Full text: Trend and Cycle

3 x 
are nearly the same as the old estimates, the growth 
rate of 2.9 percent for the period since 1979 is about 
0.5 percentage point higher than was previously es 
timated. 
The downward revision of utilization is centered in 
durable manufacturing. The 1967-84 average utiliza 
tion rate for durable manufacturing is 1.3 percentage 
points below the rate shown previously and the De 
cember 1984 rate for this group is down 2.7 percentage 
points. Within durable manufacturing, utilization rates 
were found to be substantially lower in December 1984 
for producers of motor vehicles and parts and machin 
ery, especially electrical machinery. The utilization rate 
for the latter series was revised downward nearly 11 
percentage points in December 1984. Capacity growth 
in this industry, which includes the fast growing semi 
conductor and communications equipment industries, 
had been substantially underestimated for the 1981-84 
period. 
Within manufacturing, the downward revisions of 
the operating rates for motor vehicles and machinery 
were accompanied by smaller downward revisions in 
the December 1984 rates for plants producing rubber 
and plastics products, paper and products, and textile 
mill products. The downward revisions of those series 
were offset to a considerable extent by upward revi 
sions of other series. In December 1984, the rates for 
producers of both chemicals and products and petrole 
um products were revised upward more than 5 percent 
age points. Overall the revisions reduced the dispersion 
of rates among industries. Rates that were high in 
1984 have been revised downward, and some that were 
relatively low have been revised upward. 
Outside manufacturing, the utilization rate for min 
ing has been revised upward substantially. In part, this 
reflects the larger weight given crude oil extraction 
(primarily pumping, rather than drilling) with the in 
troduction of 1977 weights. Also, the mining series 
have been reconstructed for the whole period begin 
ning in 1967. In contrast to mining, the rates for utili 
ties have been revised only slightly. 
The utilization rate for industrial materials was re 
vised upward by 0.9 percentage point in December 
1984 to 81.3 percent in large part because of the up 
ward revisions in mining and chemical materials. The 
rate for materials in late 1984 was very close to the to 
tal industry rate, and remained below its 1967-84 aver 
age (chart 2). 
Capacity utilization, output, and capacity data for 
the years 1967-84 are included in the tables contained 
in this supplement. Also, rebased manufacturing data 
for the 1948-66 period are included even though utili 
zation rates have not been revised for the period be 
fore 1967. Copies of the statistical release and this 
supplement are available* from Publications Services, 
Board of Governors of the Federal Reserve System, 
Washington, D.C. 20551. The basic methods used in 
this revision are described in a booklet, Federal Re 
serve Measures of Capacity and Capacity Utilization 
(Board of Governors, February 1978). More up-to-date 
information may be found in an article “Revised Fed 
eral Reserve Measures of Capacity and Capacity Utili 
zation,” by Richard D. Raddock scheduled to appear 
in the Federal Reserve Bulletin this fall. 
2. Capacity utilization rates—revised and previous 
1967 1970 1975 1980 1984 
Percent
	        

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