News

In December, Philadelphia’s regional manufacturing activity declined overall. The index for current general business activity remained negative and fell further from -5.5 to -16.4. Just 16% of firms reported increased activity this month, while nearly 33% saw decreases and nearly 47% experienced no change. The indexes for new orders and shipments turned negative and declined to -4.3 and -1.9, respectively. On the other hand, firms continued to report an increase in employment after steady job gains last month, with the employment index edging down slightly from 8.6 to 6.6. The average workweek index reversed last month’s surge, falling from 17.4 to -8.2.

Price indexes diverged, with the prices paid index increasing and the prices received index decreasing, indicating an overall rise in prices. The prices paid index moved up from 26.6 to 31.2. The prices received index remained significantly lower than the prices paid index at 7.3, exhibiting how manufacturers are eating a sizable portion of those higher costs paid.

Looking ahead, most future indicators decreased but remain elevated after two months of significant increases. The index for future general business activity fell 26 points from 56.6 to 30.7, indicating a leveling off of optimism among firms. A higher proportion of firms still expected increases in activity. Additionally, the future new orders and shipments indexes fell but were above their historical averages. While firms still expect employment to grow, the index for future employment ticked down from 34.2 to 32.1. The capital expenditures index also fell from 24.9 to 18.8. The future prices paid index declined 7 points to 56.4, while future prices received rose 10 points to 58.4.