The reading for December’s Industrial Production and Capacity Utilization is out. Production rose by +0.4% for December, slightly under the Dow Jones target of +0.5% that was expected. Capacity came in up +0.3% at 78.1%.
It is always good when you see a rise in production, but capacity coming in under 80% is not exactly going to create a bunch of manufacturing jobs. This is still much better on average than in the last three years, so don’t think it is only all-bad. The government may continue manipulating the official unemployment rate by having workers drop out of the labor force. They call it “not participating in the labor force” and that implies that everyone retired early, has become a house spouse, or has just decided to go off the grid and move in with their parents or a relative for free.
The good news for the broader scope of the economy is that Bloomberg’s commentary is a bit more positive: “Industrial production in December posted a healthy gain but the manufacturing component was even more robust. Overall industrial production rebounded 0.4 percent after dipping 0.3 percent in November. The latest number came in slightly lower than the consensus forecast for a 0.5 percent jump. By major components, manufacturing made a 0.9 percent comeback, following a 0.4 percent drop in November….”
YCharts.com has a detailed chart here going back to the start of 2002 when the US was in a recession.
JON C. OGG
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