Texas Manufacturing Outlook Survey

October 28, 2019

Results Summary

Historical data are available from June 2004 to the most current release month.

*Shown is the number of consecutive months of expansion or contraction in the underlying indicator. Expansion is indicated by a positive index reading and denoted by a (+) in the table. Contraction is indicated by a negative index reading and denoted by a (–) in the table.

**Shown is the number of consecutive months of improvement or worsening in the underlying indicator. Improvement is indicated by a positive index reading and denoted by a (+) in the table. Worsening is indicated by a negative index reading and denoted by a (–) in the table.

†Added to survey in January 2019.

Data have been seasonally adjusted as necessary, with the exception of the outlook uncertainty index, which does not yet have a sufficiently long time series to test for seasonality.

October 28, 2019

Production Index

Downloadable chart

October 28, 2019

Comments from Survey Respondents

These comments are from respondents’ completed surveys and have been edited for publication.

Chemical Manufacturing

• Decreased car sales have decreased our customers’ sales.

Primary Metal Manufacturing

• We are experiencing an uncharacteristic slowdown for October.
• The biggest issue is cybersecurity. It is very expensive to guard against. We know an attack will come, but not where, how, from what country, or when. The federal government should supply some assistance. Two cities around us have been attacked, and a current list of 30 Texas cities and agencies has been hit. This could get bad enough to be a drag on growth.
• We are experiencing an overall softening in the primary metals market/manufacturing. These trends have been building over the past six months and began with the energy sector. Now we are seeing softening across the board as election jitters and uncertainty take hold. One of the most crippling events for our workforce included an I-9 audit which identified 23 out of 255 employees whose documentation had mismatches. This resulted in over 480 years of experience being forced out. Although we have been a strict E-Verify employer, these individuals predated the system. Now we simply cannot fill these job openings, regardless of pay and benefits.

Fabricated Metal Product Manufacturing

• If the media continue to report the decline in business conditions, which we are not seeing, then maybe it will come true. Hiring good people is still a problem because everyone is working.

Nonmetallic Mineral Product Manufacturing

• There is a lot of uncertainty that is causing us to delay capital expenditures. Raw materials costs are uncertain due to unknown duties impacts. Planning is difficult and getting more uncertain. There is a lot of uncertainty in the homebuilding business, which directly affects us.

Machinery Manufacturing

• Business seems to be slowing back down after a fairly busy summer.
• The oil industry is slowly slowing down. I believe it has a great deal to do with the political environment that we now find ourselves in. The uncertainty has driven the customers to put their hands in their pockets to see what might develop with the elections next year. If this continues, it will be a long, cold winter and even slower summer until this is over. And if the Democratic candidate wins, then the next four years will be very tough for my business. I’d seriously consider retirement.
• Give me a level playing field and a free market and we can beat even low–labor-cost suppliers. I don’t want a subsidy and I can’t beat a tariff.
• I don’t see the economy booming.
• Sales were down; however, it was mostly due to the end of a multiyear project that ended in August. We are now making efforts to replace this business.

Computer and Electronic Product Manufacturing

• Trade deals are actually helping our customers and, therefore, helping us to book more revenue. Our backlog is pretty strong. There is a mild slowdown in a couple of sectors of our industries—nothing alarming.
• Tariffs remain a concern, but things seem to have stabilized.
• We have begun to see broad-based weakness as customers tell us they are becoming increasingly conservative due to trade tensions. Our revenues in the fourth quarter are expected to decline about what they did in fourth quarter 2008. This is the first time we have seen this magnitude of weakness since then.

Transportation Equipment Manufacturing

• Our industry has been down for year, and the outlook remains soft through 2021. We are expanding our distribution network to offset the overall downturn.

Paper Manufacturing

• Current conditions are the same as they have been for eight months, which is very soft with no positive outlook at this time. If this level continues (as expected), we will be reducing our workforce after Christmas.

Printing and Related Support Activities

• The continued shortage of semi-skilled and skilled labor is a major problem impacting growth.
• We had a very robust incoming-order month in September and now are feeling the effects. There is a lot of work in here, but this is somewhat normal for this time of year. I am very worried about how the next three to nine months will be, from a slowdown in the graphic arts industry, to our goofy city council trying to mandate paid sick time for hourly workers, to increases in taxes and fees. This all makes for a lot of uncertainty moving forward. We are looking at cutting back on bodies in the office to reduce overhead, and we are keeping a firm touch on expenditures.

Miscellaneous Manufacturing

• The China tariff situation on 23 percent of our business is a big hurt, as our Chinese supplier will give only small relief and our U.S. customers refuse an upcharge.

Historical Data

Historical data can be downloaded dating back to June 2004.

Indexes

Download indexes for all indicators. For the definitions of all variables, see Data Definitions.

All Data

Download indexes and components of the indexes (percentage of respondents reporting increase, decrease, or no change). For the definitions of all variables, see Data Definitions.