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Manufacturing Biweekly Update

July 20, 2012 [past updates]


U.S. Manufacturing Trends Current Period Year-to-Date
Wage Rates up up
Profits up up
Employment up up
Production up up
Capacity Utilization up up
Productivity up up
Exports up up
Goods Shipments up up


Biweekly Notes

Factories in U.S. Show Resilience as Production Rises: Economy

Industrial production increased in June, paced by gains among auto and machinery makers that may ease concern some of the drivers of the U.S. economic expansion were floundering. Output at factories, mines and utilities rose 0.4 percent last month after a revised 0.2 percent drop in May that was larger than previously reported, according to Federal Reserve data issued today in Washington. Other figures showed consumer prices were unchanged and homebuilder confidence jumped.
(Bloomberg| July 17, 2012)
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Energy, manufacturing fuel U.S. cities' economic growth: study

Cities will be leading contributors to U.S. economic expansion over the next year, and much of their growth will depend on energy and manufacturing, according to a study released by the U.S. Conference of Mayors on Thursday. "The timing and pace of recovery will be varied across the states and metropolitan areas," the study, conducted by independent firm IHS Global Insight, found. "Metro areas that didn't suffer and those whose economies are rooted in quickly growing or rebounding industries will likely recover before those with greater exposure to the acute economic turmoil." Over the last couple of years, a boom in natural gas has brought newfound wealth to many places, while the chemicals used to extract it have raised the ire of environmental groups. Meanwhile, once-foundering manufacturing has developed strength after federal intervention in the automobile industry.
(Reuters| July 19, 2012)
[Read More]

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U.S. Manufacturing Key Facts

Manufacturing Wage Rates

  • In June 2012, average hourly earnings in manufacturing were $19.14 (preliminary), up 0.31 percent from previous month, and up 1.16 percent from June 2011’s $18.92.

    (BLS/DOL Employment data from “The Employment Situation, USDL 12-1332,” released July 6, 2012; next release is August 3, 2012)
    http://www.bls.gov/news.release/pdf/empsit.pdf

       

Manufacturing Wage Rates (Quarterly, Yearly)

  • In the first-quarter of 2012, hourly compensation from previous quarter, annual rate (revised) was unchanged in total manufacturing, down (-0.6 percent) in durable manufacturing and up (+1.0 percent) in nondurable manufacturing.

  • In the first-quarter of 2012, hourly compensation (revised) of all manufacturing workers decreased (-0.7 percent), compared to a (+2.8 percent) increase during the first-quarter of 2011. Real hourly compensation in the total manufacturing sector decreased (-3.4 percent) in the first-quarter of 2012, compared to (+0.6 percent) increase in the first-quarter of 2011.

    (BLS/DOL Productivity data from “Productivity and Costs, First Quarter 2012,” USDL 12-1123, released June 6, 2012; next release is August 8, 2012)
    http://www.bls.gov/news.release/pdf/prod2.pdf

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Manufacturing Profits

  • (BLS/DOL Employment data from “The Employment Situation, USDL 12-1332,” released July 6, 2012; next release is August 3, 2012)

  • First quarter 2012 profits for all non-financial industries (manufacturing being a subcategory) increased $221.7 billion from the fourth quarter of 2011 to $1219.7 billion.

    (BEA/DOC GDP data from “Gross Domestic Product, BEA 12-29,” released June 28, 2012; next release is July 27, 2012)
    http://www.bea.gov/newsreleases/national/gdp/2012/pdf/gdp1q12_3rd.pdf

       

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Manufacturing Employment

  • In June 2012, manufacturing employment went up, with an increase of 11,000 jobs.

  • In June, durable goods manufacturing gained 14,000 jobs with increases in transportation equipment (+7,100), fabricated metal products (+4,800), machinery (+3,400), miscellaneous manufacturing (+2,600), primary metals (+800), and electrical equipment and appliances (+300). However, job loss occurred in nonmetallic mineral products (-2,500), furniture and related products (-1,400), and wood products (-1,100). Meanwhile, there was no change of employment in computer and electronic products.

  • In June, nondurable goods manufacturing lost 3,000 jobs with decreases in apparel (-2,300), printing and related support activities (-1,200), petroleum and coal products (-1,000), beverages and tobacco products (-900), leather and allied products (-200), textile mills (-100), and textile product mills (-100). However, job gains occurred in plastics and rubber products (+1,100), chemicals (+900), food manufacturing (+400), and paper and paper products (+200).

  • The manufacturing employment of 12.0 million workers represents 9.0 percent of total non-farm employment.

    (BLS/DOL Employment data from “The Employment Situation, USDL 12-1332,” released July 6, 2012; next release is August 3, 2012) http://www.bls.gov/news.release/pdf/empsit.pdf

       

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Manufacturing Production UPDATED

  • In June 2012, manufacturing production was up (+0.7 points from previous month and was up (+5.6 percent) above its year-earlier level.

  • Production of durable goods was up (+0.8 percent) from the previous month. The durable industries that registered increases in output included machinery (+2.3 percent), motor vehicles and parts (+1.9 percent), computer and electronic products (+1.1 percent), nonmetallic mineral products (+0.8 percent), wood products (+.8 percent), fabricated metal products (+.5 percent), miscellaneous (+.2 percent) and aerospace and miscellaneous transportation equipment (+0.1 percent). The durable industries that registered decreases in output included primary metals (-1.2 percent), electrical equip., appliances, and components (-0.9 percent), and furniture and related products (-0.3 percent).

  • IIn June 2012, production of nondurable goods was up (+0.5 percent) from the previous month. The nondurable industries that registered increases in output included textile and product mills (+1.8 percent), printing and support (+1.0 percent), plastics and rubber products (+0.9 percent), petroleum and coal products (+0.9 percent), chemicals (+0.8 percent), and paper (+0.4 percent). The nondurable manufacturing industries that registered decreases in output included apparel and leather (-1.6 percent) and food, beverage and tobacco products (-0.1 percent).

  • Other manufacturing (non-NAICS) was up (+1.6 percent).

    (Federal Reserve Statistical data from “Industrial Production and Capacity Utilization, G17 (419),” released July 17, 2012; next release is August 15, 2012)
    http://www.federalreserve.gov/releases/g17/Current/g17.pdf

       

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Manufacturing Capacity Utilization UPDATED

  • In June 2012, manufacturing industries (NAICS based) operated at 78.2 percent of capacity, + 0.4 percentage points above the capacity utilization level from previous month, and down (-0.5 percentage points) below their 1972-2011 average of 78.7 percent.

  • In June 2012, durable manufacturing, capacity utilization operated at 78.2 percent capacity, up (+0.4 percentage points) from the previous month. Increased capacity utilization was registered in machinery (+1.8 points), motor vehicles and parts (+1.2 points), wood products (+.7 points), nonmetallic mineral products (+.6 points), computer and electronic products (+.4 points) and fabricated metal products (+0.3 points). Decreased capacity utilization was registered in electrical equip., appliances, and components (-.8 points), primary metals (-0.8 points), miscellaneous (-0.2 points) furniture and related products (-.2 points) and aerospace and miscellaneous transportation equipment (-0.1 points).

  • In June 2012, non-durable manufacturing, capacity utilization operated 78.2 percent capacity, up (+0.4 percentage points) from the previous month. Increased capacity utilization was registered in textile and product mills (+1.4 points), petroleum and coal products (+1.0 points), printing and support (+0.6 points), plastics and rubber products (+0.6 points), chemicals (+0.5 points) and paper (+0.5 points). Decreased capacity utilization was registered apparel and leather (-1.0 points) and in food, beverage, and tobacco products (-0.2 points).

  • The index for other manufacturing industries (non-NAICS) was up (+1.1 points).

    (Federal Reserve Statistical data from “Industrial Production and Capacity Utilization, G17 (419),” released July 17, 2012; next release is August 15, 2012)
    http://www.federalreserve.gov/releases/g17/Current/g17.pdf

       

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Manufacturing Productivity

  • Manufacturing sector productivity was up (+5.2 percent) in the first-quarter of 2012, as output increased (+10.0 percent) and hours increased (+4.6 percent). Productivity was up (+9.9 percent) in the durable goods industries and up (+0.1 percent) in the nondurable goods industries. Unit labor costs in manufacturing decreased (-4.9 percent) in the first-quarter of 2012, and decreased (-2.9 percent) over the last four quarters.

  • In durable goods industries, productivity was up (+9.9 percent) from previous quarter, as output increased (15.4 percent), while hours worked increased (4.9 percent).

  • In nondurable goods industries, productivity was up (+0.1 percent) from previous quarter, as output increased (+4.3 percent), and hours worked increased (+4.1 percent).

    (BLS/DOL Productivity data from “Productivity and Costs, First-Quarter 2012,” USDL 12-1123, released June 6, 2012; next release is August 8, 2012)
    http://www.bls.gov/news.release/pdf/prod2.pdf

       

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Manufacturing Trade UPDATED

  • Manufactured goods exports in May 2012 were 3.5 percent higher than the previous month. Imports were 6.7 percent higher.

  • Year-to-date May 2012, U.S. manufactured goods exports accounted for 86.9 percent of all U.S. exports of goods, compared with 85.3 percent a year ago.

  • The year-to-date May 2012 trade deficit in manufactured goods of $176.6 billion was $6.7 billion more when compared with $169.9 billion a year ago.

    ((USA Trade Online, U.S. Census Bureau, released July 11, 2012; Next release is August 9, 2012)
    http://www.usatradeonline.gov/

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Manufactured Goods Shipments

  • Shipments of manufactured durable goods in May, up five of the last six months, increased $1.7 billion or 0.8 percent to $224.3 billion, revised from the previously published 0.7 percent increase. This followed a 0.7 percent April increase.

  • In May, shipments increased in computers and electronic products (+1.7 percent), wood products (+1.7 percent), transportation equipment (+1.6 percent), electrical equipment, appliances, and components (+1.1 percent), nonmetallic mineral products (+0.5 percent), and fabricated metal products (+0.2 percent). However, shipments decreased in furniture and related products (-0.5 percent), miscellaneous durable goods (-0.3 percent), and machinery (-0.1 percent). There was no change of shipment in primary metals.

    (Census Bureau/DOC data from “Report on Manufacturers’ Shipments, Inventories and Orders (M3-2(12)-5, CB12-121),” July 2, 2012; next release is August 2, 2012)
    http://www.census.gov/manufacturing/m3/

       

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Manufactured Goods Prices UPDATED

  • In June 2012, the Producer Price Index (PPI) for finished goods, except foods and energy, increased by 0.2 percent compared to previous month.

  • The index for finished energy goods was down (-0.9 percent) from previous month.

  • A seasonally adjusted decrease in price from May to June was registered liquefied petroleum gas (-24.7 percent), home heating oil and distillates (-8.3 percent), no. 2 diesel fuel (-8.8 percent) and residential electric power (-2.1 percent). An increase in price was registered in residential gas (+3.5 percent) and gasoline (+1.9 percent)

    (BLS/DOL data from “Producer Price Indexes, USDL 12-1181,” released July 13, 2012; next release is August 14, 2012)
    http://www.bls.gov/news.release/pdf/ppi.pdf

       

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Institute for Supply Management's (ISM) Index  

  • Economic activity in the manufacturing sector contracted in June for the first time since July 2009; however, the overall economy grew for the 37th consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business®.

  • Manufacturing contracted in June as the PMI registered 49.7 percent, a decrease of 3.8 percentage points when compared to May's reading of 53.5 percent. A reading above 50 percent indicates that the manufacturing economy is generally expanding; below 50 percent indicates that it is generally contracting.

  • The percentage-point changes in the components of the PMI in June were New Orders -12.3 points increase to 47.8; Production, -4.6 points decrease to 51.0; Inventories, -2.0 points decrease to 44.0; Employment, -0.3 points decrease to 56.6; and Supplier Deliveries, +0.2 points increase to 48.9.

    U.S. Industries Reporting Growth in June 2012

    • Furniture & Related Products
    • Printing & Related Support Activities
    • Fabricated Metal Products
    • Miscellaneous Manufacturing
    • Electrical Equipment, Appliances & Components
    • Machinery
    • Primary Metals

    (Institute for Supply Management, data released July 2, 2012; next release is August 1, 2012)
    http://www.ism.ws/ISMReport/MfgROB.cfm?navItemNumber=12942

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Prepared by
Director of Office of Trade Industry Information
Manufacturing and Services
International Trade Administration
U.S. Department of Commerce
(202) 482-4691