Industrial Production and Capacity Utilization - G.17

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Release Date: March 16, 2018
Revision of Industrial Production and Capacity Utilization Notice Below

Industrial production rose 1.1 percent in February following a decline of 0.3 percent in January. Manufacturing production increased 1.2 percent in February, its largest gain since October. Mining output jumped 4.3 percent, mostly reflecting strong gains in oil and gas extraction. The index for utilities fell 4.7 percent, as warmer-than-normal temperatures last month reduced the demand for heating. At 108.2 percent of its 2012 average, total industrial production in February was 4.4 percent higher than it was a year earlier. Capacity utilization for the industrial sector climbed 0.7 percentage point in February to 78.1 percent, its highest reading since January 2015 but still 1.7 percentage points below its long-run (1972–2017) average.

Industrial Production and Capacity Utilization: Summary
Seasonally adjusted
Industrial production 2012=100 Percent change
2017 2018 2017 2018 Feb. '17 to
Feb. '18
Sept.[r] Oct.[r] Nov.[r] Dec.[r] Jan.[r] Feb.[p] Sept.[r] Oct.[r] Nov.[r] Dec.[r] Jan.[r] Feb.[p]
       
Total index 104.9 106.6 106.9 107.4 107.1 108.2 .3 1.6 .3 .5 -.3 1.1 4.4
Previous estimates 104.8 106.6 106.9 107.3 107.2   .2 1.7 .3 .4 -.1    
       
Major market groups
Final Products 102.2 103.3 102.8 103.1 103.4 104.0 .6 1.1 -.4 .3 .3 .5 4.2
Consumer goods 105.3 106.7 105.9 106.5 107.0 107.1 .3 1.3 -.7 .5 .5 .1 3.7
Business equipment 102.3 103.2 103.2 103.0 102.9 103.9 1.6 .9 .0 -.2 -.1 1.0 4.6
Nonindustrial supplies 105.1 106.0 106.3 107.1 105.9 106.8 .6 .8 .4 .7 -1.1 .8 1.4
Construction 111.2 111.6 112.4 113.4 111.3 113.8 1.9 .4 .6 .9 -1.9 2.3 1.2
Materials 106.7 109.2 110.1 110.7 110.2 112.0 -.1 2.4 .8 .5 -.5 1.6 5.4
       
Major industry groups
Manufacturing (see note below) 103.2 104.6 104.8 104.8 104.6 105.9 .2 1.3 .2 .1 -.2 1.2 2.5
Previous estimates 103.2 104.6 104.8 104.7 104.8   .2 1.3 .2 .0 .0    
Mining 109.8 111.6 114.0 114.3 112.5 117.4 1.6 1.7 2.1 .3 -1.5 4.3 9.7
Utilities 101.5 105.5 103.7 107.4 108.8 103.7 -1.2 4.0 -1.7 3.6 1.3 -4.7 10.5
Capacity utilization Percent of capacity Capacity
growth
Average
1972-
2017 		1988-
89
high 		1990-
91
low 		1994-
95
high 		 
2009
low 		 
2017
Feb. 		   
2017 2018 Feb. '17 to
Feb. '18
Sept.[r] Oct.[r] Nov.[r] Dec.[r] Jan.[r] Feb.[p]
       
Total industry 79.8 85.2 78.8 85.0 66.7 75.8 76.1 77.3 77.5 77.8 77.4 78.1 1.3
Previous estimates             76.1 77.3 77.5 77.7 77.5    
       
Manufacturing (see note below) 78.3 85.6 77.3 84.6 63.7 75.6 75.3 76.2 76.3 76.3 76.0 76.9 .8
Previous estimates             75.2 76.2 76.3 76.2 76.2    
Mining 87.0 86.1 83.8 88.6 78.4 82.7 83.3 84.5 86.1 86.2 84.3 87.6 3.6
Utilities 85.4 93.2 84.7 93.2 78.1 70.1 75.6 78.6 77.2 80.0 80.8 76.9 .8
       
Stage-of-process groups
Crude 86.0 87.7 84.5 90.1 76.3 81.7 80.9 83.5 84.8 84.8 83.2 85.8 3.3
Primary and semifinished 80.4 86.5 78.1 87.8 63.8 74.8 75.3 76.6 76.7 77.5 77.3 77.0 .6
Finished 76.9 83.4 77.3 80.6 66.7 74.8 75.6 76.0 75.6 75.5 75.5 76.5 .9
r Revised. p Preliminary.
Market Groups

The output of consumer goods edged up 0.1 percent in February. A drop of 6.1 percent for consumer energy products, due to declines in residential electricity and gas sales, nearly outweighed widespread and sizable gains posted by most other consumer goods categories. The output of durable consumer goods jumped 2.8 percent, while the output of non-energy nondurables moved up 1.0 percent. Business equipment registered a gain of 1.0 percent, with advances of more than 1.0 percent posted by transit equipment and information processing equipment and with a smaller increase recorded by industrial and other equipment. The index for defense and space equipment rose 1.5 percent. The output of construction supplies jumped 2.3 percent, while the index for business supplies was unchanged. The production of materials moved up 1.6 percent, with gains in almost all of its components.

Industry Groups

In February, manufacturing output increased 1.2 percent. Gains were recorded by every major manufacturing industry except for electrical equipment, appliances, and components and for petroleum and coal products. The production of durables climbed 1.8 percent, and the index for nondurables moved up 0.7 percent. The output of other manufacturing (publishing and logging) increased 0.4 percent.

The output of mining jumped 4.3 percent in February, more than reversing its decline in January. The gain in the index for February reflected strength in the oil and gas sector and in coal mining. The index for oil and gas extraction in February was about 12 percent higher than its year-earlier level and was at the highest level in the history of the series.

Capacity utilization for manufacturing rose 0.9 percentage point to 76.9 percent in February. The factory operating rate has risen 1.3 percentage points over the past 12 months to reach its highest level since April 2008, but it was still 1.4 percentage points below its long-run average. Utilization for durables increased 1.2 percentage points to 76.8 percent, a rate that is 0.1 percentage point below its long-run average. The operating rates for both nondurables and other manufacturing rose 0.5 percentage point, to 78.0 percent and 63.4 percent, respectively. Utilization for mining rose 3.3 percentage points to 87.6 percent, which is 0.6 percentage point above its long-run average. The capacity utilization rate for utilities fell 3.9 percentage points to 76.9 percent and remained below its long-run average.

Revision of Industrial Production and Capacity Utilization

The Federal Reserve Board plans to issue its annual revision to the index of industrial production (IP) and the related measures of capacity utilization at noon on March 23, 2018. New annual benchmark data for 2016 for manufacturing will be incorporated, as will other annual data, including information on the mining of metallic and nonmetallic minerals (except fuels). The updated IP indexes will include revisions to the monthly indicator (either product data or input data) and to seasonal factors for each industry. In addition, the estimation methods for some series may be changed. Any modifications to the methods for estimating the output of an industry will affect the index from 1972 to the present.

The revision to the historical data for capacity and capacity utilization will incorporate data through the fourth quarter of 2017 from the U.S. Census Bureau's Quarterly Survey of Plant Capacity Utilization along with new data on capacity from the U.S. Geological Survey, the U.S. Department of Energy, and other organizations.

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: March 16, 2018