Total industrial production increased by 0.8% in May, according to the Industrial Production and Capacity Utilization Report, which was released Monday by the Federal Reserve.
Manufacturing production advanced 0.9%, reflecting, due in part to a large gain in motor vehicle assemblies; factory output excluding motor vehicles and parts increased 0.5%. The indexes for mining and utilities rose 1.2% and 0.2%, respectively.
In May, at 99.9% of its 2017 average, total industrial production was 16.3% higher than it was a year earlier but 1.4% lower than its pre-pandemic level in February of last year. Capacity utilization for the industrial sector rose 0.6 percentage point in May to 75.2%, a rate that was 4.4 percentage points below its long-run (1972–2020) average.
The bulk of the major market groups posted gains in May. The indexes for consumer goods, business equipment, business supplies, and materials all increased by around 1%. Within consumer goods, the index for durables increased nearly 3%, mainly due to a jump of 5.7% in the output of automotive products. In March, automotive products, transit equipment, and consumer parts all recorded losses, as shortages of semiconductors held back motor vehicle assemblies.
Manufacturing output rose 0.9% in April with decreases of 0.4% and 1.7% for manufacturing and mining, respectively. The index for durable manufacturing ticked up by 1%, with the most of that increase resulting from a gain of 6.7% for motor vehicles and parts. Overall vehicle assemblies jumped about 1 million units to 9.9 million units (annual rate); although they remained more than 1 million units below their average level in the second half of 2020, as production continued to be hampered by shortages of semiconductors.
With nearly all of its components posting gains, the index for nondurables increased by 0.8%. Increases of more than 2% were posted by apparel and leather, printing and support and by chemicals. The improvement in chemicals was mainly due to the reopening of some additional petrochemical plants that had been out of commission due to damage from the frigid conditions in February. The output of other manufacturing (publishing and logging) increased 0.8%
Capacity utilization for manufacturing increased 0.7 percentage point in May to 75.6% The operating rate for mining increased 0.9 percentage point to 75.2% , while the operating rate for utilities was unchanged at 72.8%. The rates for all three sectors remained below their long-run averages.
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