The Richmond Fed Survey of Manufacturing Activity: June 2016

Yesterday, the Federal Reserve Bank of Richmond released their Survey of Manufacturing Activity for June showing that the composite index, the broadest measure of manufacturing activity, worsened notably falling to a level of -7 from a level of -1 the prior month.

The most notable component measures also showed similar results with a weak Shipments level of -3, New Orders falling to -14 and Backlog of Orders falling to -17.

ADP Manufacturing Meltdown

Looking a bit deeper at today's ADP Employment Report, one finds yet another clear signal that the current expansion may have topped-out making recession as a distinct possibility in 2016.

The ADP Total Manufacturing Payrolls series has continued to remain weak falling 0.02% on an annual basis.

Keep in mind that while manufacturing is clearly also showing strong secular weakness, this is a very sensitive series that should not be ignored.

Also, a revitalization of the nation's manufacturing sector was a important goal of the current administration's economic policy and a particularly key focus of 2009's American Recovery and Reinvestment Act.

The Richmond Fed Survey of Manufacturing Activity: February 2016

Today, the Federal Reserve Bank of Richmond released their Survey of Manufacturing Activity for February showing that the composite index, the broadest measure of manufacturing activity, declined to a recessionary level of -4 from a level of 2 the prior month.

The most notable component measures also showed similar results with Shipments falling to -11, New Orders falling to -6 and Backlog of Orders falling to -14.

ADP Manufacturing Meltdown

Looking a bit deeper at today's ADP Employment Report, one finds yet another clear signal that the current expansion has topped-out making recession as a distinct possibility in 2016.

The ADP Total Manufacturing Payrolls series has continued to trend negative dropping 0.14% on an annual basis, the second year-over-year decline since the waning days of the Great Recession in 2010.

Keep in mind that while manufacturing is clearly also showing strong secular weakness, this is a very sensitive series that should not be ignored.

Also, a revitalization of the nation's manufacturing sector was a important goal of the current administration's economic policy and a particularly key focus of 2009's American Recovery and Reinvestment Act.

The Federal Reserve Bank of Dallas Texas Manufacturing Outlook Survey: January 2016

Today, the Federal Reserve Bank of Dallas released their latest read on manufacturing in their region indicating that assessments of manufacturing activity plunged in January with the current general business activity index declining to a recessionary level of -34.6 while the future general business activity index collapsed to -24.0.

These results are an indication (consistent with other regional and national manufacturing activity data-points) that the U.S. manufacturing sector has clearly slumped into recessionary levels as of late and provides yet another likely harbinger of what is to come in 2016 for the general economy.

The Philly Fed Business Outlook Survey: December 2015

The December release of the Federal Reserve Bank of Philadelphia Business Outlook Survey (BOS) indicated a notable pullback in the regions manufacturing activity with the current activity index falling to a weak level of -10.2 while assessments the future activity also worsened to a level of 24.1.

The above chart shows the current and future activity indexes both with their corresponding 3-month moving averages. The red line marks the threshold between contraction and expansion for these diffusion indexes.

The Empire State Manufacturing Survey: January 2013

The Empire State Manufacturing Survey consists of a series of diffusion indices distilled from a monthly survey of New York regional manufacturing executives and seeks to identify trends across 22 different current and future manufacturing related activities.

Today’s report showed a slight decline for current assessments of manufacturing activity and an improvement to future assessments with the current activity index falling to a notably weak level of -7.78 while future activity improved to 22.41.

Current prices paid rose to 22.58 while current new orders weakened to -7.18 as assessments of future new orders improved to 25.11.

The Philly Fed Business Outlook Survey: September 2012

The September release of the Federal Reserve Bank of Philadelphia Business Outlook Survey (BOS) indicated an improvement of the regions manufacturing activity with the current activity index rising to a contraction level of -1.9 while assessments the future activity index increased notably to a level of 41.2.

The following chart shows the current and future activity indexes both with their corresponding 3-month moving averages. The red line marks the threshold between contraction and expansion for these diffusion indexes.

The Federal Reserve Bank of Dallas Texas Manufacturing Outlook Survey: April 2012

Today, the Federal Reserve Bank of Dallas released their latest read on manufacturing in their region indicating that manufacturing activity worsened with the current general business activity index declining to a contraction level of -3.4 while assessments of future general business activity index declined to 15.17.

The Philly Fed Business Outlook Survey: April 2012

Today's release of the Federal Reserve Bank of Philadelphia Business Outlook Survey (BOS) for April indicated a slowing of the regions manufacturing activity with the current activity index declining to a level of 8.5 while assessments the future activity index increased slightly to a level of 33.8.

The following chart shows the current and future activity indexes both with their corresponding 3-month moving averages. The red line marks the threshold between contraction and expansion for these diffusion indexes.

Kansas City Fed Manufacturing Survey: March 2012

The Federal Reserve Bank of Kansas City, like other district FRBs (New York, Philadelphia, Richmond and Dallas), tracks its region’s manufacturing activity by surveying a number of important indicators such as general activity, production, shipments, orders, employment and prices for raw materials and finished products.

The latest results are indicating that the manufacturing activity declined to a weak growth level of 9 in March with more component measure declining than increasing while prices paid for raw materials declined somewhat at 33.

It's important to note that although this data-set has a history that only runs as far back as mid-2001, the composite index never fell below 10 during the "recovery" that followed the tech-wreck of the early aughts.

Today, we see the composite index not only remaining depressed but occasionally turning notably negative, clearly indicating the internal weakness of our current economic expansion and possibly presenting a strong signal of recession to come.

The following chart plots the seasonally adjusted Composite index since 2001 with the solid red line indicating the threshold between expansion and contraction.

Philadelphia Feeling: Federal Reserve Bank of Philadelphia Business Outlook Survey September 2011

The latest release of the Federal Reserve Bank of Philadelphia Business Outlook Survey (BOS) for September continued to indicate dramatic weakness in the regions manufacturing activity with the current activity index remaining at a notable contraction level of -17.5 while the future activity index improved to a level of 21.4.

The current activity index along with most of the other "current" data points (new orders, unfilled orders, delivery time and inventories) are now indicating significant recessionary weakness in manufacturing activity with the size and breadth of the latest pullback clearly demanding that closer scrutiny be paid to these series in future releases.

The following chart shows the current and future activity indexes both with their corresponding 3-month moving averages. The red line marks the threshold between contraction and expansion for these diffusion indexes.

Kansas City Fed Manufacturing Survey: July 2011

The Federal Reserve Bank of Kansas City, like other district FRBs (New York, Philadelphia, Richmond and Dallas), tracks its region’s manufacturing activity by surveying a number of important indicators such as general activity, production, shipments, orders, employment and prices for raw materials and finished products.

The latest results are indicating that the manufacturing expansion slowed notably from last month falling to 3 from a level of 14 a month earlier while the employee index declined to 4 and the prices paid for raw materials increased to 39.

The following chart plots the seasonally adjusted Composite index since 2001 with the solid red line indicating the threshold between expansion and contraction.

ISM Manufacturing Report on Business: June 2011

Today, the Institute for Supply Management released their latest Report on Business for the manufacturing sector indicating that economic activity continued to expand in June and at a faster pace than in May while most other measures strengthened.

At 55.3 the purchasing manager’s composite index (PMI) declined a whopping 11.42% since April and increased 3.36% above the level seen a year earlier.

Some respondents indicated increasing pressure on prices as higher energy prices stocked inflationary forces as well as weak economic trends and Japan earthquake related disruptions:

"We continue to see inflation, though at a reduced rate [compared] to earlier months." (Chemical Products)

"Slight slowdown in overall business in both domestic and international markets, although still above 2010 at the same time." (Electrical Equipment, Appliances & Components)

"The earthquake and related issues in Japan have caused shortages of some automotive equipment, negatively impacting global automotive production." (Fabricated Metal Products)

"Sales continue to be stronger than expected across both retail and industrial channels. Material costs are definitely rising and will force increases to end-use customers." (Paper Products)

"High commodity prices continue to be worrisome." (Food, Beverage & Tobacco Products)

"Business is still up and down, with no real upside potential for us until the housing market rebounds." (Furniture & Related Products)

"Customers are still being cautious with their buying. Certain plastics and metal prices continue to rise." (Machinery)

The Federal Reserve Bank of Dallas Texas Manufacturing Outlook Survey: June 2011

Today, the Federal Reserve Bank of Dallas released their latest read on manufacturing in their region indicating that manufacturing activity slowed somewhat with current production declining to a weak expansion of 5.6 while new orders turned up to a weak expansion 6.4.

The current production index declined to a weak expansion of 5.6 while the the current employment index slowed to 5.3.

The Empire State Manufacturing Survey: June 2011

The Empire State Manufacturing Survey consists of a series of diffusion indices distilled from a monthly survey of New York regional manufacturing executives and seeks to identify trends across 22 different current and future manufacturing related activities.

Today’s report showed notable overall weakness and indicated contraction for current manufacturing activity with the current activity index declining to -7.79 while assessments of future activity declined as well with the future activity index declining to 22.45.

Current prices paid registered the first decline in seven months falling to 56.12 while current new orders declined to -3.61 and assessments of future new orders plunging to 15.31.

Kansas City Fed Manufacturing Survey: May 2011

The Federal Reserve Bank of Kansas City, like other district FRBs (New York, Philadelphia, Richmond and Dallas), tracks its region’s manufacturing activity by surveying a number of important indicators such as general activity, production, shipments, orders, employment and prices for raw materials and finished products.

The latest results are indicating that the manufacturing expansion slowed significantly falling to a near contraction level of 1 from a level of 14 a month earlier while the employee index declined to 9 and the prices paid for raw materials declined to 54.

The most notable declines leading the weakness were seen in the volume and backlog of orders and volume of shipments and the production index.

It's important to note that these declines are largely consistent with similar trends seen in other regional manufacturing surveys including the Philly Fed Business Outlook Survey and the Richmond Feds Survey of Manufacturing.

The following chart plots the seasonally adjusted Composite index since 2001 with the solid red line indicating the threshold between expansion and contraction.

The Empire State Manufacturing Survey: May 2011

The Empire State Manufacturing Survey consists of a series of diffusion indices distilled from a monthly survey of New York regional manufacturing executives and seeks to identify trends across 22 different current and future manufacturing related activities.

Today’s report indicated expansion for current activity but at a slower pace than month while assessments of future activity improved slightly with the current business conditions index falling to 11.88 while the future conditions index increasing to 52.69.

Current prices paid registered a seventh consecutive monthly increase climbing to 69.89, the second highest level seen since the series began in 2001, while current new orders declined to 17.19 with future new orders climbing slightly to 47.31.

Kansas City Fed Manufacturing Survey: April 2011

The Federal Reserve Bank of Kansas City, like other district FRBs (New York, Philadelphia, Richmond and Dallas), tracks its region’s manufacturing activity by surveying a number of important indicators such as general activity, production, shipments, orders, employment and prices for raw materials and finished products.

The latest results are indicating that the manufacturing expansion slowed slightly falling to 20 from a level of 23 a month earlier while the employee index increased to 21 and the prices paid for raw materials declined to 73 from March’s decade high of 81.

The following chart plots the seasonally adjusted Composite index since 2001 with the solid red line indicating the threshold between expansion and contraction.

The Federal Reserve Bank of Dallas Texas Manufacturing Outlook Survey: November 2010

Today, the Federal Reserve Bank of Dallas released their latest read on manufacturing in their region indicating that activity improved with current production, volume of new orders and employment all signaling expansion.

The current production index increased to 13.1 as the current volume of new orders climbed out of contraction from last month at 9.1 as did the current employment index at 5.8.