Get breaking news alerts via email

Click here to manage your alerts
U.S. factory output rises solid 0.6 pct. in November
First Published Dec 16 2013 07:39 am • Last Updated Dec 16 2013 11:40 am

Washington • U.S. factories increased output in November for the fourth straight month, led by a surge in auto production. The gains show manufacturing is strengthening and could help boost economic growth at the end of the year.

Factory production rose 0.6 percent in November after a 0.5 percent gain in October, the Federal Reserve said Monday.

Join the Discussion
Post a Comment

Production of motor vehicles and parts increased 3.4 percent, rebounding from a 1.3 percent decline in October. Factories also stepped up production of home electronics and chemical products.

Industrial production, which includes manufacturing, mining and utilities, rose 1.1 percent in November. It was the fourth straight gain.

Colder-than-average temperatures drove a 3.9 percent surge in utility production. Mining output jumped 1.7 percent to reverse a similar decline in October.

Overall production for the first time surpassed the pre-recession peak set in December 2007, the month the Great Recession began. Output is now 21 percent above its recession low hit in June 2009, the month the downturn ended.

The report of healthier output at U.S. factories helped drive a rally on Wall Street. The Dow Jones industrial average soared more than 116 points in early afternoon trading.

Paul Dales, senior U.S. economist at Capital Economics, said the gains in mining and utilities can be volatile. He noted that the best guide of the underlying trend is manufacturing output.

"It suggests that producers are benefiting from stronger demand at home and overseas," Dales said.

Factories are busier in part because overseas growth has picked up and the housing recovery has driven more demand for furniture and other wood products. Automakers are also having their best year for sales since the recession.

story continues below
story continues below

Separately, the Federal Reserve Bank of New York said manufacturing in the New York region grew for the sixth time in the past seven months, although the gains were only modest.

The solid gains at U.S. factories follow other positive signs for manufacturing last month.

A closely watched report from the Institute for Supply Management showed factory activity climbed in November at the fastest pace in 2 ½ years. Factories ramped up production, stepped up hiring and received orders at a healthy clip.

And the government’s November employment report showed that factories added 27,000 jobs last month, the fourth straight month of gains and the most since March 2012.

The pickup at factories could help an economy that is starting to accelerate.

The U.S. economy grew at an annual rate of 3.6 percent in the July-September quarter. Nearly half of the growth came from a buildup in business stockpiles, which can be volatile.

Consumer spending slowed to the weakest pace since the end of the recession. But that was mostly because of a decline in utility spending. Spending on goods rose at the fastest pace since early 2012.

Companies could slow their inventory growth in the October-December quarter if they don’t see enough demand from consumers. That would weigh on overall economic growth.

Many economists are predicting growth will slow to an annual rate of between 2 percent and 2.5 percent.

Still, a recent government report showed restocking rose in October at the fastest pace in nine months. At the same time, consumers stepped up spending at retail businesses in November. If those trends continue, growth could be stronger.

Copyright 2014 The Salt Lake Tribune. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Top Reader Comments Read All Comments Post a Comment
Click here to read all comments   Click here to post a comment

About Reader Comments

Reader comments on sltrib.com are the opinions of the writer, not The Salt Lake Tribune. We will delete comments containing obscenities, personal attacks and inappropriate or offensive remarks. Flagrant or repeat violators will be banned. If you see an objectionable comment, please alert us by clicking the arrow on the upper right side of the comment and selecting "Flag comment as inappropriate". If you've recently registered with Disqus or aren't seeing your comments immediately, you may need to verify your email address. To do so, visit disqus.com/account.
See more about comments here.
Staying Connected
Contests and Promotions
  • Search Obituaries
  • Place an Obituary

  • Search Cars
  • Search Homes
  • Search Jobs
  • Search Marketplace
  • Search Legal Notices

  • Other Services
  • Advertise With Us
  • Subscribe to the Newspaper
  • Access your e-Edition
  • Frequently Asked Questions
  • Contact a newsroom staff member
  • Access the Trib Archives
  • Privacy Policy
  • Missing your paper? Need to place your paper on vacation hold? For this and any other subscription related needs, click here or call 801.204.6100.