President Carter urged businesses yesterday to consider putting their employees on a four-day work week as a way to ease the worsening natural gas shortage in the eastern two-thirds of the nation hit hard by cold weather.

Carter first said he was thinking of asking Congress to legislate a temporary four-day week but later the White House backed off that.

Deputy White House secretary Rex Granum said after an emergency Cabinet meeting that Carter called to deal with the energy crisis that the President had discussed the four-day-week legislative proposal Friday night with senior aides.

It was put aside, Granum said, because of the overtime payments businesses would have to make and because it might delay passage in Congress of the proposed emergency natural gas act Carter sent to Congress Friday.

"The President was expecting his personal opinion as to what he would like to do," press secretary Jody Powell told a press briefing after yesterday's Cabinet meeting. "It was a suggestion that individuals might be encouraged to utilize," he said.

The Cabinet was convened as the Federal Power Commission received reports that natural gas supplies in 12 states from New York to Mississippi wre dwindling so fast that theaters, restaurants, and shops in those states have been told their gas is being cut down.

White House energy adviser James R. Schlesinger told the Cabinet there were "no miracle cures" for the natural gas crisis. He said the government could do "absolutely nothing about" the weather or the natural gas supply and that the weather outlook for the month ahead was "terrible."

Powell and Schlesing also told the Cabinet that home and business use of natural gas heat climbed 50 per cent this winter, a clear indication of why gas is in such short supply.

Three major pipelines carrying gas to the 12-state sregion informed their small commercial customes over the weekend that they would lose from 5 to 10 per cent of their normal supply. One pipeline had already curtailed its small business customers last week, the other two were ordering cutbacks for the first time.

The states of New Jersey, Pennsylvania, Ohio and Virginia told their small-business communities to turn down their themostats and stay open for no more than 40 hours a week. New Jersey Gov. Brendan T. Byrne told homeowners to lower thermostats to 65 degrees in the day and 60 at night or face stiff fines and even prison sentences. He said he told state police to patrol city streets and inform resident of his order.

"The situation is critical," Byrne said. "It is going to require the cooperation of every citizen in New Jersey."

In Albany, New York Gov. Hugh Carey issued an emergency order closing all gas-heated schools in the state for a week beginning Monday and voiding for 30 days all laws about how warm buildings must be kept.

A spokesman said Carey ordered Education Commissioner Ewald Nyquist to close the 1,391 gas-heated schools after receiving a request from the state energy office and the Public Service Commission.

The order saying building temperatures may be allowed to decline supersedes all state and local laws and contracts but does not apply to health-related buildings such as hospitals, the spokesman said.

The mood at the White House yesterday was one of deepening crisis, influenced by reports that press secretary Jody Powell described as warning of worsening weather and dwindling natural gas supplies.

Before leaving the Cabinet meeting and turning it over to energy adviser James R. Schlesinger. Carter said that 11 states "are in some degree of crisis," that "8,000 to 8,500 factories have closed down and put out o work about half a million people, that's the best estimate we can get."

All Cabinet officers except those from the Justice Department, the State Department and the Treasury Department were asked to attend the meeting, which alasted one hour. Attorney General Griffin B. Bell and Warren Christopher, the desinated deputy secretary of State showed up anyway. Powell said telegrams went to the governors of the hardest hit states "asking them to give us an assessment of the situation and their most immediate needs."

"It is a situation that has been serious for some time," Powell said, "and has grown progressively worse."

Carter told the Cabinet members he wanted them to "be quite innovative in assessing what you can do. We are tring to allocate as best we can under existing laws."

Carter asked Labor Secretary F. Ray Marshall to make available unemployment benefits to those put out of work by the shortage. He asked Health Education and Welfare Secretary Joseph A. Califano Jr. to deal with emergency medical supplies and school closings and he asked Transportation Secretary Brock Adams to explore ways of getting fuel-laden bages locked in by river and lake ice to their destinations.

"I don't want anybody to be unduly alarmed," Carter told the Cabinet. "I'd like the whole process to be done carefully, methodically and coordinated with Jack Watson," the White House assistant Carter placed in charge of an emergency team to monitor the crisis.

In reports received by the Federal Power Commission over the weekend, the three pipeline companies said they had no choice but to begin to ration gas to their small commercial customers. These are banks, stores, shopping centers, theaters, restaurant, businesses that run the gaumut from dry cleaners to motels.

Transcontinental Gas Pipeline Co. said it was forced to reduce by 9.5 per cent the gas it could make available to small businesses for the second week in a row. Transco pipelines served almost the entire eastern seaboard, from North Carolina to New York.

In a memorandum handed Friday to the four members of the Federal Power Commission, the FPC's Bureau of Natural Gas said Transco had warned of its pipe system "May 'erater' this weekend."

One FPC staff member said "cratering" occurs when a pipeline loses so much pressure that gas can no longer flow, "caving in the system." The staffer said he thought cratering was "too strong a word" to use now to describe Transco's plight, saying that "at its worst we think they mean pressure might be lost at points on the system where sections of the pipeline have to be cut off."

Transco's largest customers include Philadelphia Gas Works and Public Service Electric & Gas, which serve the Philadelphia area and about 70 per cent of New Jersey. Both Philadelphia and New Jersey are among the hardest hit of any regions in the East.

Columbia Gas System, which pipes gas to eastern states west of the seaboard, told its small business customers it was rationing their gas starting at 8 a.m. yesterday. It did not describe the extent of the cutbacks, but indicated they would be in the 10 per cent range.

Worst hit all of the pipelines is Southern Natural Gas Co., which serves Mississippi, Alabama, Georgia and South Carolina and was drawing off storage wells that held less than 20 per cent of the gas it normally stores.

Southern advised its small-business customers that it will cut them back by at least 6 per cent on Monday and Tuesday =to protect storage deliverability." This meant that the pressure of the gas in storage wells was falling so fast that Southern could no longer rely on being able to pump the gas into the pipelines.

Besides New York and Mississippi, Transco, Columbia and Southern serve Pennsylvania, Ohio, West Virginia, Virginia, New Jersey, North Carolina, South Carolina, Tennessee, Georgia and Alabama. The 12 states have been hit hardest by the cold and the gas shortage.

The crisis reached epidemic proportions over the weekend. Biting winds that carried sub-zero temperatures and up to six inches of snow across the upper Mississippi Valley, Ohio Valley, Great Lakes and northern Appalchians left at least 14 persons dead and northern Appalachians left at least 14 persons dead and thousands stranded.

At least six motorists died in their cars in Buffalo, N.Y., where they were stranded by snowdrifts. Five utility workers were found frozen to death in a single car near Columbus, Ohio, and two persons, one a woman who apparently was died walking near their homes.

Blowing snow left drifts as high as 15 feet as Illinois, where a snowplow and state police led two caravans of stranded motorists out of Interstate 55. Amtrak canceled 28 trains in the midwest, northern and northwestern plains because switching yards were paralyzed and sections of track were impassable. Few trains were running west from Buffalo and one train outbound for Chicago from St. Louis and to turn back.

The National Guard was called out in Minnesota, Michigan, Ohio, Pennsylvania and New York to deal with emergencies caused by the snow and cold. Philadelphia Mayor Frank L. Rizzo ordered all commercial and industrial users of gas except for pharmacies, food markets and service stations to close through Monday or face-loss of their gas.

Rizzo declared a natural gas emergency Thursday after U.S. District Court Judge Charles R. Weiner rejected a city request for a restraining order to keep Transco from cutting back by 44 per cent its gas supply to the city. Weiner told the city to seek relief from the Federal Power Commission.

Elsewhere in Pennsylvania guards, men helped remeve snow from roads, evacuated a home for the elderly near Harrisburg when its furnace broke, and ran fuel oil deliveries to towns in the southwestern part of the state.

Gaurdsmen in Ohio carried water to communities where lines were frozen and supplied blankets to residents of Lake County, where a major power outage left more than half the county without electricity for up to eight hours. A natural gas pipeline froze in Hall, W. Va., temporarily cutting service to homes. Frozen lines stopped the How of liquid propane gas from an underground storage tank near Painesville, Ohio.

In Kentucky, there was a threatened fuel shortage of another kind. Officials warned that gasoline could be in scarce supply if the ice on the Ohio River keeps barges from delivering their supplies. At least 50 towboats and their barges, many of them carrying gasoline and heating oil were stuck on the river where it divides Kentucky and Illinois.

"I could foresee very long lines at gas pumps," said Ray Stoess, executive director of the Kentucky Gasoline Dealers Association.