330 



FAILURES IN BUSINESS. 



ties. This increase, with the increased per 

 cent, in the number of failures during the past 

 three years, has been as follows : 



The average amount of liabilities per failing 

 trader in 1883 was about $17,000; in 1882 it 

 was $12,212; in 1881, $12,800 ; in 1880, $13,- 

 131; in 1879, $14,970. 



"The general improvement," says Bradstreet's 

 " Journal," " in the record of 1880 as compared with 

 1879, as shown above, was fully offset by the in- 

 creased mortality and losses in liabilities taking place 

 in 1881. The number of failures from the latter date 

 has increased in a like ratio in both years (1882-'83), 

 but the increase per cent, of liabilities is strikingly 

 large in 1883, the gross indebtedness of 1883 being 

 nearly double that of 1882. There have been 33 fail- 

 ures during the year with liabilities aggregating $37,- 

 000,000. With these omitted from the list, as being 

 due to special causes, the increase per cent, in liabili- 

 ties (total) in 1883, as compared with 1882, drops from 

 88 per cent, to 33 per cent." 



Grouping the returns, as to average individ- 

 ual indebtedness and ability to liquidate, by 

 geographical divisions, the exhibit is as fol- 

 lows: 



In New England, the record of commercial 

 disaster during the year was 1 in every 61 en- 

 gaged in business ; in the Middle States, 1 in 

 104; in the Southern States, 1 in 69 ; in the 

 Western States, 1 in 99 ; in the Pacific States, 

 1 in 30 ; and in the Territories, 1 in 15. For 

 the country in 1878 the average was 1 failure 

 for every 56 in business. The average through- 

 out the United States in 1883 was 1 failure for 

 every 82 traders. 



At least 76 per cent, of the whole number 

 of failures in 1883 were those in which the 

 liabilities amounted to less than $10,000. But 

 13 per cent, of the whole number had liabili- 

 ties ranging from $10,000 to $25,000, and about 

 5 per cent, were individually indebted from 

 $25,000 to $50,000 each. The proportion of 

 failures in which the liabilities amounted to 

 from $50,000 to $100,000 was but about 2| 

 per cent, of the whole, and of those whose 

 liabilities were from $100,000 to $500,000 

 each the proportion was about 1 P er cent, 

 only. This calculation indicates that more 

 than 7,800 of the 10,299 failures reported in 

 1883 were those in which the debt in each in- 

 stance did not exceed $10,000 ; that more than 



* Decline in number from 1879 of failures and amount of 

 liabilities. 



1,300 failing traders' liabilities were between 

 $10,000 and $25,000; that in the case of more 

 than 500 the debts were from $25,000 to $50,- 

 000 ; that 300 of the failures ,had debts from 

 $50,000 to $100,000 each, and that the liabili- 

 ties of less than 160 were from $100,000 to 

 $500,000 each. The record of more than 10,- 

 000 business failures in 1883 is robbed of con- 

 siderable of its apparent force by the fact that 

 nearly 90 per cent, were of business houses 

 which owed each less than $25,000, and that 

 the liabilities of six sevenths of the total so 

 specified owed each less than $10,000. 



Not included in the above review are the 

 thirty-three heaviest failures, the liabilities of 

 each exceeding $500,000. Of these, ten showed 

 liabilities from $500,000 to $600,000 each ; five, 

 from $600,000 to $700,000 ; four, from $700,- 

 000 to $800,000 ; two, from $800,000 to $900,- 

 000 ; three, from $900,000 to $1,000,000 ; five, 

 from $1,000,000 to $2,000,000; two, from 

 $2,000,000 to $3,000,000; one, $3,421,000; 

 and one, $7,509,000. The failures in which 

 the liabilities reached $1,000,000 were these : 



The thirty-three firms above referred to, 

 owed about $37,300,000 in the aggregate, or 

 an average of about $1,130,000 each. Of the 

 total of over $37,000,000 of debts, Boston 

 firms are to be charged with $11,662,000 di- 

 rectly due to the F. Shaw & Brother failure. 

 New York's total is $10,225,000, about one 

 third of which was due to the Mayer and Levy 

 embarrassments. Chicago ranks third, with 

 $4,512,000 liabilities, or about equal to the 

 total liabilities of all kinds reported from 

 Philadelphia. Thirty-one of the firms whose 

 actual assets were reported, gave the total of 

 the same at approximately $20,000,000, as 

 against $36,000,000 aggregate liabilities, thus 

 indicating a possible settlement at 55 cents on 

 the dollar. 



A valuable study bearing on the subject of 

 commercial failures is afforded by an exami- 

 nation of the total number of traders and of 

 failures in business in the United States, in 

 1880, in connection with the aggregate capital 

 directly and indirectly invested in business in 

 that year. The statistical returns of such 

 capital, and also of the number of traders en- 

 gaged in business, are reported for the first 

 time by the Federal census of 1880. These 



