U.S. Manufacturing Output Rises 0.3%

By John S. McClenahen The output of U.S. factories rose 0.3% last month, following a 0.5% rise in October and a 0.4% drop in September, the Federal Reserve reported on Dec. 14. Overall U.S. industrial production, which includes mining and utilities as well as manufacturing, also rose 0.3% in November. Industrial production had increased 0.6% in October and fallen 0.1% in September. "There was a somewhat slower pace of growth in investment as high material costs, energy and employee medical care cost squeezed profit margins," notes Daniel J. Meckstroth, chief economist at Manufacturers Alliance/MAPI, an Arlington, Va.-based business and public policy research group. "More importantly, November production was held down by lack of growth in consumer goods production," he says. "High interest rates and debt-constrained consumers have helped moderate the growth in purchases. Continued import growth also constrains domestic manufacturing." U.S. factories operated at 76.7% of capacity in November, a tenth of a percentage point better than their revised level of 76.6% in October. U.S. mining operated at 84.9% of capacity in November, up from 83.1% in October, and utilities ran at 83.4% in November, down from 84.6% in October.

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