Federal Reserve marks the 100th anniversary of its data on industrial production

Nice to see Fed marking 100 anniversary of an economic data: industrial production.

The publication on Friday of the Federal Reserve Board’s monthly statistical release on industrial production and capacity utilization marks the 100th anniversary of Board data on industrial production. The index has kept pace with an ever-evolving industrial sector by providing information that spans from the rise of the modern factory through the digital age.

The Board began collecting information about industrial production to satisfy the Federal Reserve’s need for timely and relevant data on the U.S. economy. The Board’s measure of industrial production remains an important economic indicator today and is frequently used by academics, businesses, and policymakers.

The index originally divided output into 55 categories and now includes 300, reflecting an increased ability to track the diversity and changing composition of the industrial sector. For example, in 1919, textile manufacturing represented nearly a quarter of the index. Almost the same proportion is represented in 2019 by the combination of motor vehicles and parts, aircraft, and oil and gas extraction. Textiles now represent less than 1 percent of the index. A short history of the index that describes its introduction and tracks its changes and improvements over the past century is available on the Board’s website.

Hmm..

I had earlier pointed to history of other macro data in US such as output, inflation and unemployment. We now have some history of industrial production data as well:

Ever since the Federal Reserve was founded in 1913, understanding current business conditions has been a central focus in pursuing its mission of a stable and secure financial system. Less than a year after the first Board members took their oaths of office, the organization issued the inaugural monthly Federal Reserve Bulletin, which included narrative summaries of general business conditions in each of the 12 Federal Reserve Districts.

Over the next few years, the monthly reports from the Federal Reserve Districts became more statistically oriented. At the same time, private industry was in the process of reorganizing to supply the country’s effort in World War I and would soon thereafter transition to a postwar economy. In order to track the changes that were taking place, the Board in 1919 began publishing monthly tables containing data on the production of different goods, such as iron and steel, cotton and wool, and pulp and paper.2

By early 1922, the tables on the physical volume of trade had expanded to show a large number of items. To present this information in a “more compact and better coordinated form,” the Board developed three indexes of industrial activity: manufacturing, mining, and agriculture.3 These monthly indexes were published back to 1919, and they used the average of monthly activity in that year as a base. By the end of 1922, a second set of indexes—narrower in coverage but based on more refined methodology—was introduced.4 These new measures were made available by the 25th day following the reference month.

Nice stuff..

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