Economic News Blog
Posted by: Steven Kline, Jr. 22. April 2015

Capacity Utilization Contracts for First Time since July 2013

Durable goods capacity utilization was 76.6% in March 2015. The month-over-month rate of change was -0.1%, which ended a streak of 13 straight months of month-over-month growth. The annual rate of growth decelerated slightly from last month. The annual rate of growth is still noticeably faster than it was in 2014 though.

Since June 2008, the Gardner Business Index backlog index has been a very good leading indicator of durable goods capacity utilization. Our backlog index has grown at a slower rate the last six months. The trend in the backlog index shows that capacity utilization has likely seen its peak rate of growth.

We use capacity utilization as a leading indicator for a number of industries, although it is not tracked for as many industries as industrial production. You can see the trends in capacity utilization for a number of industries below.

Accelerating Growth: aerospaceforming/fabricating (non-auto)petrochemical processorstextiles/clothing/leather goodswood/paper

Decelerating Growth: automotiveconstruction materialscustom processorsdurable goodsfood/beverage processingfurnituremachinery/equipment; plastics/rubber productsprimary metalsprinting

Accelerating Contraction: electronics/computers/telecommunications

Decelerating Contraction: none


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