Research >> Economics
Texas Manufacturing Activity Declined again in May
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Texas factory activity declined again in May, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, fell to -13.5, its lowest reading in six years.
Other measures of current manufacturing activity reflected continued contraction in May. The new orders index held steady at -14.1, and the growth rate of orders index held steady at -15.2, marking the fifth and seventh negative reading in a row for these indexes. The capacity utilization index edged down to -11.6. The shipments index fell nearly 8 points to -13.2, with more than 30 percent of firms noting lower shipment volumes in May than in April.
Perceptions of broader business conditions worsened further this month. The general business activity index fell to -20.8 in May, its lowest reading since June 2009. The company outlook index moved down to -10.5, also hitting a low not seen since summer 2009.
Labor market indicators reflected employment declines and shorter workweeks. The May employment index declined 10 points to -8.2, after rebounding slightly above zero last month. Twelve percent of firms reported net hiring, compared with 21 percent reporting net layoffs. The hours worked index fell from -5 to -11.6.
Changes in prices and wages were mixed in May. Downward pressure on input costs abated, as the raw materials prices index pushed up toward zero, coming in at -1.7. The finished goods prices index edged down to -8.7, its fifth negative reading in a row and suggestive of falling selling prices. Meanwhile, the wages and benefits index remained positive and little changed at 14.7.
Expectations regarding future business conditions improved in May. The index of future general business activity surged 11 points to 4.9, and the index of future company outlook jumped 10 points to 15.1. Indexes for future manufacturing activity also moved up markedly, pushing further into solid positive territory.
Posted: May 26, 2015 Tuesday 10:30 AM