U.S. Factory Output Rises for 5th Straight Month
U.S. factory output rose for a fifth straight month in December, as manufacturers cranked out more cars and trucks, appliances and processed food. According to an Associated Press report, the gains suggest factories gave economic growth a strong boost at the end of the year.
The Federal Reserve said Friday (Jan. 17) that factory production rose 0.4% in December. That follows gains of 0.6% in both November and October. Automakers increased their production 1.8% last month and 10.4% year over year.
Higher consumer demand is driving much of the increased manufacturing activity. Production of appliances, furniture, carpeting, food and clothing all grew in December. Output of consumer goods gained 0.5%.
Overall industrial production, which includes manufacturing, mining and utilities, increased 0.3% in December. That’s also the fifth straight monthly gain.
Total production increased 3.7% over the last 12 months and has surpassed its pre-recession peak. Output is now 22% above its recession low hit in June 2009, the month the downturn ended.
Other indicators point to continued manufacturing strength. Factory orders climbed 1.8% in November. A surge in aircraft demand led the increase in orders, while businesses stepped up spending on machinery, computers and other long-lasting goods.
And despite a slowdown in hiring last month across the broader economy, factories added jobs for the fifth straight month in December.
Rising factory orders should help keep economic growth solid in the October-December quarter. Several economists project growth at a 3% annual rate in that period after a 4.1% rate in the previous quarter.