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FEDERAL RESERVE statistical release For immediate release October 17, 1979 G.3 (402) CAPACITY UTILIZATION: MANUFACTURING AND MATERIALS September 1979 Manufacturers operated at 85.1 percent of capacity in September, up 0.3 percentage point from the August rate while producers of industrial materials operated at 86.7 percent of capacity, slightly below the August rate. The September increase in manufacturing capacity utilization was concentrated in advanced processing industries, mainly reflecting a rebound in motor vehicle production. Capacity utilization in primary processing industries edged down. In the third quarter, capacity utilization in manufacturing was 85.3 percent, below the second quarter and 1.4 percentage points below the first quarter high. The September rate was 2.0 percentage points below the rate reached six months earlier. Production of industrial materials, at 86.7 percent of capacity in September, was 0.1 percentage point below the rate in August. The SeptemberAugust rate was down nearly a percentage point from the level prevailing in the preceding three months. The rate in September was 2.1 percentage points below the rate reached at the end of 1978. The utilization rate for materials in the third quarter, at 87.0 percent, was slightly below the rate in the second quarter and 1.2 percentage points below the recent high in the fourth quarter of 1978. Compared to late 1978 levels, the capacity utilization rate for metal materials, especially steel, has declined substantially. Over the same period, the utilization rate for nondurable goods materials has changed little even though the rate for the paper materials component has increased to over 95 percent. The utilization rate for producers of energy materials has changed little dince the beginning of this year but the level has been slightly below the rate at the end of 1978. MANUFACTURING INDUSTRIAL MATERIALS PER CEHT 100 TOTAL 80 60 I 100 I I I I I I I I I NONDURABLE GOODS PftMARY PROCESSING 80 ADVANCED PROCESSES DURABLE 0000$ i r i i i i i i i i -i i i 1067 1970 1073 1076 I 1070 I 1070 I I I 1073 1076 1070 OUTPUT, CAPACITY AND CAPACITY UTILIZATION Output and Capacity are Percentages of 1967 Output; Capacity Utilization is a Per Cent of Capacity. Seasonally Adjusted Manufacturing MONTHLY CAPACITY UTILIZATION SERIES MANUFACTURING, TOTAL PRIMARY PROCESSING ADVANCED PROCESSING J 19731 HIGHI 1 88.01 1 1 93.81 1 85.51 1 1976 SEP. PCT. 69.0 85.5 86.0 68.2 88.4 88.9 69.4 84.0 84.3 1975 LOU OUTPUT 1976 1979 III MANUFACTURING, TOTAL 148.6 PRIMARY PROCESSING 158.2 ADVANCED PROCESSING 143.6 IV I 1 151.71 153.4 1 1 162.21 162.1 1 146.11 148.7 1 11 153.1 161.9 148.5 NOV. 86.3 1979 JAN. PFB. OFt. 66.8 86.4 86.7 90.11 89.0 88.6 1 84.5 65.01 85.0 85.5 1 1 CAPACITY I 1978 1979 1111 HI IV 1 i 1 153.21 174.5 175.61 176.9 1 1 1 1 163.21 179.9 181.21 182.7 1 1 147.91 171.6 172.71 173.8 I j 89.5 MAR. APR. MAY I*MNE ^yi Y AUG. *PP. 87.1 85.3 66.3 86.2 66.0 84.8 85.1 88.6 67.8 88.0 87.9 86.8 87.5 87.3 86.2 63.8 85.2 64.5 63.4 84.0 65.5 1 I UTILIZATION 178.2 164.2 175.0 1979 1976 111 1 179.51 1 1 185.71 1 176.21 IV i 1 11 111 66.41 1 1 89.51 1 84.61 1 86.7 85.9 85.3 88.7 87.9 87.9 85.6 84.8 84.0 JUNE JULY AUG. SEP t 87.4 87.5 87.7 86,8 86.7 85.0 65.2 87.9 83.7 Industrial Materials SERIES 19731 HlGHl 1975 LOU 1978 SEP. MONTHLY CAPACITY UTILIZATION 1 1979 OCT. NOV. DFC.I 1 MATERIALS, TOTAL DURABLE GOODS MATERIALS METAL MATERIALS NONDURABLE GOODS MATERIALS T E X . , PAPER, £ CHEM. MAT. TEXTILE MATERIALS PAPER MATERIALS CHEMICAL MATERIALS ENERGY MATERIALS 92.61 69.4 86.8 1 1 91.51 63.6 85.7 1 98.21 68.6 92.5 1 i 94.51 '67.2 88.7 1 95,11 65.3 88.8 i 92.61 57.9 85.6 99.4) 72.4 93.5 95.51 64.2 88.4 1 1 94.61 84.8 86.5 I OUTPUT 1978 III MATERIALS t TOTAL DURABLE GOODS MATERIALS M€TAL MATERIALS 150.2 151.9 126.6 NONDURABLE GOODS MATERIALS 165.9 T E X . , PA?ER, t CHENe MAT. 172.2 TEXTILE MATERIALS PAPER MATERIALS CHEMICAL MATERIALS ENERGY MATERIALS NOTES 116.0 134.1 212.3 126.9 MAY JAN. FfR. MAR. APR. 67.9 87.8 88.3 86.9 87.3 87.0 87.5 85.4 86.3 86.9 86.9 85,1 88.6 86.2 90.6 88.2 87.0 90.3 91.5 89.7 89.4 89.8 90.0 89.6 89.7 89.2 89.8 89.5 89.6 90.3 1 87.6 88.1 86.6 87.2 93.8 94.4 89.1 89.5 88.9 89.5 87.7 93.1 88.2 87.0 93.3 89.3 88.4 88.8 89.2 90.0 89.9 69.9 90.1 89.8 90.3 90.1 86.4 89.9 89.7 65.8 92.4 90.5 86.8 93.8 89.8 85.3 94.3 90.1 86.5 93.4 90.1 69.4 93.9 89.0 89.0 96.4 69.2 87.7 95.3 69.5 87.3 86.7 87.6 87.2 86.6 86.8 66.8 87.4 1978 111 IV 155.6 156.5 173.9 157.7 158.1 176.5 124.3 139.3 173.4 175.4 188.5 181.3 163.6 196.2 119.6 140.7 224.6 136.3 146.9 242.2 128.1 129.21 144.7 i 1 1 175.41 176.6 1 1 180.11 181.5 I 139.61 139.8 1 | 190«2| 191.9 1 197.9) 199.6 I 136.61 136.9 147. 8| 146.7 244.61 247.4 1 | 145.71 146.7 » 1979 1976 1979 IV 87.1 UTILIZATION CAPACITY 1979 1 1 154.61 155.5 1 1 157.31 158.4 | 132.21 124.7 1 1 170.31 172.2 | 177.11 179.1 I 119.51 118.2 138.11 136.9 218.01 222.7 | 1 128.91 127.9 88.81 1 1 88.41 1 96.01 1 1 90.11 1 90.21 1 87.81 93.91 89.91 | j 88.21 1 11 l l l i 1 1 1 1 IV 11 III 1 178.1 179.6 183.0 184.6 140.3 86.4 85.1 90.9 193.7 195.7 201.5 203.8 137.3 149.9 250.6 147.5 88.0 87.8 85.1 91.3 87.6 148.31 87.7 88.21 88.0 | 1 87.41 87.3 1 94.7} 89.1 » 1 89.61 89.7 1 89.51 89. f 1 67.31 86.3 93.41 92.0 90.0 69.11 1 1 68.51 87.2 1 87.3 87.0 86.2 85.7 88.5 69.5 89.6 89.9 90.2 87.1 93.9 89.7 66.9 87.1 ESTIMATES OF ACTUAL OUTPUT AND CAPACITY OUTPUT ARE BOTH EXPRESSES AS PERCENTAGES OF 1967 ACTUAL OUTPUT. ESTIMATES Of CAPACITY UTILIZATION IN PERCENT ARE CALCULATED AS R A T I O S OF (1) THE FEDERAL RESERVE'S SEASONALLY ADJUSTED INDEXES OF INDUSTRIAL PRODUCTION TO (21 THE CORRESPONDING INDEXES pt CAPACITY. INDUSTRIAL MATERIALS ARE ITEMS BOTH PRODUCED AND USEO AS INPUTS 6Y MANUFACTURING PLANTS, MINES ANO UTILITIES} INDUSTRIAL MATERIALS COVER MANY OF THE ITEMS REPRESENTED IN THE PRIMARY PROCESS I Ne GROUPING OF MANUFACTURING AS WELL AS SOME OF THE OUTPUT OF MINES ANO UTILITIES — SUCH AS IRON ORE, CRUDE OIL, AND ELECTRICITY SOLD TO INDUSTRY. THE 1973 HIGHS AND 1975 LOWS IN CAPACITY UTILIZATION, SHOWN IN THE TABLES ABOVE, ARE SPECIFIC TO EACH SERIES AND MAY OCCUR IN "DIFFERENT MONTHS. INDUSTRIAL PLANTS USUALLY OPERATE AT CAPACITY UTILIZATION RATES THAT ARE WELL BELOW 100 PERCENT j NONE OF THE BROAD AGGREGATE SERIES HAS EVER INDICATED A 100 PERCENT USE Of CAPACITY. CAPACITY UTILIZATION RATES AVERAGED ABOUT 83 PERCENT FOR MANUFACTURING FROM 1955 THROUGH 1978, AND ABOUT 85 PERCENT FOR INDUSTRIAL MATERIALS FOR 1967 THROUGH 1978. IN MANUFACTURING 'AS A WHOLE* UTILIZATION RATES AS HIGH AS 90 PERCENT HAVE BEEN EXCEEDED ONLY IN WARTIME. THE PEAK RATES OF UTILIZATION IN 1979 MERE ASSOCIATED WITH SIGNIFICANT UPWARD PRESSURE ON PRICES. f i7ATIfjfH. REVISED DATA . THE METHODOLOGY AND THE SERIES ARE DESCRIBED IN FEDERAL RPSPRUP MPA.ftj.tPS Q£ CAPACITY AJUJ f-APAflTY ARC FOUND IN "CAPACITY UTILIZATIONS MANUFACTURING ANO MATERIALS, JANUARY 1967— DECEMBER 1976. « BOTH PUBLICATIONS MAY BE OBTAINED FRQN PUBLICATIONS SERVICES, BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, WASHINGTON, D.C. 20551
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