U.S. Industrial Output Jumps 0.6% in Month

After three months of lackluster performance, U.S. industrial production posted a sharp 0.6% rise in November, the best showing since last April, the government said Monday.

The Federal Reserve Board said the November gain, which came despite continued trouble in the oil and gas industry, followed tiny increases of 0.1% in October and August and no improvement at all in September.

Some analysts said the gain provided further evidence that American manufacturing finally had turned the corner on its foreign trade problems after two years in which huge trade deficits forced widespread layoffs and production cutbacks among domestic manufacturers.

Trade Deficit May Shrink

The trade deficit is expected to top $170 billion this year, but many economists are looking for this deficit to shrink by $30 billion to $40 billion next year, with the decline boosting demand for domestic production.

“This shows that the improvement in trade is really occurring,” said Maury Harris, chief economist for the New York investment firm of Paine Webber. “It couldn’t have come at a better time since some sectors of the economy, such as construction, will weaken next year.”

Harris predicted further gains in industrial production in the months ahead, although he said another increase as big as 0.6% was unlikely.

The Reagan Administration is predicting that the economy will show a sizable rebound in growth next year, but Administration economists concede that this forecast is based in large measure on expected improvements in trade.