Industrial Production and Capacity Utilization - G.17

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Release Date: February 14, 2020
Revision of Industrial Production and Capacity Utilization Notice Below

Industrial production declined 0.3 percent in January, as unseasonably warm weather held down the output of utilities and as a major manufacturer significantly slowed production of civilian aircraft. The index for manufacturing edged down 0.1 percent in January; excluding the production of aircraft and parts, factory output advanced 0.3 percent. The index for mining rose 1.2 percent. At 109.2 percent of its 2012 average, total industrial production was 0.8 percent lower in January than it was a year earlier. Capacity utilization for the industrial sector fell 0.3 percentage point in January to 76.8 percent, a rate that is 3.0 percentage points below its long-run (1972–2019) average.

Industrial Production and Capacity Utilization: Summary
Seasonally adjusted
Industrial production 2012=100 Percent change
2019 2020
Jan.[p] 		2019 2020
Jan.[p] 		Jan. '19 to
Jan. '20
Aug.[r] Sept.[r] Oct.[r] Nov.[r] Dec.[r] Aug.[r] Sept.[r] Oct.[r] Nov.[r] Dec.[r]
       
Total index 109.9 109.5 109.0 110.0 109.5 109.2 .7 -.3 -.4 .9 -.4 -.3 -.8
Previous estimates 110.0 109.4 108.9 109.8 109.4   .8 -.5 -.5 .8 -.3    
       
Major market groups
Final Products 103.4 102.6 102.3 104.3 103.1 102.0 .1 -.8 -.3 1.9 -1.1 -1.0 -1.6
Consumer goods 105.5 104.7 104.6 106.7 105.1 104.6 -.1 -.7 -.1 2.0 -1.5 -.5 -.8
Business equipment 101.7 100.5 99.7 101.8 101.1 98.5 .8 -1.2 -.8 2.1 -.7 -2.6 -4.5
Nonindustrial supplies 108.5 108.6 108.3 108.2 108.3 109.0 .6 .0 -.3 -.1 .1 .6 -.5
Construction 117.0 117.1 116.4 116.1 117.7 118.9 .8 .1 -.6 -.2 1.4 1.0 .9
Materials 115.6 115.5 114.8 115.2 115.3 115.3 1.3 -.1 -.6 .3 .1 .0 -.3
       
Major industry groups
Manufacturing (see note below) 105.2 104.5 103.9 104.9 105.0 104.9 .6 -.6 -.6 1.0 .1 -.1 -.8
Previous estimates 105.3 104.5 103.8 104.8 105.0   .7 -.8 -.7 1.0 .2    
Mining 133.7 133.6 133.3 132.6 134.6 136.2 2.3 -.1 -.3 -.5 1.5 1.2 3.1
Utilities 104.6 106.1 106.5 108.7 102.0 98.0 -.6 1.4 .4 2.1 -6.2 -4.0 -6.2
Market Groups

The major market groups posted mixed results in January. The output of business equipment declined 2.6 percent as a result of the slowdown in the production of aircraft. The step-down in the index for utilities contributed to decreases for consumer energy products and energy materials. The index for consumer durables rose, supported by an increase of 2.8 percent in the output of automotive products.

Industry Groups

Manufacturing output decreased 0.1 percent in January to a level 0.8 percent below its year-earlier reading. The production of durable goods moved down 0.5 percent in January, as drops for aerospace and miscellaneous transportation equipment and for machinery were partially offset by a gain for motor vehicles and parts. The output of nondurable manufacturing rose 0.3 percent, and almost all of its component categories posted gains. The indexes for petroleum and coal products and for plastics and rubber products recorded increases of more than 1 percent, whereas only the index for apparel and leather recorded a decrease of more than 1 percent.

Mining output advanced 1.2 percent in January and stood 3.1 percent above its level of a year earlier. The output of utilities fell 4.0 percent in January, with electric and natural gas utilities posting declines of 3.2 percent and 7.7 percent, respectively.

Capacity utilization for manufacturing edged down 0.1 percentage point in January to 75.1 percent, 3.1 percentage points below its long-run average. The utilization rate for mining rose to 90.7 percent and remained well above its long-run average of 87.2 percent. The operating rate for utilities fell to 70.6 percent, a rate that is about 15 percentage points below its long-run average.

Note: Preliminary Estimates of Industrial Capacity

The data in this release include preliminary estimates of industrial capacity for 2020 (table 8). Measured from fourth quarter to fourth quarter, total industrial capacity is projected to rise 1.3 percent this year after increasing 2.1 percent in 2019. Manufacturing capacity is expected to advance 0.8 percent in 2020 after increasing 1.4 percent in 2019. Capacity in the mining sector is estimated to rise 2.9 percent in 2020 after gaining 5.8 percent in 2019. Capacity at electric and natural gas utilities is projected to increase 3.3 percent in 2020 after expanding 2.5 percent in 2019.

Revision of Industrial Production and Capacity Utilization

The Federal Reserve Board plans to issue its annual revision to the indexes of industrial production (IP) and the related measures of capacity utilization in the summer of 2020. New annual benchmark data for manufacturing for 2017 and 2018 will be incorporated, as well as other annual data, including information on the mining of metallic and nonmetallic minerals (except fuels). The weights for market-group splits of the industry-level indexes will be updated with information from the 2012 benchmark input-output accounts from the Bureau of Economic Analysis. The updated IP indexes will include revisions to the monthly indicator (either product data or input data) and to seasonal factors for each industry. In addition, the estimation methods for some series may be changed. Any modifications to the methods for estimating the output of an industry will affect the index from 1972 to the present.

Capacity and capacity utilization will be revised to incorporate data for manufacturing through the fourth quarter of 2019 from the Census Bureau's Quarterly Survey of Plant Capacity, along with new data on capacity from the U.S. Geological Survey, the U.S. Department of Energy, and other organizations.

G.17 Release Tables:

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Last Update: February 14, 2020