WASHINGTON (AP) — U.S. factory output rose for a fifth
straight month in December, as manufacturers cranked out more cars and
trucks, appliances and processed food. The gains suggest factories gave
economic growth a strong boost at the end of the year.
The Federal
Reserve said Friday that factory production rose 0.4 percent in
December. That follows gains of 0.6 percent in both November and
October. Automakers increased their production 1.8 percent last month
and 10.4 percent year over year.
Higher consumer demand is driving
much of the increased manufacturing activity. Production of appliances,
furniture, carpeting, food and clothing all grew in December. Output of
consumer goods gained 0.5 percent.
Overall industrial production,
which includes manufacturing, mining and utilities, increased 0.3
percent in December. That’s also the fifth straight monthly gain.
Total
production increased 3.7 percent over the last 12 months and has
surpassed its pre-recession peak. Output is now 22 percent above its
recession low hit in June 2009, the month the downturn ended.
Other
indicators point to continued manufacturing strength. Factory orders
climbed 1.8 percent in November. A surge in aircraft demand led the
increase in orders, while businesses stepped up spending on machinery,
computers and other long-lasting goods.
And despite a slowdown in
hiring last month across the broader economy, factories added jobs for
the fifth straight month in December.
Rising factory orders should
help keep economic growth solid in the October-December quarter.
Several economists project growth at a 3 percent annual rate in that
period after a 4.1 percent rate in the previous quarter.
There are signs that the rate of growth for factory production could slow.
Automakers
drove much of the improvement in industrial production through the end
of last year, as motor vehicle sales jumped 8 percent to 15.6 million
last year.
However, many industry analysts expect the pace of
buying to decline in 2014. Cars and trucks are lasting longer and
families are unlikely to splurge on extra vehicles until the economy
kicks into higher gear. That could signal slower growth in factory
output in the coming months.
Overall economic growth remains
modest by historical standards. And though factory orders have
strengthened in recent months, the rate of growth has slowed during the
recovery from the 2008 financial crisis.
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