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Empire State Manufacturing Survey Conditions continues growth in February
Business activity expanded at a solid clip in New York State, according to firms responding to the February 2017 Empire State Manufacturing Survey. The headline general business conditions index rose twelve points to 18.7, its highest level in more than two years. The new orders index climbed to 13.5, and the shipments index advanced to 18.2, pointing to substantial increases in both orders and shipments. The unfilled orders index rose above zero for the first time in more than five years. Delivery times were reported as longer, and inventories increased. Labor market conditions improved, with both employment and hours worked moving higher. After reaching multiyear highs last month, the prices paid and prices received indexes were little changed. Indexes assessing the six-month outlook continued to convey a high degree of optimism about future conditions.
Business Growth Gains Momentum
Manufacturing firms in New York State reported that business activity expanded at the fastest pace since 2014. The general business conditions index climbed twelve points to 18.7, its fourth consecutive positive reading. Thirty-three percent of respondents reported that conditions had improved over the month, while fourteen percent reported that conditions had worsened. The new orders index rose ten points to 13.5, and the shipments index climbed eleven points to 18.2, pointing to a solid increase in both orders and shipments. The unfilled orders index turned positive for the first time since 2011. The delivery time index rose to 7.1, a sign of longer delivery times, and the inventories index, at 3.1, suggested that inventory levels were slightly higher.
Employment Edges Higher as Price Increases Continue
Employment indexes turned positive in February, pointing to some improvement in labor market conditions. The index for number of employees rose to 2.0, and the average workweek index rose to 4.1. Prices continued to increase at a fairly strong pace. After reaching a multiyear high last month, the prices paid index was little changed at 37.8, and the prices received index held steady at 19.4, also a multiyear high.
Firms Remain Optimistic
Indexes for the six-month outlook suggested that respondents remained highly optimistic about future conditions. The index for future business conditions dropped eight points, but at 41.7, remained high by historical standards. The indexes for future employment and the future average workweek indicated that firms expected strong growth in employment and hours worked in the months ahead. The capital expenditures index edged down to 22.4, and the technology spending index moved up modestly to 16.3.
Posted: February 15, 2017 Wednesday 08:30 AM