Texas Manufacturing Activity Grew at Strongest Pace in 11 Years
Monday, January 22, 2018
The Texas Manufacturing Outlook Survey showed regional factory activity grew at the strongest pace in more than a decade, indicating rapid growth over the month of December.
The production index soared 18 points to 32.8 in December, the highest its been in 11 years. The general business activity index and the company outlook index posted double-digit increases, coming in at 29.7 and 31.5, respectively. Both the latter components are also the highest they’ve been since 2006.
Labor market indicators also suggest much more rapid employment growth and longer workweeks in December. The employment index came in at 20.4, an increase in 14 points from November. More than 30% of firms reported net hiring, compared with 11% reporting net layoffs.
The hours worked index shot up to 23.3, a 12-year high.
Upward pressure on prices (inflation) continued in the month of December, while upward wage pressures not only continued but intensified. The raw materials prices index remained unchanged at 32.5 and the finished goods prices index ticked up to 17.9. The wages and benefits index shot up 11 points to 25.1.
Looking to the future, price expectations increased notably for a second month in a row. The index of future finished goods prices increased significantly to 42.7, up from 18.9 in October and 35.8 in November. That’s more than 20 points above its series average.