U.S. Industrial Production Down Again with Boeing Strike and Hurricane Effects Continuing
Summary
- Total production down 0.3% in October with downward revision to September.
- Manufacturing output down 0.5%.
- Capacity utilization rate in manufacturing lowest since early 2021.
Industrial production (IP) decreased 0.3% in October (-0.3% y/y) following a 0.5% decline in September, which was revised from -0.3%, and a 0.5% increase in August, revised from +0.3%. The October result was equal to the Action Economics Forecast Survey estimate of -0.3%. The Federal Reserve estimates that the strike at Boeing reduced total IP by 0.2% in October after cutting it by 0.3% in September, and the effects of Hurricanes Helene and Milton reduced the total by 0.1% in October.
Industrial production in manufacturing industries fell 0.5% in October (-0.3% y/y) after a 0.3% decrease in September, revised from -0.4% reported before, but a 0.6% rise in August, revised slightly from 0.5%. The October amount was reduced by a 1.2% decline in durable goods manufacturing which followed a 0.7% decrease in September. Among major durable goods industries, aerospace and other miscellaneous transportation industries had a 5.8% decline in October, which followed an 8.0% reduction in September. Motor vehicles and parts production fell 3.1% in October and just 0.4% in September.
Output of nondurable goods industries increased 0.1% in both October and September, which followed a modest 0.1% decrease in August. The largest October increase among nondurable goods industries was in petroleum and coal, in which production rose 0.9% after a 1.5% increase in September and 0.9% in August. Output of chemical industries rose 0.6% in October and production of paper increased 0.5%. Other nondurable goods saw production decreases in October, especially printing and related activities, -2.6%, and plastics and rubber products, -1.0%.
Output in nonmanufacturing industries rose in October, with electric and gas utilities up 0.7% after 0.3% in September and mining output up 0.3% in October following a drop of 1.9% in September.
Capacity utilization across all industries was 77.1% in October, down from 77.4% in September and 77.9% in August. The Action Economics Forecast Survey had estimated 77.2%. While the actual amount had a moderate reduction, it did yield the lowest utilization rate since 76.6% in April 2021. In the manufacturing sector, utilization was 76.2%, down from 76.7% in September and the lowest since 73.8% in February 2021.
Industrial production and capacity data are in Haver’s USECON database. Additional detail on production and capacity utilization can be found in the IP database. The expectations figures come from the AS1REPNA database.
Carol Stone, CBE
AuthorMore in Author Profile »Carol Stone, CBE came to Haver Analytics in 2003 following more than 35 years as a financial market economist at major Wall Street financial institutions, most especially Merrill Lynch and Nomura Securities. She has broad experience in analysis and forecasting of flow-of-funds accounts, the federal budget and Federal Reserve operations. At Nomura Securites, among other duties, she developed various indicator forecasting tools and edited a daily global publication produced in London and New York for readers in Tokyo. At Haver Analytics, Carol is a member of the Research Department, aiding database managers with research and documentation efforts, as well as posting commentary on select economic reports. In addition, she conducts Ways-of-the-World, a blog on economic issues for an Episcopal-Church-affiliated website, The Geranium Farm. During her career, Carol served as an officer of the Money Marketeers and the Downtown Economists Club. She has a PhD from NYU's Stern School of Business. She lives in Brooklyn, New York, and has a weekend home on Long Island.
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