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FEDERAL RESERVE statistical release For release at 9:15 a.m. (EST) February 16,1990 G.3 (402) CAPACITY UTILIZATION Manufacturing, Mining, Utilities, and Industrial Materials Capacity utilization in manufacturing, mining, and utilities fell 1.2 percentage points in January to 81.9 percent. Operating rates for auto and truck assembly facilities dropped to levels near their 1982 recession lows as vehicle makers extended their holiday shutdowns to reduce excess inventories. Electric utilities also contributed significantly to the overall decline. Utilization at power plants fell about 10 percentage points as unseasonably warm temperatures in January displaced especially cold weather during December. In contrast to the declines for manufacturing and utilities, the operating rate for mining, led by a resurgence at coal mines after a relatively weak December, rose nearly 2 percentage points to 84.7 percent. The steep decline for auto and truck assemblies, along with little overall change for other components, brought the operating rate for manufacturing down 1 percentage point to 81.9 percent. Utilization for the nonelectrical machinery and fabricated metals industries also contributed to the slowdown in January, decreasing about 1 percentage point each. The decline in nonelectrical machinery reflected some slowing of computer production while reduced output of metal stampings for the motor vehicle industry lowered the operating rate for fabricated metals. Despite these reductions in production for autos and related goods, utilization for primary metals manufacturers turned back up in January following several months of decline. Even so, the rate for primary metals in January, at about 80 percent, was 5 percentage points below the levels it maintained during the summer. The utilization rate for total manufacturing declined over the past year by nearly 3 percentage points with much of the slowing occurring during the past few months. Decreases in operating rates for primary processing industries, especially primary metals, made up the bulk of the overall drop; the rate for advanced processing industries actually increased during the first half of 1989 before weakening motor vehicle production reduced it during the second half. The operating rate for producers of industrial materials fell 0.8 percentage point in January with declines widespread. The drop in electric power generation resulted in an especially large decline for energy materials. Utilization for total industrial materials has fallen about 3 percentage points since the start of 1989 with significant declines in metal, paper, and chemical materials. Capacity Utilization: Summary Percent of capacity, seasonally adjusted Series Total industry 1973 High 1975 Low 1978 -80 High 1982 Low 1967 -89 Ave. 1989 Oct Nov Dec 1990 Jan 88.6 72.1 86.9 69.5 81.7 83.1 83.1 83.1 81.9 Manufacturing Durable manufacturing Nondurable manufacturing 87.7 87.4 88.8 69.9 67.9 71.8 86.5 86.3 87.0 68.0 63.7 74.2 80.9 79.0 83.8 83.1 80.8 86.3 83.1 80.9 86.2 82.9 80.9 85.7 81.9 79.4 85.6 Mining Utilities 92.8 95.6 87.8 82.9 95.2 88.5 76.9 78.0 86.3 86.5 84.2 81.4 84.4 81.3 82.8 86.4 84.7 77.1 Materials 92.0 70.5 89.1 68.5 82.4 83.5 83.2 82.5 81.7 CAPACITY UTILIZATION JANUARY DATA SEASONALLY ADJUSTED, PERCENT 110 110 TOTAL INDUSTRY TOTAL MATERIALS 90 - 70 - 50 - 90 70 I 1976 ! ! 1978 1 1 1980 1 1 1982 1 1 1984 1 1 1986 I I 1988 1 1 1990 1976 1 1 1978 1 1 1980 1 1 1982 1 1 1984 1 1 1986 1 1 1988 I 1990 110 50 110 MINING * UTILITIES 90 70 - vr-AAv'V/NA./A/Vyv^ *jk . . I - 90 - 70 MANUFACTURING 50 1 1976 1 1 1978 1 1 1980 1 1 1982 1 1 1984 1 1 1986 1 1 1988 1 1990 1976 1978 1980 1982 1984 1986 1988 I I I I I I 1990 50 110 110 I MANUFACTURING I I I I I I ELECTRICAL MACHINERY NONDURABLE 90 - I 70 DURABLE \/ \ - 90 - 70 1 1990 50 / NONELECTRICAL MACHINERY 50 1 1976 1 1 1978 1 1 1980 1 1 1982 1 1 1984 1 1 1986 1 1 1988 1 1 1990 1976 1 1 1978 1 ! 1980 1 1 1982 1 1 1984 1 1 1986 1 1 1988 110 110 ALUMINUM TEXTILE, PAPER, AND CHEMICAL MATERIALS ^v ^ % 90 - - 90 70 - - 70 - 50 1 1990 30 RAW STEEL 50 - 30 1 1976 1 1 1978 1 1 1980 1 1 1982 1 1 1984 1 1 1986 1 1 1988 1 1 1990 1976 1 1 1978 1 1 1980 \ 1 1 1982 / 1 1 1984 1 1 1986 1 1 1988 MANUFACTURING, MINING AND UTILITIES Table 1 Capacity Utilization Monthly, seasonally adjusted. percei ntofcaj oacity 1973 1975 1978 -80 Series Low High High 1982 Low 1967 -89 Ave. 1989 Jan 1989 May Jun Jul Aug Sep Oct Nov Dec 1990 Jan 88.6 72.1 86.9 69.5 81.7 84.3 84.0 84.0 83.7 83.9 83.6 83.1 83.1 83.1 81.9 87.7 69.9 86.5 68.0 80.9 84.7 84.3 84.4 84.0 84.2 83.7 83.1 83.1 82.9 81.9 91.9 86.0 68.3 71.1 89.1 85.1 65.0 69.5 82.2 80.3 88.4 83.1 86.2 83.4 86.2 83.5 86.7 82.9 86.6 83.2 85.8 82.6 86.2 81.6 85.6 81.9 84.9 82.1 84.9 80.7 87.4 89.3 101.9 105.8 95.6 85.0 89.0 85.7 97.1 67.9 67.1 67.0 66.6 62.1 64.7 68.2 63.7 52.7 78.4 82.9 81.6 83.2 84.5 90.6 91.6 89.3 84.3 83.9 77.3 86.6 75.7 85.7 33.4 81.7 82.9 82.3 84.1 80.8 88.6 83.7 86.6 77.1 82.5 73.1 87.3 83.7 81.2 82.9 82.2 84.0 80.2 89.1 83.7 86.8 77.1 80.1 69.6 87.8 84.1 81.9 82.4 81.5 85.6 82.8 89.4 83.7 86.2 76.7 75.9 61.8 88.3 83.9 81.7 82.8 82.0 86.5 83.2 91.0 83.5 86.5 77.6 78.4 65.8 87.8 82.7 81.5 82.2 81.6 85.3 82.4 89.1 82.6 86.4 77.1 77.2 70.7 87.0 81.8 81.4 80.8 81.6 85.0 83.3 87.1 82.2 84.3 76.7 75.4 69.8 78.4 81.2 81.7 80.9 82.0 81.1 78.4 84.7 82.9 85.6 76.2 75.5 64.3 79.6 80.6 82.0 80.9 81.4 78.9 76.2 82.5 82.2 85.7 75.9 75.6 64.3 83.6 79.8 82.1 79.4 69.6 74.9 69.0 63.7 62.9 45.8 37.6 60.8 61.3 62.9 66.9 47.0 36.6 70.7 77.8 69.1 79.0 78.6 80.2 79.1 81.8 78.2 78.5 78.0 78.3 77.0 89.2 87.7 86.3 86.6 97.1 100.3 91.1 87.4 86.0 89.9 93.3 93.3 87.1 88.9 81.0 88.8 85.8 92.1 95.6 88.6 99.6 97.5 86.4 71.8 77.6 58.9 67.7 69.2 83.7 59.5 72.3 87.0 85.1 88.3 92.7 82.9 91.7 89.4 92.4 74.2 76.5 70.6 80.2 67.6 68.8 71.2 78.9 83.8 82.1 85.5 89.0 79.6 86.9 85.0 86.0 86.8 81.2 90.7 95.1 89.3 87.5 86.0 86.5 86.2 80.7 92.8 91.6 87.3 86.3 86.6 86.9 86.4 80.9 92.8 91.3 87.9 87.2 87.0 87.0 86.3 80.4 92.5 92.4 88.8 87.4 86.6 86.1 86.2 80.7 92.1 92.3 88.0 86.9 86.8 85.9 85.9 80.8 92.0 92.4 86.5 87.4 86.7 86.2 86.3 81.4 92.1 93.4 87.2 87.1 87.1 86.2 86.2 81.9 90.5 91.9 87.2 87.1 86.3 86.1 85.7 81.7 91.0 91.9 86.6 84.7 85.4 85.8 Mining 92.8 87.8 95.2 76.9 86.3 82.2 81.8 81.5 82.1 82.4 83.4 84.2 84.4 82.8 84.7 Utilities Electric utilities 95.6 98.7 82.9 83.0 88.5 87.6 78.0 78.2 86.5 87.8 80.9 83.4 81.8 85.8 80.8 84.9 80.5 85.0 80.0 84.4 80.8 85.1 81.4 85.7 81.3 85.5 86.4 90.6 77.1 80.8 1989 Ql Qll Qlll QIV 1988 QIV 1989 Ql Qll Qlll QIV Total industry Manufacturing Primary processing Advanced processing Durable manufacturing Stone, clay & glass prod. Primary metals Iron and steel Nonferrous metals Fabricated metal products Nonelectrical machinery Electrical machinery Motor vehicles and parts Autos Aerosp. & misc. transp. eq. Instruments Other durables Nondurable manufacturing Foods Textile mill products Paper and products Chemicals and products Petroleum products Rubber & plastics prod. Other nondurables 80.4 81.1 84.7 76.2 59.3 42.8 83.7 79.8 82.0 85.6 87.7 85.8 Table 2 Output, Capacity, and Capacity Utilization Quarterly, seasonally adjusted Output Series Utilization Capacity 1988 QIV 1989 Ql Qll Qlll QIV 1988 QIV 139.9 140.7 141.8 142.2 142.2 166.3 167.5 168.7 169.9 171.1 84.1 84.0 84.1 83.7 83.1 145.8 147.0 148.3 148.8 148.4 172.8 174.3 175.7 177.2 178.7 84.4 84.4 84.4 84.0 83.0 Primary processing Advanced processing 127.7 156.7 127.8 158.6 127.6 160.8 128.8 160.9 128.7 160.3 145.2 189.5 146.5 191.0 147.8 192.6 149.1 194.2 150.4 195.8 87.9 82.7 87.3 83.0 86.4 83.5 86.4 82.9 85.6 81.9 Durable manufacturing Stone, clay & glass prod. Primary metals Iron and steel Nonferrous metals Fabricated metal products Nonelectrical machinery Electrical machinery Motor vehicles and parts Autos Aerosp. & misc. transp. eq. Instruments Other durables 145.2 124.4 92.3 80.5 114.5 124.1 175.7 182.0 123.4 116.9 152.3 159.8 139.9 146.0 125.8 90.9 79.1 113.2 124.3 180.8 181.4 122.9 110.6 153.7 161.4 138.5 147.1 124.2 88.2 74.4 114.4 124.4 186.2 181.9 119.3 108.9 157.1 164.3 141.3 147.3 123.4 89.5 75.6 115.9 125.1 187.6 182.6 112.4 99.0 158.8 164.4 142.7 145.4 123.8 85.7 72.9 109.9 124.7 186.6 181.4 110.4 98.9 146.9 161.7 144.5 175.0 149.4 102.6 89.6 127.1 146.9 211.9 233.5 143.8 150.2 177.5 191.8 171.2 176.1 150.0 103.1 90.0 127.7 148.0 213.5 234.5 144.4 150.2 178.6 193.9 172.5 177.4 150.5 103.7 90.6 128.4 149.1 215.4 235.6 145.0 150.0 179.9 196.2 173.8 178.6 151.1 104.3 91.3 129.0 150.2 217.2 236.7 145.7 149.8 181.1 198.5 175.1 179.8 151.6 105.0 91.9 129.7 151.3 219.1 237.8 146.3 149.6 182.4 200.8 176.4 82.9 83.2 90.0 89.8 90.1 84.5 82.9 78.0 85.8 77.8 85.8 83.3 81.7 82.9 83.9 88.2 87.9 88.6 83.9 84.7 77.3 85.1 73.6 86.0 83.2 80.3 83.0 82.5 85.1 82.0 89.1 83.4 86.5 77.2 82.3 72.6 87.3 83.7 81.3 82.5 81.7 85.8 82.8 89.9 83.3 86.3 77.1 77.2 66.1 87.7 82.8 81.5 80.9 81.7 81.6 79.3 84.8 82.4 85.2 76.3 75.5 66.1 80.6 80.5 81.9 Nondurable manufacturing Foods Textile mill products Paper and products Chemicals and products Petroleum products Rubber & plastics prod. Other nondurables 146.7 145.2 117.4 151.4 157.4 96.4 177.3 148.3 148.4 146.1 119.8 152.4 158.9 97.1 175.8 152.3 149.9 147.2 123.3 150.3 159.1 97.4 180.3 155.3 151.0 148.1 123.3 152.9 161.0 98.1 183.4 155.3 152.5 151.2 122.4 154.4 161.7 97.3 185.1 157.3 169.8 179.6 131.8 160.7 176.7 111.9 202.6 173.3 171.6 181.0 132.7 162.3 178.8 112.1 205.5 175.7 173.5 182.4 133.2 163.9 181.1 112.3 208.5 178.1 175.3 183.7 133.7 165.5 183.5 112.5 211.5 180.4 177.2 185.1 134.2 167.1 185.8 112.7 214.5 182.8 86.4 80.8 89.1 94.2 89.1 86.2 87.5 85.6 86.5 80.7 90.2 93.9 88.9 86.6 85.5 86.7 86.4 80.7 92.5 91.7 87.9 86.7 86.5 87.2 86.1 80.6 92.2 92.4 87.8 87.2 86.7 86.1 86.1 81.7 91.2 92.4 87.0 86.3 86.3 86.0 Mining 104.2 101.8 102.0 102.7 103.8 125.7 125.1 124.7 124.3 123.8 82.9 81.3 81.8 82.6 83.8 Utilities Electric utilities 114.3 132.4 116.0 134.4 115.7 135.8 113.9 134.9 117.9 139.5 140.7 156.7 141.0 157.4 141.4 158.2 141.7 159.0 142.0 159.8 81.3 84.5 82.3 85.4 81.8 85.9 80.4 84.8 83.0 87.3 Total industry Manufacturing Note. Data for output are percentage* of 1977 output M shown in the Federal Reserve's seasonally adjusted indexes of industrial production. Capacity is also expressed as a percentage of 1977 actual output Capacity utilization percentages are calculated as ratios of production to capacity. INDUSTRIAL MATERIALS Table 3 Capacity Utilization MOnTniv. seasonauy aajusiea.perce HOT ca jaciiv 1973 1975 1978 Low High Series High 1982 Low 1967 -89 Ave. 1989 Jan 1989 Mav Jun Jul Aug Sep Oct Nov 1990 Jan 92.0 70.5 89.1 68.5 82.4 84.6 83.8 83.6 83.7 83.9 83.6 83.5 83.2 82.5 81.7 91.8 99.2 106.0 95.7 64.4 67.1 66.4 73.0 89.8 93.6 98.9 97.4 60.9 45.7 36.1 58.8 79.2 78.1 80.9 88.3 82.1 86.1 93.3 100.2 81.0 79.8 83.7 98.4 81.1 80.6 85.4 99.6 81.3 82.3 85.4 101.2 81.7 82.7 89.0 99.9 81.2 81.9 84.0 96.4 80.3 81.5 84.7 93.9 79.9 77.7 80.2 96.9 78.9 74.9 76.7 97.1 78.2 77.3 Nondurable goods materials Textile, paper, & chem. mat. Pulp & paper materials Chemical materials 91.1 92.8 98.4 92.5 66.7 64.8 70.6 64.4 88.1 89.4 97.3 87.9 70.7 68.8 79.9 63.5 83.8 84.3 92.1 81.6 90.1 91.5 98.1 90.7 88.7 89.6 93.2 88.4 88.7 89.8 93.7 88.5 89.2 90.6 95.0 89.5 88.8 90.1 95.1 88.6 87.5 88.8 95.1 86.7 88.3 89.4 96.4 87.4 87.7 88.5 94.7 86.9 87.1 87.8 94.2 85.9 86.7 87.1 Energy materials 94.6 86.9 94.0 82.3 88.7 84.9 85.5 83.8 83.9 84.3 85.4 86.1 86.3 86.2 84.8 1989 Ql Qll Qlll QIV 1988 QIV 1989 Ql Qll Qlll QIV Materials Durable goods materials Metal materials Raw steel Aluminum Table 4 Output, Capacity, and Capacity Utilization Quarter/v. seasonally adjusted Capacity Output Utilization 1988 QIV 1989 Ql Qll Qlll QIV 1988 QIV 128.0 127.6 127.9 128.6 128.2 150.8 151.7 152.6 153.5 154.4 84.9 84.1 83.9 83.8 83.0 Durable goods materials Metal materials Raw steel Aluminum 139.2 94.8 79.5 97.8 138.6 92.3 79.8 98.5 139.0 90.0 76.2 99.1 140.4 91.4 78.2 98.9 138.5 86.9 73.6 96.2 169.0 109.8 89.2 97.9 170.1 110.2 89.6 98.7 171.3 110.6 90.2 99.2 172.5 111.0 90.8 99.7 173.7 111.4 91.4 100.2 82.4 86.3 89.1 99.9 81.5 83.8 89.0 99.7 81.1 81.4 84.5 99.8 81.4 82.3 86.1 99.2 79.7 78.1 80.5 96.0 Nondurable goods materials Textile, paper, & chem. mat. Pulp & paper materials Chemical materials 135.4 138.1 148.6 144.1 136.3 139.2 148.4 145.4 137.1 139.8 146.1 145.7 137.9 141.1 149.8 146.5 138.0 140.6 151.6 145.9 151.2 151.8 152.3 159.3 152.7 153.5 154.0 161.4 154.2 155.3 155.8 163.7 155.8 157.0 157.6 165.9 157.4 158.8 159.4 168.2 89.5 91.0 97.6 90.5 89.3 90.7 96.4 90.1 88.9 90.0 93.8 89.0 88.5 89.8 95.1 88.3 87.7 88.5 95.1 86.7 Energy materials 102.0 100.7 100.7 99.8 101.7 118.7 118.4 118.3 118.1 118.0 86.0 85.0 85.1 84.5 86.2 Series Materials Explanatory Notes. Definition. This release contains estimates of output, capacity, and capacity utilization for die nation's factories, mines, and electric and gas utilities. Output data are die Federal Reserve's seasonally adjusted indexes of industrial production, which express output as percentages of 1977 output. The capacity estimates are expressed as percentages of 1977 output as well. Capacity utilization percentages are calculated as ratios of production to capacity. The capacity indexes arc based on a variety of data, including capacity data in physical units compiled by trade associations, private and government surveys of capacity growth and utilization rates, and estimates of capital stock growth. The concept of practical capacity is applied, which is defined as the greatest level of output mat a plant can maintain widiin die framework of a realistic work pattern, taking account of normal downtime, and assuming sufficient availability of inputs to operate machinery and equipment in place. When die capacity indexes for individual industries are aggregated—for example to total manufacturing—no explicit account is taken of possible general equilibrium constraints such as emerging industry bottlenecks. Because of die large and heterogeneous database, changes in utilization rates may be more meaningful in die analysis of business condition* than any particular level of diese rates. Groupings. Estimates of capacity and industrial production are aggregated to primary and advanced processing industries, to durable and nondurable manufacturing industries, and to total manufacturing. The mining, manufacturing, and utilities estimates aggregate to me total index. Primary processing includes textile mill products, paper and products, industrial chemical*, petroleum products, rubber and plastics products, lumber and products, primary metals, fabricated metal products, and stone, clay, and glass products. Advanced processing includes foods, tobacco products, apparel products, printing and publishing, chemical products such as drugs and toiletries, learner and products, furniture and fixtures, machinery, transportation equipment, instruments, miscellaneous manufactures, and government—owned-and-operated ordnance facilities. Industrial materials are items produced and used as inputs by manufacturing plants, mines, and utilities. Industrial materials include many of die items included in die primary processing grouping of manufacturing, as well as some of die output of die advanced processing industries, mines, and utilities—such as iron ore, crude oil, semiconductors, and electricity sold to industry. Sources. The basic methodology used to estimate die series is discussed in Richard D. Raddock, "Revised Federal Reserve Rates of Capacity Utilization," Federal Reserve Bulletin Vol. 71 (October 1985), pp. 754-66. Historical utilization rates since 1967 (1948 in the case of manufacturing) are included in die statistical supplement to die October 1987 capacity utilization release. Copies may be obtained from Publications Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Release schedule for 1990. At 9:15 ajn. on January 17, February 16, March 16, April 17, May 15, June 15, July 17, August 16, September 14, October 17, November 14, and December 14. NOTICE A revision to Federal Reserve indexes of capacity utilization, industrial production, and electric power use by industries will be published with the release of the March indexes on April 17,1990. At the same time, the Federal Reserve G.3(402) release, Capacity Utilization, and the G12.3 statistical release, Industrial Production, will be combined into the single publication: G17(419) Industrial Production and Capacity Utilization Indexes of Output, Capacity, Capacity Utilization, and Electric Power Use by Industries. Points of Information: • The capacity and industrial production indexes will be shown on a 1987 basis, both in terms of value-added weights and base period. Indexes of electric power use by industries will be rebased to 1987. • Revisions will date from 1967 for capacity and capacity utilization; from 1977 for industrial production; and from 1972 for electric power. • Historical data will be available on magnetic tape from the National Technical Information Service (703-487-4650). • The separate system of Capacity Utilization for Materials will be discontinued. Many of its components will be included in Mining and in an improved Primary Processing aggregate for Manufacturing. The revisions and structure modifications to the Capacity and Capacity Utilization indexes will be presented in an article in the May Federal Reserve Bulletin. • Data shown on the new combined release will be available on the day of issue through the Department of Commerce's online Economic Bulletin Board (202-377-3870).