Global| Nov 16 2010U.S. Industrial Production Is Unchanged; Factory Output Jumped
by:Tom Moeller
|in:Economy in Brief
Summary
The capital goods sector of the economy raised industrial output last month. The headline figure of no-change in October industrial production owed to a 3.4% decline in utility output. Three-month growth in output overall dropped to [...]
The capital goods sector of the economy raised industrial output last month. The headline
figure of no-change in October industrial production owed to a 3.4% decline in
utility output. Three-month growth in output overall dropped to 0.4% (AR) versus
its 14.3% peak right after the recession ended.
Factory sector output alone, however, rose 0.6% after a little-revised 0.1% September slip. The capital goods sector led the strength with a 1.2% jump which was its strongest since May. On a three-month basis, output rose at a 6.5% rate though that is down from the 22.5% peak this past May. Industrial & other output was the strongest area and grew at an 8.9% rate. In the consumer sector, output was unchanged last month following two months of decline. Three-month growth fell to -3.7% as lower auto, appliance, and other durables output offset strong gains in clothing and food. Output of computers, video & audio equipment rose 0.2% last month and at a 2.8% rate during the last three.
Capacity utilization overall held steady at 74.8% and remained well above last year's low of 68.2%. A 74.9% October rate had been expected. The factory sector utilization rate, alone, rose to 72.7%. The increase here is from the low of 65.4% during the recession. But the figures continue to paint a picture of abundant unused productive capacity. The latest rates compare to roughly 80% just before the recession and a fifty year average also of 80%.
Of note is that declines in capacity started just after the recession ended. Overall capacity has fallen 0.4% during the last twelve months and excluding high-tech industries it's down 0.8%. Industrial production and capacity data are included in Haver's USECON database, with additional detail in the IP database.
| Industrial Production (SA, % Change) | October | September | August | Year Ago | 2009 | 2008 | 2007 |
|---|---|---|---|---|---|---|---|
| Total Output | 0.0 | -0.1 | 0.2 | 5.4 | -9.3 | -3.3 | 2.7 |
| Manufacturing | 0.6 | 0.1 | 0.0 | 6.2 | -11.1 | -4.5 | 2.9 |
| Consumer Goods | 0.0 | -0.4 | -0.5 | 2.6 | -5.8 | -4.2 | 0.9 |
| Business Equipment | 1.2 | 0.2 | 0.2 | 10.4 | -12.2 | -1.5 | 4.5 |
| Construction Supplies | 0.1 | -0.4 | 1.0 | 7.6 | -16.7 | -9.5 | -1.2 |
| Materials | -0.1 | 0.2 | 0.6 | 6.7 | -9.7 | -2.7 | 3.7 |
| Utilities | -3.4 | -2.2 | -1.0 | -2.5 | -2.6 | -0.1 | 3.4 |
| Capacity Utilization (%) | 74.8 | 74.8 | 74.9 | 70.7 | 70.0 | 77.9 | 81.3 |
| Manufacturing | 72.7 | 72.3 | 72.2 | 68.2 | 67.2 | 75.0 | 79.6 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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