Federal Reserve reports unchanged industrial production in August as manufacturing slips

The Federal Reserve’s latest G.17 report shows total US industrial production flatlined in August, with manufacturing output actually declining 0.3 percent. Capacity utilization held steady at 76.3 percent, a number that sits 3.1 percentage points below the long-run average recorded from 1972 to 2025. The numbers behind the flatline July’s preliminary numbers had shown a modest 0.2 percent increase in total industrial production, with capacity utilization ticking up to reach that 76.3 percent mark. August’s reading essentially erased the momentum. At 76.3 percent capacity utilization, roughly a quarter of the nation’s industrial capacity is sitting idle. That gap between current utilization and the long-run average of about 79.4 percent suggests that manufacturers still have plenty of room to ramp up production without building new facilities or hiring aggressively. The ISM Manufacturing PMI told a somewhat different story for August, registering at 54.6. Any reading above 50 indicates expansion, and this marked eight consecutive months of growth in manufacturing activity according to that survey. But even the ISM data carried a caveat: new orders showed signs of cooling, hinting t...