Industrial Production and Capacity Utilization: The 2009 Annual Revision
Figure 1 long description. Industrial production, capacity, and capacity utilization: Total industry, January 1999-June 2009. The figure shows the revised and previous measures of industrial production, capacity, and capacity utilization; data are plotted as curves in two separate panels, production and capacity in the left panel and capacity utilization in the right panel. For production and capacity, ratio scale, 2002 output=100. For capacity utilization, the unit measure is percent.
Regions for the 2001 recession and for the recession that began in December 2007, as defined by the National Bureau of Economic Research (NBER), are shaded in both panels. The latter shaded area begins with the peak as defined by the NBER and ends at the trough of a three-month moving average of manufacturing IP (currently June 2009). The data underlying the contours of the curves shown in both panels are in table 1.
Total industrial production peaked at about 104 percent of its average 2002 level in late 2000, then fell through late 2001. It then rose steadily for the next 6 years, reaching a peak index level of about 112 in late 2007 before dropping through 2008 and the first half of 2009, and stood at about 95 in June 2009. The revisions to total industrial production lowered output slightly in 2008 and 2009, but output in earlier years is little changed from the previous estimates.
Capacity fell or was flat from mid-2002 through mid-2005, rose from mid-2005 to the end of 2008, and then declined slightly in 2009; revised estimates of industrial capacity are little changed from the previous estimates.
The revised estimates for capacity utilization for total industry in 2007 through 2009 are slightly lower than the previous estimates. After peaking in early 2000, at about 82-1/2, capacity utilization fell rapidly through the end of 2001, reaching around 73-1/2, and then climbed back up, somewhat erratically, over the next five years. It was flat at just above 80 through 2007 and then fell sharply through 2008 and 2009, reaching around 68 by June 2009.
NOTE: Here and in the following figures, the shaded areas are periods of business recession as defined by the National Bureau of Economic Research (NBER). The last shaded area begins with the peak as defined by the NBER and ends at the trough of a three-month moving average of manufacturing IP.
Data labeled "revised" correspond to the data in the Federal Reserve's Statistical Release G.17, "Industrial Production and Capacity Utilization," published on July 15, 2009. Data labeled "previous" are those published before the March 27, 2009, annual revision.
Figure 2 long description. Industrial production: Market groups, January 1989-June 2009. The figure shows four panels; the data are plotted as curves. Ratio scale, 2002=100. The panel in the upper left, "Products," shows the indexes for consumer goods and for final products and nonindustrial supplies. The panel in the lower left, "Nonindustrial supplies," shows the indexes for construction supplies and for business supplies. The panel in the upper right, "Equipment," shows the indexes for defense and space equipment and for business equipment. The panel in the lower right, "Industrial materials," shows the indexes for energy materials and for non-energy materials.
All four panels show shaded regions for the 1990-91 recession, for the 2001 recession, and for the recession that began in December 2007, as defined by the National Bureau of Economic Research (NBER). The last shaded area begins with the peak as defined by the NBER and ends at the trough of a three-month moving average of manufacturing IP (currently June 2009).
The production indexes for consumer goods, final products and nonindustrial supplies, construction supplies, and business supplies all increased between 40 and 60 percent from the trough of the 1990-91 recession through the end of 2007. Output for all of the four categories fell during the 1990-91 and 2001 recessions, but the output of consumer goods was the least cyclical. The production index for consumer goods rose from the end of 2001 through early 2007 but has fallen about 8 percent since then. The production indexes for final products and nonindustrial supplies and for business supplies rose from the end of 2001 through late 2007 but have fallen between 10 and 15 percent since then. The output of construction supplies has also risen since late 2001; however, this index peaked in early 2006 and has fallen more than 25 percent since then.
The output of business equipment nearly doubled from 1989 to June 2009, with a small drop during the 1990-91 recession and sizable drops both during the 2001 recession and since December 2007, the start of the latest recession. The output of defense and space equipment fell about 40 percent from 1989 through 2000 and then increased about 30 percent from 2000 to June 2009. The output of energy materials increased very slowly from 1989 forward, rising less than 15 percent in 20 years; the index shows notable dips in late 2005, when Hurricane Katrina damaged a number of energy-related facilities on the Gulf Coast, and in late 2008, when Hurricanes Gustav and Ike also damaged facilities. The output of non-energy materials fell in both the 1990-91 recession and the 2001 recession, but it nearly doubled in the years between them and resumed increasing, although at a slower pace, after the latter recession. This index peaked in December 2007, the start of the latest recession, and has fallen more than 25 percent since then.
Figure 3 long description. Industrial production: Manufacturing, and manufacturing excluding selected high-technology industries, January 1989-June 2009. The figure has two panels; the data are plotted as curves. Ratio scale, 2002=100. The upper panel shows the production indexes for manufacturing and for manufacturing excluding selected high-technology industries. The lower panel shows the percent change from a year earlier for each of the two indexes.
Both panels show shaded regions for the 1990-91 recession, for the 2001 recession, and for the recession that began in December 2007, as defined by the National Bureau of Economic Research (NBER). The last shaded area begins with the peak as defined by the NBER and ends at the trough of a three-month moving average of manufacturing IP (currently June 2009).
The figure shows that production in manufacturing generally advanced faster than production in manufacturing excluding selected high-technology industries, particularly from 1992 through 2000 and from 2002 forward. Overall manufacturing output, however, fell faster than output for the sector excluding selected high-technology industries during the 2001 recession and since December 2007, the start of the latest recession, as production of high-technology goods dropped substantially.
Note: Manufacturing consists of those industries in the North American Industry Classification System, or NAICS, definition of manufacturing plus those industries--logging and newspaper, periodical, book, and directory publishing--that traditionally have been considered to be manufacturing.
The selected high-technology industries are semiconductors and related electronic components (NAICS 334412-9), computers and peripheral equipment (NAICS 3341), and communications equipment (NAICS 3342).
Figure 4 long description. Industrial production: Selected high-technology industries, January 1998-June 2009. The figure contains one panel that shows the production indexes for communications equipment, computers, and semiconductors; the data are plotted as curves. Ratio scale, 2002=100.
The panel has shaded regions for the 2001 recession and for the recession that began in December 2007, as defined by the National Bureau of Economic Research (NBER). The latter shaded area begins with the peak as defined by the NBER and ends at the trough of a three-month moving average of manufacturing IP (currently June 2009).
The output of semiconductors increased the most rapidly of the three series from 1998 to mid-2008, and the level in August 2008, the month of its last peak, was roughly 12 times the level at the beginning of 1998. Since its peak in 2008, the output of semiconductors has fallen about 25 percent. In early 2008, the output index for computers was nearly 4 times its level in early 1998; it has fallen more than 30 percent since its peak in April 2008. In the beginning of 2009, the output index for communications equipment stood almost 2-1/2 times its level at the beginning of 1998. Production of communications equipment showed the sharpest drop during the 2001 recession, roughly 20 percent, and fell further during 2002. It then rose about 80 percent over the next 6-1/2 years to a peak in early 2009 and has fallen slightly since then.
Note: The selected high-technology industries are semiconductors and related electronic components (NAICS 334412-9), computers and peripheral equipment (NAICS 3341), and communications equipment (NAICS 3342).
Figure 5 long description. Capacity utilization: Selected high-technology industries, and manufacturing excluding selected high-technology industries, January 1989-June 2009. The figure contains one panel that shows the utilization rates for selected high-technology industries and for manufacturing excluding selected high-technology industries; the data are plotted as curves. The unit measure is percent.
The panel has shaded regions for the 1990-91 recession, for the 2001 recession, and for the recession that began in December 2007, as defined by the National Bureau of Economic Research (NBER). The last shaded area begins with the peak as defined by the NBER and ends at the trough of a three-month moving average of manufacturing IP (currently June 2009).
The utilization rate for manufacturing excluding selected high-technology industries generally decreased from 1989 through early 1991, during 1995, from late 1997 through late 2001, and from late 2007 through June 2009; it generally increased or was flat during other periods shown in the figure. The utilization rate for the selected high-technology industries moved in a similar pattern, though with more variability, from 1989 through 1995. Afterward, it showed substantially more volatility, with peaks in early 1996, mid-1997, mid-2000, mid-2006, and early 2008 and with troughs in early 1997, mid-1998, 2002, and mid-2007. Since the peak of 83 in early 2008, it has fallen to about 60 in June 2009.
Note: The selected high-technology industries are semiconductors and related electronic components (NAICS 334412-9), computers and peripheral equipment (NAICS 3341), and communications equipment (NAICS 3342).
Figure 6 long description. Capacity utilization: Selected high-technology industries, January 1996-June 2009. The figure has three panels; each panel shows the revised and previous utilization rates for the selected high-technology industries; the data are plotted as curves. The unit measure for the ratio scale is percent. The top panel covers computers and peripheral equipment, the middle panel covers communications equipment, and the bottom panel covers semiconductors and related electronic components.
Each panel has shaded regions for the 2001 recession and for the recession that began in December 2007, as defined by the National Bureau of Economic Research (NBER). The latter shaded area begins with the peak as defined by the NBER and ends at the trough of a three-month moving average of manufacturing IP (currently June 2009).
The revised utilization rate for computers and peripherals showed the same trends as the previously published rate; but the increase from late 2007 to mid-2008 is slightly higher in the revised data, and the decline since mid-2008 is not as steep. The contour of the utilization rate for communications equipment in 2005 through 2009 has been altered by the revision. In the previous data, the utilization rate rose steadily from the beginning of 2005 to a peak in early 2008 and then declined slightly. In the revised data, the increase is steeper in 2005 and early 2006, and the utilization rate reaches a peak of about 85 in mid-2006; it then declines, on balance, from mid-2006 to June 2009, to about 66. The utilization rate for semiconductors and related electronic components is hardly changed by the revision. Historically, the figure shows peaks in 1997, 2000, and 2006 at about 90, 97, and 88, respectively. The trough in 1998 was about 75, and the trough in early 2002 was about 58. The utilization rate declined slowly from mid-2006 to late 2008, then fell sharply, to about 55 in June 2009.