Summer Hum

Despite the steel strike (see above), U.S. business hummed on to new heights.

One of the biggest gainers was building. The Commerce Department estimated that new construction in July reached $5.2 billion, up 3% from June and 14% from July a year ago. Total work put in place in the first seven months of 1959 was $30.1 billion, 15% ahead of the same period last year. Outlays for new private building in July rose to $3.6 billion to push the seven-month total 16% ahead of a year ago. Biggest gains were in home building, which leveled in July at a seven-month rate 32% above last year. So great is the demand for funds to finance home mortgages that Federal Reserve Board Chairman William McChesney Martin Jr. warned: "Overstimulation of building activity under currently developing boom conditions" must be held in check to avoid a later downturn.

Machine-tool orders, prime indicator of industrial activity, rose 38% above May to hit a new two-year high in June, one of the most significant gains since the orders started to turn up last fall. The June total of $67.3 million was more than double last June's, pushed six-month orders to $307.2 million v. last year's $179.8 million.

Part of the upturn was due to the auto industry's retooling for 1960 models. As automakers began phasing out production of their 1959 models, their production for the year's first seven months stood 49% above that period last year, bringing operations to an annual rate of 6,135,000 passenger cars and 1,200,000 trucks. For automakers, July's" estimated production of 551,200 cars made it the third best July in history.

Such activity did its part to brighten the unemployment picture. The Labor Department removed 14 more major industrial centers from its list of areas of heavy unemployment, reported employment gains in nearly all of the 149 key centers that it surveys. The change brings the number of areas with "substantial" joblessness down to 46, compared with 89 at the worst of the recession.

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