Federal Reserve Statistical Release G.17

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION

[2000 Revision Notice Below]

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION

Industrial production rose 0.2 percent in September. At 146.0 percent of its 1992 average, industrial production was 5.7 percent higher than in September 1999. For the third quarter as a whole, the total index increased at an annual rate of 2.8 percent, the slowest quarterly rate since the first quarter of 1999. The rate of capacity utilization for total industry held steady at 82.2 percent in September, a level 0.2 percentage point above its 1967-99 average.

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION: SUMMARY Seasonally adjusted | Index, 1992=100 | Percent change | 2000 | 2000 | Sept. 99 to Industrial Production | June July Aug. Sept. | June July Aug. Sept. | Sept. 00 ----------------------------------------------------------------------------------------------------------------------------- | | | Total index | 145.3 145.0 145.6 146.0 | .4 -.2 .4 .2 | 5.7 Previous estimates | 145.2 145.2 145.7 | .3 .0 .3 | | | | Major market groups: | | | Products, total | 131.6 131.7 131.7 132.1 | .4 .0 .0 .4 | 3.6

Consumer goods | 119.4 119.0 119.1 120.1 | .6 -.4 .1 .8 | 2.5

Business equipment | 187.2 188.6 189.7 190.3 | .8 .8 .6 .3 | 9.6

Construction supplies | 136.8 136.9 135.5 135.9 | -.4 .1 -1.1 .3 | 1.3 Materials | 169.1 168.0 169.9 169.9 | .6 -.6 1.1 .0 | 9.1 | | | Major industry groups: | | | Manufacturing | 151.0 151.0 151.3 151.8 | .5 .0 .2 .3 | 6.2

Durable | 190.8 190.7 191.9 192.5 | .8 .0 .6 .3 | 10.0

Nondurable | 113.2 113.3 112.9 113.2 | .0 .1 -.3 .3 | 1.2 Mining | 102.8 102.7 102.7 101.7 | .6 -.1 .0 -1.0 | 3.4 Utilities | 118.7 114.3 118.4 119.3 | -.3 -3.7 3.6 .7 | 1.3 ----------------------------------------------------------------------------------------------------------------------------- | | Capacity | Percent of Capacity | Growth | Average 1982 1988-89 1999 | 2000 | Sept. 99 to Capacity Utilization | 1967-99 Low High Sept. | June July Aug. Sept. | Sept. 00 -------------------------------------------------------------------------------------------------------------------------- | | | Total industry | 82.0 71.1 85.4 80.6 | 82.5 82.1 82.2 82.2 | 3.7 Previous estimates | | 82.4 82.2 82.3 | | | | Manufacturing | 81.1 69.0 85.7 79.7 | 81.6 81.3 81.3 81.2 | 4.2

Advanced processing | 80.5 70.4 84.2 78.7 | 81.1 81.1 81.2 81.2 | 5.5

Primary processing | 82.4 66.2 88.9 82.8 | 83.2 82.4 81.9 81.9 | 1.3 Mining | 87.3 80.3 88.0 81.8 | 86.3 86.3 86.4 85.7 | -1.3 Utilities | 87.5 75.9 92.6 92.0 | 91.9 88.4 91.5 92.1 | 1.2 -------------------------------------------------------------------------------------------------------------------------- Note: Estimates for September are preliminary. Estimates from June to August are revised.

Market Groups

The output of consumer goods increased 0.8 percent in September after having edged up 0.1 percent in August. After two months of declines, the production of durable consumer goods increased 1.6 percent. The production of autos and light trucks rose 1.1 percent in September, but for the third quarter as a whole, assemblies were noticeably below the second-quarter rate. Auto parts and allied goods jumped 2.1 percent in September, in large part because of strong gains in the production of replacement tires. The output of other consumer durables moved up 1.6 percent after having fallen 2.2 percent in August. For the third quarter, the production of other consumer durables fell at an annual rate of 5.1 percent, as the output of appliances weakened.

The production of nondurable consumer goods rose 0.6 percent in September, with the output of both energy and non-energy products posting moderate gains. Within non-energy products, the output of chemical products increased 1.4 percent, paper products remained steady, and clothing moved down 1.1 percent. For the third quarter, the output of nondurable non-energy consumer goods rose at an annual rate of 4.1 percent. The production of consumer energy products increased 0.7 percent in September, mostly because of increases in the output of fuel oil and in residential sales of gas and electricity.

The output of business equipment increased 0.3 percent, a slower pace than in any previous month this year. The production of industrial equipment, which had increased about 2.9 percent over the July-August period, fell 2.0 percent. The output of transit equipment declined an additional 1.1 percent as a result of a slowing in the assembly of business trucks. In contrast, the production of other equipment jumped 6.8 percent and was led by a sizable increase in the production of farm machinery and equipment. The output of information processing equipment advanced 1.1 percent, with another strong gain in office and computing equipment. The production of defense and space equipment fell for a second consecutive month, partly because of a strike at a major producer.

The output of construction supplies increased 0.3 percent in September but only partially reversed the previous month's decline; for the third quarter, the index for construction supplies fell at an annual rate of 4.8 percent. The output of materials remained flat after having posted a large increase in August. The production of durable goods materials edged up 0.1 percent, as another increase in the production of equipment parts, particularly semiconductors and computer parts, was largely offset by a drop in the production of parts for consumer durables. The output of nondurable goods materials was unchanged, continuing the weakness that has been evident in this sector over the past several months. The output of energy materials ticked down 0.1 percent.

Industry Groups

Manufacturing output advanced 0.3 percent in September, with increases about even in both durable and nondurable goods industries. Among durable goods, the gains were concentrated in lumber and products and in computers and semiconductors. The output of transportation equipment dropped 2.2 percent, while changes in the remaining durable goods industries were small. After several months of weak output, the production of nondurables advanced 0.3 percent; the output of nondurable goods was only 1.2 percent higher than a year earlier. The September gains were largely the result of higher production of chemicals and textile mill products; in contrast, several industries, including apparel, petroleum, and rubber and plastics, posted moderate declines.

The factory operating rate declined to 81.2 percent in September, with the easing concentrated in durable goods industries. The operating rate at electric utilities rose to 95.5 percent, 6 percentage points above its 1967-99 average; capacity utilization at gas utilities also increased, to 76.4 percent. The operating rate for mining fell to 85.7 percent, with a noticeable decline in oil and gas well drilling.

Revision of Industrial Production and Capacity Utilization

On December 5, the Federal Reserve Board will publish revisions to the index of industrial production (IP), to the related measures of capacity and capacity utilization, and to the index of industrial use of electric power. The updated measures will reflect both the incorporation of newly available, more comprehensive source data typical of annual revisions and, for some series, the introduction of improved compilation methods. The revision will also include a refinement of the method used to aggregate the individual series in the production and capacity indexes. The new source data are for recent years, primarily 1997 through 1999, and the modified methods will affect data from 1992 onward.

This statistical release, the G.17, will be redesigned with the publication of the revision. Special aggregates will be added, and some detailed industry data will no longer be listed in the regular release, but will be available on the Federal Reserve Board's public web site. On November 15, a template of the redesigned tables will be made available on the Board's web site (www.federalreserve.gov/releases/g17).

The updating of source data for IP will include annual data from the following reports of the Bureau of the Census: the 1997 Census of Manufactures, the 1998 Annual Survey of Manufactures, and selected editions of its 1998 and 1999 Current Industrial Reports. Annual data from the U.S. Geological Survey regarding metallic and nonmetallic minerals (except fuels) for 1998 and 1999 will also be introduced. The updating will include revisions to the monthly indicator for each industry (either physical product data, production-worker hours, or electric power usage) and revised seasonal factors.

Capacity and capacity utilization will be revised to incorporate preliminary data from the 1999 Survey of Plant Capacity of the Bureau of the Census, 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 will incorporate additional information received from utilities for the past few years and will include some data from the 1997 Census of Manufactures and 1998 Annual Survey of Manufactures. Aggregate IP indexes have been built as annually weighted chain-type indexes, beginning with data for 1977. Currently, the weights are changed at the middle of every year; with the coming revision, the weights will change every month, rather than once a year, beginning with data for 1992. Once the revision is published, it will be made available on the Board's web site (www.federalreserve.gov/releases/g17). The revised data will also be available through the web site of the Department of Commerce. Further information on these revisions is available from the Board's Industrial Output Section (telephone 202-452-3197).

G.17 Release Tables:

Chart 1: Industrial Production and Capacity Utilization
Table 1A: Industrial Production: Market Groups (index)
Table 1B: Industrial Production: Market Groups (percent change)
Table 2A: Industrial Production: Industry Groups (index)
Table 2B: Industrial Production: Industry Groups (percent change)
Table 3: Capacity Utilization: Manufacturing, Mining, and Utilities
Table 4: Industrial Capacity: Manufacturing, Mining, and Utilities
Table 5A: Industrial Production, Capacity and Utilization for Total Industry: Historical Data
Table 5B: Industrial Production, Capacity and Utilization for Manufacturing: Historical Data
Table 6: Industrial Production: Industry Subtotals and Individual Series
Table 7: Industrial Production: Gross Value of Products
Table 8: Diffusion Indexes of Industrial Production
Table 9: Electric Power Use: Manufacturing and Mining

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Last update: October 17, 2000, 9:15 AM