Dallas Fed Survey: Business Conditions Worsened in October

The general business activity index in the Dallas Fed’s Texas Manufacturing Outlook Survey (TMOS) decreased by 1.1 points in October, marking the second consecutive month of declines.

However, the production index showed growth in Texas factory activity after four months in negative territory. The capacity utilization index also showed a second consecutive positive reading, while the new orders index remained negative.

The overall business environment perceptions declined in October, with the company outlook and general business activity indexes remaining mostly stable at -17.1 and -19.2, respectively.

Labour market indicators showed slower job growth and shorter workweeks, with the employment index falling seven points to 6.7. Net hiring was reported by 19% of companies, while net layoffs by 13% were reported. The hours worked index entered negative territory again at -2.3.

Texas plays a significant role in US manufacturing output, with $159 billion in manufactured goods produced in 2008, making it the top exporter of manufactured goods and second in factory production.