Dallas Fed: Texas Manufacturing Expands but New Orders Remain Flat
For immediate release: May 29, 2012
DALLAS—Texas factory activity continued to increase in May, according to the Federal Reserve Bank of Dallas’ Texas Manufacturing Outlook Survey.
Texas produces more than 9 percent of total manufactured goods in the United States, ranking second behind California in factory production.
The production index—a key measure of state manufacturing conditions—held steady at 5.5, suggesting growth continued at about the same pace as last month.
Positive readings in the survey generally indicate expansion of factory activity, while readings below zero generally indicate contraction.
The new orders index posted a near-zero reading for the third consecutive month, suggesting order volumes have stagnated since February. Shipment volumes were flat again in May, with the index near zero for the second month in a row.
The capacity utilization index came in at 5, up from 1.4 in April, with one-quarter of respondents noting increases.
Perceptions of broader economic conditions were mixed in May. The general business activity index remained negative for the second consecutive month. Fifteen percent of firms noted improvement in the level of business activity, while 20 percent noted a worsening.
Employment grew again in May, but the pace continued to slow. Eighteen percent of firms reported hiring new workers, while 10 percent reported layoffs.
Input prices and wages continued to increase in May, but selling prices were flat.
The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state’s factory activity.
Federal Reserve Bank of Dallas
Phone: (214) 922-5307