New York Manufacturing Growth Slows to 7.6 in September
New York Manufacturing Growth Slows to 7.6 in September
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Key Points
1
The September reading fell short of economists’ expectations: The Wall Street Journal’s consensus forecast was 15, while another estimate cited by RTT News was 14.1.
2
The prices paid index rose to 63.1 and the prices received index climbed to 28.1, quantifying the acceleration in input-cost and selling-price increases.
3
Firms’ six-month outlook remained positive, with the future business conditions index at 29.0 and respondents expecting increases in orders, shipments and employment.
4
Manufacturers expected supply availability to deteriorate further and price increases to remain elevated in the coming months, indicating that sourcing and inflation risks had not eased despite the positive outlook.
5
Inventories increased during the month, adding another detail to the survey’s evidence of ongoing supply-chain adjustments.
New York's manufacturing sector expanded at a much slower pace in September, with the Empire State Manufacturing Survey's key index dropping to 7.6 from 20.6 in August NASDAQ. The reading fell well short of economists' expectations — WSJ had forecast 15 and other analysts predicted 14.1. Despite the sharp slowdown, factories remained profitable and optimistic about the months ahead.
New orders climbed and employment stayed solid, but manufacturers face mounting headwinds. Input costs and selling prices both accelerated sharply, while supply chains tightened further Market Screener. Inventories rose as factories adjusted to ongoing logistics challenges.
Orders Rise Despite Sharp Economic Slowdown
New orders increased in September even as the overall business conditions index collapsed Sharecast. Unfilled orders also grew, signaling customer demand remains intact. However, shipments edged lower and delivery times stretched substantially, reflecting ongoing bottlenecks in New York's supply chains.
The disconnect between rising orders and falling shipments suggests factories are struggling to keep up with demand. Supply availability deteriorated sharply during the month, adding pressure to already-strained logistics networks Federal Reserve.
Wages and Hours Hit Five-Year High
Employment remained solid in September, and the average workweek jumped to its strongest level in nearly five years Market Screener. Factories are pushing harder to meet demand despite supply constraints. Higher hours and solid hiring paint a picture of labor market confidence in manufacturing hubs.
Price Pressures Accelerate Sharply
The prices paid index surged to 63.1, while the prices received index climbed to 28.1 NASDAQ. Both measures accelerated from prior months, showing manufacturers face intense pressure to raise selling prices just as their input costs spike. These readings indicate inflation is alive and well in New York's factories.
Despite the slowdown, firms expect price increases to remain elevated for the next six months Market Screener. Supply availability is expected to deteriorate further, meaning sourcing costs will likely stay high through the end of the year.
Manufacturers Stay Optimistic on Future Demand
The future business conditions index hit 29.0, showing factories expect conditions to improve over the next six months NASDAQ. Respondents anticipate increases in orders, shipments, and employment. This forward-looking confidence suggests the September slowdown is viewed as temporary rather than a sign of deeper weakness.
Inventories rose during September as manufacturers adjusted to supply-chain friction Market Screener. The combination of rising inventories and strong future expectations suggests factories are building stock in preparation for stronger demand ahead.
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