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Empire State Manufacturing Survey Conditions expanded at a faster pace in May
Business activity grew strongly in New York State, according to firms responding to the May 2018 Empire State Manufacturing Survey. The headline general business conditions index climbed four points to 20.1, indicating a faster pace of growth than in April. The new orders index rose seven points to 16.0, and the shipments index was little changed at 19.1, suggesting ongoing growth in orders and shipments. Delivery times continued to lengthen, and inventories moved higher. Labor market indicators pointed to a modest increase in employment and longer workweeks. The prices paid index rose to its highest level in several years, indicating significant input price increases, and the prices received index remained elevated. Looking ahead, firms were somewhat more optimistic about the six-month outlook than they were in April, though less so than earlier this year.
Business Activity Grows at a Solid Clip
Manufacturing firms in New York State reported that business activity expanded at a faster pace than in April. The general business conditions index rose four points to 20.1. Forty percent of respondents reported that conditions had improved over the month, while 20 percent reported that conditions had worsened. The new orders index rose seven points to 16.0 and the shipments index was little changed at 19.1, indicating that orders and shipments again grew strongly. Unfilled orders increased, and inventories moved higher. The delivery time index was close to last month’s level at 13.7, a sign that delivery times continued to lengthen.
Input Price Increases Pick Up
The index for number of employees edged up three points to 8.7, while the average workweek index fell to 11.1, readings pointing to a modest increase in employment and hours worked. Price increases remained elevated. The prices paid index moved up seven points to 54.0, its highest level since 2011, indicating a pickup in input price increases. The prices received index rose two points to 23.0, suggesting ongoing moderate selling price increases.
Outlook Improves, but Optimism Remains Subdued
Optimism about the six-month outlook increased, but fell short of levels enjoyed in recent months. The index for future business conditions, which plunged to 18.3 in April after remaining above 40 for most of the past year and a half, regained thirteen points to reach 31.1 in May. Employment was expected to increase in the months ahead, and the indexes for future prices remained elevated. The capital expenditures index moved up four points to 29.5, and the technology spending index rose to 23.0.
Posted: May 15, 2018 Tuesday 08:34 AM