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Empire State Manufacturing Survey Conditions continued to decline in March 2023
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Business activity continued to decline in New York State, according to firms responding to the March 2023 Empire State Manufacturing Survey. The headline general business conditions index fell nineteen points to -24.6. New orders dropped significantly, and shipments declined modestly. Delivery times shortened for a second consecutive month, suggesting supply availability improved, and inventories were steady. Both employment and hours worked declined for a second consecutive month. Input and selling price increases slowed somewhat. Looking ahead, businesses expect little improvement in conditions over the next six months.
Activity Continues to Contract
Manufacturing activity continued to decline in New York State, according to the March survey. The general business conditions index fell nineteen points to -24.6, continuing the see-saw pattern of ups and downs within negative territory seen in recent months. Twenty percent of respondents reported that conditions had improved over the month, and forty-five percent reported that conditions had worsened. The new orders index fell fourteen points to -21.7, indicating that orders declined substantially, and the shipments index fell fourteen points to -13.4, pointing to a decline in shipments. The unfilled orders index came in at -6.7, a sign that unfilled orders continued to decline. At -7.6, the delivery times index was negative for a second consecutive month, indicating that delivery times shortened. The inventories index moved down eight points to -1.9, indicating that inventory levels held steady.
Labor Market Indicators Weaken
The index for number of employees fell four points to -10.1, its second consecutive negative reading, indicating that employment levels continued to decline. The average workweek index fell six points to -18.5, its lowest level since early in the pandemic, indicating that hours worked shrank for a fourth consecutive month. Input prices and selling prices increased at a somewhat slower pace than last month: the prices paid index fell three points to 41.9, and the prices received index moved down six points to 22.9.
Little Improvement Expected
The index for future business conditions fell twelve points to 2.9, suggesting that firms do not expect activity to improve much over the next six months. New orders and shipments are expected to increase modestly, and employment is expected to be somewhat higher. The index for future prices paid fell a steep eighteen points, suggesting that, looking ahead, firms expect slower input price increases than they were anticipating last month. The capital spending index and technology spending index both fell to 13.3.
Posted: March 15, 2023 Wednesday 08:30 AM