Industrial Production and Capacity Utilization - G.17

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Release Date: January 18, 2023
Revision of Industrial Production and Capacity Utilization Notice Below

Industrial production decreased 0.7 percent in December and 1.7 percent at an annual rate in the fourth quarter. In December, manufacturing output fell 1.3 percent amid widespread declines across the sector. The index for utilities jumped 3.8 percent, as cold temperatures boosted the demand for heating, while the index for mining moved down 0.9 percent. At 103.4 percent of its 2017 average, total industrial production in December was 1.6 percent above its year-earlier level. Capacity utilization dropped 0.6 percentage point in December to 78.8 percent, a rate that is 0.8 percentage point below its long-run (1972–2021) average.

Industrial Production and Capacity Utilization: Summary
Seasonally adjusted
Industrial production 2017=100 Percent change
2022 2022 Dec. '21 to
Dec. '22
July[r] Aug.[r] Sept.[r] Oct.[r] Nov.[r] Dec.[p] July[r] Aug.[r] Sept.[r] Oct.[r] Nov.[r] Dec.[p]
       
Total index 104.5 104.5 104.8 104.8 104.2 103.4 .5 .0 .3 .0 -.6 -.7 1.6
Previous estimates 104.5 104.4 104.8 104.7 104.5   .5 -.1 .4 -.1 -.2    
       
Major market groups
Final Products 104.6 105.0 105.0 105.7 104.9 104.4 .4 .4 -.1 .7 -.7 -.5 2.5
Consumer goods 104.4 104.6 104.3 105.1 104.5 104.4 .2 .2 -.3 .7 -.5 -.1 1.7
Business equipment 97.5 98.3 99.0 99.3 97.6 95.6 .7 .8 .7 .4 -1.8 -2.0 1.5
Nonindustrial supplies 102.2 102.0 102.2 101.9 101.5 100.2 .4 -.2 .2 -.3 -.4 -1.3 -.8
Construction 104.5 104.1 104.7 104.5 104.2 102.7 .6 -.3 .6 -.2 -.3 -1.4 -2.1
Materials 105.0 104.7 105.4 104.9 104.4 103.6 .6 -.3 .7 -.5 -.5 -.7 1.7
       
Major industry groups
Manufacturing (see note below) 101.5 101.7 101.9 102.2 101.1 99.8 .4 .2 .2 .3 -1.1 -1.3 -.5
Previous estimates 101.5 101.6 102.0 102.2 101.6   .4 .1 .3 .3 -.6    
Mining 116.9 116.8 119.2 119.1 117.7 116.7 1.3 .0 2.0 .0 -1.2 -.9 5.8
Utilities 107.7 106.3 104.2 101.6 106.2 110.2 .1 -1.3 -2.0 -2.5 4.5 3.8 9.7

Capacity utilization Percent of capacity Capacity
growth
Average
1972-
2021 		1988-
89
high 		1990-
91
low 		1994-
95
high 		 
2009
low 		 
2021
Dec. 		   
2022 Dec. '21 to
Dec. '22
July[r] Aug.[r] Sept.[r] Oct.[r] Nov.[r] Dec.[p]
       
Total industry 79.6 85.2 78.8 85.0 66.6 78.7 80.0 79.9 80.1 80.0 79.4 78.8 1.6
Previous estimates             80.0 79.9 80.1 79.9 79.7    
       
Manufacturing (see note below) 78.2 85.6 77.3 84.7 63.4 78.6 79.1 79.2 79.3 79.5 78.5 77.5 1.0
Previous estimates             79.1 79.1 79.3 79.5 78.9    
Mining 86.3 86.2 84.3 88.6 78.9 85.8 88.6 88.3 89.9 89.8 88.6 87.7 3.4
Utilities 84.7 92.9 84.5 92.9 78.0 71.8 75.9 74.7 73.1 71.1 74.1 76.8 2.6
       
Stage-of-process groups
Crude 85.5 87.9 84.8 90.0 76.9 84.7 87.1 86.6 87.6 87.4 86.3 85.4 2.5
Primary and semifinished 80.1 86.5 78.0 87.8 63.5 77.5 78.7 78.3 78.2 77.6 77.8 77.3 1.1
Finished 76.7 83.3 77.5 80.7 66.4 77.7 78.4 78.9 78.9 79.5 78.4 77.7 1.6
[r] Revised. [p] Preliminary.
Market Groups

The indexes for all major market groups except defense and space equipment decreased for a second consecutive month in December. Business equipment recorded the largest drop (2.0 percent), followed by construction supplies (1.4 percent) and business supplies (1.3 percent). The index for materials fell 0.7 percent, as a loss for non-energy materials offset a modest gain for energy materials. The index for consumer goods edged down 0.1 percent, with an increase for consumer energy products mostly offsetting decreases for durable and non-energy nondurable goods. The index for defense and space equipment rose 1.0 percent in December and increased 14.0 percent at an annual rate in the fourth quarter.

Industry Groups

Manufacturing output fell 1.3 percent in December and moved down 2.5 percent at an annual rate in the fourth quarter. In December, the indexes for durable and nondurable manufacturing dropped 1.1 percent and 1.5 percent, respectively, while the index for other manufacturing (publishing and logging) stepped down 0.9 percent. Within durables, most major industries posted declines of at least 1 percent; machinery and wood products recorded the largest declines, at 3.4 percent and 2.1 percent, respectively. Within nondurables, the indexes for all major industries declined, with the indexes for printing and support and for petroleum and coal products contracting more than 3 percent.

Mining output declined 0.9 percent in December; the index edged up 0.7 percent at an annual rate in the fourth quarter, a notable step-down from its rates of increase in the second and third quarters. The output of utilities jumped 3.8 percent in December, driven by increases for both electric and natural gas utilities.

Capacity utilization for manufacturing decreased 1.0 percentage point in December to 77.5 percent, a rate that is 0.7 percentage point below its long-run average. The operating rate for mining fell 0.9 percentage point to 87.7 percent, while the operating rate for utilities jumped 2.7 percentage points to 76.8 percent. The rate for mining was 1.4 percentage points above its long-run average, while the rate for utilities remained substantially below its long-run average.

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 spring of 2023. New annual benchmark data for manufacturing for 2021 will be incorporated, as well as other annual data, including information on the mining of metallic and nonmetallic minerals (except fuels). 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 2022 from the U.S. Census Bureau's Quarterly Survey of Plant Capacity Utilization, along with new data on capacity from the U.S. Geological Survey, the U.S. Department of Energy, and other organizations.

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.

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Last Update: January 18, 2023