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Kansas City Fed Manufacturing Survey: Manufacturing activity declined further in the Tenth District in September, but expectations for future activity stayed positive. 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 composite index fell from August but is up from July. The decline was primarily driven by durable goods, particularly machinery, transportation, nonmetallic mineral and wood manufacturing. All month-over-month indexes were negative and lower than last month’s readings, except the raw materials prices and inventories indexes. 

Volume of shipments and new orders fell somewhat, while production and backlogs declined substantially. The year-over-year composite index for factory activity reached its lowest level since September 2020, as production and new orders decreased substantially. The backlog of new orders decreased to its lowest level since June 2020. Employment levels fell moderately while capital expenditures stayed steady. On the other hand, the future composite index ticked up, as production and employment are expected to increase substantially.

This month, survey respondents were asked how they expect their current investment in technology to likely impact employment levels over the next year. A majority of firms (63%) said their technology investment will have no impact on employment, but around a quarter (23%) reported they expect a slight decrease, 11% expect a slight increase and 3% anticipate a substantial decrease. Firms were also asked if they’ve seen any change in the flow of job applicants per job opening since last year. About half of firms (45%) reported an increase in the number of job openings, while 32% did not have a change, 17% saw a decrease and 6% have not had any openings.