INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION

[Annual Revision Notice Below]

Industrial production decreased 1.1 percent in May after having fallen a downward-revised 0.7 percent in April. The average decrease in industrial production during the first three months of the year was 1.6 percent. Manufacturing output moved down 1.0 percent in May with broad-based declines across industries. Outside of manufacturing, the output of mines dropped 2.1 percent, and the output of utilities fell 1.4 percent. At 95.8 percent of its 2002 average, overall industrial output in May was 13.4 percent below its year-earlier level. The rate of capacity utilization for total industry declined further in May to 68.3 percent, a level 12.6 percentage points below its average for 1972-2008. Prior to the current recession, the low over the history of this series, which begins in 1967, was 70.9 percent in December 1982.

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION: SUMMARY
Seasonally adjusted

Industrial production	2002=100						Percent change
	2008 Dec.[r]	2009					2008 Dec.[r]	2009					May '08 to May '09
		Jan.[r]	Feb.[r]	Mar.[r]	Apr.[r]	May[p]		Jan.[r]	Feb.[r]	Mar.[r]	Apr.[r]	May[p]
Total index	102.4	100.2	99.4	97.6	96.9	95.8	-2.3	-2.1	-.8	-1.8	-.7	-1.1	-13.4
Previous estimates	102.4	100.3	99.3	97.6	97.1		-2.2	-2.1	-1.0	-1.7	-.5
Major market groups
Final Products	106.1	103.5	102.8	101.6	100.9	100.0	-.6	-2.5	-.6	-1.2	-.7	-1.0	-9.8
Consumer goods	100.6	98.7	98.8	98.3	98.1	97.2	-1.4	-1.9	.1	-.5	-.2	-.8	-7.1
Business equipment	120.8	115.8	113.9	110.8	108.7	107.2	2.7	-4.1	-1.6	-2.7	-1.9	-1.4	-16.5
Nonindustrial supplies	96.5	94.7	93.2	91.2	90.4	89.5	-3.3	-1.9	-1.6	-2.2	-.8	-1.0	-15.8
Construction	89.1	85.9	84.6	82.3	81.0	80.2	-4.9	-3.6	-1.4	-2.8	-1.5	-1.0	-21.5
Materials	101.0	99.1	98.5	96.2	95.6	94.3	-3.6	-1.9	-.6	-2.3	-.7	-1.4	-15.9
Major industry groups
Manufacturing (see note below)	100.6	97.9	97.8	96.0	95.4	94.4	-2.9	-2.7	-.1	-1.9	-.6	-1.0	-15.3
Previous estimates	100.7	98.0	97.9	95.8	95.5		-2.9	-2.7	-.1	-2.1	-.3
Mining	103.4	102.9	101.0	99.1	95.9	93.8	-1.9	-.5	-1.8	-1.9	-3.2	-2.1	-10.5
Utilities	111.3	111.5	106.4	105.3	106.0	104.5	2.0	.2	-4.5	-1.1	.7	-1.4	-3.4

Market Groups

The production of consumer goods fell 0.8 percent in May with declines in both consumer durables and nondurables. The output of consumer durables dropped 2.9 percent; all major categories registered significant declines. The index for automotive products fell 5.2 percent but still remained above its trough in January of this year. The output indexes for the other major categories of consumer durables declined between 1 and 2 percent in May. The production of consumer nondurables moved down 0.4 percent. A decline of 3.1 percent in consumer energy products more than offset a 0.5 percent increase in nondurable non-energy goods. A decrease in gasoline output was the largest contributor to the drop in consumer energy products. Among consumer nondurable non-energy goods, production of foods and tobacco and of chemical products increased, while the output indexes for both clothing and paper products declined slightly.

The output of business equipment dropped 1.4 percent in May and was more than 16 percent below its year-earlier level. The declines in May for information processing equipment and for industrial and other equipment were similar to those in April. The production of information processing equipment decreased 0.4 percent, and the production of industrial and other equipment fell 2.3 percent. The index for transit equipment moved down 0.5 percent in May after having fallen 3.6 percent in April. The production of defense and space equipment increased 0.7 percent in May and was little changed from its year-earlier level.

Among nonindustrial supplies, the output indexes for both business supplies and construction supplies fell 1.0 percent in May. The production of materials declined 1.4 percent. The output of durable materials dropped 2.3 percent, with decreases in all major categories. Lower production of motor vehicle parts was largely responsible for a decline of 5.5 percent in consumer parts. Among non-energy nondurable materials, the indexes for textiles and paper each moved down about 1 percent; the production of chemicals edged up 0.1 percent. The output of energy materials decreased 1.4 percent.

Industry Groups

Manufacturing output fell 1.0 percent in May and was more than 15 percent below its year-earlier level. The factory operating rate decreased 0.6 percentage point to a historical low of 65.0 percent in May; prior to this recession, the low for this series, which begins in 1948, was 68.6 percent in December 1982. The production of durable goods fell 1.8 percent with declines in most categories. The largest decreases were in motor vehicles and parts and in machinery. Gains were recorded in primary metals, aerospace and miscellaneous transportation equipment, and miscellaneous manufacturing. The production of nondurable goods edged down 0.2 percent. Gains in the output of food, beverages, and tobacco products; apparel and leather; and chemicals were offset by declines of more than 1 percent in textile and product mills, paper, and petroleum and coal products. Production in non-NAICS manufacturing, which consists of publishing and logging, decreased 0.6 percent.

The output of electric and gas utilities fell 1.4 percent, and the sector's operating rate dropped 1.3 percentage points to 79.3 percent, a rate 7.5 percentage points below its 1972-2008 average. Mining output moved down 2.1 percent, and the utilization rate fell to 80.8 percent.

Capacity utilization rates in May at industries grouped by stage of process were as follows: At the crude stage, utilization fell 0.9 percentage point, to 77.7 percent, a rate 8.9 percentage points below its 1972-2008 average; at the primary and semifinished stages, utilization dropped 1.1 percentage points, to 65.6 percent, a rate 16.4 percentage points below its long-run average; and at the finished stage, utilization decreased 0.2 percentage point, to 67.4 percent, a rate 10.3 percentage points below its long-run average.

Revision of Industrial Production and Capacity Utilization

The Federal Reserve Board released its annual revision to the index of industrial production (IP) and the related measures of capacity utilization on March 27, 2009. The revision affected the data from January 1972 through February 2009; most of the changes were for the period beginning in 2004 (the index levels for IP, but not the rates of change, may have been changed before 1972 to maintain consistency with the revised indexes for 1972 and after). The revised IP indexes incorporated data from selected editions of the U.S. Census Bureau's 2007 Current Industrial Reports. Detailed data from the 2007 Economic Census, however, were not available. Annual data from the U.S. Geological Survey regarding metallic and nonmetallic minerals (except fuels) for 2007 were incorporated. Utilization rates were updated to incorporate data from the U.S. Census Bureau's Quarterly Survey of Plant Capacity through 2008 as well as data from other government and trade sources.

The published revision release and revised data are available on the Board's website at www.federalreserve.gov/releases/G17. The revised data are also available through the website of the Department of Commerce. Further information on the revision 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