The 2020 Mid-Year Economic Update_long

Manufacturing Production Decreased 0.6% in October

Industrial production down 0.8% during the month.

Industrial production fell 0.8% in October after declining 0.3% in September, according to the latest data from the Federal Reserve. 

Manufacturing production decreased 0.6% in October. Much of this decline was due to a drop of 7.1% in the output of motor vehicles and parts that resulted from a strike at a major manufacturer of motor vehicles. The decreases for total industrial production, manufacturing, and motor vehicles and parts were their largest since May 2018, April 2019, and January 2019, respectively. 

In October, the strike in the motor vehicle industry contributed to a drop of 1.2% for durables. Excluding motor vehicles and parts, the output of durables moved down 0.2%. The indexes for electrical equipment, appliances, and components and for miscellaneous manufacturing each moved down more than 1%; wood products recorded the largest gain, with an increase of 0.7%. The production of nondurables was unchanged, as increases in the indexes for food, beverage, and tobacco products and for printing and support were offset by declines in other indexes. The output of other manufacturing (publishing and logging) fell 1.0%. 

Capacity utilization for manufacturing decreased 0.5% in October to 74.7%, a rate that is 3.6% below its long-run average. The operating rate for durables dropped 1.0%age point, while the rate for nondurables edged down 0.1%age point. The utilization rate for mining fell to 88.8% yet was still 1.7% higher than its long-run average. The rate for utilities declined 2.1%age points and remained well below its long-run average.

At 108.7% of its 2012 average, total industrial production was 1.1% lower in October than it was a year earlier. Capacity utilization for the industrial sector decreased 0.8% in October to 76.7%, a rate that is 3.1% below its long-run (1972–2018) average.

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