ECONOMIC ANALYSIS 39 



far above their immediate post-war levels, and only vigorous regula- 

 tion has prevented a sharp rise in the fishing efficiency of the indi- 

 vidual unit. 



In Fig. 19 an indexed total fishing capacity in the Puget Sound 

 net fishery is compared to total landings of salmon. The conclusion 

 is plain: over the past fifteen years we have been using more and more 

 fishing effort to catch fewer and fewer fish. By any standard — physi- 

 cal or economic — this must be termed inefficient. 



How could this trend continue when it obviously makes no sense 

 to incur greater and greater costs for a smaller and smaller catch? In 

 part the situation simply reflects increases in the prices of salmon in 

 the post-war years, a trend accentuated by the serious decline in 

 salmon production from the major fishery in Alaska. As long as 

 prices continue to climb it is possible to waste large amounts of 

 capital and labor through excessive numbers of fishing units without 

 forcing more than a few fishermen out of the operation. Finally, the 

 situation reflects the competitive situation in the Puget Sound indus- 

 try. It is extremely expensive to run a salmon cannery below capacity. 

 As fish became increasingly scarce the struggle to obtain a larger part 

 of a decreasing total catch led to concealed and open subsidizing of 

 salmon fishing gear. It is obvious that all firms could not simultane- 

 ously increase their shares of the salmon catch. The end result has 

 been to increase the amount of idle capacity in the fishing fleet and 

 to increase costs for operators in every segment of the industry. 



The effects of overcapacity on earnings are apparent in the fol- 

 lowing summaries of the direct surveys of fishermen's incomes con- 

 ducted as part of this study. 



1 . Purse seiners 



The owners of twenty-one purse seine vessels, comprising 

 a fairly representative segment of the Puget Sound fleet, pro- 

 vided detailed information on sales and costs of operation from 

 income tax returns for the years 1959-1961. The principal 

 findings from this survey are summarized below. 



The average seiner surveyed showed annual gross receipts 

 of $36,613 of which $31,982 represented sales of fish and 

 $4,631 "incentive" payments from buyers. The gross receipts 

 include the shares of the crew and represent returns from 

 Alaska as well as Puget Sound fishing. The total net return 

 to the owners of the vessels, including their own fishing shares, 



