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FEDERAL RESERVE statistical release For release at 9:15 a.m. (EST) January 17,1990 G.3 (402) CAPACITY UTILIZATION Manufacturing, Mining, Utilities, and Industrial Materials Capacity utilization in manufacturing, mining, and utilities increased 0.2 percentage point in December to 83.3 percent. A surge of 5 percentage points in the operating rate for utilities, which was the largest in the 23-year history of this series, resulted from the abnormally cold temperatures experienced in December. Elsewhere, utilization in manufacturing edged down 0.1 percentage point while the rate for mining fell nearly a percentage point. Utilization for manufacturing declined in December despite the return to work of strikers at a major aircraft manufacturer, which boosted the operating rate for aerospace and miscellaneous transportation equipment nearly 6 percentage points. Elsewhere, decreases in factory operating rates were widespread. Utilization for primary metals continued the downward trend that began in late summer, dropping more than 2 percentage points in December to 78.8 percent, its lowest level since June 1987. Operating rates for both the nonferrous metals and iron and steel industries have fallen to levels significantly below those earlier in the year. Activity at auto assembly facilities remained slack in December as their operating rate held steady at 64.3 percent. Over the course of 1989, overall factory utilization declined 1.3 percentage points with durable goods industries experiencing the bulk of the slowdown. Utilization for producers of industrial materials fell 0.5 percentage point in December to 82.8 percent. The drop reflected declines for both durable and nondurable goods materials industries. The operating rate for energy materials rose as a result of the increase in utilities output. Capacity Utilization: Summary Percent of capacity, seasonally adjusted 1973 Series High Total industry 1975 Low 1978 -80 High 1982 Low 1967 -88 Ave. 1989 Sep Oct Nov Dec 88.6 72.1 86.9 69.5 81.6 83.6 83.1 83.1 83.3 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 80.7 78.8 83.6 83.7 82.2 85.9 83.1 80.9 86.2 83.2 81.0 86.2 83.1 81.1 85.8 Mining Utilities 92.8 95.6 87.8 82.9 95.2 88.5 76.9 78.0 86.5 86.7 83.4 80.8 84.0 81.7 84.3 81.3 83.4 86.3 Materials 92.0 70.5 89.1 68.5 82.3 83.6 83.5 83.3 82.8 CAPACITY UTILIZATION DECEMBER DATA SEASONALLY ADJUSTED, PERCENT 110 110 TOTAL INDUSTRY TOTAL MATERIALS 90 90 70 70 50 1974 1976 1978 1980 1982 1984 1986 1988 1974 1976 1978 50 1980 1982 1984 1986 1988 110 110 MINING 1^ UTELrriES 90 90 70 70 MANUFACTURING 50 1974 1976 1978 1980 1982 1984 1986 1988 1974 1976 1978 50 1980 1982 1984 1986 1988 ELECTRICAL MACHINERY 70 NONELECTRICAL MACHINERY 50 1974 1976 1978 1980 1982 1984 1986 1988 1974 1976 1978 1980 1982 1984 1986 1988 110 110 TEXTILE, PAPER, AND CHEMICAL MATERIALS /i^ji ALUMINUM i 90 90 70 70 RAW STEEL 50 30 1974 1976 1978 1980 1982 1984 1986 1988 1974 1976 1978 \ / 1980 1982 1984 1986 1988 50 30 MANUFACTURING, MINING AND UTILITIES Table 1 Capacity Utilization Monthly seasonally adiusted Series 1973 High 1975 Low 19?8 -80 High 1982 Low 1967 -88 Ave. 1988 Dec 1989 Apr May Jim Jul Aug Sep Oct Nov Dec 88.6 72.1 86.9 69.5 81.6 84.3 84.2 84.0 84.0 83.7 83.9 83.6 83.1 83.1 83.3 87.7 69.9 86.5 68.0 80.7 84.4 84.5 84.3 84.4 84.0 84.2 83.7 83.1 83.2 83.1 91.9 86.0 68.3 71.1 89.1 85.1 65.0 69.5 82.0 80.2 87.9 82.8 86.8 83.5 86.2 83.4 86.2 83.5 86.7 82.9 86.6 83.2 85.8 82.6 86.2 81.7 85.7 81.9 84.5 82.2 87.4 Durable manufacturing 89.3 Stone, day & glass prod. 101.9 Primary metals 105.8 Iron and steel 95.6 Nonferrous metals Fabricated metal products 85.0 89.0 Nonelectrical machinery 85.7 Electrical machinery Motor vehicles and parts 97.1 Autos Aerosp. & misc. transp. eq 77.0 89.2 Instruments 87.7 Other durables 67.9 67.1 67.0 66.6 62.1 64.7 68.2 63.7 52.7 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 78.8 78.5 79.9 79.0 81.5 78.0 78.2 78.1 78.2 78.1 82.9 81.6 83.1 83.6 87.6 86.5 89.1 84.9 83.7 77.3 87.2 79.8 85.6 82.7 82.4 83.0 82.9 87.1 85.1 89.7 82.8 86.0 77.4 84.2 75.2 86.9 83.4 80.7 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 61.9 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 80.9 81.7 84.9 83.3 87.0 82.3 84.6 76.6 75.4 69.8 78.3 81.7 81.8 81.0 81.9 81.0 78.5 84.4 82.7 86.0 76.3 75.5 64.3 79.4 81.1 81.8 81.1 69.6 74.9 69.0 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 83.6 82.1 85.2 88.8 79.3 86.9 85.0 86.0 86.3 81.0 89.1 94.1 89.2 87.5 87.2 85.1 86.5 80.6 92.0 92.2 88.3 86.7 85.8 87.8 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 86.2 81.3 91.7 93.2 87.3 87.1 87.0 85.9 86.2 81.4 90.7 92.8 87.6 87.0 86.6 85.8 85.6 Mining 92.8 87.8 95.2 76.9 86.5 83.6 82.0 81.8 81.5 82.1 82.4 83.4 84.0 84.3 83.4 Utilities Electric utiKties 95.6 98.7 82.9 83.0 88.5 87.6 78.0 78.2 86.7 87.9 82.0 84.7 82.9 86.8 81.8 85.8 80.8 84.9 80.5 85.0 80.0 84.4 80.8 85.1 81.7 86.1 81.3 85.6 86.3 90.7 1989 Ql Qll Qlll QIV 1988 QIV 1989 Ql Qll Qlll QIV Total industry Manufacturing Primary processing Advanced processing Nondurable manufacturing Foods Textile mHI products Paper and products Chemicals and products Petroleum products Rubber & plastics prod. Other nondurables 78.8 82.1 86.2 75.9 75.4 64.3 85.3 80,6 81.4 85.8 85.2 Table 2 Output, Capacity, and Capacity Utilization Quarterly, seasonally adjusted Capacity Output IMzsSstn 1988 QIV 1989 Ql Qll Qlll QIV 1988 QIV 139.9 140.7 141.8 142.2 142.3 166.3 167.5 168.7 169.9 171.1 84.1 84.0 84.1 83.7 83.2 145.8 147.0 148.3 148.8 148.5 172.8 174.3 175.7 177.2 178.7 84.4 84.4 84.4 84.0 83.1 Primary processing Advanced processing 127.7 156.7 127.8 158.6 127.6 160.8 128.8 160.9 128.5 160.4 145.2 189.5 146.5 191.0 147.8 192.6 149.1 194.2 150.4 195.8 87.9 82.7 87.3 83.0 86.4 83.5 86.4 82.9 85.5 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 99.0 158.8 164.4 142.7 145.6 175.0 149.4 102.6 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 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 81.0 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 98.1 183.4 155.3 171.6 181.0 132.7 162.3 178.8 112.1 205.5 175.7 173.5 182.4 133.2 163.9 181.1 112.3 208.5 178.1 175.3 183.7 133.7 165.5 183.5 112.5 211.5 180.4 177.2 156.9 169.8 179.6 131.8 160.7 176.7 111.9 202.6 173.3 182.3 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 Mining 104.2 101.8 102.0 102.7 103.9 125.7 125.1 124.7 124.3 123.8 82.9 81.3 81.8 82.6 83.9 Utilities Electric utilities 114.3 132.4 116.0 134.4 115.7 135.8 113.9 134.9 118.0 139.8 140.7 156.7 141.0 157.4 141.4 158.2 141.7 159.0 142.0 159.8 81.3 84.5 82.3 85.4 81.8 85.9 80.4 84.8 83.1 87.5 Series Total industry Manufacturing 85.6 124.7 187.6 181.4 110.3 98.9 147.7 162.9 144.1 152.5 97.4 Note. Data for output are percentages of 1977 output as shown in the Federal Reserve's seasonally adjusted indexes of industrial production. Capacity is also 105.0 151.3 219.1 237.8 146.3 149.6 182.4 200.8 176.4 112.7 expressed as a percentage of 1977 actual output Capacity utilization percentages are cafcuktod at ratios of production to capacity. 81.6 82.4 85.6 76.3 75.4 66.1 81.0 81.1 81.7 86.1 86.5 85.8 INDUSTRIAL MATERIALS Table 3 Capacity Utilization perce it Of CQDBCitV Monthly, seasonally adjusted. 1973 High Series 1975 Low 1978 -80 High 1982 Low 1967 -88 Ave. 1988 Dec 1989 Apr May Jun Jul Aug Sep Oct Nov Dec 92.0 70.5 89.1 68.5 82.3 84.9 84.2 83.8 83.6 83.7 83.9 83.6 83.5 83.3 82.8 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 79.1 77.9 80.7 87.8 82.1 84.6 87.6 99.4 81.3 83.6 84.4 101.5 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 81.7 84.7 93.5 80.0 77.2 80.2 96.2 79.1 75.0 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 83.6 84.1 92.0 81.3 89.8 91.3 98.4 90.7 89.2 90.7 94.5 90.1 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 96.3 87.4 88.1 89.1 95.8 87.2 87.8 88.8 Energy materials 94.6 86.9 94.0 82.3 88.9 86.5 86.0 85.5 83.8 83.9 84.3 85.4 86.1 86.1 86.6 1989 Ql QII Qlll QIV 1988 QIV 1989 Ql QII Qlll QIV Materials Durable goods materials Metal materials Raw steel Aluminum Table 4 Output, Capacity, and Capacity Utilization Quarterly, seasonally adjusted Output Capacity Utilization 1988 QIV 1989 Ql QII Qlll QIV 1988 QIV 128.0 127.6 127.9 128.6 128.5 150.8 151.7 152.6 153.5 154.4 84.9 84.1 83.9 83.8 83.2 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 98.9 138.6 86.9 169.0 109.8 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 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 79.8 78.0 Nondurable goods materials Textile, paper, & chem. mat. Pulp & paper materials Chemical materials 135.4 138.1 148.6 144.1 136.3 139.2 148.4 145.4 137.1 139.8 146.1 145.7 137.9 141.1 149.8 146.5 138.6 141.5 151.2 151.8 152.3 159.3 152.7 153.5 154.0 161.4 154.2 155.3 155.8 163.7 155.8 157.0 157.6 165.9 157.4 158.8 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 88.1 89.1 Energy materials 102.0 100.7 100.7 99.8 101.8 118.7 118.4 118.3 118.1 118.0 86.0 85.0 85.1 84.5 86.3 Series Materials Explanatory Notes. Definition. This release contains estimates of output, capacity, and capacity utilization for the nation's factories, mines, and electric and gas utilities. Output data are the 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 19/7 output as well. Capacity utilization percentages are calculated as ratios of production to capacity. The capacity indexes are 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 within the 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 the capacity indexes for individual industries arc aggregated—for example to total manufacturing—no explicit account is taken of possible general equilibrium constraints such as emerging industry bottlenecks. Because of the large and heterogeneous database, changes in utilization rates may be more meaningful in the analysis of business conditions than any particular level of these 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 the total index. Primary processing includes textile mill products, paper and products, industrial chemicals, petroleum products, rubber and plastics products, lumber and products, primary metals, fabricated metal products, and stone, clay, and class products. Advanced processing includes foods, tobacco products, apparel products, printing and publishing, chemical products such as drugs and toiletries, leather 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 oi the items included in the primary processing grouping of manufacturing, as well as some of the output of the advanced processing industries, mines, and utilities—such as iron ore, crude oil, semiconductors, and electricity sold to industry. Perspective. The historical highs and lows in capacity utilization shown in the tables above are specific to each series and did not all occur in the same month. Industrial plants usually operate at capacity utilization rates that are well below 100 percent; none of trie broad aggregates has ever reached 100 percent. For mining, manufacturing, and utilities as a whole, and for total manufacturing, utilization rates as high as 90 percent have been exceeded only in wartime. Revisions. Thefirstestimates for a month are published about the 16th of the following month. These estimates may revise in each of the next three months as new data become available. After the fourth month, no further revisions are undertaken until an annual or benchmark revision. The median of the revisions in the total manufacturing utilization rate between the first and fourth estimate is 0.3 percentage point; that is, in about half of the cases, the absolute value of the revision from the first to the fourth estimate is less than 0.3 of a percentage point Sources. The basic methodology used to estimate the 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 the statistical supplement to the October 1987 capacity utilization release. Copies may be obtained from Publications Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Rounding. Utilization rates are calculated from unrounded capacity and production indexes. Aggregates are derived from unrounded detailed components. Release schedule for 1990. At 9:15 a.m. on January 17, r^bruary 16, March 16, April 17, May 15, June 15, July 17, August 16, September 14, October 17, November 14, and December 14. Notice This release is available on the day of issue through the Department of Commerce's online Electronic Bulletin Board. (202) 377-3870
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