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U.S. factory production shows modest rebound in September

A group of workers at C.C. Filson Co. work at their sewing machines in Seattle on Aug. 31.
A group of workers at C.C. Filson Co. work at their sewing machines in Seattle on Aug. 31.
(Ted S. Warren / Associated Press)
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U.S. manufacturers boosted output modestly last month, led by greater production of construction supplies, autos and petroleum products.

The Federal Reserve said Monday that factory production rose 0.2% in September, following a decline of 0.5% in the previous month. The broader industrial production category, which includes mining and utilities, ticked up 0.1%.

Even with the gain, manufacturing output has been flat in the last year. Factories have been hit by several factors: weak business spending on machinery and other equipment, a strong dollar that has made U.S. goods more expensive overseas, and sharp cutbacks in oil and gas drilling that has lowered demand for pipeline.

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Mining output rose 0.4% last month, though it has fallen 9.4% in the last year. Utility production fell 1%.

With manufacturing production weak in the last year, factories have shed 47,000 jobs.

Other reports suggest there is some hope that factories are slowly recovering. A private survey found that manufacturers boosted production and saw a rise in new orders last month, according to the Institute for Supply Management, a trade group.

With new orders rising, production may increase in the coming months. Still, that survey found that factories were still cutting jobs.

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And orders for manufactured goods increased in August, according to a separate report from the Commerce Department. A category that tracks business investment rose for the third straight month, a sign that business spending may be rebounding.

The weakness in manufacturing has weighed on the broader economy, which grew at a sluggish pace of 1.1% in the first half of this year. Still, many economists expect a mild acceleration in the second half of the year to about 2%.

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