Industrial Production and Capacity Utilization - G.17
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Industrial production increased 1.0 percent in September and advanced at an annual rate of 3.2 percent in the third quarter of 2014, roughly its average quarterly increase since the end of 2010. In September, manufacturing output moved up 0.5 percent, while the indexes for mining and for utilities climbed 1.8 percent and 3.9 percent, respectively. For the third quarter as a whole, manufacturing production rose at an annual rate of 3.5 percent and mining output increased at an annual rate of 8.7 percent. The output of utilities fell at an annual rate of 8.5 percent for a second consecutive quarterly decline. At 105.1 percent of its 2007 average, total industrial production in September was 4.3 percent above its level of a year earlier. The capacity utilization rate for total industry moved up 0.6 percentage point in September to 79.3 percent, a rate that is 1.0 percentage point above its level of 12 months earlier but 0.8 percentage point below its long-run (1972–2013) average.
Industrial Production and Capacity Utilization: Summary
|Industrial production||2007=100||Percent change|
|2014||2014|| Sept. '13 to
|Major market groups|
|Major industry groups|
|Manufacturing (see note below)||99.1||99.5||99.8||100.5||100.0||100.5||.3||.4||.3||.7||-.5||.5||3.7|
|Capacity utilization||Percent of capacity|| Capacity
|2014|| Sept. '13 to
|Manufacturing (see note below)||78.7||85.6||77.3||84.6||63.9||76.2||77.0||77.1||77.2||77.6||77.1||77.3||2.1|
|Primary and semifinished||80.8||86.5||77.9||87.7||64.2||76.4||77.1||77.4||77.4||77.0||77.0||77.7||1.8|
The production of consumer goods rose 0.5 percent in September but decreased at an annual rate of 0.6 percent in the third quarter. After having dropped 3.6 percent in August, the output of consumer durables declined 0.3 percent further in September. Within consumer durables, losses in the indexes for automotive products and for home electronics slightly outweighed gains elsewhere. The production of non-energy nondurables moved up 0.3 percent, while the output of consumer energy products gained 2.2 percent. Within non-energy nondurables, gains in the indexes for clothing and for chemical products were partly offset by a decrease in the production of paper products.
The production of business equipment increased 0.3 percent in September; the indexes for transit equipment and for information processing equipment each moved up 0.5 percent or more, while the output of industrial and other equipment was unchanged. For the third quarter, the index for overall business equipment advanced at an annual rate of 4.9 percent, with gains in all three of its major categories.
The production of defense and space equipment rose 1.4 percent in September. The index increased 3.2 percent at an annual rate in the third quarter after having gained 4.6 percent in the second quarter.
Among nonindustrial supplies, the production of construction supplies rose 0.4 percent in September and moved up at an annual rate of 10.2 percent in the third quarter; nevertheless, output in September was more than 10 percent below its level just prior to the most recent recession. The index for business supplies gained 1.4 percent in September and increased at an annual rate of 1.8 percent in the third quarter.
The output of materials rose 1.4 percent in September and advanced at an annual rate of 4.6 percent in the third quarter. Durable materials recorded an increase of 0.7 percent in September; among its components, the indexes for equipment parts and for other durable materials moved up and the output of consumer parts fell. The output of nondurable materials rose 0.7 percent, with increases in all of its major components. The output of energy materials jumped 2.3 percent in September and rose at an annual rate of 4.4 percent in the third quarter; the index has increased in each quarter since the second quarter of 2011.
In September, manufacturing production moved up 0.5 percent with widespread gains across its components. Output increased at an annual rate of 3.5 percent in the third quarter; on average, it has advanced at a pace of about 4 percent over the past four quarters. The factory operating rate rose 0.2 percentage point in September to 77.3 percent, a rate 1.4 percentage points below its long-run average.
The production of durable goods increased 0.4 percent in September and rose at an annual rate of 6.6 percent in the third quarter; it has increased in each quarter since the third quarter of 2009. In September, the indexes for aerospace and miscellaneous transportation equipment, for furniture and related products, and for miscellaneous manufacturing all posted increases of more than 1 1/2 percent; decreases of more than 3/4 percent were registered both by wood products and by motor vehicles and parts. Capacity utilization for durable goods manufacturing increased 0.1 percentage point to 77.6 percent, a rate 0.6 percentage point above its long-run average.
The production of nondurable goods moved up 0.5 percent in September and increased at an annual rate of 1.2 percent in the third quarter. With the exception of petroleum and coal products, each of the major components of nondurables posted gains in September. The largest increases were recorded by apparel and leather and by plastics and rubber products. The operating rate for nondurable manufacturing increased 0.3 percentage point to 78.6 percent, a rate 2.1 percentage points below its long-run average.
The output of non-NAICS manufacturing industries (publishing and logging) was unchanged in September following a decrease of 0.6 percent in August. The index dropped at an annual rate of 12.5 percent in the third quarter. As a result of continuing declines in the index for publishing, the output of non-NAICS manufacturing industries has trended downward over the past 15 years.
Mining output rose 1.8 percent in September and has advanced 9.1 percent in the past 12 months. Capacity utilization at mines moved up 0.9 percentage point in September to 90.1 percent, a rate 2.8 percentage points above its long-run average. The output of utilities jumped 3.9 percent, an increase that likely reflected unseasonably high demand for air conditioning as temperatures swung from below normal in August to above normal in September. The operating rate for utilities in September increased 2.9 percentage points to 79.2 percent, a rate 6.9 percentage points below its long-run average.
Capacity utilization rates in September for industries grouped by stage of process were as follows: At the crude stage, utilization increased 0.8 percentage point to 87.6 percent, a rate 1.3 percentage points above its long-run average; at the primary and semifinished stages, utilization moved up 0.7 percentage point to 77.7 percent, a rate 3.1 percentage points below its long-run average; and at the finished stage, utilization increased 0.2 percentage point to 77.1 percent, a rate equal to its long-run average.Note. The statistics in this release cover output, capacity, and capacity utilization in the U.S. industrial sector, which is defined by the Federal Reserve to comprise manufacturing, mining, and electric and gas utilities. Mining is defined as all industries in sector 21 of the North American Industry Classification System (NAICS); electric and gas utilities are those in NAICS sectors 2211 and 2212. Manufacturing comprises NAICS manufacturing industries (sector 31-33) plus the logging industry and the newspaper, periodical, book, and directory publishing industries. Logging and publishing are classified elsewhere in NAICS (under agriculture and information respectively), but historically they were considered to be manufacturing and were included in the industrial sector under the Standard Industrial Classification (SIC) system. In December 2002 the Federal Reserve reclassified all its industrial output data from the SIC system to NAICS.