Manufacturing Sales, Inventories and Production Decline

Compiled By Jill Jusko Businesses trimmed their inventories by 1% in November over the previous month, while sales declined 1.4%, the U.S. Commerce Department reported on Jan. 16. For manufacturing, inventories declined by 0.9%, following a 0.7% drop in the previous month. Sales were off a bit less, down 0.6% in November from the previous month. The decline in manufacturers' inventories is in keeping with other recent findings. The just-released quarterly business outlook index compiled by manufacturing research group Manufacturers Alliance/MAPI, Washington D.C., also shows manufacturers' inventories continuing to decline. In a third report, the Federal Reserve announced that industrial production for manufacturing, mining and utilities declined 0.1% in December, with output in December 5.8% below its level in December 2000. For all of 2001, industrial production declined 3.9%, its first drop since 1991. Production increased by 4.5% in 2000. Capacity utilization also sank slightly in December, down 0.1% to 74.4%. For manufacturing specifically, industrial output declined 0.1% in December after a 0.2% dip in November. Capacity utilization stood at 72.8% in December, also having edged down 0.1% from the previous month. Among market groups, consumer-goods output was unchanged in the fourth quarter. However, fourth-quarter production declined at an annual rate of 4.8%, the largest quarterly decline since the end of 1990. The output of automotive products increased 3.1% in December. The output of consumer energy products declined 0.6%. Output of defense and space equipment edged up for the third time in the last four months, rising 0.1% in December. And a 0.4% decline in construction supplies was helped by a large decrease in the production of construction steel.

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