2001 Industrial Production Worst Since '82
January 16, 2002
Industrial production in the United States fell for the fifth straight month in December, ending a year with the worst record since 1982.
Wednesday the Federal Reserve reported a 0.1% drop for December, after revising the November figure downward from a 0.3% decline to a 0.4% drop. During December, businesses ran at only 74.4% of full capacity, down from 74.5% percent in November and the lowest level since April 1983.
Durable goods production was steady for the second month while non-durables fell 0.3%, adding to a 0.5% drop in durable goods production in November.
Newport Communications Senior Economist Jim Haughey says this pattern is typical of the final stage of a recession.
“Durable goods manufacturers led the economy into recession and are now set to lead it out after clearing out excess inventories. The high tech industries were the first to enter recession, but now computer production has risen for two months and semiconductor production has increased for four months.”
He says the outlook through the winter is for production to be steady to very slightly up; stronger production growth will begin when job losses stop, probably in the spring.
Also on Wednesday the Labor Department reported consumer prices for last year remained in check. The Consumer Price Index rose 1.6% compared with a 3.4% percent jump in 2000, marking the lowest inflation rate since 1998. The core rate of inflation, when the volatile food and energy prices are removed, show an increase of just 0.1% for the year.