suntimes
BRISK 
Weather Updates

U.S. factories increase output in June for 2nd month

In this Tuesday June 11 2013 phoGarrett Tombloperates remote control thcontrols fire mine disaster training areRunning Right Leadership Academy Julian

In this Tuesday, June 11, 2013, photo, Garrett Tomblin operates a remote control that controls the fire in the mine disaster training area of the Running Right Leadership Academy in Julian, Va. The Federal Reserve reports on production from factories, mines and utilities in June on Tuesday, July 16, 2013. (AP Photo/Steve Helber)

storyidforme: 52194318
tmspicid: 19350031
fileheaderid: 8785249

WASHINGTON — U.S. factories cranked out more business equipment, home electronics and autos last month, boosting manufacturing output for the second straight month.

The Federal Reserve said Tuesday that manufacturing production rose 0.3 percent in June from May. That followed a 0.2 percent gain the previous month. Still, the two months of gains barely offset drops in March and April.

Overall industrial production, which includes factories, mines and utilities, also rose 0.3 percent in June. Mining output increased 0.8 percent, and utility output slid 0.1 percent.

The gains in manufacturing, the most critical component of industrial production, are a hopeful sign that factories could rebound in the second half of the year.

Manufacturers have struggled this year, providing little support to the economy. Their output is up just 1.8 percent over the past 12 months. And factories have cut jobs in each of the past four months, shedding a total of 24,000 since February.

A key reason for the weakness is slower global growth has cut demand for U.S. exports. Europe is still in a recession and China’s economy grew from April through June at the slowest pace in more than two decades.

Manufacturing has shown improvement in Britain, France and Italy. Large Japanese manufacturers are also sounding optimistic for the first time in nearly two years.

There have been other positive signs that suggest U.S. factory production could increase in the second half of the year.

The Institute for Supply Management said that factory activity improved in June after hitting its lowest level in four years. But the closely watched manufacturing survey reported that employment fell to its lowest level since September 2009.

Factory activity in the New York region grew for the second straight month in July, according to the Federal Reserve Bank of New York’s Empire State manufacturing survey.

U.S. businesses reported a strong 1.1 percent increase in sales in May, the Commerce Department reported. Those same firms only increased their stockpiles slightly, suggesting they will need to order more goods to keep up with demand.

And Americans bought more cars and trucks, furniture and clothes in June, according to a separate Commerce report on retail spending. But consumers cut back almost everywhere else, and overall retail sales rose just 0.4 percent last month from May.



© 2014 Sun-Times Media, LLC. All rights reserved. This material may not be copied or distributed without permission. For more information about reprints and permissions, visit www.suntimesreprints.com. To order a reprint of this article, click here.