kinds of hides and skins has increased in recent months, there has also been a marked growth in imports. As a result, supplies have generally been sufficient to fill the constant growing requirements of the American tanning industry.

The 15 cents per pound price ceiling has tended to eliminate speculation from the hide market, but the practice of sellers in mixing all qualities in lots sold at the ceiling price has in effect increased the cost of hides to the tanning industry.

However, this will be remedied by the recently issued order which increases the price ceiling to 15 cents a pound and establishes differentials for the more important grades.

Goat and Kid Skin Storage Looms

In goat and kid skins, a situation is developing which may adversely affect operations of establishments depending on these raw materials. India is the principal foreign supplier of this important raw material of which we normally use 40 million skins annually, more than 99 percent of which are imported.

Since these skins are not classed as strategic materials they do not receive shipping priorities. If a real shortage occurs it will necessitate increased consumption of leather made from cattle hides, which are considered strategic raw materials. This matter is now receiving serious consideration in Washington.

During August leather continued to move into consumption as soon as completed and tanners' inventories of finished leathers were further reduced. Moreover, new business continues to be booked at the tanneries in substantial volume with several firms now having sufficient orders on hand to keep them fully occupied during September and October. The volume of leather ordered during August was reported to have been the greatest since April.

Leather Production Up 40 Percent

Total leather production during August was about 40 percent larger than last year, the largest gains being recorded in side, belting,

sole, sheep and lamb, and goat and kid varieties. While occasionally there have been temporary shortages of a few grades or varieties, these have not been of sufficient importance to seriously hamper consuming industries. Although leather requirements for government use have shown constant expansion, the industry has been fully able to satisfy these needs as well as the larger civilian demand.

Management and labor have worked well together in the tanning industry and there were no serious strikes or labor stoppages during August. Frequent pay increases have been granted; in Massachusetts a 10 percent advance was agreed upon in a conference attended by labor, management, and state officials. Labor had requested a 20 percent increase, but compromised on 10. Work meanwhile proceeded on schedule.

Wages in the tanning industry are high and compare favorably with those prevailing in many of the defense industries. Employment in August was about 15 percent above a year ago while wages improved about 30 percent. As a result, there have been no large movements of tannery workers to other industries as has been experienced by some other branches of

manufacture.

Shoe Production at Peak Levels

Increased production has also featured shoe manufacturing operatons in recent months, the output in July being in excess of 43 million pairs. Production of boots, shoes and slippers in the first 7 months of the year was only slightly under 286 million pairs, an increase of almost 25 percent over the same period of 1940. Only 8,203,413 pairs of government type shoes were made in the first 7 months of 1941, 1,172,000 pairs monthly accounting for less than 3 percent of the total output.

Retail sales were seasonally off during July and most of August but are expected to improve in September and October. Aggregate sales of shoe retailers were about 15 percent greater in the first seven months of 1941 than in the similar period of 1940. Following the lead of two important mail-order houses and

one important shoe chain which notified customers of retail shoe price advances in July, several large shoe chains made similar announcements during August. Price increases ranged from 10 to 20 cents a pair and were generally considered in line with higher costs to the retail trade.

Profits Maintained by Large Turn-Over

Net profits in the shoe industry and trade for the last half of 1941 are expected to be as high as for the same period of 1940, despite increased labor costs and higher tax provisions. A record production and higher sales volume are expected to enable both manufacturers and retailers to offset their higher cperation costs.

Leather glove production continues to increase and the output for the first half of

1941 was larger than in the similar periods of any of the 5 preceding years. Reduced arrivals of foreign gloves and large government orders are responsible for the increased activity of the domestic industry. These factors will undoubtedly enable the local manufacturers to continue high operations for at least the remainder of the year.

The labor situation in the glove industry is generally satisfactory with no serious strikes or labor stoppages reported for August. With the cutting departments well ahead of schedule, overtime may be necessary in the finishing branches and some plants are considering operating additional shifts. Pledges against strikes and lockouts during the National Defense program were signed by 2,000 A. F. of L. glove workers in 8 factories (6 in Wisconsin and 2 in Illinois) during August.

The growing importance of commercial aviation in the National Defense pattern has resulted in the assignment of a limited blanket priority rating order to the industry assuring its continuous operation at a high degree of efficiency.

The order assigns the high defense rating of A-3 to deliveries of all materials of any nature which enter into the upkeep of planes and ground equipment. An air carrier or a supplier of maintenance equipment and repair parts wishing to secure the assistance of the plan should apply to the Priorities Division on Form PD-96. Each assignment of the rating will cover a 3 months' period, and the amounts and kinds of material so covered will be based on information furnished in the application.

Provision is made in the order for the immediate termination of the assignment of the rating if it is applied by an air carrier to

deliveries in excess of the amounts specifically prescribed by the Priorities Division.

Necessity Must Be Shown

A supplier may apply the rating only if the materials to be delivered cannot be secured without it. He is prohibited from using the rating to secure deliveries in greater quantities or on earlier dates than are required for delivery on schedule of the rated material, or to obtain material which will not be used by his customer for the maintenance and repair of its aircraft and equipment.

The order may be extended by an air carrier by executing a copy and furnishing it to his supplier. A supplier may follow the same procedure where necessary to secure deliveries from a sub-supplier.

Plans designed to facilitate production of heavy motor trucks, medium trucks, and truck trailers vitally needed to move heavy industrial and armament materials were recently announced by the Priorities Division of the Office of Emergency Management.

The plan also facilitates production of certain passenger carriers and necessary replacement parts.

The new program amends and simplifies administration of the motor truck order originally announced August 30, The new order does not make any major changes in the plan as originally announced but does change the methods set up to enforce and administer the order.

truck trailers, and passenger carriers produced during the first half of the year, except that all trucks ordered for specific defense purposes, as defined in the order, may be produced without limit. This means, in effect, that the producers. of these trucks and carriers may produce all trucks needed for defense during the 3-month period and may continue producing civilian trucks at the going rate during the first half year.

Parts

Replacement parts for trucks and carriers are limited as follows: A producer shall not manufacture for replacement purposes more than €0 percent of the number of parts sold for replacement purposes during the first half year. This, in effect, permits increased production of replacement parts during the 3-month period.

LIMITED PREFERENCE RATING ORDER P-54

This is a typical blanket rating order. It extends a rating which can be used to obtain material going into heavy motor trucks (3 tons or more), medium motor trucks (1 tons or more), truck trailers (5 tons or more), passenger carriers (motor or electric coaches with not less than 15 seats), and replacement parts as specifically listed in the order. The rating extended A-3 permits producers and their suppliers to obtain necessary materials and parts up to the maximum limitation as set in the limitation order. The rating, of course, cannot be used to obtain materials greater than required for the stipulated production, taking into consideration the producers' inventories of such materials.

-

Producers and suppliers will not have to make application for the use of the rating. The order provides that producers and suppliers can extend the rating by signing a special certification on the original and all copies of the purchase orders they place for the materials involved. Reports will be required on the use of the orders, however.

Half the total number of air line passengers ride less than 250 miles and only onetwentieth more than 1,000 miles, according to an exhaustive "Air Line Traffic Survey" for September 1940, by the Civil Aeronautics Board.

Analysis of passenger traffic between 200 pairs or combinations of stations accounting for over 73 percent of all passenger travel, indicate that half the passengers traveled less than 250 miles, three-quarters less than 400 miles, and nine-tenths less than 750 miles. Only 5 percent of the passengers traveled over 1,000 miles.

Owing to the short distances traveled by most passengers, but very long distances traveled by others, the average miles per passengers differ strikingly from the average trip mileage. When the total passenger miles are divided by the number of passengers, it is found that the average miles per passenger is 464, nearly double the distance traveled by half the passengers during September 1940.

Cities with the largest degree of traffic density are mainly in the industrialized northeastern part of the country. The first five in order of their importance are New York, Chicago, Washington, Detroit and Boston followed by Los Angeles, Cleveland, San Francisco, Pittsburgh and Philadelphia.

Concentration in Passengers and Miles

Three and six-tenths percent of the total number of air stations accounted for half the number of passengers during September 1940; 13 percent of the stations for three-quarters of the passengers and 30.2 percent of the air stations for 90 percent of the passengers. Remaining air stations, amounting to 70 percent of the total, produced, therefore, only 10 percent of the total traffic.

Even higher degree of concentration is

noted with respect to passenger miles flown, 3.1 percent of the air stations accounting for half of the passenger miles, 10.9 percent of the stations for three-quarters of the passenger miles, and 27.1 percent of the air stations for 90 percent of the passenger miles, while the remaining 72.9 percent of the air stations produced only 10 percent of the total passenger miles.

During the first 7 months of 1940, air lines carried 1,427,350 paying passengers. For the same period of this year, the number of such passengers was 1,942,738, an increase of more than 36 percent.

Air express carried during these periods jumped from 6,261,209 pounds in 1930 to 9,665,064 pounds in 1941, an increase of nearly 54 percent.

On June 30, 1940, there were 322 air line planes on regular flights within the continental boundaries of the United States. On June 30 of this year, there were 365 planes engaged in these operations.

Flights Under 500 Miles

Flights of heavy of heavy traffic density are relatively short. Traffic to and from Boston and Washington comprised 35 percent of the traffic handled by the New York air station and Boston and Washington are only 184 and 214 miles respectively from New York.

With the exception of the New York to Chicago flight, all of the first ten flights of heaviest traffic density are under 500 miles.

In order of their importance they are: New York--Boston, New York-Washington, New York-- Chicago, Los Angeles--San Francisco, Chicago-Detroit, Detroit-Cleveland, New York-Detroit, New York--Buffalo, New York-Providence, New York-Pittsburgh.