Industrial Production and Capacity Utilization - G.17

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Release Date: July 14, 2017

Industrial production rose 0.4 percent in June for its fifth consecutive monthly increase. Manufacturing output moved up 0.2 percent; although factory output has gone up and down in recent months, its level in June was little different from February. The index for mining posted a gain of 1.6 percent in June, just slightly below its pace in May. The index for utilities, however, remained unchanged. For the second quarter as a whole, industrial production advanced at an annual rate of 4.7 percent, primarily as a result of strong increases for mining and utilities. Manufacturing output rose at an annual rate of 1.4 percent, a slightly slower increase than in the first quarter. At 105.2 percent of its 2012 average, total industrial production in June was 2.0 percent above its year-earlier level. Capacity utilization for the industrial sector increased 0.2 percentage point in June to 76.6 percent, a rate that is 3.3 percentage points below its long-run (1972–2016) average.

Industrial Production and Capacity Utilization: Summary
Seasonally adjusted
Industrial production 2012=100 Percent change
2017 2017 June '16 to
June '17
Jan.[r] Feb.[r] Mar.[r] Apr.[r] May[r] June[p] Jan.[r] Feb.[r] Mar.[r] Apr.[r] May[r] June[p]
Total index 103.5 103.7 103.8 104.7 104.8 105.2 -.3 .2 .1 .8 .1 .4 2.0
Previous estimates 103.5 103.7 103.9 105.0 105.0 -.3 .3 .1 1.1 .0
Major market groups
Final Products 100.3 99.8 100.0 101.5 101.4 101.5 -.7 -.5 .2 1.5 -.1 .1 .8
Consumer goods 104.0 103.1 103.4 105.0 105.1 105.1 -1.1 -.9 .3 1.5 .1 .0 .2
Business equipment 99.6 99.7 99.4 100.9 99.9 100.1 -.1 .1 -.3 1.5 -.9 .1 .7
Nonindustrial supplies 104.9 105.3 105.3 105.6 105.4 105.5 .1 .3 .0 .3 -.2 .1 1.5
Construction 110.5 112.3 111.1 112.3 111.8 111.7 1.4 1.6 -1.1 1.1 -.4 -.1 3.9
Materials 105.3 106.2 106.3 106.8 107.1 107.8 .0 .9 .1 .5 .3 .7 3.1
Major industry groups
Manufacturing (see note below) 103.0 103.3 102.5 103.5 103.1 103.3 .4 .3 -.8 1.0 -.4 .2 1.2
Previous estimates 103.0 103.4 102.6 103.7 103.3 .4 .4 -.8 1.1 -.4
Mining 103.3 107.0 106.4 107.1 109.2 111.0 1.4 3.6 -.5 .7 1.9 1.6 9.9
Utilities 98.5 93.8 101.4 101.6 102.4 102.5 -7.2 -4.8 8.2 .1 .8 .0 -2.2
Capacity utilization Percent of capacity Capacity
growth
Average
1972-
2016 		1988-
89
high 		1990-
91
low 		1994-
95
high
2009
low
2016
June
2017 June '16 to
June '17
Jan.[r] Feb.[r] Mar.[r] Apr.[r] May[r] June[p]
Total industry 79.9 85.2 78.8 85.0 66.7 75.8 75.7 75.8 75.8 76.4 76.4 76.6 1.0
Previous estimates 75.7 75.9 75.9 76.7 76.6
Manufacturing (see note below) 78.4 85.6 77.3 84.6 63.7 75.1 75.4 75.6 75.0 75.7 75.3 75.4 .7
Previous estimates 75.4 75.7 75.0 75.8 75.5
Mining 87.0 86.1 83.8 88.6 78.4 77.7 80.0 82.7 82.1 82.4 83.7 84.8 .7
Utilities 85.6 93.2 84.7 93.2 78.1 79.3 73.7 70.1 75.8 75.8 76.4 76.4 1.4
Stage-of-process groups
Crude 86.1 87.7 84.5 90.1 76.3 78.1 80.4 81.7 81.3 81.5 82.3 83.3 1.0
Primary and semifinished 80.5 86.5 78.1 87.8 63.8 75.7 74.9 74.6 75.4 75.8 75.8 75.9 .8
Finished 76.9 83.4 77.3 80.6 66.7 75.1 74.9 74.9 74.3 75.2 74.8 74.9 .8
r Revised. p Preliminary.
Market Groups

The output of consumer goods was unchanged in June but rose at an annual rate of 6.1 percent in the second quarter. Consumer durables recorded a gain of 1.0 percent in June as a result of sizable increases in the indexes for automotive products and for appliances, furniture, and carpeting. The indexes for consumer non-energy nondurables and for consumer energy products declined 0.3 percent and 0.4 percent, respectively. The output of business equipment edged up 0.1 percent; the indexes for its major components were all little changed from May. Similarly, the indexes for defense and space equipment, construction supplies, and business supplies were nearly unchanged in June. The production of materials moved up 0.7 percent. The output of energy materials jumped about 1 percent, and durable and nondurable materials each posted increases of about 1/2 percent.

Industry Groups

Manufacturing output moved up 0.2 percent in June following a decline in May. The production of durables advanced 0.4 percent, while the indexes for nondurables and for other manufacturing (publishing and logging) were little changed. Nearly all major industry groups within durables posted gains. Within nondurables, plastic and rubber products registered an increase of more than 1 percent, and apparel and leather recorded a decrease of more than 1 percent; the other major components of nondurables posted gains or losses of 1/2 percent or less.

The index for mining recorded a second consecutive gain of more than 1-1/2 percent in June, with advances in oil and gas extraction, in coal mining, and in drilling and support activities. Although mining production was 9.9 percent higher than its year-earlier level, it was still 9.0 percent below its peak in December 2014. After jumping 14.1 percent at an annual rate in the first quarter, the index for mining increased at the same pace in the second quarter. The output of utilities was unchanged in June, as a decrease for gas utilities was offset by an increase for electric utilities.

Capacity utilization for manufacturing rose 0.1 percentage point in June to 75.4 percent, a rate that is 3.0 percentage points below its long-run average. The operating rates for durables and for other manufacturing (publishing and logging) each advanced, while the rate for nondurables remained unchanged. Capacity utilization for all three of these major components of manufacturing remained below their respective long-run averages, with the deficit being the greatest for other manufacturing. Utilization for mining moved up 1.1 percentage points to 84.8 percent in June but remained below its long-run average. The operating rate for utilities was unchanged at 76.4 percent.

Note: Revised Estimates of Industrial Capacity

The estimates for industrial capacity for 2017 were revised for this release. The revisions reflect updated measures of physical capacity from various government and private sources as well as updated estimates of capital spending by industry. Measured from the fourth quarter of 2016 to the fourth quarter of 2017, capacity indexes for the industrial sector and for manufacturing are now expected to increase 1.1 percent and 0.7 percent, respectively; each gain is 0.1 percentage point higher than previously estimated. Mining capacity is now expected to rise 2.7 percent. This increase is 0.5 percentage point higher than previously estimated, primarily reflecting faster capacity growth for oil and gas extraction. The increase in capacity for utilities is unrevised at 0.7 percent.

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.

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Last Update: July 14, 2017