e- x long-ter- growth rate of Year-to-Ye- Into Business Health Occupations Licensed Practical Nursing Nurse Aide ' Pre-Na- tal year-to-ye- Sheltered Workshop r Vocationally Handicapped NOTE: Those classes marked with are available any time between the scheduled hours to meet the student's needs. INDEPENDENT STUDY CLASSES Possible Labor Pitfalls busy year for new labor contract negotiations. In fact, parleys are scheduled to hammer out fresh labor agreements virtually from the beginning through to the very end of the year. Among the talks will be those involving workers in clothing, electrical machinery, construction, and retailing. But the most crucial for the economy as a whole will be in trucking and automotive production. Both these lines have effects on the economy, and they are also rated as pattern setters for other bargaining sessions in 1976 and subsequent years. While some labor observers express hope that depleted war chests of labor groups and flattened pocketbooks of workers because of the recession and inflation may discourage long and bitter walkouts, this is by no means certain. Labor representatives cite the costly spurt in living costs since the last contracts were signed, and they seek not only compensatory wage hikes but also' raises in anticipation of further inflation. Demands of union leaders will, moreover, 1976 will be a to NOTE: ever-expandi- full-scal- Type Going workweeks are normally lengthened before additions are made to work foreea. In 1976, unemployment will continue to ease only grudgingly and will do well to mark by years end. recede to the 7 other hand, can the on Employment, even without a levels climb to new peak sizeable public "make work" program.'' The disparity between the jobless and the employment sectors will be a reflection of the expanaion jn the total ' labor force. With the lengthening of workweeka and the beefing up of staffs aa the business advance makes further headway, personal income figures should makegood reading in 1976. Wage boosts overall, will also help materially, personal income could gain as much aa 12 over that of 1975, and disposable income should not be far behind. Consumer And Government Spending Although inflation was a big factor in turnover totals, consumer demand responded to the betterment in economic conditions and prospects over the past year. With the outlook for business, employment, and personal income ing a distinctly healthier tone (except for the threat of labor disruptions), 1976 is expected to see more liberal spending on the part of consumers. In current dollars, consumer expenditures should cross the trill mark, but high prices will improvement on temper the year-to-yea unit volume basis. Such a large part of thelspending dollar will be gobbled up by hefty allocations, for food, shelter, clothing and energy that there will be scant leeway for lower priority segments. Locked in by inflation and social programs, public spendall at government levels will move ing higher in 1976. The federal government, particularly, is saddled with prior commitments. Hence, mounting pressures for fiscal responsibility are not likely to do more than pare some appropriations, and force curtailment and postponement of items. some lavish and Therefore, another huge federal deficit looms for calendar 1976, despite the moderating influence of an increase in tax revenues. Building And Construction After a sharp two-yea- r slump during which the seasonally adjusted annual rate of private housing starts tumbled from 2.5 million units to somewhat less than 1 million units, an improvement in mortgage credit supplies spawned an upturn for home building in 1975. But even when the full years total is tallied, it will be well below the 1972 record and even less than the poorest showing of recent years. Babsons forecasts new housing starts of some 1.3 million units in 1976. Nonre-sidenticonstruction will also improve steadily, but the gains will not be substantia and will lend business only long-subdue- d This may not seem impressive, but a predominantly upward trend at approximately the rate of the nation's basic growth is surely far more acceptable than the adverse experiences suffered in parts of the past two years. A more ambitious projection of both the real GNP and industrial production is not warranted at this time since business capital expenditures for the expansion of productive capacity are likely to remain limited. Such spending, particularly when superimposed upon powerful consumer demand and agressive inventory accumulation, is a prerequisite for a business surge of boom proportions because it takes this type of activity to hike demand sharply for manpower and materials. But there is still a sizeable amount of productive potential in American industry either underutilized or idle. Until the production is felt and impetus of e business confidence is again running strong, it ia unlikely that budgets for capital investments will be liberalized to any appreciable extent. This may apply especially to 1976 inasmuch as the high level of factory operations will doubtless be reached in the second half when profit margins will feel increasing pressure and the monetary climate may well present a considerably less expansive posture. True, political overtones will be strong in much of the new year, and there may well be a push for business capital expenditure incentives. Capital spending policies, however, are not likely to anticipate any such favorable legislation but rather to wait and see. The total of may top that of capital spending 1975, but the edge should be small and contain a substantial inflationary content. It should be noted, too, that many such outlays will be for compliance with environmental improvement regulations rather than for raising production. So, this aspect of economic activity in 1976 should prove to be more of a sustainer of business than an upthruster. Corporate Reports Corporate profits in 1975 did better than had been anticipated because of the unexpectedly sharp and early business recovery and the decline in some raw materials .costs. With the prospect of even further advances in business during the new year, corporate profits after taxes could well run 20 above the 1975 levels. Most of the gains are likely to occur early in the year, however, as the bite of costs will tend to deepen as the year proceeds. Profit margins will find it difficult to move up along with the higher level of sales in the second half of the year since the cost squeeze will tighten and interest rates will likely be on the upswing again. The widest gains will be chalked up irr the early months of 1976 because the comparisons will be made with the recession lows in profits. Also, the business advance will still be in that stage where productivity increased use of idle improvements, facilities, and strict cost controls will help to provide favorable profits. In an effort to speed up the economy as an antidote to the high level of unemployment, it is a reasonable bet that the federal corporate tax structure will be kept as it was in 1975. Any broad sweeps of the threatened tax reform will not take place in 1976 although there are likely to be hikes in levies by some states and munci-palitie- Auto Mechanics slow in recovering, which was not unusual in view of the fact that curtailed thought likely a year ago. What with the gathering momentum of the fledgling recovery phase, 1976 makes its debut enjoying a brisk pace of factory operations. While the strength is not evenly spread across the industrial spectrum, the cyclical advance of automobile output and the more positive signs in the home building sector are optimistic. Consumer demand for apparel, appliances, and home furnishings is also contributing to the industrial improvement. So even with allowances for possible strike interruptions, it now looks as if 1976 can manifest an overall upward trend, although factory produc- 9:00 .p.a Classes listed above are available any time during the scheduled hours to meet the needs of the students PRE REGISTRATION, December 8 CONTINUOUS REGISTRATION, TELEPHONE 23rd, 8 a.m. to 9 p.m. January 5th, CLASSES BEGIN, January 5, 1976. 6 or Vernal, Roosevelt, 722-452- 1976 789-194- 2. be heightened because of a healthier business climate along with the issuance of good corporate profits reports. But managements will be mindful of their profit margins and put up sufficient resistance to hold final wage settlements 10 in the 6 range. Even though raises will average less than union leaders seek, there will be a persistent push for such costly fringe concessions as health and death insurance. shorter hours with the same pay, more liberal vacations and holidays, and other benefits. Employment And Personal Income The seasonally adjusted unemployment rate, as a percentage of the total in civilian labor force, peaked at 9.2 mid-Maof 1975. Total employment on a seasonally stippl'd only about 3 adjusted basis. Both barometers were low-priori- al mild . ,, support. Farm Prospects 1975 was a fine year for agricultural output, but farmers did not fare well in terms of income. High operating coats embargo on grain exports, .held net farm income far below expectations . relative to the bumper 1975 crop. There will be a good carryover of key harvests for 1976, although with the worldwide food shortages weather conditions will be crucial in the coming crop year. Better fertilizer supplies and costs, however, augur well for 1976 totals. Wage And Prices The expected advance in business for the year ahead will man gains in pay rates, employment, and the length of the workweek. So, 1976 consumers earned income should post sizeable increases and-th- turn, will stimulate consumer confidence and demand. While price increases have been a matter of deep concern this past year, the impact was far less burdensome than in 1974. Markdowns to spur consumer demand and lower costs for some key raw materials helped restrain the overall price advance. 1976 will not be as fortunate, however, aa the business uptrend will inevitably bring a price pattern. With new wage boosts in labor contracts, there will be added price pressures. Any imperilment of 1976 crops could move prices sharply higher, and lurking in the background also is the threat of new hikes in the price of OPEC oil. Election Year Considerations Political campaigns will have a definite effect on the economy during the new year, since all aspirants will focus mainly on economic problems. The Administration will devote most of its attention to alleviating the plight of the jobless as well as the farmers. Of course, the power struggle on the Hill will continue. Potential Dangers Of Foreign Scene The Administration shows little inclination to cease its quest for detente with the Soviet Union or alter its calm approach to the Middle East However, success in both objectives will remain in the tenuous category in 1976. The SALT talks have made little progress of late, and civil strifle in Lebanon and Angola may impose new strains on relations. Still, Babsons foresees no direct conflict between the superpowers over the year ahead. In the realm of world trade, the outlook is encouraging. True, gains in imports will likely exceed those in exports. But American business can benefit from the currently stronger dollar, and also from the fact that the domestic rate of inflation is so much lower than that prevailing in which, in firm-to-high- er Soviet-Amer-ica- n other nations. ey Interest Supplies Because of the worries over unemployment, it is unlikely that the monetary authorities will change their current policy during the better part of 1976. Money and credit will h kept sufficient to meet business needs and to accommodate the Treasury's financings. Once inflationary forces regain the ascendancy, many Rates-Mon- however, the money supply may once again be curtailed aa an n move. The Babson staff looks for in short-ter- rates to hover near present levels the early part of 1976. With the money - |