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Empire State Manufacturing Survey Condition edged slightly higher in December 2020
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Business activity edged slightly higher in New York State, according to firms responding to the December 2020 Empire State Manufacturing Survey. The headline general business conditions index was little changed at 4.9. New orders increased marginally, and shipments were modestly higher. Inventories continued to move lower, and delivery times edged up. Employment posted its strongest gain in months, and the average workweek lengthened somewhat. Input prices increased at the fastest pace in two years, while selling prices increased at about the same pace as last month. Looking ahead, firms remained optimistic that conditions would improve over the next six months.
Very Little Growth in Activity
Like last month, manufacturing activity in New York State expanded only to a small degree in December. The general business conditions index held steady at 4.9. Twenty-six percent of respondents reported that conditions had improved over the month, while 21 percent reported that conditions had worsened. The new orders index was little changed at 3.4, indicating a slight increase in orders, and the shipments index climbed six points to 12.1, pointing to a relatively substantial increase in shipments. Delivery times were somewhat longer, and inventories edged lower.
Employment Grows at a Faster Pace
The index for number of employees rose five points to 14.2, its highest level in over a year, pointing to ongoing significant gains in employment. The average workweek index was unchanged at 4.8, signaling a small increase in hours worked. The prices paid index rose eight points to 37.1, its highest level in two years, indicating a pickup in input price increases. The prices received index held steady at 10.0, pointing to ongoing modest selling price increases.
Firms Remain Optimistic
The index for future business conditions was little changed at 36.3, suggesting that firms remained optimistic about future conditions. The indexes for future new orders and shipments were positive and similar to last month’s readings. Employment levels and the average workweek are expected to continue to increase in the months ahead. The indexes for future prices paid and prices received both picked up for a third consecutive month. The capital expenditures index came in at 16.4, and technology spending indexes moved down to 12.1.
Posted: December 15, 2020 Tuesday 08:30 AM