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Texas Manufacturing Activity Increases After Nine-Month Slump
Texas factory activity increased in October after nine months of flat or declining output, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, rose to 4.8, marking the first month of output growth this year.
Some other indexes of current manufacturing activity also reflected growth in October, but the survey’s demand measures remained in negative territory. The new orders index posted a third negative reading in a row and fell three points to -7.6. The growth rate of orders index has been negative for 12 months and moved down to -7.7 in October. Meanwhile, the capacity utilization index moved up from 4.9 to 8.6, and the shipments index rose from 0.9 to 6.4.
Perceptions of broader business conditions remained weak in October. The general business activity index, which has been negative all year, fell 3 points to -12.7. The company outlook index remained negative for a third consecutive month but edged up to -4.1.
Labor market indicators reflected a stabilization in October. The employment index moved up to zero, indicating no change in headcounts after five months of declines. The hours worked index rose nearly 10 points to -1.7, suggesting a much smaller decline in workweek length than last month.
The survey’s price measures have been quite weak this year, and the trend continued in October. The raw materials prices index was -1.2 this month, suggesting a slight decline in input costs. The finished goods prices index came in at -9.5, posting its 10th negative reading in a row. Meanwhile, the wages and benefits index stayed strong and edged up to 17.9.
Expectations regarding future business conditions remained positive in October. The index of future general business activity held fairly steady at 4.1, and the index of future company outlook edged up to 9.8. Indexes for future manufacturing activity moved up and remained strongly positive.
Posted: October 26, 2015 Monday 10:30 AM