New York manufacturing index plummets back to negative territory in May

Manufacturing activity in New York state contracted in May after two months of expansion, according to results of the latest Empire State Manufacturing Survey issued today.

The survey’s general business-conditions index plunged 19 points to -9.0 in May after posting positive readings in both April and March, following seven months of negative index levels.

The results of the May survey indicated that business activity “declined” for New York manufacturers, the Federal Reserve Bank of New York said in its survey report. A negative reading indicates a contraction in manufacturing activity, while a positive reading on the index indicates expansion in the sector.

The May general business-conditions index level was much worse than economists were expecting. A MarketWatch.com poll of economists had forecast an index reading of 5.8.

The New York Fed said that 19 percent of New York manufacturers reported that conditions had improved over the latest month, while 28 percent said that conditions had worsened.

The new orders and shipments indexes also fell below zero, according to the manufacturing survey.

Employment levels appeared to be “little changed,” while the average-workweek index pointed to a decline in hours worked.

The six-month outlook among New York manufacturers was “somewhat less optimistic” than last month, and the capital-spending index plummeted to 3.1, its lowest level in more than two years.

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.

Contact Reinhardt at ereinhardt@cnybj.com