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Empire State Manufacturing Survey Conditions Continue to Improve
The July 2013 Empire State Manufacturing Survey indicates that conditions for New York manufacturers continued to improve modestly. The general business conditions index rose two points to 9.5. The new orders index rose ten points to 3.8, and the shipments index climbed twenty-one points to 9.0. The prices paid index fell four points to 17.4, pointing to a slower pace of input price increases, while the prices received index fell to 1.1, suggesting that selling prices were little changed. Employment indexes were mixed, and indicated little positive momentum in the labor market. The index for number of employees inched up to 3.3, while the average workweek index remained negative at -7.6. Indexes for the six-month outlook were generally higher—a sign that optimism about future business conditions had strengthened.
In a series of supplementary survey questions, firms were asked how they expected the Affordable Care Act (ACA) to affect them and how they were responding to its provisions. Three in four respondents said that they have not made, and do not plan to make, changes in their health plans. Roughly the same proportion indicated that they have made minimal or no changes in their workforces; a somewhat smaller majority (65 percent) said they did not anticipate making any major changes over the next year. Nearly 15 percent of those surveyed indicated that they would outsource more work. A large majority of manufacturers, more than 85 percent, reported that they expected their health insurance costs to increase as a result of the ACA; none anticipated a decrease. See the full supplemental report for a more detailed summary.
Business Conditions Continue to Improve
The general business conditions index remained positive for a second consecutive month, rising two points to 9.5 in the July survey. This index has been modestly positive for five of the past six months, dipping slightly below zero in May before rising in June and July. Thirty percent of respondents reported that conditions had improved over the month, while 21 percent reported that conditions had worsened. The new orders index climbed above zero, rising ten points to 3.8—evidence of a small increase in orders. The shipments index increased twenty-one points to 9.0, its ascent into positive territory indicating that shipments had expanded. The unfilled orders index advanced six points to -8.7. The delivery time index rose to 3.3, suggesting that delivery times were slightly longer this month, and the inventories index remained below zero at -6.5, indicating that inventory levels were lower.
Labor Market Conditions Remain Weak
Price indexes fell in the July survey. The prices paid index dropped four points to 17.4, indicating that input price increases were somewhat slower than they were last month. The prices received index fell ten points to 1.1, suggesting that selling prices were little changed. Employment indexes were mixed, and indicated that labor market conditions remained weak. Rising three points to 3.3, the index for number of employees showed only a slight increase in employment levels, while the average workweek index, still negative at -7.6, indicated that hours worked fell.
Six-Month Outlook Strengthens
Indexes for the six-month outlook generally rose, indicating increased optimism about future conditions. The future general business conditions index advanced seven points to 32.0. The future new orders index climbed eleven points to 31.1, and the future shipments index rose fourteen points to 34.4. The future inventories index fell noticeably, declining thirteen points to -19.6 in a sign that inventory levels were expected to be lower. The future prices paid and future prices received indexes also fell, suggesting that both input and selling price increases were expected to be less widespread in the months ahead. Future employment indexes hovered around zero, indicating that employment levels and hours worked were expected to be little changed. The capital expenditures index rose seven points to 9.8, and the technology spending index rose fourteen points to 10.9.
Posted: July 15, 2013 Monday 08:30 AM