Texas Manufacturing Activity Extends Growth Streak in February, Says Dallas Fed Survey
For Immediate Release: Feb. 27, 2017
DALLAS—Texas factory activity increased for the eighth consecutive month in February, according to the Federal Reserve Bank of Dallas’ Texas Manufacturing Outlook Survey.
For this month’s Texas Business Outlook Surveys, respondents were also asked special questions on employment expectations and the labor market this month. Responses to those questions indicated a marked uptick in hiring expectations, particularly among manufacturers.
The production index—a key measure of state manufacturing conditions—rose five points to 16.7, suggesting output growth picked up pace this month.
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 indicated expansion. The new orders and growth rate of orders indexes fell but remained positive, coming in at 11.6 and 2.0, respectively. The shipments index also moved down but stayed positive, and the capacity utilization index rose from 9.1 to 14.7 this month.
Perceptions of broader business conditions improved again in February. The general business activity index returned to positive territory in October 2016 and has pushed further positive every month since, reaching 24.5 this month. The company outlook index posted a sixth consecutive reading above zero this month, but slipped slightly to 17.6.
Labor market measures indicated employment gains and longer workweeks. The employment index posted a second positive reading in a row—something that hasn’t happened since the end of 2015—and edged up from 6.1 to 9.6.
Expectations regarding future business conditions generally improved this month. The indexes of future general business activity and future company outlook came in at 37.0 and 35.6, respectively—down from their January readings but still solidly in positive territory.
Texas produces more than 11 percent of total manufactured goods in the United States, ranking second behind California in factory production.
The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state’s factory activity.
Federal Reserve Bank of Dallas
Phone: (214) 922-6703