U.S. industrial output rises 0.6% in September, boosted by utility segment
WASHINGTON — U.S. industrial output improved in September after a surge in the volatile utility segment helped bolster weaker gains in manufacturing.
Industrial production increased a seasonally adjusted 0.6% from August and capacity utilization rose 0.4 percentage point to 78.3%, the Federal Reserve said Monday. Economists surveyed by Dow Jones Newswires had forecast output to increase 0.4% during September and expected utilization of 78.0%.
September’s gain raises output back to the 2007 average for the first time since the recession. The gain for August was unrevised at 0.4%.
Manufacturing, the largest component of industrial production, increased just 0.1% in September, a slowdown from August’s gain of 0.5%. Utility output rose 4.4% during the month, following declines in the previous five months.
September’s manufacturing gain was led by an improvement in automotive and machinery output, which helped offset a decline in nondurable production, including food processing and chemicals.
Total industrial production fell off sharply during the recession then rose fairly rapidly in the early part of the recovery. But the pace of gains has slowed somewhat over the past year.
Other recent measures of manufacturing also paint a modestly improving picture. The Institute for Supply Management earlier this month reported its September manufacturing index rose to the highest level since April 2011. The Commerce Department said Friday durable goods orders advanced last month on aircraft purchases, but demand otherwise slowed.
Further improvement in factory output would be a welcome sign for the economy, especially if it led to additional job growth. However, over the past 12 months manufacturing employment fell by 18,000, the Labor Department said last week, giving back some of the increase recorded in 2010 and 2011.
