Fed Manufacturing Surveys Indicate Modest Growth in November

Written by Sandy Williams

Tenth District: Manufacturing activity and expectations for future growth grew modestly in the Tenth District in November according to a survey conducted by the Federal Reserve Bank of Kansas City.

The index for new orders surged from 3 to 15, month-over-month, and indices increased for order backlogs and employment. Indices fell in production, shipments, new export orders, raw materials, and finished goods. Most of the indices for future activity rose in November with the future composite index picking up four points from last month for a reading of 12.

“Factory activity in our region continues to hum along at a moderate rate of growth” said Chad Wilkerson, vice president and economist at the Federal Reserve Bank of Kansas City. “The marked improvement in hiring plans was a nice development.”

Survey respondents shared concerns about market uncertainty, shortage of skilled labor and continued low inventories.

The Tenth district encompasses the western third of Missouri; all of Kansas, Colorado, Nebraska, Oklahoma and Wyoming; and the northern half of New Mexico.

Third District: The pace of growth in the Third district slowed according to the November Business Outlook Survey conducted by the Federal Reserve Bank of Philadelphia. Although the manufacturing sector continued to grow, most indices were lower than last month. The six month outlook continued to be optimistic but more moderate than October’s outlook. The future general activity index dropped 15 points in November to 45.8. More than one-third of manufacturers surveyed said they expect to add workers in the next six months.

Supplementary survey questions for November concerned capacity utilization rates. The average manufacturing utilization rate for the District was 78 percent, up from 76 percent in 2012. The percentage of firms planning to increase capital spending in 2014 was 29 percent, while 23 percent of firms plan to reduce spending.

The Third District includes eastern Pennsylvania, southern New Jersey, and Delaware.

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