Close

April 15, 2022

Chart of the day: Industrial production hits record in March

REAL ECONOMY BLOG | April 15, 2022

Authored by RSM US LLP

Domestic industrial production increased by 0.9% in March, beating market forecasts despite global supply chain disruptions of key materials. Elevated levels of order backlogs and rising prices of industrial products were behind the increase, combining to give producers the extra boost to increase production.

The index for industrial production volume advanced to 104.59, the highest level in the 100 years of the index, according to the Federal Reserve report on Friday. February’s reading was revised upwardly to 0.9% from 0.5%, making it the third month in a row that production increased by 0.9% or above.

Mining posted the largest gain at 1.7% as higher oil and commodity prices helped to drive up supply. Capacity utilization for mining also led all industry categories at 79.5% on the month. And there is room for mining to improve as its utilization remained below the long-run average.

Industrial production

Manufacturing, which accounts for 75.9% of total production supply in the United States, grew steadily at 0.9% after a sharp 1.2% increase in February.

Domestic auto producers posted the largest increase at 7.8%, followed by machinery at 0.8%. The total number of vehicles produced in March reached 9.75 million, the highest since January last year. But auto production remained subdued compared to pre-pandemic levels as manufacturers continued to face a shortage of chips.

Manufacturing capacity utilization advanced higher on the month, to 78.7%, the only industry that surpassed the long-term average.

Utility production inched up by 0.4% in March after dropping by 1% prior because of seasonal factors, while capacity utilization also picked up slightly, to 75.1%.

The takeaway

The void in global and domestic demand, especially in energy and raw production materials as a result of the war in Ukraine, might have given American producers the opportunities to increase production.

The strong performance of the industrial sector should give gross domestic product growth in the first quarter a needed boost especially with consumption hampered by elevated inflation.

Let’s Talk!

Call us at (541) 773-6633 or fill out the form below and we’ll contact you to discuss your specific situation.





  • Should be Empty:
  • Topic Name:

This article was written by Tuan Nguyen and originally appeared on 2022-04-15.
2022 RSM US LLP. All rights reserved.
https://realeconomy.rsmus.com/chart-of-the-day-industrial-production-hits-record-in-march/

RSM US Alliance provides its members with access to resources of RSM US LLP. RSM US Alliance member firms are separate and independent businesses and legal entities that are responsible for their own acts and omissions, and each are separate and independent from RSM US LLP. RSM US LLP is the U.S. member firm of RSM International, a global network of independent audit, tax, and consulting firms. Members of RSM US Alliance have access to RSM International resources through RSM US LLP but are not member firms of RSM International. Visit rsmus.com/aboutus for more information regarding RSM US LLP and RSM International. The RSM(tm) brandmark is used under license by RSM US LLP. RSM US Alliance products and services are proprietary to RSM US LLP.

KDP Certified Public Accountants, LLP is a proud member of RSM US Alliance, a premier affiliation of independent accounting and consulting firms in the United States. RSM US Alliance provides our firm with access to resources of RSM US LLP, the leading provider of audit, tax and consulting services focused on the middle market. RSM US LLP is a licensed CPA firm and the U.S. member of RSM International, a global network of independent audit, tax and consulting firms with more than 43,000 people in over 120 countries.

Our membership in RSM US Alliance has elevated our capabilities in the marketplace, helping to differentiate our firm from the competition while allowing us to maintain our independence and entrepreneurial culture. We have access to a valuable peer network of like-sized firms as well as a broad range of tools, expertise, and technical resources.

For more information on how the KDP Certified Public Accountants, LLP can assist you, please call us at +1 (541) 773-6633.