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Empire State Manufacturing Survey Conditions continued to decline in February 2023
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Business activity continued to decline in New York State, according to firms responding to the February 2023 Empire State Manufacturing Survey. The headline general business conditions index climbed twenty-seven points but remained negative at -5.8. New orders declined modestly, while shipments held steady. Delivery times shortened, and inventories edged higher. Employment levels declined for the first time since early in the pandemic, and the average workweek shortened for a third consecutive month. Both input and selling price increases picked up. Looking ahead, firms expect business conditions to improve somewhat over the next six months.
Conditions Continue to Worsen
After falling steeply last month, manufacturing activity continued to decline in New York State, according to the February survey. The general business conditions index climbed twenty-seven points but held below zero at -5.8. Twenty-six percent of respondents reported that conditions had improved over the month, and thirty-two percent reported that conditions had worsened. The new orders index rose twenty-three points to -7.8, pointing to a small decline in orders, and the shipments index rose to 0.1, indicating that shipments held steady. The unfilled orders index came in at -9.2, a sign that unfilled orders continued to decline. The delivery times index fell ten points to -9.2, its first significant negative reading since before the pandemic, indicating that delivery times shortened. The inventories index was little changed at 6.4, pointing to a small increase in inventories.
Employment Falls
The index for number of employees fell to -6.6, its first negative reading in over two years, indicating that employment levels declined for the first time since early in the pandemic. The average workweek index remained negative at -12.1, indicating that hours worked shrank for a third consecutive month. Input prices and selling prices increased at a faster pace than last month: the prices paid index rose twelve points to 45.0, and the prices received index climbed ten points to 28.4.
Some Improvement Expected
The index for future business conditions rose seven points to 14.7, suggesting that firms expect some improvement over the next six months. New orders and shipments are expected to rise somewhat, and delivery times are expected to shorten further. Employment is not expected to increase in the months ahead. The capital spending index edged down to 18.3, and the technology spending index fell to 10.1.
Posted: February 15, 2023 Wednesday 08:30 AM