(1898 for imports), 1901 (slight), 1904, 1908 (and 1909, also, for clearings), 1914 and 1915, 1919, and 1921 and 1922.

CHART 7

INDICES OF ECONOMIC CONDITIONS, BY FISCAL YEARS: 1870-1923.

Pig Iron Production and a Composite Index of Business Cycles. Pig iron is basic to many manufacturing industries and to much construction work, and, in the form of machinery or other products of iron and steel, is supplementary to practically all industrial activities, hence fluctuations in the production of pig iron ordinarily bear a close relation to the volume of industrial activity. This relationship has been frequently noted in previous statistical studies of economic conditions. For example, Professor E. E. Day, in his construction of an index of manufacturing, compares annual statistics of pig iron production with his index and finds a striking similarity in the fluctuations of the two series. Because of this

1Review of Economic Statistics, 1920, p. 367, "The correspondence of pig-iron production with manufacture, when both are adjusted for secular trend, is extraordinary. The correlation coefficient is .97." (Based upon the period 1899-1919).

close association between pig iron and industrial activity, we have made frequent use of pig iron production in comparisons with migratory fluctuations in this and other countries, partly because direct employment figures are not available and partly because it is

TABLE 13-A.-INDICES OF ECONOMIC CONDITIONS, BY FISCAL YEARS
ENDING JUNE 30TH: 1870-1923

U. S. Bureau of Foreign and Domestic Commerce, Monthly Summary of Commerce and Finance. bAn average of monthly figures of an index of business conditions based upon clearings outside New York, corrected for trend, compiled by Mr. Carl Snyder, Federal Reserve Bank, New York, Journal of the American Statistical Association, September, 1924, p. 335.

Annual averages computed from monthly data published in the Iron Age, and based prior to October, 1902, upon the number of furnaces in blast and thereafter upon monthly statistics of pig iron produced.

not improbable that pig iron, related as it is to o r industries as well as manufacturing, may be an index of employment opportunities for immigrants at least as significant as the ordinary index of numbers employed in factories, which at best does not make adequate allowance for part-time employment.

TABLE 13-B.-INDICES OF ECONOMIC CONDITIONS, BY FISCAL YEARS
ENDING JUNE 30TH: 1890-1922

An estimate for the United States, based upon Census of Manufactures statistics for census years and on interpolations in intervening years with the aid of State employment and unemployment statistics. Statistical Abstract of the United States. In 1908 and the subsequent years, these data exclude switching and terminal companies hence are not strictly comparable with those for the years prior to 1908.

To indicate the extent to which the fluctuations in pig iron production are similar to those of other indices of economic conditions, there is given in Chart 8 a comparison between pig iron production and a composite index of business conditions, both expressed as deviations from computed trends. This composite index is one computed by Professor W. F. Ogburn and Dorothy S. Thomas, using nine economic series, namely: wholesale prices (1870-1913), commercial failures (1870-1920), bituminous coal production

(1870-1920), rig iron production (1870-1920), railroad freight tony mileage (188 920), bank clearings outside New York (1881-1915), employment in Massachusetts (1889-1920), railroad mileage constructed (1870-1888), and imports (1870-1888).

CHART 8

CYCLES IN ECONOMIC CONDITIONS IN THE UNITED STATES: 1870-1919.

The numerical data for pig iron are in Table 14. For source of the "Composite Index," see accompanying text.

It will be noted that all major cycles and most of the minor fluctuations are common to the two curves, that there is no lag of sufficient extent to be obvious in these annual data, and that only in a few years are changes in the two series opposite in direction. It appears that, on the whole, no marked differences in results will arise whether pig iron production or such a composite index as that plotted in Chart 8 is used in analyzing annual cycles in economic conditions.

2"The Influence of the Business Cycle on Certain Social Conditions," Journal of the American Statistical Association, September, 1922, p. 327.

TABLE 14.—CYCLES OF PIG IRON PRODUCTION, BY CALENDAR Years:

1860-1919

Percentage deviations from a seven-year moving average, expressed in multiples of their standard deviation (12.68 per cent)

We have previously noted the desirability of a monthly index of employment conditions. For the quarter century preceding the Great War it has been possible to build up by the synthesis of somewhat fragmentary series, an index of factory employment. This index has been supplemented by an index of monthly changes in pig iron production. Charts of the cyclical movements in these two series are given in Chapter V. The methods of compilation are set forth in the subsequent pages of this chapter.

The Census of Manufactures.

The United States Census of Manufactures furnishes a virtually complete census of the number of wage earners employed in factories, by months, for the years 1899, 1904, 1914, 1919, and 1921. In taking the census of manufactures in 1899 workers in the hand