Input Stories

Existing home sales increased 0.5% over the month in November but fell 1.0% over the year. Housing inventory moved down to 1.43 million units, reflecting a 5.9% drop from October but a 7.5% jump from last year. The median existing home price was $409,200, up 1.2% from last year. The Northeast and South posted monthly increases in existing home sales, while the Midwest registered a decline, and the West stayed the same in November. 

Single-family home sales rose 0.8% from October but fell 0.8% from November 2024, with the median price increasing 1.2% from last year to $414,300. Condo and co-op sales fell 2.6% over the month and over the year to 380,000 units in November. Meanwhile, the median price for condos and co-ops inched up 0.1% from the prior year to $358,600.

Homes were typically on the market for 36 days in November, up from 34 days in October and 32 days in November 2024. First-time buyers made up 30% of sales in November, down from 32% in October but unchanged from November 2024.

Manufacturing activity slowed in the Tenth District in December, with the month-over-month composite index declining 7 points to 1 from November. On the other hand, expectations for future activity rose 4 points to 13. The Tenth Federal Reserve District encompasses the western third of Missouri; all of Kansas, Colorado, Nebraska, Oklahoma and Wyoming; and the northern half of New Mexico. The month-over-month easing in activity was due to weakness in both durable and nondurable manufacturing. New orders stayed the same from November, but production fell. Meanwhile, shipments were flat after rising the prior month, and new orders for exports decreased at a faster pace than in November.

The production index turned negative, falling from 18 to -3, while the new orders index moved up from -2 to 0. The new orders for exports index remained negative and weakened from -3 to -4 over the month. The employment index declined from 11 to -4, contracting for the first time since July. The backlog of orders improved but remained negative, moving from -4 to -2. Both the pace of growth for prices received and paid grew month-over-month, with raw materials prices increasing from 36 to 40 and prices received climbing 9 points to 22. Furthermore, both prices received and paid rose at a faster pace year-over-year, increasing 8 points and 4 points, respectively.

In December, survey respondents were asked about employee turnover, productivity and capital expenditures. Approximately 24% of firms reported decreased employee turnover over the past year, while 15% cited an increase and 61% revealed no change. About one-third of firms reported increased productivity, 15% experienced a decrease and 51% saw no change. In 2026, 37% of respondents expect capital expenditures to be higher, 29% anticipate no change and 34% plan on lower capital expenditures.

Manufacturing activity in New York state decreased in December, with the headline general business conditions index falling 22.6 points to -3.9. The new orders index declined 15.9 points to 0.0, indicating new orders were flat from November, while the shipments index dropped 22.5 points to -5.7. Unfilled orders moved down from -5.8 to -14.9, while inventories slipped 2.7 points to 4.0, indicating business inventories continue to grow but at a slower pace. Delivery times shortened, and supply availability improved but remained negative, increasing 4.6 points to -6.9.

Employment increased in December, with the index for the number of employees inching up 0.7 points to 7.3. Meanwhile, the average employee workweek declined to 3.5 from 7.7, signaling a smaller increase in hours worked than in November. The prices paid index fell 11.4 points to 37.6, while the prices received index moved down 4.2 points to 19.8, a reflection of a slower pace of increase for prices received and prices paid.

In December, firms’ optimism regarding the future rose to a yearly high. The future business activity index gained 16.6 points, rising to 35.7. In the next six months, new orders are expected to increase and at a faster pace compared to the prior month at 38.0. The future employment index decreased 3.1 points to 8.8, suggesting an anticipated slower pace of employment growth over the next six months. Meanwhile, input prices are expected to rise at a slower pace, declining from 62.5 to 55.4, while selling price expectations are forecasted to increase at a faster pace, moving up from 41.3 points to 46.5. Furthermore, capital spending plans weakened from November, down from 11.5 to 6.9.

In December, Philadelphia’s regional manufacturing activity contracted for the third consecutive month and at a faster pace than November. The index for general business activity fell from -1.7 to -10.2. This month, 27.8% of firms reported decreases in activity, while just 17.6% of firms noted increases. The indexes for new orders and shipments returned to positive territory, rising from -8.6 to 5.0 and from -8.7 to 3.2, respectively. Meanwhile, the employment index moved up 6.9 points as the average employee workweek grew 11.0 points to 14.7.

The prices paid index declined from 56.1 to 43.6, its lowest reading since June, while the prices received index rose from 17.7 to 24.3. As has been the case for many months, the prices received index remained lower than the prices paid index, indicating that manufacturers have been absorbing a portion of higher costs paid.

Looking ahead, indicators showing expectations for future growth declined for the first time since June. After climbing 13.4 points in November, expectations for future business activity moved down 8.0 points to 41.6 in December. The drop came from an increase in the proportion of firms expecting a decrease in activity (12.6%). At the same time, the number of firms anticipating an increase in activity (54.2%) was virtually unchanged in December. The future new orders index decreased from 55.6 to 44.0, and the future shipments index edged down from 48.4 to 43.2. On the other hand, the capital expenditures index grew from 26.7 to 30.3, its highest reading since August. The future prices paid and prices received indexes declined from 75.1 to 62.6 and from 56.8 to 55.8, respectively. Additionally, the index for future employment stepped down from 35.7 to 27.1.

In December, firms were asked to estimate production growth in the fourth quarter compared to the third quarter. Of those responses, 52.0% expect higher production, while 16.0% anticipate a decrease. More than a majority of firms (61.5%) reported that uncertainty was at least a slight constraint on capacity utilization this quarter. Other issues cited included labor supply (50.0%) and supply chains (48.0%). Looking forward, 29.2% of firms expect energy markets to be a greater constraint on capacity utilization over the next three months.

Nonfarm payroll employment increased by 64,000 in November, after declining by 105,000 in October during the federal government shutdown. In sum, employment is down by 41,000 from September. Meanwhile, August and September’s job gains were revised downward by 33,000 to a loss of 26,000 jobs and a gain of 108,000 jobs, respectively. The 12-month average stands at 78,000 job gains per month. The unemployment rate rose 0.2 percentage points from September to 4.6% in November, the highest rate in more than four years, while the labor force participation rate inched up 0.1 percentage point to 62.5%.

Manufacturing employment slipped by 5,000 in November, the seventh consecutive month of job losses, after decreasing by 9,000 in October. On the other hand, the collective job losses in August and September of 21,000 were revised upward by 5,000 jobs to a decrease of 16,000 jobs. Manufacturing employment is down 73,000 over the year, the most of any industry. Durable goods manufacturing employment fell by 4,000 in November, while nondurable goods employment edged down by 1,000. The most significant gain in manufacturing in November occurred in electrical equipment, appliance and component manufacturing, which added 2,200 jobs over the month. Meanwhile, the most significant loss occurred in motor vehicles and parts manufacturing, which shed 4,900 jobs over the month.

The employment-population ratio ticked down 0.1 percentage point from September to 59.6% in November and is down 0.2 percentage points from a year ago. Employed persons who are part-time workers for economic reasons jumped by 909,000 from September to 5.49 million in November and are up from 4.47 million in November 2024. Native-born employment is up 114,000 from September and 2,631,000 over the year. Meanwhile, foreign-born employment is up 58,000 over the month but down 21,000 over the year. On the other hand, the native-born unemployment rate is up 0.4 percentage points over the year to 4.3% in November, while the foreign-born unemployment rate is down 0.1 percentage point to 4.4%.

Average hourly earnings for all private nonfarm payroll employees rose 0.1%, or 5 cents, reaching $36.86. Over the past year, earnings have grown 3.5%. The average workweek for all employees inched up 0.1 hour to 34.3 hours and ticked up 0.1 hour to 40.0 hours for manufacturing employees.

Abuse of the National Environmental Policy Act has led to costly, sometimes years-long delays of job-creating projects across the United States. The House must pass the Standardizing Permitting and Expediting Economic Development (SPEED) Act this week to help end that abuse, the NAM said.

What’s going on: “The bipartisan SPEED Act, sponsored by House Natural Resources Committee Chairman Bruce Westerman (R-AR) and Rep. Jared Golden (D-ME), would make crucial reforms to NEPA,” NAM Managing Vice President of Policy Charles Crain told the House Monday ahead of a possible House vote on the legislation this week.

• NEPA reforms in the SPEED Act include appropriately shortening timelines for environmental reviews, modernizing judicial review processes, clarifying the definition of major federal actions triggering additional permitting requirements, preventing duplicative reviews, expanding the use of categorical exclusions and more.

Why it’s important: The measure “is a critical piece of the NAM’s ‘Manufacturing’s Roadmap to AI and Energy Dominance,’ a blueprint outlining the steps—including vital permitting reforms—that policymakers must take to strengthen America’s energy and artificial intelligence leadership,” Crain continued in communication picked up by Axios.

• The legislation will make it easier and more cost-efficient for manufacturers to start and complete work on projects across the country, strengthening manufacturing in the U.S.

The NFIB Small Business Optimism Index inched up 0.8 points to 99.0 in November, remaining slightly above the 52-year average of 98. November’s increase was due primarily to a jump in sales in the previous quarter and sales expectations going forward. Of the 10 components included in the index, six increased, three decreased and one stayed the same. Meanwhile, the Uncertainty Index increased 3 points to 91, still well above the 51-year average (68) and above the average since 2016 (80).

Labor quality was again cited as the top concern for small business owners, with 21% reporting it as the most important problem, but was down 6 points from October. Business owners experienced difficult hiring conditions, as 33% struggled to fill open jobs, up 1% from October and the first increase since June. The share of business owners reporting inflation as a top problem rose 3 points from October to 15%, with a net 34% raising prices, up 13 points from the prior month and the largest monthly jump in survey history. Meanwhile, taxes fell to third in the list of concerns, with 14% reporting it as a top problem, down 2 points from October.

A net 26% of small business owners reported raising compensation, unchanged in November after falling 5 points in October. Meanwhile, 24% of business owners plan to raise compensation in the next three months, up 5 points from October. Pressure on profitability weakened in November, with positive profit trends rising 2 points from October to a net negative 23%. Among owners reporting lower profits, 27% blamed weaker sales, 16% cited increased material costs, 12% noted labor costs and 9% mentioned usual seasonal changes. Meanwhile, 4% reported their last loan was harder to get than previous attempts, down 1 point from October, and a net 2% of owners cited paying a higher rate on their most recent loan, up 1 point from the prior month.

The outlook for general business conditions fell 5 points to 15%. Furthermore, expectations for better business conditions have fallen 32 points since the start of the year. On the other hand, 13% reported that it is a good time to expand their business, unchanged from October and a rather weak reading compared to times of economic expansion. Overall, affordability continues to be a concern for small business owners, and uncertainty remains high.

The Federal Open Market Committee lowered its interest rate target range by 25 basis points to 3.50%–3.75% at its December meeting. As it did at its previous two meetings, the committee judged that downside risks to employment warranted an additional cut to its interest rate target. Three FOMC members—Stephen Miran, Austan Goolsbee and Jeffrey Schmid—dissented. Miran preferred to lower the target range by 50 basis points, while Goolsbee and Schmid preferred to keep the rate steady. After the FOMC just concluded its multiyear reduction of its Treasury holdings at its October meeting, the FOMC announced at this meeting that it will initiate purchases of shorter-term Treasuries for the first time since 2022.

In the press conference following the meeting, Federal Reserve Chairman Jerome Powell noted that the data that has become available since the government shutdown suggests that the outlook for employment and inflation has not changed much since their previous meeting, with conditions in the labor market cooling while inflation remains elevated. Chairman Powell noted that he believes some of the government data could be greatly distorted due to the government shutdown, so the committee may not be heavily persuaded to change its position by new data by the January meeting.

The FOMC’s summary of economic projections, which maps out the Federal Reserve’s expectations for where interest rates may be headed in the future, signaled a similar, mixed stance compared to the September summary. Twelve Federal Reserve officials project there will be additional rate cuts across 2026, while four anticipate no additional rate cuts next year, and three predict a 25-basis-point hike. Meanwhile, the projections show that officials still expect inflation to remain elevated, averaging 2.4% in 2026, albeit less so than the 2.6% average projected in September. At the same time, the projections show officials expect real GDP to rise more in 2026 than previously anticipated.

Job openings for manufacturing increased by 25,000 to 410,000 in October. Nondurable goods job openings in October inched up by 1,000 to 130,000, while durable goods job openings grew by 24,000 to 280,000. The manufacturing job openings rate rose to 3.1% from 2.9% in September but declined from 3.4% the previous year. The rate for nondurable goods manufacturing stayed the same at 2.6%, while it increased 0.3 percentage points to 3.4% for durable goods.

In the larger economy, the number of job openings ticked up to 7.7 million, an increase of 12,000 from September and of 55,000 from the previous year. The job openings rate stayed the same from September at 4.6%, also the same rate as last year. This data reflects an overall labor market that has eased back to pre-pandemic levels, but remains relatively tight from a historical perspective.

The number of hires in the overall economy decreased 218,000 to 5.1 million in October and 201,000 from the previous year. The hires rate for the overall economy edged down 0.2 percentage points in October to 3.2%. Meanwhile, the hires rate for manufacturing ticked down 0.1 percentage point to 2.4%. The hires rate for durable goods stayed the same at 2.4%, while the hires rate for nondurable goods declined 0.2 percentage points to 2.5%.

In the larger economy, total separations, which include quits, layoffs, discharges and other separations, declined 214,000 from September to 5.1 million and 235,000 from the previous year. The total separations rate edged down 0.1 percentage point to 3.2% for the overall economy but stayed the same at 2.6% for manufacturing. Within that rate, layoffs and discharges increased by 10,000 in October for manufacturing, while quits fell by 2,000. The quit and layoff rates continue to remain lower for manufacturing than the total nonfarm sector.

The bipartisan Incentivizing New Ventures and Economic Strength Through Capital Formation Act will build upon past legislative successes to “ensure that America’s public capital markets support business growth and job creation at small manufacturers across the country,” the NAM told U.S. House leadership recently.

What’s going on: The House of Representatives on Thursday voted 302–123 to approve the INVEST package, following advocacy by the NAM and others.

• The more than 20 bills in the package previously advanced out of the House Committee on Financial Services, where they received strong support during markups from Republican and Democratic members alike.

What’s in it: The NAM strongly supports the following measures in the INVEST Act:

• Section 105 (Advocating for Small Business), to establish Offices of Small Business in the Securities and Exchange Commission’s Corporation Finance, Investment Management and Trading and Markets divisions
• Section 106 (Small Entities), to direct the SEC to conduct a study and rulemaking on the definition of ‘‘small entity’’ under the securities laws and direct the agency to consider small business impacts in future rulemakings
• Sections 201 and 203 (Expand Eligibility for Accredited Investor Status), to expand ways individual investors may qualify as “Accredited Investors” through a new exam, professional or educational credentials or inflation-adjusted net worth or income tests
• Sections 301 and 303 (Encouraging IPOs), to reduce registration requirements by allowing emerging growth companies to submit two years of audited financial statements instead of three and to direct the SEC to expand access to its testing-the-waters provisions to promote IPOs
• Section 305 (Middle Market IPO Cost), to direct the comptroller general to prepare a report on costs encountered by small and medium-sized companies during public offerings
• Section 306 (Expanding Well-Known Seasoned Issuer Eligibility), to enable smaller companies to qualify for WKSI status by decreasing the minimum market value threshold from $700 million to $400 million

The last word: “Manufacturers thank House Financial Services Committee Chairman Rep. French Hill (R-AR), Rep. Ann Wagner (R-MO), Rep. Gregory Meeks (D-NY) and Rep. Josh Gottheimer (D-NJ) for their leadership on the INVEST Act. This bipartisan legislation will reduce regulatory burdens and enhance capital formation for the small and medium-sized manufacturers that fuel our economy,” the NAM wrote following the vote.