VIII. POPULATION GROWTH AND THE RISING DEMAND FOR GOODS AND SERVICES

A rapidly growing population demands more and more goods and services. In 1955 the total value of all goods produced and services rendered in the United States our gross national product-was $391 billion.

We look forward to a constantly growing volume of goods and services-not only because we will have more people to support-but because we as a nation have as a goal a continually rising standard of living for all our people. The gross national product of $391 billion in share of $2,370 for each of 165 million people. capita share of gross national product has been year.

1955 represents a per capita During recent years the per rising about 2.3 percent each

If we set an equivalent rate of increase (25 percent) as a goal for the next 10 years, the per capita share should rise to approximately $2,960. With a population of 190 million, this would call for a gross national product of $560 billion in 1965.

IX. LABOR FORCE IMPLICATIONS OF $560 BILLION NATIONAL PRODUCT IN 1965 What size labor force will be needed to produce $560 billion worth of goods and services in 1965?

To answer this question two important factors have to be considered: increasing productivity and possible shorter hours of work.

In 1955, with an average of 63 million individuals employed, we produced a gross national product of $391 billion, which amounts to about $6,190 per worker. Over the past 25 years output per worker (computed in this fashion) has increased at the rate of about 2.8 percent per year.

Over the next 10 years it seems reasonable to expect an increase in output of 28 to 30 percent.

There are some indications, however, that the number of hours we work per year may be reduced. The reduction may take the form of longer vacations, more holidays, or a shorter working day, particularly in nonmanufacturing activities. Based on trends in recent years, this table assumes a 6-percent reduction in annual hours of work by 1965.

Taken together, the increase in output, partially offset by a reduction in hours of work, points to an output per worker of about $7,500 for the year 1965. A gross national product of $560 billion, therefore, will require the employment of approximately 74 million people.

X. RECENT LABOR FORCE TRENDS

Before considering the size and kind of labor force we are likely to have in 1965, we should consider several significant trends in labor force participation rates which have developed in recent years.

1. The number of years of formal schooling for our youth has been increasing. This tends to reduce the number of young people employed, although many work on a part-time basis while enrolled in school.

2. In 1940 about one out of every four women (14 years of age and over) was in the labor force. In 1955 the ratio was 1 out of 3.

3. There is a trend toward earlier retirement made possible by the extension of pubic and private pension systems.

The extent to which men and women in the various age groups in our population worked or sought work in 1956 is shown here.

Population trends affect the age

- sex composition of our labor force - in 1956 it looked like this:

XI. OUR TOTAL LABOR FORCE-1965

On the basis of recent trends and assuming a prosperous peacetime economy, the United States can reasonably expect to have a total labor force of approximately 79.2 million in 1965-an increase of 10.3 million over 1955.

We must depend on this size labor force to staff our schools, businesses, and factories, and maintain our Armed Forces.

We have estimated that some 74 million employees will be needed to produce the $560 billion gross national product set as a goal for 1965.

The labor balance sheet for 1965 would look like this:

Civilian employment..

Armed Forces 1.

Minimum unemployment 2.

Estimated labor force____

Million

74. 0 2.8

1 At 1956 levels, the Department of Labor has no basis for any other figure in 1965. 2 At 3 percent of the civilian labor force, approximately the same level as in 1956.

2. 4

79.2

If our estimates are reasonably sound, it appears that our 1965 labor supply will be adequate at least numerically.

Will the individuals in our labor force be qualified to perform the work which will be required? Quality, not quantity, is the matter for concern.

XII. MEN IN THE LABOR FORCE-1965

At the present time 7 out of every 10 persons in our labor force are men. During the next 10 years the number of men is expected to rise by 5 million-from 48 million to slightly less than 53 million.

The largest increases (2.7 million) will be in the 14- to 24-year-age group, young men entering the labor force for the first time.

The next largest increases will be in the 45- to 54-year-age group (1.3 million) and the 55 years and over group (1 million).

These three groups will account for the entire net increase of 5 million. In the prime working age groups (25 to 34 and 35 to 44) there will be practically no increase. In 1965 there will be 700,000 fewer men aged 25-34 than today. In the 35- to 44-year-age group of a 600,000 increase will not quite offset the decrease in the next younger age group.