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Texas Manufacturing Posts Slower Growth, Says Dallas Fed Survey

For immediate release: November 24, 2014

DALLASTexas factory activity increased again in November, according to the Federal Reserve Bank of Dallas’ Texas Manufacturing Outlook Survey.

Texas produces more than 11 percent of total manufactured goods in the United States, ranking second behind California in factory production.

The production index—a key measure of state manufacturing conditions—fell from 13.7 to 6, indicating output growth slowed in November.

Positive readings in the survey generally indicate expansion of factory activity, while readings below zero generally indicate contraction.

Other measures of current manufacturing activity also reflected slower growth in November. The capacity utilization index fell sharply. The new orders index declined notably as well, although more than a quarter of firms continued to note increases in new orders over October levels. The shipments index was nearly unchanged from its October reading.

Perceptions of broader business conditions remained positive in November, while outlooks were less optimistic. The general business activity index held steady at a solid reading of 10.5. The company outlook index dropped due to a smaller share of firms noting an improved outlook in November than in October.

Labor market indicators reflected continued employment growth and longer workweeks. The November employment index posted its sixth robust reading. The hours worked index edged down, indicating a smaller increase in hours worked than last month.

Expectations regarding future business conditions remained optimistic in November. The index of future general business activity rose, and the indexes of future manufacturing held steady or improved.

For this month’s Texas Business Outlook Surveys, respondents were also asked supplemental questions on employment expectations and the labor market in Texas.

The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state’s factory activity.


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Justin Jones
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