Industrial production near consensus, while manufacturing surprises on upside (+0.8% vs. +0.3% m\/m). Here\u2019s a picture of key indicators followed by the NBER Business Cycle Dating Committee, along with SPGMI\u2019s monthly GDP (formerly from Macroeconomic Advisers and IHS-Markit).<\/p>\n
Figure 1:<\/strong> Nonfarm Payroll employment from CES (bold blue), from Philadelphia Fed early benchmark (teal), civilian employment (orange), industrial production (red), personal income excluding current transfers in Ch.2017$ (bold green), manufacturing and trade sales in Ch.2017$ (black), consumption in Ch.2017$ (light blue), and monthly GDP in Ch.2017$ (pink), GDP, 3rd release (blue bars), all log normalized to 2021M11=0. Source: BLS via FRED, Federal Reserve, BEA 2023Q4 2nd release, S&P Global Market Insights<\/a>\u00a0(nee Macroeconomic Advisers, IHS Markit) (3\/1\/<\/em>2024 release), and author\u2019s calculations.<\/em><\/p>\n I include the Philly Fed\u2019s early benchmark CES series (not the sum of states) as a check on whether the BLS birth\/death model is imparting too much job creation to the official series (see discussion in yesterday\u2019s post<\/a>).<\/p>\n Note that industrial production has been lackluster over the past year or so. Industrial production includes manufacturing, mining, and utilities. I thought it of interest to see how real value added, reported with a much greater lag, correlates with industrial production (which is a gross measure).<\/p>\n Figure 2:<\/strong> Industrial production index (blue), and value added in industry (sum of manufacturing, mining, and utilities), in 2017$ (chartreuse), aggregate weekly hours of production and nonsupervisory workers in industry (red), all in logs 2021M11=0. Note: Industrial value added calculated as simple sum of components, rather than using a Tornqvist approximation. Hours for industry includes logging (which is about 7% of employment in mining and logging). Source: FRB, BLS via FRED, BEA, and author\u2019s calculations.\u00a0<\/em><\/p>\n Industry value added and production index have moved in different ways since end-2021, but are roughly at the same level relative to 2021M11 as of Q3. Hours have moved up consistently, in contrast.<\/p>\n Manufacturing has shown less divergence.<\/p>\n![\"\"](\"https:\/\/econbrowser.com\/wp-content\/uploads\/2024\/03\/recindex_feb24e.png\")
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