Global| May 26 2015Texas Factory Sector Activity Softens
by:Tom Moeller
|in:Economy in Brief
Summary
Deterioration in economic activity is spreading throughout the country. The Federal Reserve Bank of Dallas indicated that Texas business conditions eased sharply this month. The overall business activity index deteriorated to its [...]
Deterioration in economic activity is spreading throughout the country. The Federal Reserve Bank of Dallas indicated that Texas business conditions eased sharply this month. The overall business activity index deteriorated to its weakest level since the recession as did the production component. The growth rate of new orders held for the third straight month near the recovery's weakest point. The company outlook measure deteriorated to a new low as did the employment measure. The pricing power growth rate indicated a steady rate of deflation.
Despite these shortfalls, expected business conditions improved slightly this month. The reading for expected business activity recovered m/m but remained well below its high early last year. The company outlook measure gained as well but was quite depressed versus the early 2014 high. Showing some strength was the production outlook component as it improved to the highest level since November. Expected orders growth also increased to its best level since November along with shipments. Future wages & benefits paid deteriorated sharply and was well below the January 2014 high.
Each index is calculated by subtracting the percentage reporting a decrease from the percentage reporting an increase. When all firms report that activity has increased, 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 decrease is equal. Items may not add up to 100% because of rounding. Data for the Texas Manufacturing Outlook can be found in Haver's SURVEYS database.
| Texas Manufacturing Outlook Survey (SA) | May | Apr | Mar | May '14 | 2014 | 2013 | 2012 |
|---|---|---|---|---|---|---|---|
| Current General Business Activity Index (% Balance) | -20.8 | -16.0 | -17.4 | 8.6 | 8.3 | 2.2 | -0.6 |
| Production | -13.5 | -4.7 | -5.2 | 11.6 | 14.6 | 9.8 | 8.7 |
| Growth Rate of Orders | -15.2 | -15.5 | -15.3 | 3.9 | 4.7 | 0.1 | -2.8 |
| Number of Employees | -8.2 | 1.8 | -1.8 | 3.3 | 11.5 | 5.6 | 11.8 |
| Prices Received for Finished Goods | -8.7 | -7.7 | -9.8 | 6.2 | 8.3 | 2.9 | 0.9 |
| Expected Conditions in Six Months | 4.9 | -5.9 | 3.0 | 12.1 | 17.4 | 11.0 | 7.6 |
| Production | 38.6 | 28.2 | 36.2 | 37.0 | 42.7 | 37.1 | 32.4 |
| Growth Rate of New Orders | 27.3 | 19.6 | 28.3 | 30.6 | 31.5 | 25.0 | 19.5 |
| Wages & Benefits | 30.6 | 34.2 | 34.2 | 43.1 | 43.0 | 38.2 | 34.2 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
