Supply Chain News Bites - Only from SCDigest

- June 28, 2012 -


Supply Chain Graphic of the Week: Reviewing US Manufacturing Capacity


Perhaps Surprisingly, Total US Capacity Has Risen Sharply Since 1998, but Now 5% Below Peak; Introducing New SCDigest Web Charts


By SCDigest Editorial Staff



So with all the concern and hope over US manufacturing - concern that factories and jobs are continuing to be lost overseas, but with some hope that rising wages in China and other factors may lead to an emerging manufacturing renaissance in the US - in aggregate has manufactuing capacity in the US been rising or falling?

Well, we have the answer to that question, shown below using our cool new "web chart" technology, which you will be seeing a lot more of in the future on these pages to illustrate supply chain data. Note that you can easily set the view data by periods period all the way from 1990 to the present, or other increments (pretty cool!).

As can be seen, manufacturing capacity, which basically means the number and size of factories in the US, has slowly started to rise of late, but just barely. Based on an index year of 1998 (when capacity is calculated at a score of 100), total manufacturing capacity rose .9% over the past 12 months ending in May, according to the Federal Reserve.


That put the index at a level of 122.1, meaning total US manufacturing capacity, perhaps surprisingly, is actually up 22.1% since 1998.


However, that is also down 6.8 percentage points from the all-time peak of about 128.9 in Q1 2008. That's a drop of a little over 5%. It is up just 1.2 percentage points and less than 1% from the post-recession low of 120.9 in April 2011.


Whether all that is good news or not is a matter of opinion, but as we said above the 20+% increase in capacity since 1998 probably is a a bit surprising. But of course, across sectors, there were major differences in capacity changes across industry sectors - but we will save that for another day.


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