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FEDERAL RESERVE statistical release For immediate release January 18, 1977 G.3 (Formerly E.5) Capacity utilization in manufacturing increased an estimated 0.4 per cent in December to 81.1 per cent. The increase reflected production gains in advanced processing industries, most notably in motor vehicles and parts. Primary processing industries operated at generally lower utilization rates in December than in November. After adjusting for seasonality, both primary and advanced processing industries are estimated to have operated at about 81 per cent of capacity in December. Capacity utilization in materials decreased an estimated 0.2 per cent in December to 80.3 per cent. The decline in December, as well as a decline to 80.4 per cent for the fourth quarter as a whole, is attributable to a weakening of production in durable goods materials, especially in basic metals. Utilization rates in both nondurable goods materials and energy materials have changed relatively little, on balance, in recent months. Industrial utilization rates during 1976 generally rose at a slower pace than in the rapid cyclical recovery phase in 1975. In December 1976, utilization rates for both manufacturing and materials were around 80 to 81 per cent, up 10 to 15 per cent from the lowest rates registered in 1975. MANUFACTURING INDUSTRIAL MATERIALS PER CENT 105 ENERGY TOTAL 85 65 100 PRIMARY PROCESSING ADVANCED PROCESSING I I 1965 1068 1971 1974 1977 1968 1971 1974 1977 OUTPUT, CAPACITY AND CAPACITY UTILIZATION Output and Capacity are Percentages of 1967 Output; Capacity Utilization is a Per Cent of Capacity. Manufacturing MONTHLY CAPACITY UTILIZATION SERIES 1975 19751 I 88.01 69.6 \ \ | 1 77.4| 1 1 78.11 f 77.01 19731 1976 JUNE MANUFACTURING, TOTAL 78.2 79.2 78.8 77.3 PRIMARY PROCESSING 93.6J 67.8 ADVANCED 1 85.41 70.5 1975 IV 1976 I I I I I I 122.5 126.7 129.4 131.1 PROCESSING OUTPUT MANUFACTURING, TOTAL AUG. SEP. OCT. NOV. DEC. 80.5 80.9 81.1 80.4 79.8 80.8 81. I 79.6 79.8 80.8 81.0 81.2 81.4 82.1 82.1 82.4 83.1 81.6 81.8 81.2 78.6 78.7 78.8 79.6 79.3 79.7 80.1 78.9 78.8 80.1 81.0 1975 IV 1976 I I I II I IV 80.5 1 1 IVl 1 80.3 JULY CAPACITY 131.51 159.5 160.4 11 161.3 | 1 ' II I 162.3 1 1 IVl | 163.21 UTILIZATION 1975 IV 1976 I 76.8 79.0 80.2 80.8 78.1 80.2 81.5 82.5 81.5 76.1 78.2 79.2 79.6 80.0 1 1 PRIMARY PROCESSING 128.9 133.4 136.6 139.3 138.71 165.0 ADVANCED PROCESSING 119.1 122.9 125.2 126.3 127.61 156.4 166.2 167.5 . 168.8 170.11 158.8 159.61 1 1 157.2 158.0 J Industrial Material MONTHLY CAPACITY UTILIZATION MATERIALS. TOTAL DURABLE GOODS MATERIALS BASIC METAL MATERIALS NONDURABLE GOODS MATERIALS TEX.t PAPER, £ CHEM. MAT. TEXTILE MATERIALS PAPER MATERIALS CHEMICAL MATERIALS ENERGY MATERIALS 19731 1975 19751 1976 HTCHl 1 SERIES LOU DEC.I JAN. 1 FEB,T MAR. APR. MAY JUNE JULY AUG. SEP. OCT. NOV. pEC. 93.11 1 1 92.51 1 97.7! 1 1 94.61 1 94.51 1 94.41 69.7 79.3 79.7 80.1 80.8 80.8 81.2 81.6 81.0 80.3 80.5 60.3 74.0 74.3 75.4 76.6 76.5 78.5 78.9 77.8 76.8 77.0 76.2 73.8 72.9 75.5 79.1 77*7 81.9 83.5 79.2 77.6 74.3 71.0 85.9 86.3 86.2 85.5 86.0 84.9 84.7 85.4 84.7 85.1 85.1 5B.O 77.21 78.2 1 1 70.71 72.1 1 67.71 71.7 1 1 84.71 84.6 1 84.31 83.8 1 86.41 85.4 100.51 71.8 87.51 87.7 93.81 1 64.7 82.9| 1 94.61 82.7 85.11 64.3 66.1 67.8 65.5 85.3 86.1 85.6 84.6 84.8 83.8 83.6 84.4 83.7 83.7 83.9 82.2 84.0 89.9 84.3 83.4 89.8 86.0 82.2 90.9 85.2 83.7 90.1 83.3 83.3 91.9 83.4 82.2 90.2 82.6 82.2 90.4 82.1 81.1 89.1 84.0 80.2 89.5 83.3 78.2 88.5 84.2 78.5 88.4 84.2 86.2 84.6 85.0 84.2 85.2 84.9 83.9 84.4 83.5 83.6 83.9 84.6 OUTPUT 1975 IV MATERIALS, TOTAL 122.8 1976 I 126.9 11 130.3 II I 132.6 1 1 IVl 1 CAPACITY 1975 IV 132.11 159.2 1976 1 160.6 11 161.7 |1 I 163.1 115.1 120.8 126.1 130.7 128.61 163.1 164.4 165.5 166.7 MATERIALS 98.4 103.7 110.8 117.1 107.31 141.7 142.4 143.1 143.7 141.4 145.0 146.9 146.6 147.91 167.8 169.4 171.0 172.5 146.3 150.2 151.6 151.2 152,41 174.7 118.2 124.0 167.7 116.5 128.9 173.6 115.5 114.4 132.5 131.9 175.3 175.1 111.11 137.2 131.31 143.5 179.21 203.7 118.5 119.7 120.0 121.01 119.9 I NOTE: 144.4| 174.11 178.3 180.1 182.01 138.2 144.6 139.0 145.7 206.2 208.7 139.8 144.7 211.2 140.61 147.91 213.71 80.6 81.3 80.4 70.6 73.5 76.2 78.4 76.6 69.4 72.8 77.4 81.5 74.3 84.3 85.6 85.9 85.0 85.0 11 II I IV 140.3 141.5 142.7 143.91 83.8 85.1 85.0 84.0 83.0 86.2 86.4 82.3 84.3 89.1 84.2 83.1 9O.9 84.0 81.8 89.9 82.9 79.0 86.8 83.9 85.2 85.3 84.8 84.0 84.1 1 1 1 1 1 ENERGY MATERIALS 167.8) 176.5 1 TEXTILE MATERIALS PAPER MATERIALS CHEMICAL MATERIALS 77.1 79.0 1 1 TEX., PAPER, C CHEM. MAT. 1976 I 1 1 1 1 NONDURABLE GOODS MATERIALS 1975 IV 1 1 BASIC METAL 164.31 UTILIZATION 1 1 1 1 DURABLE GOODS MATERIALS 1 1 IVl 1 139.1 1 ESTIMATES OF ACTUAL OUTPUT AND CAPACITY OUTPUT ARE BOTH EXPRESSED AS PERCENTAGES OF 1967 ACTUAL OUTPUT. ESTIMATES OF CAPACITY UTILIZATION IN PER CENT ARE CALCULATED AS RATIOS OF (1) THE INDEXES OF INDUSTRIAL PRODUCTION TO 12) THE CORRESPONDING INDEXES OF CAPACITY. INDUSTRIAL MATERIALS ARE THOSE CRUDE AND SEMIFINISHED PRODUCTS THAT ARE BOTH PRODUCED AND USED AS INPUTS BY INDUSTRIAL ESTABLISHMENTS; THE INDUSTRIAL M A T E R I A L S INCLUDE MOST OF THE COMPONENTS OF THE P R I M A R Y PROCESSING GROUPING OF MANUFACTURING AS W E L L AS THE INPUTS SUPPLIED TO THE INDUSTRIAL SECTOR BY MINES AND UTILITIES—SUCH AS IRON O R E , CRUDE OIL, AND INDUSTRIAL ELECTRICITY. THE 1973 HIGHS (AND ALSO 1975 LOWS) IN CAPACITY UTILIZATION, SHOWN IN THE TABLES ABOVE, ARE SPECIFIC TO EACH SERIES AND MAY OCCUR IN DIFFERENT MONTHS. BUSINESSES U S U A L L Y OPERATE AT CAPACITY UTILIZATION R A T E S THAT ARE WELL BELOW 100 PER CENT; NONE OF THE BROAD AGGREGATE SERIES HAS EVER INDICATED A 100 PER CENT USE OF CAPACITY. CAPACITY UTILIZATION R A T E S A V E R A G E D ABOUT 83 PER CENT FOR MANUFACTURING FROM 1955 THROUGH 1975, AND ABOUT 86 PER CENT FOR INDUSTRIAL M A T E R I A L S FOR 1967 THROUGH 1975. IN M A N U F A C T U R I N G AS A WHOLE, UTILIZATION R A T E S AS HIGH AS 90 PER CENT HAVE B E E N EXCEEDED ONLY IN W A R T I M E . THE PEAK R A T E S OF U T I L I Z A T I O N IN 1973 W E R E ASSOCIATED WITH S I G N I F I C A N T U P W A R D P R E S S U R E S ON PRICES. THE C A P A C I T Y UTILIZATION ESTIMATES ARE DESCRIBED, AND HISTORICAL DATA ARE PROVIDED, IN THE N O V E M B E R 1976 ISSUE OF THE F E D E R A L RESERVE ftULLfXUt. THE PRODUCTION FIGURES ARE D E S C R I B E D IN THE JUNE 1976 ISSUE OF THE BULLETIN; C U R R E N T E S T I M A T E S ARE PUBLISHED IN THE FEDERAL R E S E R V E S T A T I S T I C A L R E L E A S E , INDUSTRIAL PRODUCTION. G.12.3.
