New York Manufacturing Dips but Optimism Holds Steady

Highlights

• General business index falls to -4.6
• Marginal improvement in labor market
• Future outlook cautiously optimistic

New York Manufacturing Takes a Hit, Yet Optimism Lingers

Manufacturing in New York State took a dip in October, evidenced by a seven-point decline in the general business conditions index to -4.6. The drop was underscored by a fall in new orders and stagnant shipments. While 24% of firms surveyed indicated improved conditions, 29% reported a downturn.

Inventory Levels and Supply Chain

Inventories remained nearly steady, with the index registering just below zero at -2.1. Unfilled orders declined significantly, reflected by an index score of -19.1. Coupled with this, delivery times shortened, as indicated by the -6.4 index rating, suggesting some ease in supply chain issues.

Employment and Pricing Dynamics

The labor market saw marginal improvement, with both employment levels and average workweek hours ticking up. Despite the downturn in manufacturing, the prices paid index held firm at 25.5, pointing to stable input costs. However, the selling prices showed a moderation, with the prices received index falling to 11.7.

Future Outlook

Firms maintained a relatively upbeat view of the six-month horizon, though the future business conditions index slipped three points to 23.1. Anticipations for new orders, shipments, and employment were cautiously optimistic, although slightly less so than in the previous month.

Short-Term Forecast: Neutral to Bearish

Despite the slump in current conditions, firms exhibit a degree of optimism for the near future. However, given the prevailing downward trajectory in several key indicators, the short-term outlook for New York State’s manufacturing sector tilts more towards neutral to bearish.