Texas Manufacturing Outlook Survey

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 2018.

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.

Production Index

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Comments from Survey Respondents

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

• We are having increased difficulty in procurement of raw materials and logistical costs.

• We have had unprecedented increases in steel raw materials and are unable to secure long-term commitments for volume or price.

• Business is still good. Our problems are not orders—we have plenty—but we don’t have enough people or raw materials to fill all orders.
• We have the largest backlog in the history of our company. Our raw material prices are rising, and on Jan. 1, we will have the largest one-time increase in our industry. So far, orders are still at record levels, but the general consensus is that inflation has to kick in soon and orders will slow down.

• We were able to refinance our bank debt on favorable terms. We still have a large volume of outstanding quotes where the owner/contractor is reluctant to start the applicable construction.
• In terms of our pipeline of contract opportunities, demand at market level is decreasing for new construction, but maintenance deferred from last year’s COVID interruption is filling the void for now.
• Shortages and pricing of American iron and steel products are delaying projects and availability of our emergency fittings. Some domestic stainless steel material pricing is now 14–28 times the price of imported material and not available for 12–16 weeks. For products going into the water market, these increases are being paid for by cities and utilities and ultimately the taxpayer. This limits the amount of funds available to improve our crumbling infrastructure.
• Labor shortages, raw material price increases and shortages, and power outage issues are all having a negative impact.

• This is the worst market I have seen since 1975.
• We are quoting more projects, but we believe that this is due to our competition declining rapidly. While they have pulled back their operations, we have maintained or expanded many parts of our business to meet our customers’ needs. We’ve maintained a large inventory that allows us to ship anything either the same day or next day. Therefore, our supply chain for our customers is very important and responsive where others have fallen short.
• We see variations in sales from month to month that are hard to explain. Sales are up one month and then down the next. We would prefer a steady flow of business so that we can plan accordingly. Strange times we live in!

• World supply issues as well as the political movement against small businesses are affecting us.
• Demand continues to outstrip supply across the board. We will bring on incremental capacity each quarter, limited by lead time of equipment and factory space, until the second half of 2022 or early 2023, if needed.
• We are having issues getting parts in to make and complete orders on hand.

• Labor costs continue to rise, and supply-chain disruptions with major material components continue to drive production delays, increased costs and uncertainty.
• The Delta COVID-19 variant adds a level of uncertainty regarding the impact on our customers’ business, primarily emergency medical services and tourism.
• Today, the business demand is encouraging, but there are too many future uncertainties—i.e., inflation, available employees and the economic outlook—including continued supply-chain problems and the fact that COVID won’t go away. Add a dysfunctional government and runaway fiscal spending and it’s hard to be optimistic. We are proceeding cautiously.

• We continue to have unfilled employee positions, and the labor rate is increasing at faster pace than our product pricing. Skilled construction trades jobs continue to experience lots of market disruption from e-commerce and lack of job skills training in the education system.

• We are seeing a mild seasonal uptick at this time.
• It is impossible to find employees. We are having to work the ones we have way too hard.

• We are worried about how rampant inflation is for our materials and services and feel the economy is in for a jolt soon on this front. Because of this, we are worried about six months out, although we are busy now and appear to be busy for a while to come.
• Team members out with COVID is causing disruptions.

• The lack of domestic tranquility simmers underneath the surface. This growing instability in the world—the disregard of civility and law—may not directly go to business activity, but it impacts morale and efforts at optimism for the future. The shutting in of domestic oil production while encouraging increases in foreign production/purchases and increasing foreign dependence in an ever-unstable world only adds to the fractured nature of things.

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.