Industrial Production and Capacity Utilization

Release Date: December 16, 2003
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INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION
[2003 Revision Notice Below]

Industrial production rose 0.9 percent in November, its largest increase since October 1999. At 112.9 percent of its 1997 average, output was 1.6 percent above its level in November 2002. Despite a small decline in the production of motor vehicles and parts, manufacturing output climbed 0.9 percent in November. Capacity utilization for total industry moved up 0.6 percentage point, to 75.7 percent, a level 0.3 percentage point higher than its year-earlier level but 5.6 percentage points below its 1972-2002 average.

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION: SUMMARY
Seasonally adjusted

1997=100 Percent change

2003 2003 Nov. '02 to

Industrial production Aug. Sept. Oct. Nov. Aug. Sept. Oct. Nov. Nov. '03

Total index 110.9 111.5 111.9 112.9     .0     .6     .4     .9    1.6

   Previous estimates 111.0 111.5 111.8           .2     .5     .2

Major market groups

Final Products 107.2 107.7 107.7 108.5     .1     .5     .0     .7     .9

   Consumer goods 105.7 106.0 106.0 106.5    -.2     .4     .0     .4     .0

   Business equipment 110.0 111.1 110.8 112.7     .6    1.0    -.2    1.7    2.9

Nonindustrial supplies 108.6 108.6 109.7 110.7    -.1     .0    1.0     .9    1.9

   Construction 101.9 102.2 103.2 104.2     .4     .2    1.0    1.0    1.4

Materials 115.5 116.5 117.2 118.5     .0     .8     .6    1.1    2.2

Major industry groups

Manufacturing (see note below) 111.8 112.7 113.0 114.0     .0     .8     .3     .9    1.8

   Previous estimates 111.8 112.6 112.7           .0     .7     .1

Mining   93.1   93.7   93.3   93.8    -.3     .7    -.5     .6     .0

Utilities 111.8 110.3 112.4 114.0     .5   -1.4    2.0    1.4    1.0


									Capacity
	Percent of capacity								growth
	Average	1982	1988-89	2002	2003				Nov. '02 to
Capacity utilization	1972-2002	Low	High	Nov.	Aug.	Sept.	Oct.	Nov.	Nov. '03

Total industry	81.3	70.9	85.2	75.4	74.5	74.9	75.1	75.7	1.1
Previous estimates					74.6	74.9	75.0

Manufacturing (see note below)	80.2	68.7	85.6	73.6	73.0	73.5	73.7	74.3	1.0
Previous estimates					73.0	73.5	73.5
Mining	86.9	78.6	85.6	85.1	84.8	85.4	85.0	85.5	-.5
Utilities	87.0	77.6	92.8	87.1	83.5	82.1	83.4	84.3	4.3

Stage-of-process groups
Crude	86.4	77.2	88.5	83.3	83.4	84.0	83.6	84.2	-1.1
Primary and semifinished	82.4	68.1	86.4	77.7	76.4	76.7	77.4	78.1	1.8
Finished	78.4	71.3	83.2	71.1	70.6	71.1	70.9	71.5	.8

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 comprises those industries included in the North American Industry
Classification System, or NAICS, manufacturing plus the logging and newspaper, periodical,
book and directory publishing industries that have traditionally been considered manufacturing and included
in the industrial sector.

Market Groups

The output of consumer goods rose 0.4 percent in November. The production of consumer durables increased 0.5 percent despite a decline of 0.1 percent in the output of automotive products. The index for appliances, furniture, and carpeting moved up 1.7 percent. The output of home electronics and of miscellaneous goods also increased. The production of nondurables moved up 0.4 percent. The output of non-energy nondurables rose 0.4 percent; the indexes for foods and tobacco, for clothing, and for chemical products all posted gains. The output of consumer energy products increased 0.7 percent.

The production of business equipment climbed 1.7 percent. A rise of 2.5 percent in the output of industrial and other equipment and a rise of 1.1 percent in the output of information processing equipment were primarily responsible for the gains in this category. The increase in industrial and other equipment was led by a rebound in the production of farm machinery.

The output of defense and space equipment edged up and was 6.3 percent higher than its year-earlier level. The index for construction supplies recorded its second consecutive gain of 1.0 percent; this index has risen in each of the past five months. The output of business supplies has also been strong the past couple of months and rose 0.9 percent in November.

The production of industrial materials increased 1.1 percent. The index for non-energy materials moved up 1.2 percent, and all major components posted gains. Led by a rise in the production of semiconductors, the output of equipment parts climbed 2.9 percent in November; this index has recorded gains of more than 1 percent in each of the past six months and is 15.3 percent higher than its year-earlier level. The output of energy materials rose 0.8 percent.

Industry Groups

Manufacturing output increased 0.9 percent in November. The overall factory operating rate rose 0.6 percent, to 74.3 percent, a level 0.7 percentage point above its year-earlier level but 5.9 percentage points below its 1972-2002 average. Excluding the production of motor vehicles and parts, which fell back 0.3 percent, manufacturing output rose 1.0 percent. The production of durable goods increased 1.4 percent; gains were widespread across industries. Increases of more than 1.0 percent were recorded in several industries, including computers and electronic products, machinery, miscellaneous goods, primary metals, nonmetallic mineral products, and furniture and related products. Among the high-technology industries, all three major sectors-- computers, semiconductors, and communications equipment--posted gains for the second consecutive month. The output of nondurable goods rose 0.4 percent, and many industries in the category recorded increases. The indexes for textiles and for apparel and leather moved up in each of the past two months but remained well below their year-earlier levels. Production increased noticeably in the paper and chemical industries. The petroleum and coal products industry and the plastics and rubber products industry were the only two major categories of nondurables that declined in November; still, output in both industries remained near their highs for the year.

Production at mines rose 0.6 percent in November; the utilization rate increased 0.5 percentage point, to 85.5 percent, a rate 1.4 percentage points below its 1972-2002 average. The output of utilities rose 1.4 percent. The operating rate at utilities moved up 0.9 percentage point; at 84.3 percent, the rate is 2.7 percentage points below its 1972-2002 average. By stage of processing, capacity utilization for industries in the crude stage increased 0.6 percentage point, to 84.2 percent. Utilization for industries in the primary and semifinished stage increased 0.7 percentage point, to 78.1 percent. Utilization for industries in the finished stage increased 0.6 percentage point, to 71.5 percent.

Revision of Industrial Production and Capacity Utilization

On November 10, the Federal Reserve Board issued 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 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 2003 annual revision included annual data from the Census Bureau's 2000 and 2001 Annual Survey of Manufactures and from selected editions of its 2001 and 2002 Current Industrial Reports. Annual data from the U.S. Geological Survey regarding metallic and nonmetallic minerals (except fuels) for 2001 and 2002 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 Census Bureau's 2002 Survey of Plant Capacity, which covers manufacturing, along with other new data on capacity from the U.S. Geological Survey, the 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 include some data from the 2001 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: December 16, 2003, 9:15 AM