Texas Manufacturing Outlook Survey - Dallasfed.org

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October 31 2022

Texas manufacturing output increased, but new orders fell and the outlook worsened.

What’s new this month?

For this month’s survey, Texas business executives asked supplemental questions about labor market conditions. Texas Manufacturing Outlook Survey; Results for these questions from the Texas Service Sector Outlook Survey and the Texas Retail Outlook Survey are published together. Read the special question results.

Texas manufacturing continued to see growth in October, according to business executives responding to the Texas Manufacturing Outlook Survey. The manufacturing index, a key measure of state manufacturing conditions, fell 3 points to 6.0, indicating a slight slowdown in output growth.

Other manufacturing activities also scaled back this month. The new orders index fell to -8.8—a fifth month in negative territory—indicating a continued decline in demand. The growth rate of the order index remained negative, falling 12 points to -13.2. The capacity utilization index was positive, but fell from 13.4 to 9.1, and the exports index slipped into negative territory for the first time since May 2020, coming in at -1.6.

Broader economic conditions worsened in October. The general business activity index posted a sixth negative reading, falling from -17.2 to -19.4. The company’s outlook index was also negative, largely unchanged at -9.1. The outlook uncertainty index rose to 38.3.

Although the weeks are no longer long, labor market measures continue to point to strong employment growth. The employment index ticked up to 17.1, a reading significantly above its series average of 7.8. Twenty-six percent of companies observed net hiring, and 9 percent observed net hiring. The working hours index fell to a near-zero reading this month — with no change in the length of the workweek — ending a two-year upward trend.

Prices and wages continued to rise rapidly. The crude price index fell five points to 32.0, inching toward its series average of 28.1. However, the finished goods price index rose four points to 22.2, pushing its series average above 9.0. The wage and benefits index remained unchanged from September at 36.7.

Expectations for next October’s production were mixed. Although the futures production index is positive; It fell 25 points to a 3.1, though. It was its lowest reading since April 2020. The future general business activity index was negative and largely unchanged at -21.2. Other measures of manufacturing activity saw large declines in index values this month, although most remained in positive territory except for the future new orders index, which fell to -4.5.

Upcoming Edition: Monday November 28th

Data was collected Oct. 18-26, and 96 Texas manufacturers responded to the survey. The Dallas Fed conducts the Texas Manufacturing Outlook Survey each month to provide a timely assessment of the state’s factory operations. output of businesses; employment order Prices and other indicators increased from the previous month; It asks whether it has decreased or remained unchanged.

Survey responses are used to calculate an index for each indicator. Each indicator is calculated by subtracting the percentage of respondents reporting a decrease from the percentage reporting an increase. When the share of reporting companies increases more than the share reported decreases. The index will be greater than zero, indicating an increase over the previous month. If the share of the reporting companies exceeds the share showing the increase. The index will remain below zero, indicating that the index has decreased from the previous month. The index will be zero when the number of firms reporting an increase equals the number of firms reporting a decrease. Data are seasonally adjusted as necessary.

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