INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION

[2007 Revision Notice Below]

Industrial production rose 0.2 percent in August after an increase of 0.5 percent in July. At 114.4 percent of its 2002 average, total industrial production in August was 1.7 percent above its year-earlier level. Manufacturing output fell 0.3 percent in August after five consecutive months of increases, mining output dropped 0.6 percent, but unusually hot weather contributed to an increase of 5.3 percent in the output of utilities. Capacity utilization for total industry was unchanged, at 82.2 percent, a rate 0.2 percentage point below its level in August 2006 but 1.2 percentage points above its 1972-2006 average.

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION: SUMMARY
Seasonally adjusted

Industrial production	2002=100				Percent change
	2007				2007				Aug. '06 to Aug. '07
	May	June	July	Aug.	May	June	July	Aug.
Total index	113.0	113.6	114.2	114.4	-.1	.6	.5	.2	1.7
Previous estimates	112.8	113.5	113.9		-.2	.6	.3
Major market groups
Final Products	114.0	114.8	115.5	115.5	-.2	.7	.6	.0	2.3
Consumer goods	108.8	109.4	109.9	110.0	-.4	.6	.4	.1	2.1
Business equipment	131.1	132.1	133.7	133.4	.2	.8	1.2	-.2	3.7
Nonindustrial supplies	110.8	111.3	111.1	112.0	-.1	.5	-.2	.7	.5
Construction	109.1	110.3	110.3	110.3	.7	1.1	.0	.0	-.9
Materials	112.7	113.2	114.0	114.3	.0	.5	.7	.2	1.5
Major industry groups
Manufacturing (see note below)	114.9	115.7	116.6	116.3	.1	.7	.7	-.3	1.7
Previous estimates	114.8	115.5	116.2		-.1	.6	.6
Mining	99.9	100.3	101.1	100.4	-.3	.4	.8	-.6	.5
Utilities	108.0	107.4	105.7	111.3	-1.5	-.6	-1.7	5.3	2.3

Market Groups

The production of consumer goods edged up 0.1 percent in August. The production of durable consumer goods decreased 1.0 percent; the drop was due mainly to a reduction of 2.1 percent in the output of automotive products. Elsewhere, the output of home electronics declined 0.2 percent; the output of appliances, furniture, and carpeting fell 0.6 percent; but the index for miscellaneous durable goods rose 0.2 percent. The production of nondurable non-energy consumer goods fell 0.3 percent; decreases in the production of foods and tobacco, of clothing, and of paper products more than offset an increase in the production of consumer chemical products. Boosted by residential sales of electricity, the index for consumer energy goods rose 3.5 percent.

The index for business equipment fell 0.2 percent in August. The output of transit equipment declined 0.2 percent, as a reduction in motor vehicle assemblies more than offset an increase in the production of civilian aircraft. The index for industrial and other equipment decreased 0.6 percent; although farm machinery increased for the second month in a row, other machinery categories registered declines. The production of defense and space equipment fell 0.6 percent.

The index for construction supplies stayed flat in August. The index for business supplies rose 1.0 percent as a result of an increase in the commercial sales of electricity; the output of non-energy business supplies was unchanged.

The production of materials rose 0.2 percent in August. Within non-energy materials, the index for durable materials fell 0.2 percent, and the index for nondurable materials fell 0.1 percent. The decrease in durable materials reflected reduced output of motor vehicle parts as well as decreases in a variety of equipment parts. Among nondurable materials, declines in the output of textiles and of chemicals more than offset an increase in the production of paper. The output of energy materials climbed 1.5 percent.

Industry Groups

Manufacturing output fell 0.3 percent in August, as production of both durable and nondurable goods decreased. The factory operating rate for manufacturing declined 0.3 percentage point in August, to 80.7 percent, a rate about 1 percentage point above its 1972-2006 average. The production of durable goods fell 0.3 percent. Decreases were recorded in wood products; machinery; electrical equipment, appliances, and components; motor vehicles and parts; furniture and related products; and miscellaneous manufacturing, whereas increases were registered in nonmetallic mineral products; primary metals; fabricated metal products; computer and electronic products; and aerospace and miscellaneous transportation equipment. The production of nondurable goods moved down 0.2 percent. Declines in the indexes for food, beverage, and tobacco products; for textile and product mills; for apparel and leather; for petroleum and coal products; and for plastics and rubber products more than offset gains in paper, printing and support, and chemical products. The output of the non-NAICS manufacturing industries (logging and publishing) fell 0.3 percent.

The output of utilities jumped 5.3 percent in August. Electric utility output increased 6.3 percent, whereas the output of natural gas utilities was unchanged. The operating rate at utilities rose to 87.9 percent, a rate 1.2 percentage points above its 1972-2006 average. The output of mines fell 0.6 percent, and the capacity utilization rate for mining fell 0.6 percentage point, to 90.2 percent, a rate 2.8 percentage points above its long-run average.

In August, capacity utilization for industries in the crude stage moved down 0.3 percentage point, to 89.6 percent. For industries in the primary and semifinished stages, capacity utilization advanced 0.6 percentage point, to 83.1 percent; for industries in the finished stage, capacity utilization fell 0.4 percentage point, to 78.8 percent.

Notice

Revision of Industrial Production and Capacity Utilization

The Federal Reserve Board plans to issue an annual revision to the index of industrial production (IP) and the related measures of capacity and capacity utilization around the end of March 2008. The revised IP indexes will incorporate data from the 2006 Annual Surveys of Manufactures and 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 updating 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 index from 1972 to the present. After the release of the revision, subsequent monthly releases will include new or revised indexes for a six-month reporting window: one month of new data and revisions for the previous five months.

Capacity and capacity utilization will be revised 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.

Once the revision is published, it will be available on the Board's website at www.federalreserve.gov/releases/G17. The revised data will also be available through the website of the Department of Commerce. Further information on these revisions can be obtained from the Board's Industrial Output Section (telephone number 202-452-3197).

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.


G.17 Release Tables:

Ascii	Screen reader	Summary: Industrial Production and Capacity Utilization
Chart		Chart 1: Industrial Production, Capacity, and Capacity Utilization
Chart		Chart 2: Industrial Production and Capacity Utilization
Chart		Chart 3: Industrial Production and Capacity Utilization, High Technology Industries
Ascii	Screen reader	Table 1: Industrial Production: Market and Industry Groups (percent change)
Ascii	Screen reader	Table 2: Industrial Production: Special Aggregates and Selected Detail (percent change)
Ascii	Screen reader	Table 3: Motor Vehicle Assemblies
Ascii	Screen reader	Table 4: Industrial Production Indexes: Market and Industry Group Summary
Ascii	Screen reader	Table 5: Industrial Production Indexes: Special Aggregates
Ascii	Screen reader	Table 6: Diffusion Indexes of Industrial Production
Ascii	Screen reader	Table 7: Capacity Utilization: Manufacturing, Mining, and Utilities
Ascii	Screen reader	Table 8: Industrial Capacity: Manufacturing, Mining, and Utilities (percent change)
Ascii	Screen reader	Table 9: Industrial Production: Gross Value of Products and Nonindustrial Supplies
Ascii	Screen reader	Table 10: Gross-Value-Weighted Industrial Production: Stage-of-Process Groups
Ascii	Screen reader	Table 11: Historical Statistics for IP, Capacity, and Utilization: Total Industry
Ascii	Screen reader	Table 12: Historical Statistics for IP, Capacity, and Utilization: Manufacturing
Ascii	Screen reader	Table 13: Historical Statistics for IP, Capacity, and Utilization: Total Industry excluding Selected High-Technology Industries
Ascii	Screen reader	Table 14: Historical Statistics for IP, Capacity, and Utilization: Manufacturing excluding Selected High-Technology Industries