The Federal Reserve Bank of New York reported Aug. 15 that its Empire State Manufacturing Survey general business-conditions index fell 11 points to 14.7 in August.
The index figure of 25.9 in July represented its highest level in more than four years, according to the New York Fed.
At the same time, the new survey found New York manufacturers displayed more optimism for the next months than they had indicated in the July survey.
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Despite the decline in that general-conditions index, the New York Fed indicated that business conditions “improved for a fourth consecutive month” for New York manufacturers, although the improvement was “less widespread” than in the July survey.
The survey found 31 percent of respondents reported that conditions had improved over the month, while 17 percent said that they had worsened.
This month’s report was “generally good,” says Randall Wolken, president of the Manufacturers Association of Central New York.
“One of the things I was expecting … was the general-business [conditions] index to come down a little bit because as of last month, [it] had reached a four-year high, so I didn’t think it would necessarily stay … that high, but it’s still in the positive territory,” says Wolken.
The New York Fed also posted details on additional survey components on its website.
The new-orders index slipped almost five points to 14.1, while the shipments index edged up a point to 24.6, its highest level since March 2010.
The unfilled-orders index inched down one point to -8.0, pointing to a “slow but steady lessening” in backlogs, the New York Fed said.
The delivery-time index fell five points to -5.7, and the inventories index fell another 11 points to -14.8, pointing to a “noteworthy drawdown of inventories.”
The indexes for both prices paid and prices received were up “slightly,” indicating a “marginal” pickup in the pace of price increases, according to the New York Fed.
The prices-paid index rose two points to 27.3, and the prices-received index inched up one point to 8.0.
Labor market conditions were mixed but “continued to improve overall.”
The index for number of employees slipped three points to 13.6, suggesting a “slight pullback” in the pace of hiring. However, the average-workweek index rose six points to 8.0, signaling a slight increase in hours worked.
“As long as the work-hour index is strong, that’s usually a sign that you’ve got strong production,” says Wolken.
Most of the indexes for the six-month outlook rebounded “sharply,” after slipping in the July survey.
The index for future general-business conditions climbed 18 points to 46.8, its highest level in two-and-a-half years.
The future new-orders index surged 25 points to 50.4, and the future-shipments index soared 30 points to 54.5.
Wolken is “encouraged” with the future-index readings, “which would suggest people are expecting the year to get better and to continue to look positive.”
The index for expected number of employees rose six points to 22.7, and the future average-workweek index edged up to zero.
The capital-expenditures index jumped nine points to 18.2, and the technology-spending index inched up to 12.5.
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, it says.
Contact Reinhardt at ereinhardt@cnybj.com
