Atlanta: August 1975

A pickup in new orders has stimulated rehiring by many District businesses. Genesco, in Nashville, Tennessee, reports a jump in new orders at the wholesale level. Other Tennessee manufacturing industries which are tied to construction have recently reported increased orders. Several wood products plants have reopened, after being closed for several months. The outlook for this industry, according to local businessmen, is good, and most plants are now at full production. In Alabama, new jobs and rehiring are proceeding more slowly, largely because of the lagging steel industry. One Alabama steel manufacturer closed an entire plant for the first week in July and still remains well below full operating capacity. However, a Goodyear tire plant in Gadsden, Alabama, has rehired most of its employees. The plant is now operating on a six-day week and expects to continue to operate at this rate through the summer. In Louisiana, the Uniroyal Tire Company, as well as several other local plants, is rehiring workers previously laid off. The Mobile, Alabama, area reports rehiring in the shipbuilding, paper, and chemical industries. Several employment agencies in the District indicate a turnaround in the past two months. A representative of Snelling and Snelling in Jacksonville, Florida, indicates that there has recently been in improvement in the "quality" of job orders they are receiving from local businessmen, as well as in the number of firms that are looking for people. This representative reports that their firm will begin advertising on television in August. Car dealers are also reportedly now anxious to restock their staffs of car dealers. But they are now looking for a new breed of car salesmen, college-educated men who want to make a career out of selling cars.

The two areas of greatest weakness—autos and housing—appear to be picking up. A regional Ford representative reports July sales in Georgia and Florida up sharply from June. The new high-fuel economy (MPG) models are given a good deal of credit for the pickup. Sales of imports and luxury cars, as well as used cars, are still the strongest. The high trade-in price of used cars may be stimulating some new car sales.

Evidence of a recovery in the single-family housing market became more evident. Inflows to District savings and loans association were strong throughout the first half of this year. This, along with the housing tax credit, has finally begun to stimulate sales and new construction. Single-family home sales in Florida are booming, according to one Florida banker. Throughout the state, even in south Florida, sales and new starts are moving ahead. The condominium glut remains a problem. Even condominium sales are beginning to show some strength in the Tampa-St. Petersburg area, but a tremendous glut still remains. The condominium glut is also a problem in Atlanta, Knoxville, and Nashville.

Capital spending plans are apparently being taken off the shelves and dusted off by several District industries. New contracts were also announced by several area companies. In the Mobile, Alabama, area, some of the large industrial developments and expansions shelved in late 1974 are now being put into action. One of the largest is the Ow Badische $100 million chemical plant. Union Carbide is planning to build a plant employing 750 workers in Columbus, Georgia. In Tennessee, pollution-control projects costing about $78.5 million were approved by the Tennessee Valley Authority. Most of the projects are for modifications of their twelve coal-fired steam power plants to meet state and Federal water-quality standards. The United States Air Force announced a $24.7 million C-130 Hercules contract for the Lockhead-Georgia Company, pushing the total C-130 contract announcements in July to more than $100 million. This will stabilize employment at the huge aircraft manufacturer.

Most area businessmen appear to have calmed their fears of shortages, but some conflicting evidence was also noted. In Jackson, Mississippi, the supply of materials for manufacturers is not anticipated to be a problem, but energy costs and natural gas availability are much more of a concern. An east Tennessee chemical manufacturer also expressed concern over the shortage of natural gas. A furniture manufacturer reports a drastic change in supply and delivery recently. Several types of wood have recently been more difficult to obtain. He indicates that the problem stems from large orders for these woods placed by the Japanese. Upholstery fabric prices have also gone up. A representative of the Georgia Purchasing Managers Association reports that delivery lead times have increased from thirty days to between forty-five and sixty days in the last two months. Twenty-eight percent of the purchasing agents surveyed expected higher prices on materials purchased in the next three months. The Alabama Purchasing Managers Association characterizes most purchasing managers as "nervous" about the return of shortage conditions.