For immediate release: September 29, 2008
Manufacturing Activity in Texas Still Weakening, According to Dallas Fed Survey
DALLAS—Texas manufacturing weakened further in September, according to the Federal Reserve Bank of Dallas' Texas Manufacturing Outlook Survey.
The September survey can be found at: http://dallasfed.org/data/outlook/2008/tmos0809.html
Texas produces more than 8 percent of the total manufactured goods in the United States, ranking second behind California in factory production.
Most indicators of current production and general business conditions recorded their lowest readings since the survey's inception in 2004.
The indexes for production, capacity utilization, volume of shipments, volume of new orders and growth rate of orders plunged sharply as more than twice as many manufacturers reported declines as noted improvements in these measures.
Wage and price pressures moderated. Indexes for raw material prices, finished goods prices and wages and benefits eased, with a smaller share of producers reporting increases in prices and wages in September compared with last month.
Sentiment on general business activity remained subdued—half of those responding said the economy had worsened since last month.
The indexes for future production, capacity utilization, volume of shipments and volume of new orders improved, with nearly 40 percent of producers expecting an increase in these measures six months from now.
Additionally, as part of the September survey, participants responded to supplemental questions about wage pressures. Nearly two-thirds indicated they were fielding requests for pay raises from their employees. In response, 63 percent of manufacturers were granting wage increases.
Among those not currently granting wage increases, a third said they didn't plan to raise wages in the near term because of continuing weak demand for their products.
The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state's factory activity.
Phone: (214) 922-5307