Recent Updates

  • US: Consumer Sentiment (Sep-prelim)
  • Germany: Real Estate Opinion (Sep)
  • Slovakia: BOP (Jul)
  • Croatia: Short-term Indicators of Energy (Jul)
  • Mexico: IOAE - Estimated Econ Activity (Aug)
  • more updates...

Economy in Brief

Texas Manufacturing Growth & Outlook Weaken Sharply in August
by Tom Moeller  August 30, 2021

• Current production & new orders growth decline.

• Current employment & wages weaken, but outlook for both improves.

• Pricing strength moderates.

The Texas Manufacturing Outlook Survey, conducted by the Federal Reserve Bank of Dallas, indicated that its August General Business Activity Index fell to 9.0 from 27.3 in July. A lessened 22.5% of respondents reported improved business activity this month, down from 36.4 in July. A moderately increased 13.5% of respondents reported a worsening of business conditions. The survey was conducted between August 17-25 amongst 96 Texas manufacturers.

The shipments index fell to 15.2, a seven-month low, and the production index weakened to 20.8, a three-month low. The growth rate of new orders index fell sharply to 10.7, a seven-month low. Offsetting these declines was the growth rate of unfilled orders which rose moderately to 22.6. (These series date back to June 2004.) The employment index eased to 21.9 from 23.7, which was the highest reading in three months. A lessened 28.8% of firms reported more hiring this month while a diminished 6.9% reported less. The wages & benefits index fell to 43.4, but remained up from 15.8 twelve months earlier, as 43.8% of respondents paid higher wages, up from 17.0% six months ago. The production index reading of 20.8 was the lowest level in three months.

The finished goods prices measure eased to 38.1 in August but remained up from 1.6 twelve months earlier. It reflected a near-record 41.5% of respondents reporting higher prices while a slightly increased 3.4% reported price declines. The index of prices paid for raw materials rose modestly m/m to 74.9 in August, up from 20.8 twelve months ago.

The headline reading of expectations for overall business activity in six months more than halved m/m to 15.1 in August. Most of the component readings weakened except future employment and wages. Nonetheless, all remained at high levels.

Each index is calculated by subtracting the percentage reporting a decrease from the percentage reporting an increase. When all firms report rising activity, an index will register 100. An index will register -100 when all firms report a decrease. An index will be zero when the number of firms reporting an increase or a decrease is equal. Data for the Texas Manufacturing Outlook can be found in Haver's SURVEYS database.

Texas Manufacturing Outlook Survey (SA, % Balance) Aug Jul Jun Aug '20 2020 2019 2018
Current General Business Activity Index 9.0 27.3 31.1 9.0 -10.6 -1.2 25.8
   Production 20.8 31.0 29.4 14.6 3.7 8.9 21.4
   Growth Rate of New Orders 10.7 25.8 23.4 12.0 -5.3 -1.1 14.8
   Employment 21.9 23.7 22.9 11.8 1.6 9.5 20.0
   Wages & Benefits 43.4 46.0 48.1 15.8 11.5 23.5 29.7
   Prices Received for Finished Goods 38.1 40.9 42.8 1.6 -1.7 2.5 17.6
General Business Activity Index Expected in Six Months 15.1 37.1 37.3 21.2 6.6 6.4 31.6
   Production 44.3 48.4 56.6 43.5 31.3 35.6 48.6
   Growth Rate of New Orders 29.0 31.5 40.6 40.4 23.9 25.2 35.8
   Employment 44.5 43.5 48.2 28.5 15.5 26.0 37.7
   Wages & Benefits 60.6 52.6 59.2 28.9 26.7 39.7 50.4
close
large image