New York Manufacturing Index Out Of Contraction, But Labor Market Mixed

The predominant New York manufacturing index emerged from contraction territory in January, clocking in at 9.95 from -1.23 the month prior. It was the first contraction in regional manufacturing activity in two years.

Wall Street expected a reading of 5. in January

The New York Federal Reserve’s Empire State Manufacturing Survey activity in the region showed modest growth in new orders and shipments, but labor market conditions were mixed. While the index for number of employees rose to 13.7, the average workweek index remained negative at -8.4.

Both the prices paid and prices received indexes came in at 12.6, suggesting a modest increase in input prices and selling prices. The prices paid index was little changed at 12.6, where is has now stood for four consecutive months.

Roughly a third of respondents reported that business conditions improved last month. The index for future general business conditions rose nine points to 48.4, with nearly 60 percent of those respondents expecting conditions to improve.

The new orders index rose six points to 6.1, showing a slight increase in orders, and the shipments index rose seven points to 9.6, indicating a similar rise in shipments. However, the unfilled orders index moved up after a sharp decline last month, yet remained negative at -8.4. The delivery time index came in at -5.3, indicating shorter delivery times, while the inventories index was -7.4, indicating a decline in inventory levels.

The index for expected number of employees rose eleven points to 31.6, its highest level in nearly three years, indicating that a significant expansion in employment is anticipated in the months ahead. The capital expenditures index was little changed at 14.7, while the technology spending index fell five points to 12.6.