INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION

Industrial production decreased 0.2 percent in September after having increased 0.2 percent in August. The indexes both for manufacturing and for manufacturing excluding motor vehicles and parts also moved down 0.2 percent in September. Production at mines moved up 0.7 percent, while the output of utilities fell 1.9 percent. For the third quarter as a whole, total industrial production rose at an annual rate of 4.8 percent after having advanced about 7 percent in both the first and second quarters of this year. The index for manufacturing decelerated sharply in the third quarter: After having jumped at an annual rate of 9.1 percent in the second quarter, factory output gained 3.6 percent in the third quarter. At 93.2 percent of its 2007 average, total industrial production in September was 5.4 percent above its year-earlier level. The capacity utilization rate for total industry edged down to 74.7 percent, a rate 4.2 percentage points above the rate from a year earlier but 5.9 percentage points below its average from 1972 to 2009.

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION: SUMMARY
Seasonally adjusted

Industrial production	2007=100						Percent change
	2010						2010						Sept. '09 to Sept. '10
	Apr.[r]	May[r]	June[r]	July[r]	Aug.[r]	Sept.[p]	Apr.[r]	May[r]	June[r]	July[r]	Aug.[r]	Sept.[p]
Total index	91.5	92.5	92.6	93.2	93.4	93.2	.5	1.1	.1	.7	.2	-.2	5.4
Previous estimates	91.4	92.4	92.5	93.1	93.2		.4	1.1	.1	.6	.2
Major market groups
Final Products	92.5	94.2	94.3	95.3	95.0	94.8	-.3	1.9	.1	1.1	-.3	-.2	5.2
Consumer goods	92.3	94.4	94.4	95.3	94.8	94.4	-1.2	2.2	.0	1.0	-.6	-.4	3.2
Business equipment	91.2	92.7	93.4	94.4	94.7	94.8	2.2	1.6	.8	1.0	.3	.1	10.1
Nonindustrial supplies	84.7	85.2	85.3	85.3	85.6	84.9	1.6	.6	.1	.0	.4	-.9	3.2
Construction	79.4	79.3	79.3	78.9	79.7	79.1	4.3	-.1	.0	-.6	1.1	-.8	5.2
Materials	92.9	93.5	93.6	94.1	94.6	94.6	.9	.6	.0	.6	.6	.0	6.4
Major industry groups
Manufacturing (see note below)	89.3	90.2	90.0	90.6	90.7	90.6	.9	1.1	-.3	.6	.1	-.2	5.4
Previous estimates	89.2	90.1	89.8	90.5	90.6		.8	1.0	-.4	.7	.2
Mining	100.8	100.0	99.8	100.7	102.3	103.0	1.9	-.8	-.2	.9	1.6	.7	7.3
Utilities	95.3	99.2	101.6	102.5	101.1	99.2	-3.8	4.1	2.5	.9	-1.4	-1.9	2.8

Market Groups

The output of consumer goods declined 0.4 percent in September. The index for consumer durables decreased 0.9 percent. Within durables, the output of automotive products fell 1.0 percent, the index for appliances, furniture, and carpeting dropped 1.9 percent after a similarly sized decline in August, and the production of miscellaneous goods declined for a second consecutive month. The output of home electronics rose 0.6 percent. The production of nondurable consumer goods moved down 0.2 percent; a fall of 1.9 percent in the energy category, which primarily resulted from a decrease in the index for residential utilities, more than offset an increase in the non-energy category. Within non-energy nondurables, the indexes for foods and tobacco and for clothing moved up, while the indexes for chemical products and for paper products moved down. The output of consumer goods increased faster in the third quarter than in the second quarter, a pickup that reflected unusually strong summer sales by utilities and a jump in the output of consumer automotive products.

The output of business equipment edged up 0.1 percent in September and was 10.1 percent above its year-earlier level. The index for transit equipment advanced 1.8 percent and offset a decline in the production of information processing equipment; the output of industrial and other equipment was unchanged. For the third quarter, the output of business equipment rose at an annual rate of 9.8 percent. This increase was slower than in the second quarter due to substantial decelerations in the indexes for information processing equipment and for industrial and other equipment. In contrast, the output of transit equipment jumped at an annual rate of 33.4 percent in the third quarter after having fallen the previous two quarters.

The index for defense and space equipment declined 0.2 percent in September after a 0.5 percent decrease in August.

The production of construction supplies retreated 0.8 percent in September after having advanced 1.1 percent in August. The index for business supplies decreased 0.9 percent in September, with declines in both the energy and non-energy categories.

In September, the production of materials was unchanged from August. A decrease in the output of durable materials offset increases in the indexes for nondurable materials and for energy materials. The decrease in durable materials was its first decline since June 2009, and the indexes for all of its major categories moved down. For the third quarter as a whole, the output of materials rose 4.9 percent, somewhat less than the 7.5 percent advance recorded in the second quarter; relative to the second quarter, slower increases in durable materials more than offset faster gains for nondurable materials and for energy materials.

Industry Groups

Production in manufacturing moved down 0.2 percent in September, and the factory operating rate edged down to 72.2 percent, a rate 7.0 percentage points below its 1972 to 2009 average. The output of durable goods declined 0.2 percent in September, with decreases in most major categories, including a 0.7 percent decrease in the output of machinery. Production for only two major components of durables advanced: The indexes for motor vehicles and parts and for miscellaneous manufacturing each rose 0.5 percent.

The index for nondurable goods moved up 0.1 percent in September after having risen 0.9 percent in August. Food, beverage, and tobacco products posted the largest increase, and the indexes for apparel and leather, for paper, and for chemicals also rose. Categories that recorded declines included printing, petroleum and coal products, and plastics and rubber products. The index for other manufacturing (non-NAICS), which consists of publishing and logging, fell 1.7 percent.

Mining production moved up 0.7 percent in September, and the utilization rate rose to 87.8 percent, a rate 0.4 percentage point above its 1972 to 2009 average. The index for utilities fell 1.9 percent; the output of both electric and gas utilities declined for a second consecutive month. The operating rate for utilities fell 1.5 percentage points, to 79.4 percent.

Capacity utilization rates at industries grouped by stage of process were as follows: For the crude stage, the operating rate increased 0.7 percentage point, to 86.9 percent, a rate that was 0.4 percentage point above its 1972 to 2009 average; for the primary and semifinished stages, utilization declined 0.6 percentage point, to 71.5 percent, a rate 10.1 percentage points below its long-run average; and for the finished stage, utilization decreased 0.1 percentage point, to 73.8 percent, a rate 3.7 percentage points below its long-run average.

Note: With this release, seasonal factors for motor vehicle assemblies were revised for the period beginning in April 2010.

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