U.S. Manufacturers’ Profits Fall, Retailers’ Rise at End of 1997

Profits at major U.S. manufacturers fell in the last three months of 1997, while retailers’ after-tax profits rose, the Commerce Department said Monday.

After-tax profits for manufacturers averaged 6.1 cents per dollar of sales in the fourth quarter of 1997, down from 6.3 cents in the third quarter. Manufacturers’ profits were 6.1 cents per dollar of sales in the fourth quarter of 1996.

Manufacturers’ after-tax profits totaled $61.1 billion in the fourth quarter, falling from $61.9 billion in the third quarter. In the fourth quarter of 1996, after-tax profits totaled $58.4 billion.

The Commerce Department also reported that profits at major U.S. retailers with assets of $50 million or more averaged 2.9 cents per dollar of sales in the last three months of 1997. That’s up 2 cents from the third quarter and 2.4 cents from the fourth quarter of 1996.

Retailers’ after-tax profits totaled $8.3 billion during the fourth quarter, up from $4.9 billion in the third quarter. After-tax profits totaled $6.5 billion in the fourth quarter of 1996.

The Commerce Department’s estimates were based on quarterly financial reports from 6,674 manufacturers and 541 retailers.

In a separate report Monday, employment firm Challenger, Gray & Christmas said the number of planned job cuts by major U.S. businesses was lower in March than it was a year earlier.

Planned cuts were at 23,028 in March, 54% lower than 50,182 in March 1997, the company said in its monthly survey. Compared with a month earlier, planned dismissals decreased 47.6%.

Among the industries showing the largest declines in planned job cuts from a year earlier were financial, apparel, industrial goods, insurance and health care.