How the Strike Will Hurt

What damage will the auto strike do to U.S. business? If the workers re turn to their jobs within a month or so, the impact will be minimal-- ex cept for the losses and layoffs suffered by G.M.'s suppliers. But if, as most authorities expect, the walkout lasts for six weeks or more, the effects could be unsettling. Last week Data Resources Inc., an economic consulting firm headed by Harvard's Otto Eckstein, a former member of the President's Council of Economic Advisers and a member of TIME'S Board of Economists, made some projections for TIME. By analyzing 320 eco nomic equations in a computer, Data Resources projected what the econ omy would have looked like in this year's fourth quarter had there been no strike, and compared these results with what is likely to hap pen if the work stoppage lasts six weeks or twelve weeks. The figures list ed below are in billions of dollars at an annual rate, except where otherwise stated.

Without Strike Six Weeks Twelve Weeks

G.N.P. $1,003.3 996.5 987.2

Corporate profits, after taxes $45.9 43.4 41.1

Unemployment rate 5.1% 5.4% 5.6%

Total federal deficit $10.7 13.6 16.9

Consumer purchases of autos and parts $40.6 35.8 29.5

Auto industry profits after taxes $2.8 1.9 .434

In addition, Eckstein's group also examined the effects of the hy pothetical six-or twelve-week strikes on industries that are major sup pliers to the auto companies. The figures listed below indicate the declines that those industries would be expected to sustain in fourth-quarter profits and production.

SIX WEEKS TWELVE WEEKS

Profits Production Profits Production

Textiles 8% 2% 18% 5%

Rubber 9% 2% 22% 6%

Steel 11% 3% 26% 8%

Nonferrous metals 4% 2% 9% 5%

Fabricated metals 3% 2% 7% 5%

Nonelectrical machinery 4% 3% 6% 5%

Electrical 4% 3% 9% 7%

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