20% of US industry on 'idle'

Use of the nation's manufacturing capacity was 78.9 percent in May, two percentage points behind April and the lowest level since February 1976, the Federal Reserve Board said Monday.

The drop in the utilization rate reflects the steepening recession that has witnessed a sharp falloff in consumer spending and a rapid increase in unemployment -- 7.8 percent -- as factories continue to lay off workers.

Producers of durable goods -- products designed to last more than three years -- reduced factory use 3 percent to 75.9 percent. Producers of nondurable goods cut back a more moderate 1.8 percent, operating at 84.8 percent of capacity in May.

May's overall utilization rate compares with 80.9 percent in April and 78.8 percent in February 1976.

The decline in factory use was widespread, cutting across virtually every manufacturing category, with significant cutbacks in the auto, steel, and petroleum industries. Factories producing textiles, paper, chemicals, nonferrous metals, machinery, aircraft, instruments, stone, clay, and glass also had "sizable cutbacks" in May, the Federal Reserve said.

About these ads
Sponsored Content by LockerDome

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...

Save for later

Save
Cancel

Saved ( of items)

This item has been saved to read later from any device.
Access saved items through your user name at the top of the page.

View Saved Items

OK

Failed to save

You reached the limit of 20 saved items.
Please visit following link to manage you saved items.

View Saved Items

OK

Failed to save

You have already saved this item.

View Saved Items

OK