Federal Reserve Bank of Dallas
09/30/2024 | Press release | Distributed by Public on 09/30/2024 08:48
Texas Manufactoring Outlook Survey
September 30, 2024
Texas manufacturing activity slips in September, but production expectations remain solid
What's new this month
For this month's survey, Texas business executives were asked supplemental questions on wages, prices, outlook concerns and remote work. 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 fell modestly in September, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, slipped to -3.2, with the negative reading signaling a slight decline in output from August.
Most other measures of manufacturing activity also indicated declines this month. The new orders index was largely unchanged at -5.2. The capacity utilization index fell five points to -7.0, and the shipments index retreated back into negative territory, falling eight points to -7.0.
Perceptions of broader business conditions remained negative in September. The general business activity index held fairly steady at -9.0, while the company outlook index stayed negative but inched up three points to -6.4. The outlook uncertainty index spiked 10 points to 17.3.
Labor market measures suggested some employment growth but slightly shorter workweeks this month. The employment index moved up four points to 2.9. Twenty percent of firms noted net hiring, while 17 percent noted net layoffs. The hours worked index held steady at -2.5.
Moderate upward pressure on prices and wages continued in September. The wages and benefits index ticked down to 18.5, a reading roughly in line with the historical average. The raw materials prices index fell 10 points to 18.2, while the finished goods prices index was unchanged at 8.4.
Expectations are for increased manufacturing activity six months from now. The future production index edged up to 35.2, reaching its highest reading since early 2022. The future general business activity held steady at 11.4.
Next release: Monday, October 28
Data were collected Sept. 17-25, and 83 of the 124 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.