For immediate release: March 9, 2011
Dallas Fed Survey: Texas Manufacturing Activity Rises but at a Slower Pace
DALLAS—Texas factory activity expanded in June, according to the Federal Reserve Bank of Dallas' Texas Manufacturing Outlook Survey.
Texas produces more than 9.5 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--remained positive but fell from 12.7 to 5.6, suggesting output growth slowed this month.
Positive readings in the survey generally indicate expansion of factory activity, while readings below zero generally indicate contraction.
The new orders index rose from 1.1 in May to 6.4 in June, its eighth consecutive month in positive territory. Nearly a quarter of firms said order volumes increased from May levels.
Perceptions of general business conditions were mixed in June. The general business activity index pushed further negative, falling from –7.4 to –17.5. However, the company outlook index rose from 3.2 to 7.2, suggesting manufacturers were more optimistic about their firms' prospects for the near future.
Labor market indicators reflected slower growth in labor demand. The employment index came in at 5.3, with 14 percent of manufacturers reporting hiring new workers compared with 9 percent reporting layoffs. The hours worked index fell to 1.5 in June, down from a reading of 13.2 in May.
Price and wage pressures moderated this month. The raw materials price index retreated from 42.3 to 31.1, suggesting input costs rose but at a slower pace than in May. The finished goods price index was largely unchanged at a reading of 10. More than 50 percent of respondents anticipate further increases in raw materials prices over the next six months, while 28 percent expect higher finished goods prices.
The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state’s factory activity.
Next release: July 25.
Phone: (214) 922-5307