MRO Magazine

U.S. industrial production fell 0.4 per cent in November


December 14, 2016
By The Canadian Press

Washington – U.S. industrial production dropped sharply in November, mainly because power plants reduced output due to unusually warm weather.

The Federal Reserve reported Wednesday that output at America’s factories, mines and utilities fell 0.4 per cent last month. It was another sign that American industry is struggling even as the overall U.S. economy looks healthy. The Federal Reserve is confident enough to be considering an interest rate hike later in the day.

Utility output plunged 4.4 per cent, following a 2.8 per cent downturn in October. A warm fall meant Americans used less heat.

Factory output slipped 0.1 per cent. A drop in auto production, which is volatile month to month, offset increased output elsewhere.


Mining production rose 1.1 per cent despite a steep drop in output at coal mines.

“Beyond the disappointing headline, the general improving trend in mining and manufacturing should justify this afternoon’s broadly expected Fed move,” Jennifer Lee, senior economist at BMO Capital Markets, said in a research note.

Still, industrial production has now dropped three of the last four months and has fallen 0.6 per cent in the past year. November’s drop was steeper than economists had expected.

American industry has been hurt by a strong dollar, which makes U.S. goods costlier in foreign markets. Factory production is up just 0.1 per cent over the past year.

Energy companies have slashed production in the face of low oil prices. That is why mining output is down 4.6 per cent since November 2015 despite the uptick last month.

Mines have shed 87,000 jobs over the past year, and factories have lost 54,000.