New York Factory Growth Slows, but Hiring Gains Continue

Manufacturing activity in New York state expanded at a slower pace in June, with the headline business conditions index falling 13.9 points to 5.7. The new orders index plummeted 19.2 points to 3.5, while the shipments index declined 10.3 points to 8.6, with both remaining in growth territory. Unfilled orders edged up 0.1 point to 5.0, while inventories moved down 9.7 points to 0.0, indicating business inventories stayed the same. Delivery times lengthened, though the index decreased 8.5 points to 11.9, and supply availability declined to its worst level since June 2022, stepping down 3.2 points to -13.9.

Employment increased at a faster rate in June, with the index for the number of employees rising 1.3 points to 9.6. At the same time, the average employee workweek declined to 5.1 from 11.5, signaling a smaller increase in hours worked in June. The prices paid and prices received indices stepped down in June, moving from 62.6 to 61.0 and from 31.8 to 31.4, respectively.

In June, firms’ optimism regarding the future weakened slightly, with the future business activity index falling 3.4 points to 30.1. In the next six months, new orders are expected to rise at a faster pace compared to the prior month at 32.5. The future employment index edged up 0.3 points to 20.9, suggesting a slightly faster anticipated pace of employment growth over the next six months. Meanwhile, input prices are forecasted to increase at a slower pace, declining from 62.1 to 59.4, while selling prices are expected to rise at a faster pace, moving from 43.6 to 51.6. Furthermore, capital spending plans weakened in June, decreasing from 15.5 to 10.9.