New York manufacturing index dips below zero in May with concern about orders

New York manufacturers indicated concern about new orders and unfilled orders in the latest monthly survey examining the state’s manufacturing sector.

The Empire State Manufacturing Survey general business-conditions index fell 6 points to -1.0 in May.

The index fell 11 points to 5.2 in April. It also declined 2 points in March after climbing 12 points in February to its highest level in more than two years.

The -1.0 figure is the survey’s first negative reading since October.

A negative index number indicates a decline in the state’s manufacturing sector, while a positive reading indicates expansion or growth in state manufacturing activity.

The results of the May survey indicate that business activity “leveled off” for New York manufacturers, the Federal Reserve Bank of New York said in its news release issued May 15.

The survey found 26 percent of respondents reported that conditions had improved over the month, while 27 percent said that conditions had worsened.

The percentage of manufacturers reporting improvement in conditions was down “roughly” 10 percentage points compared to the April survey, the New York Fed said.

The May index level followed the 5.2 reading in April, 16.4 in March, 18.7 in February, 6.5 in January, and 9 in December.

Survey details
The new-orders index fell below zero for the first time in several months, and at -4.4, “pointed to a small decline in orders,” the New York Fed said.

The shipments index slipped to 10.6, indicating that shipments increased “at a slower pace.”

The unfilled-orders index tumbled 16 points to -3.7. The delivery-time index fell 9 points to 6.7, a sign that delivery times “continued to increase,” though less so than last month.

The inventories index declined to -0.7, suggesting that inventory levels were “stable.”

Employment indexes remained positive, pointing to “continued improvement” in labor-market conditions.

The index for number of employees edged down to 11.9, and the average-workweek index was little changed at 7.5.

Price increases slowed, according to the New York Fed.

The prices-paid index fell 12 points to 20.9, its lowest level since November, and the prices-received index moved down
8 points to 4.5.

Indexes assessing the six-month outlook suggested that firms “remained optimistic” about future conditions.

The index for future business conditions held steady at 39.3, and indexes for future new orders and shipments were “somewhat higher.”

Respondents expected employment “to increase in the months ahead,” the New York Fed said.

The capital-expenditures index fell 14 points to 13.4, and the technology-spending index also came in at 13.4.

The New York Fed distributes the Empire State Manufacturing Survey on the first day of each month to the same pool of about 200 manufacturing executives in New York.

On average, about 100 executives return responses.