Industrial Production and Capacity Utilization

Release Date: January 17, 2003
Release dates | Historical data | Documentation
Current Monthly Release   Other formats: ASCII | PDF (144 KB)
Supplemental Monthly Release   Other formats: ASCII | PDF (144 KB)
Annual Revision Release   Other formats: ASCII | PDF (150 KB)

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION
[2002 Revision Notice Below]

Industrial production fell 0.2 percent in December. At 110.6 percent of its 1997 average, output was 2.1 percent above its level in December 2001. For the fourth quarter as a whole, industrial production declined at an annual rate of 2.4 percent. Manufacturing output declined 0.2 percent in December. A sharp drop in the production of motor vehicles and parts, which more than reversed its November gain, contributed to the overall decline. Excluding motor vehicles and parts, manufacturing output rose 0.2 percent. Capacity utilization for total industry edged down to 75.4 percent, a level 0.8 percentage point above that of December 2001 but 6.1 percentage points below its 1972-2001 average.

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION: SUMMARY Seasonally adjusted -------------------------------------------------------------------------------------------------------------------------------------- | 1997=100 | Percent change | ----------------------------------------------- | ------------------------------------------------- | 2002 | 2002 | Dec. '01 to Industrial production | Sept. Oct. Nov. Dec. | Sept. Oct. Nov. Dec. | Dec. '02 -------------------------------------------------------------------------------------------------------------------------------------- | | | Total index | 111.2 110.7 110.8 110.6 | -.1 -.5 .1 -.2 | 2.1 Previous estimates | 111.3 110.7 110.8 | .0 -.6 .1 | | | | Major market groups | | | Final Products | 107.4 106.7 107.1 106.6 | -.1 -.7 .3 -.5 | .3 Consumer goods | 107.9 107.1 107.7 107.1 | .2 -.8 .6 -.6 | 1.3 Business equipment | 106.9 106.2 106.0 105.5 | -1.1 -.6 -.2 -.5 | -2.8 Nonindustrial supplies | 115.8 115.4 114.9 114.7 | .4 -.3 -.5 -.2 | 2.1 Construction | 104.5 104.2 103.5 102.9 | -.3 -.3 -.7 -.6 | .3 Materials | 113.4 112.9 113.0 113.2 | -.2 -.4 .1 .1 | 4.1 | | | Major industry groups | | | Manufacturing (see note below) | 112.1 111.6 111.7 111.5 | -.2 -.4 .1 -.2 | 1.7 Previous estimates | 112.2 111.7 111.7 | -.2 -.5 .1 | Mining | 92.2 92.4 93.0 94.6 | -1.8 .1 .7 1.6 | -.5 Utilities | 113.3 111.3 111.3 110.0 | 2.7 -1.8 .0 -1.2 | 7.6 -------------------------------------------------------------------------------------------------------------------------------------- | | Capacity | Percent of capacity | growth | --------------------------------------------------------------------------------- | --------------- | Average 1982 1988-89 2001 | 2002 | Dec. '01 to Capacity utilization | 1972-2001 Low High Dec. | Sept. Oct. Nov. Dec. | Dec. '02 -------------------------------------------------------------------------------------------------------------------------------------- | | | Total industry | 81.5 70.8 85.1 74.6 | 76.0 75.6 75.6 75.4 | 1.1 Previous estimates | 74.6 | 76.1 75.5 75.6 | | | | Manufacturing (see note below) | 80.4 68.6 85.5 73.0 | 74.1 73.8 73.8 73.6 | .8 Previous estimates | | | Mining | 87.0 78.6 85.6 86.1 | 83.8 83.9 84.4 85.8 | -.1 Utilities | 86.7 77.2 92.6 83.5 | 88.4 86.3 85.9 84.4 | 6.5 | | | Stage-of-process groups | | | Crude | 86.5 77.2 88.6 82.1 | 83.1 82.8 82.9 84.2 | -.6 Primary and semifinished | 82.4 67.9 86.2 75.6 | 78.6 78.1 78.1 77.8 | 1.6 Finished | 78.7 71.3 83.1 71.9 | 71.3 70.9 71.0 70.6 | .9 -------------------------------------------------------------------------------------------------------------------------------------- r Revised. p Preliminary.

The statistics in this release cover output, capacity, and capacity utilization in the industrial sector, which the Federal Reserve defines as manufacturing, mining, and electric and gas utilities. Manufacturing consists of those industries included in the North American Industry Classification System, or NAICS, manufacturing plus those industries-logging and newspaper, periodical, book and directory publishing-that have traditionally been considered manufacturing and included in the industrial sector.

Market Groups

The output of consumer goods fell 0.6 percent in December. In the fourth quarter, consumer goods production declined at an annual rate of 2.8 percent. A 2.2 percent decline in the output of durables in December was largely due to a 4.3 percent drop in the output of automotive products. The index for appliances, furniture, and carpeting rose 0.9 percent, its fourth consecutive monthly increase. The output of nondurables edged down 0.1 percent. Among non-energy goods, declines in the production of foods and tobacco and of clothing outweighed gains in the output of chemical products and paper products. The index for energy products edged up 0.1 percent.

The production of business equipment moved down 0.5 percent in December. A drop of 3.6 percent in the output of transit equipment included noticeable declines in the production of motor vehicles and commercial aircraft. The indexes for information processing equipment and for industrial and other equipment posted small gains.

The output of defense and space equipment climbed 1.1 percent in December. For the fourth quarter as a whole, production increased at an annual rate of 3.9 percent. The index for construction supplies moved down 0.6 percent in December, and the index for business supplies was unchanged.

The production of industrial materials edged up 0.1 percent for a second consecutive month. The output of materials declined at an annual rate of 1.9 percent in the fourth quarter. For December, gains in the indexes for nondurable materials and energy materials slightly more than offset a contraction in the index for durable materials.

Industry Groups

Manufacturing output dipped 0.2 percent in December, to a level 1.7 percent higher than its level in December 2001. The overall factory operating rate fell 0.2 percentage point, to 73.6 percent, a level 0.6 percentage point above its year-earlier rate but 6.8 percentage points below its 1972-2001 average. A decrease of 4.7 percent in the production of motor vehicles and parts pulled down the index for durable goods, which fell 0.6 percent. Other major durable goods industries that registered declines in December included fabricated metal products, electrical equipment, nonmetallic mineral products, and wood products. December marked the fourth consecutive month in which the output of wood products has fallen more than 1.0 percent; that index declined at an annual rate of 14.3 percent in the fourth quarter. Major durable goods industries that recorded gains in December included primary metal, machinery, computer and electronic products, aerospace and miscellaneous transportation equipment, and miscellaneous goods. The production of nondurables edged up 0.1 percent. The nondurable industries reporting declines in output were food, beverage, and tobacco products; plastics and rubber products; and apparel and leather. All other major nondurables industries reported increases in production. The production of other (non-NAICS) manufacturing industries (publishing and logging) moved up 0.9 percent, (see Box "Revision of Industrial Production and Capacity Utilization").

Production at mines climbed 1.6 percent in December; the utilization rate rose 1.4 percentage points, to 85.8 percent, but was still 1.2 percentage points below its 1972-2001 average. The output of utilities fell 1.2 percent. The operating rate at utilities fell 1.5 percentage points; at 84.4 percent, the rate is 2.3 percentage points below its 1972-2001 average. Looking across stage-of-process groups, utilization rose 1.3 percentage points for industries in the crude category, fell 0.3 percentage point for operators at the primary and semifinished level of processing, and fell 0.4 percentage point for processors of finished goods.

[In Text Box :]

Revision of Industrial Production and Capacity Utilization

On December 5, the Federal Reserve Board published a revision to the index of industrial production (IP), the related measures of capacity and capacity utilization, and the data on industrial use of electric power. The revised estimates are classified according to the 2002 North American Industry Classification System (NAICS); previously, the estimates from 1987 forward were classified according to the 1987 Standard Industrial Classification (SIC) system. NAICS changes the SIC system's industry composition of manufacturing. To preserve the continuity of the production, capacity, and utilization rate measures featured in the Federal Reserve's G.17 statistical release, portions of SIC 27 (printing and publishing) and SIC 24 (lumber and products) that are not classified in manufacturing under NAICS continue to be included in the overall IP index and capacity utilization.

The revised production indexes are based on annual output measures that were constructed by reclassifying the establishments in historical Censuses of Manufactures and Mineral Industries under NAICS; annual output indexes constructed this way maximize the reliability and historical consistency of the IP industry detail. Data going back to 1972 were restated using NAICS. The monthly indicators used in current IP indexes were incorporated into the revised IP indexes as far back as the data allow.

The revised indexes are now expressed as percentages of output in 1997, beginning at the start date of each index: 1919 for total and manufacturing IP, 1948 for manufacturing capacity, and 1967 for total industrial capacity. The Federal Reserve's accompanying indexes of industrial electric power use, which began in 1972, also were restated to accord with NAICS, rebased to use 1997 as a comparison year, and revised to incorporate previously unavailable data.

The updated measures reflect the incorporation of newly available, more comprehensive source data typical of annual revisions. The updating of source data for IP in the 2002 annual revision included annual data from the 2000 Annual Survey of Manufactures of the Bureau of the Census and from selected editions of its 2000 and 2001 Current Industrial Reports. Annual data from the U.S. Geological Survey regarding metallic and nonmetallic minerals (except fuels) for 2000 and 2001 were also introduced. The updating included revisions to the monthly indicator for each industry (either physical product data, production-worker hours, or electric power usage) and revisions to seasonal factors.

Capacity and capacity utilization were revised to incorporate preliminary data from the 2001 Survey of Plant Capacity of the Bureau of the Census, which covers manufacturing, along with other new data on capacity from the U.S. Geological Survey, the U.S. Department of Energy, and other organizations. The statistics on the industrial use of electric power incorporate additional information received from utilities for the past few years and data from the 2000 Annual Survey of Manufactures.

The revision release and revised data are available on the Board's web site, at www.federalreserve.gov/releases/G17. The revised data are also available through the web site of the U.S. Department of Commerce. Further information on these revisions is available from the Board's Industrial Output Section (telephone 202-452-3197).

Statistical releases

Last update: January 17, 2003, 9:15 AM