EconoIndicators

Industrial Production At a Glance

• Industrial Production Index: 113.7
• (Base year 2002)
• Monthly Change: Down 0.5%%
• Manufacturing Change: Down 0.2%
• Mining Change: Up 0.4%
• Utilities Change: Down 3.7%
• Capacity Utilization: 80.9%
• Long Run Average Capacity Utilization: 81%

Technorati Tags: industrial, production, capacity, utilization, manufacturing, mining, utilities

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION G.17

Industrial production fell 0.5 percent in February after having increased 0.1 percent in January. Much of
the decrease in February resulted from a weather-related drop of 3.7 percent in the output of utilities.
In the manufacturing sector, output decreased 0.2 percent in February, and declines were fairly widespread
across industries. The output of mines moved up 0.4 percent. At 113.7 percent of its 2002 average, total
industrial production was 1.0 percent above its year-earlier level. The capacity utilization rate for
total industry in February fell 0.6 percentage point, to 80.9 percent, the lowest rate since November 2005.

Market Groups
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The production of consumer goods decreased 0.6 percent in February with declines in the production of both
consumer durables and consumer nondurables. Among durable consumer goods, the production index for
automotive products moved down 1.3 percent, to a level roughly the same as its year-earlier reading. The
production of appliances, furniture, and carpeting dropped 3.1 percent further, and the output of
miscellaneous consumer durables edged down. The output of home electronics advanced 1.2 percent after
having fallen nearly 1 percent in the previous month. The output of non-energy nondurables advanced 0.2
percent; gains in the production of food and tobacco, chemical products, and paper products offset declines
in clothing production. The output of consumer energy goods dropped as a result of lower sales by
utilities to residences.

The output of business equipment edged up 0.1 percent in February, as an increase in information
processing equipment outweighed decreases both in transit equipment and in industrial and other equipment.
Information processing equipment rose 1.4 percent with continued gains in most of its components. A
decrease of 0.4 percent in transit equipment resulted from declines in motor vehicle assemblies and in the
production of civilian aircraft. The index for industrial and other equipment fell 0.5 percent; within
industrial equipment, declines were widespread.

The output of defense and space equipment declined 0.3 percent in February after having increased 1.0
percent in January.

The output of construction supplies fell 0.8 percent in February after having decreased 0.6 percent in
January; the level of production in February was nearly 1 percent below its year-earlier level and
5.2 percent below its peak in 2006. The output of business supplies declined 1.1 percent in February.

The production of materials fell 0.5 percent in February after having changed little in January. Within
non-energy materials, the index for durable materials edged down 0.2 percent in February. A gain in
equipment parts was outweighed by a decline in consumer parts, which reflected lower output of motor
vehicle parts, and by a decrease in other durable materials. The output of nondurable materials moved down
0.3 percent; the indexes for textile materials, paper materials, and chemical materials each declined 0.3
percent. Energy materials fell 1.0 percent as a result of a decrease in utility output.

Industry Groups
—————

Manufacturing production decreased 0.2 percent in February after having been unchanged in January. The
factory operating rate fell 0.3 percentage point in February, to 79.3 percent, a level 0.5 percentage point
below its 1972-2007 average. The production of durable goods moved down 0.4 percent. Large production
declines were recorded in wood products, primary metals, motor vehicles and parts, furniture and related
products, and miscellaneous products. Increases occurred in machinery and in computer and electronic
products. The production of nondurables edged down 0.1 percent after having risen the same amount in
January. In February, a decrease in printing and support, as well as small declines in some other
categories, more than offset small gains in the production of food, beverage, and tobacco products; paper;
and petroleum and coal products. The output of non-NAICS industries (publishing and logging) edged down
0.1 percent and was 0.7 percent below its year-earlier level.

The output of electric utilities fell 3.5 percent in February, and the output of natural gas utilities
dropped 5.0 percent. The operating rate for utilities moved down 3.4 percentage points, to 84.7 percent, a
level 2.0 percentage points below its 1972-2007 average. Mining production rose 0.4 percent; the capacity
utilization rate for mining edged up to 92.0 percent, a rate 4.5 percentage points above its long-run
average.

Capacity utilization at industries grouped by stage of process changed as follows: For the crude stage,
utilization was unchanged at 90.2 percent, a rate that is 3.6 percentage points above its 1972-2007
average; for the primary and semifinished stages, utilization decreased 1.0 percentage point, to 80.9
percent; and for the finished stage, utilization edged down 0.2 percentage point to 78.0 percent.

Notice

Revision of Industrial Production and Capacity Utilization

The Federal Reserve Board will issue an annual revision to the indexes of industrial production (IP) and
the related measures of capacity and capacity utilization on March 28, 2008. The revised IP indexes will
incorporate data from the 2006 Annual Survey of Manufactures and data from selected editions of the 2006
Current Industrial Reports, all from the U.S. Census Bureau. Annual data from the U.S. Geological Survey
regarding metallic and nonmetallic minerals (except fuels) for 2006 will also be incorporated. The update
will include revisions to the monthly indicator (either product data or input data) and to seasonal factors
for each industry as well as changes in the estimation methods for some series. Any changes to methods for
estimating the output of an industry will affect the indexes from 1972 to the present.

After the publication of the revision, later monthly releases will include new or revised indexes for a
six-month reporting window, which will encompass one month of new data and revisions to the previous five
months of data. The new longer reporting window will allow the incorporation of additional lagging data
before an annual revision. Over the past year, with a six-month window, an additional 3 percent to 4
percent of IP would have reflected source data. The longer reporting window will cause the latest month of
data shown for a few indexes to be as many as five months earlier than the latest value for aggregate
industrial production; data for detailed production indexes are not shown in the supplement to the G.17
release until either the underlying data are available or the reporting window is closed. Currently, the
data issued for only one or two of the published indexes would be affected by this change.

Capacity and capacity utilization will be revised to reflect the revised production indexes and to
incorporate data from the Census Bureau’s 2006 Survey of Plant Capacity, which covers manufacturing, along
with new data on capacity from the U.S. Geological Survey, the Department of Energy, and other
organizations.

G.17 Industrial Production - February 2008 [PDF]

G.17 Industrial Production - February 2008 [Text]