"In the evolution of retailing, the independent merchant has kept pace with the chain organizations, despite all the clamor of 25 years ago that the corporate chains were going to put the independent merchant out of business. They now stand exactly where they stood 20 years ago. Today, the chains are competitive one with the other. The future growth of their individual chainstores will be retarded through its competition with other chains rather than with independent stores.'

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The growth of effective cooperation among independents helps to explain their ability to hold their relative position. Hector Lazo has noted: "There is no one single factor making for the growth of chainstores that cannot be applied with equal success by the individual merchants with proper organizatiɔn." "

While multiunit firms have grown in size, independents also have increased in size. Many supermarkets, self-service stores, and discount houses are independents rather than parts of chains. As a result of these factors, the chains have not increased in relative importance within the entire retail trade economy. Currently, the chains account for a somewhat smaller proportion of total retail trade sales than they did in 1938.

4. Stability: retail trade as compared with other areas of economic activity during periods of economic decline

The movement of retail trade closely parallels disposable income. This relationship reflects the nature of retailing which is to serve the ultimae consumer. However, when retail trade is compared with the industrial sector of the economy, as represented by industrial production, it is found that in four recessions since 1929 the retail sector has exhibited greater stability (see table 15). During the 1953-54 recession, industrial production fell 6.7 percent, while retail sales remained about unchanged. A similar relationship appeared in the 1948-49 period, when retail sales showed little change, increasing 0.2 percent, while the industrial production index also fell by 6.7 percent. The 1937-38 recession evidenced an even more striking contrast with retail trade falling only 10 percent, as against a 21 percent decline in industrial production.

TABLE 15.-Changes in retail sales and industrial production, selected periods,

1 Data on retail sales were not available for 1932 and hence the index number for department store sales (1947-49=100) was used.

Sources: U. S. Department of Commerce, Survey of Current Business, November 1943, p. 7: October 1951, p. 20; September 1952, p. 17; February 1955, p. 25; Economic Report of the President, January 1955, p. 164.

Retail sales are in terms of dollars while industrial production represents physical units. Such a comparison makes no allowance for price changes. If this important factor is taken into account, the change in retail sales in real terms for the periods covered was as follows:

24 Tremain, op. cit., p. 7.

25 Cited in Paul D. Converse. Henry W. Huegy, and Robert V. Mitchell, Elements of Marketing, Prentice-Hall, Inc., New York 1952, p. 421.

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These data were derived by using the implicit price deflator for durable and nondurable goods of the United States Department of Commerce. Therefore, they take into consideration both price changes and the physical volume of sales. When this adjustment is made, the stability that characterizes the retail sector of the economy is clearly demonstrated. In the period from 1937 to 1938, real retail sales declined by only 5.8 percent, while industrial production fell by 21.3 percent. From 1948 to 1949 a similar pattern emerges as retail sales in real terms rose by 2.2 percent and the level of industrial production was 6.7 percent lower. In the most recent period of economic adversity, from 1953 to 1954, real retail sales recorded no change while industrial production declined by 6.7 percent. Similar results were obtained during the period from 1929 to 1932. Real department store sales were only 9.4 percent lower, while industrial production fell by 47.5 percent. In conclusion, after allowance for changes in price, the volume of retail trade has shown far less fluctuation than has industrial production during the past quarter of a century.

Greater stability of employment in retailing.-In connection with employment as a measure of stability, the Department of Labor Materials stated: "Another popular misconception which is often stated to prove stability of employment in retail trade is that unemployment is practically noneixstent among full-time workers in retail trade. Actually available statistics indicate that unemployment rates for full-time retail trade workers are somewhat higher than for all wage and salary workers combined, and considerably higher than the rates in wholesale trade and the service industries. Even when the comparison is limited to manufacturing industries, no clear cut pattern in favor of retailing trade emerges" (F, p. 12).

This conclusion was based upon data for unemployment rates (F, p. 13), which in turn are based on the last full-time job of the unemployed. In light of the large amount of temporary employment to meet seasonal needs, these data showing unemployment are not too significant as a measure of stability of employment in some States. A more appropriate measurement is the volume of employment and how it changes during periods of recession. Employment data show the employment opportunities in retailing and hence are more significant as a measurement of relative stability.

TABLE 16.-Changes in full-time equivalent employees in retail trade and the economy, selected periods, 1929-54

For 1954 data on full-time equivalent employees were not available. Therefore, the Bureau of Labor Statistics' series of employees in nonagricultural establishments was used to indicate the changes from 1953 to 1954. No information was available for all private industries.

Sources: U. S. Department of Commerce, Office of Business Economics, National Income, 1954 edition, pp. 196-197; U. S. Department of Labor, Bureau of Labor Statistics, Employment and Earnings, May 1955, pp. 49, 54.

The United States Department of Commerce publishes data for full-time equivalent employees. Table 16 shows that during the four economic declines from 1929 to 1954, retail employment fell relatively less than did total private

28 U. S. Department of Commerce, National Income, 1954 edition, Washington, D. C., p. 216.

employment, private nonagricultural employment, or manufacturing employment. For example, in the 1929-32 period, employment in retail trade fell 24 percent, total private employment declined 27 percent, private nonagricultural employment 28 percent, and manufacturing 36 percent. Since full-time equivalent employment is not currently available for 1952-54, the figures of the Department of Labor as published in its Annual Supplement on Employment and Earnings (May 1955) were used. United States Department of Labor data for the 1948-49 recession yield almost the same results as shown for full-time equivalent employment. (See table 17.)

TABLE 17.-Employment: Retail trade, private nonagricultural, and manufac turing, 1948-49

Source: U. S. Department of Labor, Bureau of Labor Statistics, Employment and Earnings, May 1955, p. 49; Employment, Hours, and Earnings, Retail Trade, 1939-50, p. 4.

In 1953-54, retail trade employment declined less than 1 percent as compared with a decline of 3.5 percent of all private nonagricultural employment, and 7.2 percent for manufacturing employment.

This stability of employment in trade (wholesale and retail) is particularly marked for those workers who regularly work full time. In the 1953-54 recession, the percentage at work in trade full time the year around declined only mildly from 53.8 percent to 51.1 percent. The corresponding percentages for all wage and salary workers was cut from 60.7 percent to 57.3 percent; for manufacturing the figure fell from 67.5 percent to 61.9 percent (table 18). These findings stand in striking contrast to the Department of Labor's contention that "even when the comparison is limited to manufacturing industries, no clear-cut pattern in favor of retailing trade emerges” (F, p. 12).

3 Worked at full-time jobs for 26 weeks or less, or at part-time jobs.

Source: U. S. Bureau of the Census, Annual Report on the Labor Force, 1954, p. 7.

The greater stability of employment in retail trade, as evidenced by full-time equivalent employment, is buttressed by similar relationships indicated by the data for the "average number of full- and part-time employees." (See table 19.) Since such data are available only through 1953, only three comparisons are

shown. The relationships are similar to those shown for full-time employment alone with the declines in retail trade employment markedly less than that in total employment and employment in manufacturing industries.

TABLE 19.-Changes in average number of full-time and part-time employees in retail trade and the economy, selected periods, 1929-49

Source: U. S Department of Commerce, Office of Business Economics, National Income, 1954 edition, pp. 198-199.

The materials also stressed that unemployment rates in retail trade are "considerably higher than the rates in wholesale trade and service industries." Table 20 compares these groups during three past periods of economic decline in terms of full-time equivalent, and table 21 in terms of full-time and part-time employees. No major differences are shown in the magnitudes. In the 1929-32 depression, retail trade full-time employment fell by 24 percent as compared with 22 percent for wholesale trade and 21 percent for services. In the 1937-38 recession, employment in retail trade fell moderately more than for wholesale trade and less than for service industries. In the 1948-49 recession, both retailing and service trades recorded only nominal changes in employment as compared with a decline of 1.9 percent for wholesale trade. These data do not support the claim that there is any considerable difference in employment stability among these three sectors of the economy. All three groups have much more stable employment than the economy generally.

These data for volume and employment indicate that retail trade does have greater stability than the balance of the economy.

TABLE 20.-Changes in full-time equivalent employees in retail trade, wholesale trade, and services, selected periods, 1929-49

[In thousands]

Retail Whole

Retail Whole

Year and percent change

trade sale Services Year and percent change trade sale Services trade

trade

1 For 1954 data on full-time equivalent employees were not available. Therefore, the Bureau of Labor Statistics' series of employees in nonagricultural establishments was used to indicate the changes from

1953 to 1954.

Sources: U. S. Department of Commerce, Office of Business Economics, National Income, 1954 edition, pp. 196-197; U. S. Department of Labor, Bureau of Labor Statistics, Employment and Earnings, May 1955, pp. 49, 54.

TABLE 21.-Changes in average number of full-time and part-time employees in retail trade, wholesale trade, and services, selected periods, 1929-49

Source: U. S. Department of Commerce, Office of Business Economics, National Income, 1954 Edition, pp. 198-199.

5. Characteristics of retail trade employment

Retail trade is marked by a unique pattern of activity. In most branches of retailing, volume on the day the store is open late and on Saturdays (and sometimes Fridays) is very high as compared with the balance of the week. This pattern reflects a combination of Friday paydays and Saturday shopping days. The latter is encouraged both by the immediate availability of the weekly income and the fact that children do not go to school and the breadwinner usually does not have to work on Saturday. As a result of this pattern of volume, many retail establishments-independent and multiunit alike-supplement the regular store staff by "Saturday onlies" or by part-time help which may work Thursday evenings, Fridays, and Saturdays. Students and housewives provide an important share of this part-time help.

In addition, there is a marked seasonal pattern in many retail lines. Of particular importance are the bulges in sales which precede Easter and Christmas, with the latter being far more important. These seasonal requirements are met by the temporary employment of full-time and part-time workers. These workers are hired for the Christmas season and know in advance that their employment will be terminated when the seasonal rush of business is ended. Because of these patterns of volume, the employment picture for many stores includes:

(a) Full-time permanent staff with relatively stable employment opportunities.

(b) Seasonal employment of part-time and full-time workers.

(c) Part-time workers, 1 or more days a week, who may work on a yearround basis.

This pattern of employment opportunities is unique to retailing, and, of course, is typical of chainstores and independents.

There are three other characteristics of retail trade employment which should be noted. (d) A relatively large proportion of the employees are women, (e) the proportion of younger workers is large, and (f) the extent of unionization is less than in other industries.

Stability of full-time employment.-In the preceding section, data were presented which showed that employment fluctuates less in retail trade than in manufacturing and other industries. The United States Department of Labor has recognized the stability of full-time employment in department stores.

"Those who obtain permanent, full-time employment will have fairly good job security. The basic regular force of a department store is relatively stable; the temporary and part-time sales force, however, varies with the volume of sales."

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There is no evidence that the nature of department store operations, or of retailing generally, has changed so significantly since 1946 that this conclusion is no longer true.

Duncan and Phillips, two careful students of retailing, concluded in their book published in 1955 that

"The retail field offers more stable employment than many other industries. For some types of retail businesses, such as food stores, there is relatively little

7 U. S. Department of Labor, U. S. Employment Services, Department Stores, Industry Series No. 53-1, Washington, D. C., June 1, 1946, p. 9.