Analysis
Industrial production measures the physical output of the nation's factories, mines and electric and gas utilities. In September much of the headline gain came from utilities rather than factories, and manufacturing growth was more modest, held back by a drop in motor vehicle output. The Fed's release does not give a cause for the rise in utility output.
The September numbers
The Federal Reserve reported on October 16 that industrial production rose 0.7% in September after edging up 0.1% in August, a figure revised from no change. At 104.0% of its 2017 average, total output was 2.2% above its level a year earlier [1].
Factories, mines and utilities
Manufacturing output rose 0.3% in September. Within manufacturing, output of motor vehicles and parts fell 3.0% [1].
Mining output rose 0.2%, and utility output increased 3.5% [1].
Capacity utilization
Capacity utilization, the share of available industrial capacity in use, rose to 76.9% in September from 76.4% in August. That is 2.5 percentage points below its average from 1972 to 2025 [1].
What remains uncertain
The September figures are preliminary and are often revised in later releases. Utility output can swing from month to month, so one month's gain driven by utilities may not continue.