What the Auto Strike Cost

The auto strike threw off schedule a budding recovery in the economy by converting what could have been a fourth quarter of slow growth into a period of renewed, though temporary, decline. That is the conclusion of a computer study made for TIME last week by Data Resources Inc., an economic consulting firm headed by Harvard's Otto Eckstein, a member of TIME'S Board of Economists. Data Resources calculated how some sensitive economic statistics are likely to turn out for the fourth quarter, compared with the results that could have been expected if there had been no strike. The figures below are in billions of dollars at an annual rate, unless otherwise indicated.

With Strike Without Strike Strike's Cost G.N.P. $993 $1,000 $7 Real G.N.P. $724 $ 730 $6 Growth Rate minus 1.6% plus 1.6% 3.2% Unemployment Rate 5.6% 5.4% .2% Corporate profits after taxes $42 $44 $2 Auto industry profits after taxes $1.2 $ 2.4 $1.2 Consumer purchases of autos and parts $33 $39 $6 Federal deficit $16 $13 $3

Eckstein's group also analyzed the production and profit losses that the strike caused in industries that supply the automakers. The figures below show how far fourth-quarter output and earnings in these industries will probably fall below the results that would have been achieved if G.M. had stayed in full operation.

Product Profit Drop Rubber 4% 15% Steel 6% 18% Nonferrous metals 4% 6% Fabricated metals 4% 5% Electrical machinery 5% 6% Nonelectrical machinery 4% 5%

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