The April Empire State Index of General Business Conditions in New York's manufacturing industries dropped sharply 3.12 from an upwardly revised March level. The decline was to the lowest level since 2003.

The new orders component went negative for the first time in two years and the shipments index was barely positive. Employment fell as well and the measure indicated little if any job growth. Like the Philadelphia Fed Index of General Business Conditions, the Empire State Business Conditions Index reflects answers to an independent survey question; it is not a weighted combination of the components.

The prices paid index fell sharply to the lowest level in over a year.

Expectations for business conditions in six months fell sharply. The decline reversed the prior month's improvement and indicated the most pessimism since 2001. Expectations for future capital spending held up relatively well and slipped m/m to the average level of 2004 which was sharply improved from the year earlier.

The Empire State Manufacturing Survey is a monthly survey of manufacturers in New York State conducted by the Federal Reserve Bank of New York. Participants from across the state in a variety of industries respond to a questionnaire and report the change in a variety of indicators from the previous month. Respondents also state the likely direction of these same indicators six months ahead. April 2002 is the first report, although survey data date back to July 2001.

For more on the Empire State Manufacturing Survey, including methodologies and the latest report, click here.