An analysis of E bond sales by markets shows that 1946 and 1947 sales we good because the community and farm sales held up so well. Community a farm sales this year will be twice the pre-Pearl Harbor level. They will be on slightly down from 1945, a year with two drives. Sales in the pay-roll market the other hand were relatively low in 1946 and 1947. Sales in this market i clude pay-roll deductions and extra bonds for cash purchased through employer Sales in the pay-roll market depend to an important extent on direct prom tional activity. Management must be contacted frequently and employees urge to buy bonds through direct personal solicitation. New people have to be adde to the plan continually in order to keep participation up. Otherwise labor tur over and inertia result in substantial reductions in participation and in sales. O of the problems since the end of war financing has been that the decline in the si of our staff has made it impossible to make a sufficient number of personal contac with management and labor. An expanded savings-bond sales organizatio which we are planning at this time, will put primary emphasis on providing mo pay-roll-savings contact men in the field. We think that an expanded organiz tion can turn the trend of pay-roll savings upward and increase the sales volum considerably. CURRENT E BOND SALES PICTURE During most of the year sales of E bonds run from around $300,000,000 t $350,000,000 a month. In January, February, and March, however, sales ar somewhat higher. This is due primarily to the fact that many larger investor acquired their annual limit in these months. This situation was one that wa characteristic of the sales picture in the prewar period. During the war, however the pattern changed, because these investors spread their purchases out ove the various war loans. The chart shows that substantial amounts of community and farm marke have held up the monthly sales totals. In early 1946 the community and farm market accounted for just over one-half of the total E sales. . At the present tim sales in this market represented nearly three-fourths of the total. In January and February 1947, limit buying caused the proportion of community and farm sales to run from 70 to 80 percent of the total. The continued decline in pay-roll sales shows up emphatically in the chart The trend has been downward every month and can be turned only by a con centration of sales activity in the pay-roll field. The decline has come about because of the reduction in the number of persons participating in the pay-rol savings plan, for which the details will be given in the next chart. The average purchase of persons participating in the pay-roll savings plan has, however, held up remarkably well. The average participant in industry is currently running at the rate of about a $25 bond a month. In the Federal Government the average purchase is somewhat greater—about five $25 bonds every 4 months. NUMBER OF PERSONS PARTICIPATING IN THE PAY-ROLL SAVINGS PLAN The number of people participating in the pay-roll savings plan has declined from 101⁄2 million in January 1946, after the close of the Victory Loan to about 41⁄2 million at the present time. The decline has been Nation-wide and in all types of organizations having the plan-big companies, little companies, the Federal Government, and the armed forces. An analysis of the sales in the pay-roll market shows that most of the money came from the big companies. These, together with the Federal Government, accounted for over 60 percent of the sales during the war and for about the same percent at the present time. The present job of the pay-roll savings promotion is to hold large companies on the plan, and to build up participation in these companies. The decline in the number of people participating in the pay-roll plan in big companies is a result of fewer participants in some companies and the dropping of the plan in others. Some of the big firms have dropped the plan because of the cost of promotion and accounting. Other companies have dropped out because they wanted to keep the take-home pay as high as possible. A few dropped out because they weren't contacted by war-bond salesmen often enough after the war was over. On the other hand, the plan has been reinstated in some companies after it was dropped because of the efforts of the employees. In other cases the sales-promotion staff persuaded the management to reinstate the plan. The experience is that only through continued promotion will it be possible to keep sales up on the pay-roll program. The experience has been that this promotion has to take the form of personal contact between the Treasury and management and labor to be successful. Pay-roll savings participation among Federal employees as a group is greater on the average than among industrial employees as a group. The big decline in Federal employees' participation last year occurred as a result of the big reduction in Federal employment. Navy-yard workers were particularly good participants in the pay-roll-savings plan. Number of persons participating in pay-roll savings plan PURCHASES OF SAVINGS BONDS ON THE BOND-A-MONTH PLAN Last summer the Treasury inaugurated a program of selling bonds to people who were not on the pay-roll savings plan through the bond-a-month plan. This plan provided an arrangement whereby professional people, business people, farmers, and other people not on pay rolls could have their banks charge their accounts each month for the purchase of a designated amount of savings bonds. The table below shows the result of two surveys of the participation of the bond-a-month plan that were made about August 1. The figures indicate that in a thousand banks surveyed, there were 50,000 people participating. Their bond purchases were $3,000,000 a month. The survey covered a representative sample of banks. On the basis of the fact that there are about 50,000,000 depositors in banks having a bond-a-month plan, we think it fair to estimate that there are probably a quarter of a million persons participating in the bond-a-month plan. They are acquiring probably $15 million of savings bonds a month through the bond-a-month plan. The bond-a-month program is wholly voluntary and has been able to show successful operation because of the cooperation of the commercial bankers of the country. There have only been a handful of Treasury people assigned to the program. With greater attention to the program on our part through an enlargement of the sales staff, we think it would be possible to run up substantially the purchases on the bond-a-month plan. We feel that the experience to date warrants the conclusion that the number of people now participating could be multiplied a number of times within a relatively short period. Purchases of savings bonds on the bond-a-month plan survey on Aug. 1, 1947 DENOMINATION BREAK-DOWN OF SALES OF E BONDS SINCE BEFORE THE WAR Sales of large-denomination bonds held up well in the period immediately after the war and showed a marked increase this year over last. Estimated sales of $1,000-denomination bonds in 1947 are exceeded only by sales during the war years. Series E bonds of $1,000 denominations go mainly to those persons in the investment market who find that the largest E bond fills a part of their portfolio requirements rather well. |