Recession hits U.S. output

Press, Volume CXIV, Issue 33728, 28 December 1974, Page 13

Recession hits U.S. output

(New Zealand Press Association—Copyright) NEW YORK, December 27. The American economy was dealt another blow today by a Federal Judge who ordered the United States Steel Corporation to close a bank of open-hearth furnaces employing 4000 workers at Gary, Indiana, or pay a fine of about SNZI7SO a day to keep them open.

Other lay-offs were announced elsewhere. It was reported that American industry worked at only 77 per cent of its capacity in November, and several industries issued gloomy reports. For the last year, the Gary furnaces have been working on six-month extension under a decree to shut them for violations of the Clean Air Act.

A spate of gloomy reports came from industries that have been hard hit by the recession. The Insurance Information Institute said American property and casualty isurance had had the worst year in its history. Representative firms in the synthetic fibre and plastics industries reported - sharp downturns in their sales and output in November and December.

Some economists reported that the industrial production rate in November fell three points from October and 10 points from November, 1973, to 77 per cent of capacity. The fall in capacity used was particularly sharp in the mining sector — because of the miners’ strike. There the rate slumped from 88 per cent in October to 75 per cent in November. In the manufacturing sector, there was a drop of 3 per cent to 77.5 per cent. BUDGET DEFICIT The United States Treasury reported that the

Federal Budget had a deficit of SNZ2OSO million in November, compared with deficits of SNZS24O in October, and SNZI44Om in November, 1973.

For the first five months of the 1974-75 financial year, which began on July 1, the Budget deficit was about SNZBSOOm, compared with a deficit of about SNZ642Om for the first five months of the previous financial year.