Federal Reserve Bank of Dallas
10/28/2024 | Press release | Distributed by Public on 10/28/2024 08:51
Texas Manufactoring Outlook Survey
October 28, 2024
Texas manufacturing activity rebounds in October
What's new this month
For this month's survey, Texas business executives were asked supplemental questions on credit conditions. Results for these questions from the Texas Manufacturing Outlook Survey, Texas Service Sector Outlook Survey and Texas Retail Outlook Survey have been released together. Read the special questions results.
Texas factory activity rose notably in October, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, shot up 18 points to 14.6, its highest reading in more than two years.
Other measures of manufacturing activity were mixed. The new orders index remained negative at -3.7, indicating slight declines in demand. Meanwhile, the capacity utilization and shipments indexes posted large gains and moved into positive territory, coming in at 4.3 and 1.5, respectively.
Perceptions of broader business conditions remained negative in October, though pessimism waned a bit. The general business activity index moved up six points to -3.0, and the company outlook index edged up three points to -3.3. The outlook uncertainty index held steady at 16.4.
Labor market measures suggested employment declines and shorter workweeks this month. The employment index fell eight points to -5.1. Fourteen percent of firms noted net hiring, while 19 percent noted net layoffs. The hours worked index ticked down to -5.5.
Moderate upward pressure on prices and wages continued in October. The wages and benefits index rose five points to 23.5, a reading roughly in line with the historical average. The raw materials prices index inched down to 16.3, while the finished goods prices index was unchanged at 7.4.
Expectations are for increased manufacturing activity six months from now. The future production index moved up to 42.4, its highest reading in nearly three years. The future general business activity index shot up 18 points to 29.6, also a three-year high.
Next release: Monday, November 25
Data were collected Oct. 15-23, and 86 of the 123 Texas manufacturers surveyed submitted a response. The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state's factory activity. Firms are asked whether output, employment, orders, prices and other indicators increased, decreased or remained unchanged over the previous month.
Survey responses are used to calculate an index for each indicator. Each index is calculated by subtracting the percentage of respondents reporting a decrease from the percentage reporting an increase. When the share of firms reporting an increase exceeds the share reporting a decrease, the index will be greater than zero, suggesting the indicator has increased over the prior month. If the share of firms reporting a decrease exceeds the share reporting an increase, the index will be below zero, suggesting the indicator has decreased over the prior month. An index will be zero when the number of firms reporting an increase is equal to the number of firms reporting a decrease. Data have been seasonally adjusted as necessary.