Texas factory activity contracted in November, ending the two-month-long expansion recorded in September and October, data from the Federal Reserve Bank of Dallas indicated Monday.
The Texas Manufacturing Outlook Survey, which is conducted monthly by the Dallas Fed, showed that perceptions of broad business conditions continued to worsen in November. The general business activity and company outlook indexes were largely unchanged and deep in negative territory, at -19.9 for general activity and -18.8 for company outlook. These have booth been negative for more than a year and a half.
The production index, which is considered the key measure of state manufacturing conditions, fell 12 points to -7.2, putting the index back in negative territory after two months above water.
The new orders index plunged to -20.5 from -8.8. This has been negative for 18 months. The capacity utilization index, which had been positiver, fell to -10.1 from 5.4. The shipments index fell eight points to -9.5.
Labor market indicators were softer, indicating slower employment growth and shorter workweeks. The employment index declined and is below its longterm average. The hours worked index posted its second consecutive negative reading.
Wage growth normalized, the Dallas Fed said. Materials costs remained below average and selling prices fell, indicating some relief from inflationary pressures. The finished goods prices barometer fell to its lower reading since mid-2020.