FLASH Headline Alerts, State of the Economy

Empire Manufacturing Survey: Business Activity Plummets

New York

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Economic Update: Empire Manufacturing Survey

The January 2016 Empire State Manufacturing Survey indicates that business activity hit the worst level since the Great Recession as the headline index declined for a sixth consecutive month.

The headline index – one of the more closely watched indicators due to it being a current report – dove in January to a reading of -19.4. The level was well below the consensus for a reading of -3.0 and also below last month’s revised reading of -6.2 (revised lower from -4.6). November’s reading was -10.7.

According to the report, business activity declined for New York manufacturing firms more sharply than at any time since the 2007-09 recession

The new orders and shipments indexes plummeted, indicating a steep decline in both orders and shipments. Price indexes suggested that both input prices and selling prices increased. Labor market conditions continued to deteriorate, with employment indexes remaining in negative territory. The six-month outlook was noticeably weaker, with the index for future general business conditions falling to its lowest level since early 2009.

The Empire Manufacturing Index is designed to indicate the state of the manufacturing sector in the New York region.

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About the Author

David Moenning is the Chief Investment Officer at Sowell Management Services. Dave began his investment career in 1980 and has been an independent money manager since 1987. Thus, Dave has been live on the firing line and investing for a living for more than 29 years.