Survey of Tenth District Manufacturing
Tenth District manufacturing activity declined moderately in September, and firms’ expectations about future factory activity dropped noticeably. Most price indexes in the survey fell sharply, following more modest decreases in the previous two months. Still, considerably more firms continued to plan finished goods price increases heading forward than planned price decreases.
The net percentage of firms reporting month-over-month increases in production in September was -9, down from 6 in August and 21 in July (Tables 1 & 2, Chart). Production declined at non-durable-goods producing plants, but remained relatively stable at durable-goods producing plants. Nearly all other month-over-month indexes also declined in September, with most slipping into negative territory. The shipments index dropped from 2 to -8, and the new orders and order backlog index posted their lowest levels in over 6 years. The employment, employee workweek, and supplier delivery time indexes also decreased from the previous month. In contrast, the new export orders index edged up slightly after falling considerably last month. The raw materials inventory index decreased, but the finished goods inventory index increased from -6 to 0.
Most year-over-year factory indexes also fell in September. The production index edged down from 1 to -1, and the shipments, new orders, and order backlog indexes also dropped. The new orders for exports index slipped from 10 to 8, and the supplier delivery time index also decreased. On the other hand, while still negative, the employment index increased from -10 to -7, and the capital expenditures index remained unchanged. Both inventories indexes increased after falling last month.
Nearly all future factory activity indexes dropped substantially in September. The future production index fell from 30 to 3, its lowest level since 2001. In addition, the future shipments and new orders indexes also posted seven-year lows, and the future order backlog, employment, and supplier delivery time indexes also decreased. The future new orders for exports index fell for the third straight month. Meanwhile, the future capital expenditures index increased from 7 to 12 after slipping last month. The future raw materials inventory index declined further from -5 to -7, while the future finished goods inventory index edged up slightly but was still in negative territory.
Most price indexes fell considerably following more moderate decreases in the previous two months. The month-over-month finished goods index decreased from 30 to 20, and the raw materials index dropped from 53 to 38. The year-over-year finished goods price index edged down slightly, and the raw materials index also eased from 90 to 86. The future raw materials index decreased from 73 to 51, and the future finished goods index posted a sharp decline from 53 to 24.
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