---

INDUSTRIAL PRODUCTION AND CAPACITY UTILIZATION:THE 2010 HISTORICAL AND ANNUAL REVISION



The Federal Reserve has revised the index of industrial production (IP) and the related measures of

 capacity and capacity utilization.  Although rates of change from January 1972 through May 2010 are

 affected, the revision had its largest effect on data from 2006 through 2009.  The annual data from the

 2007 Census of Manufactures and 2008 Annual Survey of Manufactures (ASM) were the largest sources of

 revision and implied noticeably stronger output in 2007 (mostly in durable goods industries) and a larger

 drop in output in 2008 (mostly in nondurables).  Nevertheless, the overall contour of total IP in recent

 years was little changed by the revision:  The index increased at a moderate rate in 2006 and 2007; it fell

 sharply in 2008 and declined further in the first half of 2009.  Relative to earlier estimates, measured

 from fourth quarter to fourth quarter, total IP is now reported to have increased 0.7 percentage point and

 0.5 percentage point more rapidly in 2006 and 2007, respectively.  The decrease in total IP in 2008 is now

 shown to have been 0.9 percentage point greater than estimated earlier, but the decrease in 2009 is 0.9

 percentage point less.[1]



The revision shows that the rate of capacity utilization for total industry was 0.7 percentage point

 higher in the fourth quarter of 2007.  At 71.1 percent, overall utilization in the fourth quarter of 2009

 was 0.2 percentage point below its previous estimate.



In this revision, the base year for the IP index was advanced from 2002 to 2007, which lowered the

 level of the IP index for most periods.  In addition to the new base, the revised IP indexes incorporated

 detailed data from the 2007 Economic Census and the 2008 ASM, both conducted by the U.S. Census Bureau.

 Data from selected editions of the Census Bureau's 2008 and 2009 Current Industrial Reports have also been

 incorporated along with annual data from the U.S. Geological Survey regarding metallic and nonmetallic

 minerals (except fuels) for 2008.  The revised indexes reflect updated price deflators from the Bureau of

 Economic Analysis (BEA).  For this release, monthly indicators (either product data or input data) were

 revised, and the estimation methods for some series were changed.  The new monthly production estimates

 reflect the incorporation of updated seasonal factors and monthly and quarterly source data that became

 available (or were revised) after the closing of the reporting window.



Capacity and capacity utilization were revised to incorporate data from the Census Bureau's Quarterly

 Survey of Plant Capacity for the fourth quarters of 2008 and 2009, which covered manufacturing, along with

 new data on capacity from the U.S. Geological Survey, the Department of Energy, and other organizations.



RESULTS OF THE REVISION





The tables show the summary statistics for the annual revision.  Tables1A and 1B show the monthly,

 quarterly, and annual average index levels for IP and for capacity and utilization for January 1980 through

 May 2010, along with percent changes in IP.  Tables 2 through 4 show the revised rates of change in IP from

 2005 through 2009 for market groups, industry groups, special aggregates, and selected detail.  Table 5

 shows the revised rates of change in capacity by industry groups for the 2006-10 period.  Tables 2 through

 5 also show the difference between the revised and earlier rates of change.  Table 6 shows the revised

 capacity utilization rates for the final quarters of 2006 through 2009 and the difference between the

 revised and previous rates.  Tables 7A, 7B, 8A, 8B,
 9A, and 9B report the revised production, capacity, and

 utilization series for manufacturing, total industry excluding selected high-technology industries, and

 manufacturing excluding selected high-technology industries.  Table 10 reports the annual proportions in IP

 by market and industry groups for 2002 through 2009.  Table 11 reports revised IP indexes and capacity

 utilization rates for the major market and industry groups for the most recent six months.



Industrial Production





The changes in total IP were revised up for 2006 and 2007 (table 2), but the overall contour for recent

 years was little changed--moderate gains for 2005 through 2007 are still followed by drops in the index in

 2008 and 2009.[2]  After the revision, the recent trough in IP remained June 2009.  The peak for IP prior to

 the recent recession moved earlier, to September 2007; previously, it had occurred in December 2007.  (The

 overall index level in December 2007 had been about 0.3 percent above September 2007; it is now 0.2 percent

 below September 2007.)



Production by Industry Group





Manufacturing production expanded during the 2005-07 period, on balance, before contracting sharply in

 2008 and again in 2009.[3]  The breadth of the decline in 2008 was noteworthy--the output index for every

 major manufacturing industry fell during the year.  For durable goods industries as a whole, output rose in

 each year from 2005 through 2007, and the increase over this period was revised up, on net.  The output of

 durable goods output fell sharply in 2008, and that drop was little changed compared with the previous

 estimate.  In 2009, production of durable goods fell again but by less than previously estimated; smaller

 declines are now reported in most industries with the exceptions of machinery and miscellaneous

 manufacturing.  The industries with the most notable upward revisions over the entire 2005-09 period were

 wood products, primary metals, machinery, computer and electronic products, and aerospace and miscellaneous

 transportation equipment.



Production in nondurable manufacturing industries advanced in 2005 and in 2006.  It was unchanged in

 2007 but fell sharply in 2008 and moved down a bit in 2009.  Over the 2005 through 2008 period, rates of

 change in most nondurable goods industries were revised down.  In 2008, all of the major components of

 nondurable goods except for printing and support now show larger drops in their production indexes.  In

 2009, revisions were mixed.  Changes were revised down in the indexes for food, beverage, and tobacco

 products; apparel and leather; printing and support; and plastics and rubber products.  Rates of change

 were revised up for textile and product mills; paper; petroleum and coal products; and chemicals.



The output index for industries not in the scope of manufacturing under the North American Industry

 Classification System (NAICS) (that is, logging and publishing) fell each year from 2005 through 2009, and

 revisions over this period were generally small and negative.  The exception was 2009, which now shows a

 smaller decline.  The index for mining fell substantially in 2009 after being little changed during 2007

 and 2008.  In 2008, the small decline was previously reported as a gain of about 1 percent, but in 2009,

 the index is now shown to have fallen by less.  The index for utilities is also nearly unchanged from

 previous estimates, with the exception of 2008, for which the index now shows a small decline rather than a

 small advance.



The estimates for selected high-technology industries--computers and peripheral equipment, communications

 equipment, and semiconductors and related electronic components--had sizable upward revisions over the

 2005-09 period (table 3).  Output in the high-tech sector is still reported to have posted robust gains

 from 2005 through 2007 followed by a decline in 2008.  The output of high-technology industries turned back

 up in 2009.  The index for computers and peripheral equipment rose in each year from 2005 through 2007 and

 then fell in the next two years; the rates of change were revised up in most years.  The index for

 communications equipment posted strong gains over 2005 and 2006.  It fell substantially in 2007 but moved

 higher in the next two years.  Rates of change for 2006 and 2009 were revised sizably upward, and those in

 2007 and 2008 were revised significantly downward.  The revisions for this industry reflect two factors.

 First, the benchmark annual output index was close to the previous estimate of output for 2007 but

 substantially below the earlier estimate for 2008.  The change in the estimate for 2008 was primarily due

 to a very large downward revision to data networking equipment that began in the middle of 2007 as domestic

 production facilities began to close permanently.[4]  Second, from 2007 forward, the high frequency indicator

 series for the various components of communications equipment are based on different data sources

 (discussed in more detail later), which indicated a different quarterly pattern.  The production of

 semiconductors and related components rose solidly from 2005 through 2007, contracted significantly in

 2008, but moved higher in 2009.  The rates of change were revised up over this period.



Production by Market Group





The production index for final products and nonindustrial supplies (table 2) posted moderate gains

 from 2005 through 2007 and then fell markedly in 2008 and 2009.  The rates of change in the index are lower

 than previously reported for 2005 and 2008 but slightly higher in 2006, 2007, and 2009.



The production of consumer goods rose in 2005 but was little changed in 2006 and 2007.  It then moved down

 significantly in 2008 and declined a bit further in 2009.  Compared with previous estimates, output was

 revised down noticeably in 2008; the revisions to other recent years were much smaller.  The output of

 durable consumer goods rose, on net, from 2005 through 2007, then dropped steeply in 2008 and posted a

 moderate decline in 2009.  The rates of change were revised up in each year from 2005 to 2007 and in 2009.

 Among durable consumer goods, the revised index for automotive products increased more rapidly from 2005

 through 2007.  In 2008, the index now posts a steeper decline, but in 2009, its rebound is larger.  The

 output of home electronics was also revised noticeably; negative revisions in 2006 and 2008 offset positive

 revisions in 2005 and 2007, but in 2009 the rate of change in output revised up substantially to now show a

 small gain over the course of the year.



The index for consumer nondurables shows gains in output for 2005 and 2006 and contractions for 2007

 through 2009.  Rates of change in the index for consumer nondurable non-energy goods display a similar

 pattern; the index was little changed in 2005 and 2009 but revised down for 2006 through 2008.  The largest

 revision occurred in clothing, which is now shown to have declined substantially more steeply, on net, for

 2005 through 2009.  The index for consumer energy products posted gains from 2005 through 2008 but recorded

 a small decline in 2009.



The production of business equipment increased solidly in 2005 and 2006, rose modestly in 2007, then fell

 sharply in 2008 and again in 2009.  Relative to previous estimates, the rate of change in the index was a

 bit lower in 2005 but higher in the years following.  Among its components, the output index for transit

 equipment rose substantially in 2005 and 2006.  It posted a modest gain in 2007 before plummeting in 2008,

 partly because of weakness in the motor vehicle industry and partly because of a strike at a major aircraft

 producer in the second half of the year.  Production advanced in 2009 but by a bit less than the earlier

 estimate.  Revisions to its rates of change from 2006 through 2008 were positive.  The production of

 information processing equipment expanded in each year from 2004 through 2008 but posted a modest decline

 in 2009; on net, the rates of change for this market group were revised up.  The production of defense and

 space equipment is now estimated to have risen more rapidly, on balance, from 2005 through 2007.  The

 decline in 2008 is now modestly larger than stated previously, but the increase in 2009 is little changed.



After a gain in 2005, the output of construction supplies fell from 2006 through 2009.  Relative to

 previous estimates, the overall decrease since 2005 is little changed, with larger declines in 2007 and

 2008 but smaller drops in 2006 and 2009.  The production of business supplies rose modestly from 2005

 through 2007 and then tumbled in 2008 and again in 2009.  Revisions were relatively small in most years.



The index for materials was down slightly in 2005 but moved up in 2006 and 2007 before falling over the

 next two years.  The revisions to the change in output since 2005 for this group were generally upward with

 only 2005 and 2008 showing small downward revisions.  The indexes for durable and nondurable materials both

 fell more than 12 percent in 2008 after having increased moderately, on net, from 2005 through 2007.  In

 2009, durable materials posted another large decline, but nondurable materials rose modestly.  Relative to

 earlier estimates, the net decrease over the 2005-09 window for durable materials is somewhat less, whereas

 the net decline for nondurable materials is little different.  The index for energy materials is now shown

 to have posted small declines in 2008 and 2009.  Previous estimates showed the indexes up slightly in 2008

 and down moderately in 2009.  In prior years, energy materials moved higher on balance; revisions were

 relatively modest.



Capacity





Overall, total industrial capacity increased moderately from 2006 through 2009 but is expected to

 decline in 2010 (table 5).  The rates of change in both 2009 and 2010 have been revised up somewhat from

 earlier estimates, but revisions to earlier years were smaller.  With the notable exception of 2009, the

 contour of manufacturing capacity and the revisions to that contour are roughly similar to those for total

 industry.  In 2009, factory capacity fell sharply, but increases in capacity for both mining and utilities

 helped overall capacity post a modest increase.



Aggregate capacity for the selected high-technology industries rose in each year from 2006 through

 2009 and is expected to post a sizable increase in 2010.  Relative to previous reports, capacity in these

 industries rose more quickly in 2006 and 2007 and less quickly in 2008 and 2009.  Excluding high-technology

 industries, manufacturing capacity expanded from 2006 through 2008.  It declined in 2009 and is expected to

 fall again in 2010.  The current estimates are similar to previous reports.



Capacity at mines expanded from 2006 through 2009 and is expected to be little changed this year.

 The gains in 2008 and 2009 are now reported to have been stronger than previously published, but the rates

 of change in 2007 and 2010 have been revised down.  Capacity at electric and gas utilities has risen each

 year since 2006; the gains in 2008 and 2009 were somewhat larger than in 2006 and 2007, and the increase

 this year is projected to be slightly below the average over the preceding four years.



By stage of processing, after a large upward revision in 2009, capacity in the crude stage is now reported

 to have risen every year from 2006 to 2009, although it is expected to fall in 2010.  The rates of change

 for capacity in the primary and semifinished stages were mostly revised up over the 2006-09 revision

 period.  After gains from 2006 to 2008, capacity at this stage fell in 2009, but by a bit less than earlier

 estimates, and it is expected to fall again in 2010.  Relative to previous estimates, changes to the index

 for finished goods were revised down from 2006 through 2009.  Despite the downward revisions, capacity for

 this stage of process still rose from 2006 through 2008 and only fell modestly in 2009; it is expected to

 rise more in 2010 than estimated previously.



Capacity Utilization





In 2006 and 2007, the capacity utilization rate for total industry stood a little above its long-run

 (1972 to 2009) average of 80.6 percent.[5]  It fell in 2008 and again in 2009 to a level in the fourth

 quarter of 2009 that was about 9-1/2 percentage points below its long-run average (table 6).  The

 utilization rate for total industry was revised up noticeably in 2007 and down a bit in 2009.  Revisions to

 2006 and 2008 were slight.  Manufacturing capacity utilization stood at about its long-run average of 79.2

 percent in 2006 and 2007.  It fell sharply in 2008 and dropped further in the fourth quarter of 2009, to

 68.8 percent, a rate more than 10 percentage points below its long-run average.  Relative to earlier

 reports, the factory operating rate was unrevised in 2006, was revised down in 2008, and was revised up in

 2007 and 2009.



Within durable goods, utilization rates for most industries were above their long-run averages in

 2007 but then dropped to well below their long-run averages over the next two years.  Durable goods

 industries that saw the largest declines in operating rates were wood products, nonmetallic mineral

 products, primary metals, and motor vehicles and parts.  In these industries, utilization rates tumbled 15

 percentage points or more below their long-run averages in 2008.  Apart from motor vehicles and parts,

 utilization rates in all the other major durable goods industries fell further in 2009.  Capacity

 utilization rates were revised noticeably in a number of industries.  In particular, substantial downward

 revisions occurred in nonmetallic mineral products and motor vehicles and parts.  Sizable upward revisions

 over the 2006-09 window occurred in wood products; machinery; computer and electronic products; electrical

 equipment, appliances, and components; and furniture and related products.



Utilization rates for most nondurable goods industries were a bit below their long-run averages in 2006

 and 2007.  Most fell substantially in 2008 and declined further in 2009.  In the fourth quarter of 2009,

 four nondurable goods industries (textile and product mills; paper; printing and support activities; and

 plastics and rubber products) had utilization rates more than 10 percentage points below their long-run

 averages.  Among nondurable goods industries, the rates for apparel and leather, printing and support, and

 plastics and rubber products had the largest downward revisions over the 2006-09 period; revisions in other

 nondurable goods industries were relatively small.



Capacity utilization in the other (non-NAICS) manufacturing category was revised downward in 2006 and

 2007 but upward substantially in 2008 and 2009.



The operating rates for the selected high-technology industries were above their long-run averages in the

 fourth quarters of 2006 and 2007 before dropping below the average in 2008 and 2009.  Relative to earlier

 estimates, capacity utilization is now reported to have been substantially higher in 2008 and 2009 but

 little changed, on net, in previous years.  The operating rates for computers and peripheral equipment and

 those for communications equipment are now shown to have been lower than previously reported in 2006 and

 2007 but higher in more recent years.  Although capacity utilization was revised up over the entire 2006-09

 period for semiconductors and related electronic components, operating rates have been at or below the

 long-run average since 2007.



Capacity utilization in mining was above its long-run average from 2006 through 2008.  In the fourth

 quarter of 2009, it fell to 81.7 percent, a rate 5-3/4 percentage points below its long-run average.

 Relative to earlier estimates, the utilization rate for mining was lower over the entire 2006-09 period.

 At electric and gas utilities, capacity utilization rates had small revisions from 2006 through 2008.  The

 rate was revised down in 2009 to 78.8 percent, a rate that was nearly 6 percentage points below its

 long-run average.



TECHNICAL ASPECTS OF THE REVISION





This revision incorporated comprehensive data for both 2007 and 2008 for manufacturing production.

 The results of the Economic Census for 2007 and the ASM for 2008 became available since the last annual

 revision was published in March 2009.  Revised price indexes from the BEA and updated price indexes

 constructed by the Federal Reserve for a few selected industries were also incorporated.[6]  In addition, the

 benchmark indexes for logging and publishing (included in the IP index for manufacturing but no longer

 included in manufacturing under NAICS) were advanced through 2008 based on data from the U.S. Forest

 Service and the Census Bureau.



The revised IP indexes incorporated information from selected Current Industrial Reports (CIRs) for

 2009, the Quarterly Survey of Plant Capacity for 2009, and other annual industry reports.  The indexes also

 incorporated revised monthly and quarterly source data on production, shipments, inventories, and

 production-worker hours.



Annual Benchmark Output Indexes





The annual benchmark indexes--defined for each six-digit NAICS industry as nominal gross output

 divided by a price index--were updated to include new as well as revised information from the 2007 Economic

 Census and the 2008 ASM.  Data from these reports were classified based on the 2007 NAICS, whereas data

 from these reports for 2002 through 2006 were classified based on the 2002 NAICS.  The 2007 NAICS included

 about a dozen six-digit manufacturing industries that had different coverage than they did in the 2002

 NAICS.  One industry included in the 2002 NAICS, Laboratory Apparatus and Furniture Manufacturing (NAICS

 339111), was eliminated; its various components were distributed among seven different six-digit industries

 in the 2007 NAICS.



Industrial production and capacity utilization are structured to follow a single industry classification

 system, currently 2002 NAICS, from 1972 forward.  For the purposes of maintaining a consistent benchmark

 time series, the data from the 2007 Economic Census and the 2008 ASM were transformed to the 2002 NAICS

 system using data from tables on product shipments by industry from the 2002 Economic Census.  The Census

 Bureau plans to issue bridge tables providing a more precise allocation of the data from the 2007 Economic

 Census into the 2002 NAICS next year.



Since 2003, the ASM has not included separate data for every six-digit manufacturing industry; data for

 some industries were only included as part of a larger group of industries.  Previously, the benchmark

 indexes for industrial production were calculated by allocating the data for these combined industries to

 their six-digit components based on shares from the 2002 Economic Census.  With this revision, the

 allocations for 2003 through 2006 reflect shares from both the 2002 and 2007 Economic Censuses.  Data from

 the 2008 ASM were allocated to the component six-digit industries based on shares from the 2007 Economic

 Census.



The deflators for the IP benchmarks primarily reflect industry shipments deflators issued by the Bureau of

 Economic Analysis in May 2010.  The BEA deflators differed occasionally from their previously published

 values because of the incorporation of information from the 2002 Input-Output tables on the composition of

 each industry's primary and secondary products.

Changes to Individual Production and Capacity Series



With this revision, the monthly production indicators for some series have changed.

Communications equipment



The IP aggregate index for communications equipment (NAICS 3342) comprises six product-based indexes.

 With this revision, each of those six indexes incorporates quarterly data on nominal shipments at the

 detailed product level from the Census Bureau's relevant CIR from 2007 forward.  The quarterly CIR for

 communications equipment began in 2006 and now has enough history available to incorporate these data on a

 seasonally adjusted basis.  The nominal shipments data for each of the six indexes are combined with price

 indexes constructed or taken from other sources.



Previously, four of the six communications equipment output indexes used data on nominal domestic

 absorption combined with price deflators constructed from detailed product information, and the other two

 indexes were based on production-worker-hour data.  The nominal CIR shipments data more closely reflect

 domestic output and are expected to provide a more accurate measure of U.S. production than the data on

 domestic absorption.



The IP indexes for enterprise and home voice equipment; data networking equipment;

 transmission, local loop, and legacy central office equipment; and wireless system equipment were

 previously based on nominal domestic absorption data deflated with matched-model price deflators.  The new

 CIR-based indicators for these products continue to incorporate matched-model deflators, though for the

 first two indexes, the price data are now provided by the Dell'Oro Group and cover more detailed product

 types than the price information used previously.



The other two communications equipment indexes, satellites and earth station equipment and other

 radio and TV broadcasting equipment, had been previously based on production-worker hours.  The revised

 index for satellites and earth station equipment deflates the CIR shipments data with an annual price index

 initially constructed for the 2006 annual revision.  The index uses annual data from Futron Corporation and

 the Satellite Encyclopedia that is interpolated and extended based on a producer price index.  The CIR

 shipments data for other radio and TV broadcasting equipment is deflated by a Bureau of Labor Statistics

 (BLS) producer price index.



Computers



The production indexes for computer storage device and computer terminal manufacturing (NAICS 334112

 and NAICS 334113) and for other computer peripheral equipment manufacturing (NAICS 334119) are now based on

 nominal shipments data from the Census Bureau's quarterly CIR deflated by the relevant BLS producer price

 indexes for 2007 to the present.  As with the CIR for communications equipment, the CIR for computers was

 introduced in 2006, and there is now enough history for the data to be seasonally adjusted.  Previously,

 the IP indexes for these series were based on data from Gartner on output of these products during the

 1990s that were extended by statistical models that predicted changes in output based on changes in the

 production of personal computers and of servers.



Semiconductors





Within semiconductors, the output index for other MOS memories (NAICS 334413, part) is constructed

 from nominal domestic absorption data deflated by a matched-model price deflator constructed from detailed

 product information from the Semiconductor Industry Association.  Previously, the price deflator for this

 index was constructed from product data from iSuppli that were discontinued.



Glass containers





The index for glass containers (NAICS 327213) is based on monthly data on unit production from the

 Glass Packaging Institute (GPI).  Formerly, this index was based on monthly data from the Census Bureau's

 CIR, which was discontinued after December 2008.  The GPI data begin in January 2008, and the year of

 overlap was used to adjust the GPI data to the CIR level going forward.

Series switched from using product data to production-worker hours



Product data used as indicators for a few IP indexes were discontinued in the past few years and have

 been replaced by production-worker hours for 2007 to the present.  The industries affected are industrial

 gas manufacturing (NAICS 32512), electric housewares and household fan manufacturing (NAICS 335211), and

 household vacuum cleaner manufacturing (NAICS 335212).



In addition, production worker hours have replaced physical product data as the indicator for the IP

 index for audio and video equipment manufacturing (NAICS 3343) because of the changes to the concentration

 of domestic production of products within the industry.  The previous physical product data source for this

 index predominantly covered sales of products such as digital televisions.  Newly available information

 from the Census of Manufactures indicated that these products now represent a smaller fraction of domestic

 production (about 20 percent in 2007 and 2008 compared with about 40 percent between 2002 and 2006).

 Consequently, the production-worker hours are able to provide a more accurate indicator of output.



New Capacity Series





Plywood and miscellaneous wood products





The capacity index for plywood and miscellaneous wood products (NAICS 3212 and 3219) was split into

 two series--veneer, plywood, and engineered wood product (NAICS 3212)  and other wood products (NAICS

 3219)--from 1987 onward.  The capacity indicator for veneer, plywood, and engineered wood products is data

 on particleboard capacity and fiberboard capacity, both from the Composite Panel Association.  The capacity

 indicator for other wood products is based on utilization rates from the Census Bureau's Survey of Plant

 Capacity.





Basic inorganic chemicals





The capacity index for basic inorganic chemicals (NAICS 32512-8) was split into two series--alkalies

 and chlorine (NAICS 325181) and basic inorganic chemicals excluding alkalies and chlorine (NAICS 32512-7,

 325182, and 325188).  The capacity indicator for alkalies and chlorine is data on chlorine capacity from

 the Chlorine Institute.  The capacity indicator for basic inorganic chemicals excluding alkalies and

 chlorine is based on utilization rates from the Census Bureau's Survey of Plant Capacity.



Weights for Aggregation



The IP index is a Fisher index.  The weights for manufacturing industries are derived from value-added

 measures from the Census of Manufactures and the ASM.  The Federal Reserve derives estimates of value added

 for the electric and gas utility industries from annual revenue and expense data issued by other

 organizations.  The weights for aggregation, expressed as value added per unit, were estimated with the

 latest data on producer prices for the period after 2008.  Table 10 shows the annual value-added

 proportions in the IP index from 2002 through 2009.



Revised Quarterly and Monthly Data



This revision incorporates product data that became available or were revised after the regular six-month

 reporting window for monthly IP was closed.  These data were released with too great a lag to be included

 with monthly IP estimates but were available for inclusion in the annual revision.



Revised Seasonal Factors



Seasonal factors for all series were reestimated using data that extend into 2010.  Factors for

 production-worker hours--which adjust for timing, holiday, and monthly seasonal patterns--were updated with

 data through January 2010.  The updated factors for the physical product series, which include adjustments

 for holiday and workday patterns, used data through March 2010 where available.  Seasonal factors for unit

 motor vehicle assemblies have been updated, and projections through December 2010 are on the Board's

 website at www.federalreserve.gov/releases/g17/mvsf.htm.



For many of the series based on production-worker-hour data, and some based on product data

 (particularly steel products), the recent recession seemed to have a systematic effect on the seasonal

 factors estimated using standard procedures (X-12 with a time-series-based pre-adjustment).  The seasonal

 factors for these series had revised down around the apparent trough of the recession in June 2009 and

 increased toward the beginning and end of the year.  This pattern would generally raise the change in IP in

 the first halves of 2008 through 2010 and lower the change in the second halves of those years.  Because

 the pattern was probably artificially induced by the recession and a more normal pattern will likely return

 in 2010, those series were pre-adjusted for much of 2009 to eliminate the recession pattern before applying

 X-12 to them.  These pre-adjustments will be reconsidered when the seasonal factors are reestimated after

 2010 data are fully available.



Data Availability and Publication Changes





Files containing the revised data and the text and tables from this release are available on the

 Board's website at www.federalreserve.gov/releases/g17, as are updated data for the annual revision and for

 all of the regularly issued series on industrial production, capacity, and capacity utilization.  The

 revised data will also be available through the STAT-USA website of the Department of Commerce

 (www.stat-usa.gov).  Further information on these revisions is available from the Board's Industrial Output

 Section (telephone 202-452-3197).



A document with printed tables of the revised estimates of series shown in the G.17 release is available

 upon request to the Industrial Output Section, Mail Stop 82, Division of Research and Statistics, Board of

 Governors of the Federal Reserve System, Washington, DC 20551.



An expanded version of this release will be published in a forthcoming report that will be available on

 the Board's website.



---

[2] In this section, all the rates of change are calculated from the fourth quarter of the previous year to

 the fourth quarter of the reference year.
Return to text

[3] Manufacturing consists of those industries in the North American Industry Classification System

 definition of manufacturing, plus those industries--logging and newspaper, periodical, book, and directory

 publishing--that traditionally have been considered to be manufacturing.Return to text

[4] This change had a substantial effect on the fourth-quarter to fourth-quarter changes in the index because

 it left the level at the end of 2008 much lower than the previous estimate.Return to text

[5] Capacity utilization rates are reported for the fourth quarter of the year referenced.Return to text

[6] Price indexes for pharmaceuticals (NAICS 325412), for semiconductors (NAICS 334413), and for most

 components of communications equipment (NAICS 3342) are constructed by the Federal Reserve from alternative

 sources.  A table that lists annual and quarterly price indexes for the networking equipment component of

 communications equipment follows the text.Return to text

---

|      | ProductionIndex | PriceIndex | Value ofProduction(millions of dollars)
|----- | --------------- | ---------- | ---------------------------------------
|
|
|
|
|40.4  | 233.4           | 12,756.7  
|84.4  | 193.7           | 22,111.2  
|102.7 | 173.6           | 24,174.1  
|132.1 | 133.1           | 23,839.6  
|100.0 | 100.0           | 13,595.4  
|115.5 | 76.6            | 11,941.9  
|133.1 | 59.9            | 10,809.1  
|154.9 | 54.3            | 11,398.8  
|249.5 | 51.4            | 17,251.4  
|171.6 | 48.3            | 11,337.9  
|10.1  | 47.1            | 642.4     
|
|38.6  | 261.2           | 13,604.5  
|37.8  | 243.3           | 12,416.6  
|39.0  | 216.2           | 11,391.7  
|47.1  | 214.6           | 13,640.1  
|68.7  | 204.2           | 18,953.9  
|85.9  | 195.2           | 22,649.1  
|91.1  | 192.0           | 23,611.6  
|93.6  | 184.2           | 23,292.2  
|99.5  | 184.0           | 24,725.8  
|101.4 | 172.6           | 23,623.2  
|102.1 | 171.3           | 23,622.7  
|109.1 | 167.1           | 24,617.2  
|132.0 | 146.1           | 26,048.1  
|130.8 | 140.1           | 24,736.4  
|134.4 | 128.4           | 23,305.8  
|131.6 | 119.1           | 21,173.9  
|108.0 | 112.4           | 16,405.3  
|98.7  | 103.2           | 13,762.0  
|97.0  | 95.8            | 12,549.5  
|96.2  | 89.7            | 11,653.6  
|100.0 | 84.2            | 11,367.1  
|116.7 | 81.8            | 12,899.6  
|127.0 | 75.3            | 12,918.2  
|118.2 | 65.8            | 10,505.5  
|141.2 | 66.7            | 12,723.4  
|132.5 | 60.8            | 10,878.6  
|129.1 | 57.5            | 10,025.3  
|130.4 | 54.9            | 9,672.1   
|141.0 | 54.1            | 10,294.1  
|149.8 | 53.7            | 10,870.6  
|156.8 | 54.6            | 11,556.4  
|170.4 | 55.0            | 12,648.6  
|200.8 | 54.1            | 14,664.1  
|223.6 | 51.6            | 15,586.1  
|265.2 | 50.3            | 18,007.3  
|300.4 | 49.7            | 20,176.0  
|287.2 | 48.8            | 18,929.0  
|231.9 | 48.9            | 15,299.1  
|137.2 | 47.9            | 8,879.4   
|52.5  | 47.8            | 3,389.3   
|17.0  | 48.3            | 1,110.5   
|6.1   | 47.5            | 389.8     
|6.5   | 47.1            | 415.8     
|11.2  | 45.7            | 691.3     







G.17 Revision Release Tables:

|Chart 1 |               | Total industrial production, capacity, and utilization                                            
|------- | ------------- | --------------------------------------------------------------------------------------------------
|Chart 2 |               | Manufacturing industrial production, capacity, and utilization                                    
|Chart 3 |               | Industrial production and capacity utilization                                                    
|Chart 4 |               | Consumer goods                                                                                    
|Chart 5 |               | Equipment, total                                                                                  
|Chart 6 |               | Nonindustrial supplies                                                                            
|Chart 7 |               | Industrial materials                                                                              
|Chart 8 |               | Capacity utilization by stage of process                                                          
|Ascii   | Screen reader | Table 1A: Industrial Production:  Total                                                           
|Ascii   | Screen reader | Table 1B: Capacity and Utilization: Total                                                         
|Ascii   | Screen reader | Table 2: Rates of Change in Industrial Production, Market and Industry Group Summary:  2005-09    
|Ascii   | Screen reader | Table 3: Rates of Change in Industrial Production, Special Aggregates and Selected Detail: 2005-09
|Ascii   | Screen reader | Table 4: Annual Rates of Change for Industrial Production: 2005-09                                
|Ascii   | Screen reader | Table 5: Rates of Change in Capacity, By Industry Groups: 2006-10                                 
|Ascii   | Screen reader | Table 6: Revised and Earlier Capacity Utilization Rates, By Industry Groups                       
|Ascii   | Screen reader | Table 7A: Industrial Production:  Manufacturing                                                   
|Ascii   | Screen reader | Table 7B: Capacity and Utilization:  Manufacturing                                                
|Ascii   | Screen reader | Table 8A: Industrial Production:  Total Industry Excluding Selected High-Technology Industries    
|Ascii   | Screen reader | Table 8B: Capacity and Utilization:  Total Industry Excluding Selected High-Technology Industries 
|Ascii   | Screen reader | Table 9A: Industrial Production: Manufacturing Excluding Selected High-Technology Industries      
|Ascii   | Screen reader | Table 9B: Capacity and Utilization:  Manufacturing Excluding Selected High-Technology Industries  
|Ascii   | Screen reader | Table 10: Annual Proportions in Industrial Production, Market and Industry Group Summary          
|Ascii   | Screen reader | Table 11: Industrial Production and Capacity Utilization Summary                                  

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