Dallas Fed October manufacturing index -19.4 vs -17.2 prior

• Prior was -17.2
• Employment 17.1 vs 15.0 last month
• Hours worked -0.1 from 8.0 last month
• New orders -8.8 from -6.4 last month
• Production 6.0 vs 9.3 last month
• Raw material price paid 32.0 vs 37.1 last month
• Prices received 22.2 vs 18.1 last month month
• Shipments -1.6 vs 7.1 last month
• Growth rate of new orders -13.2 vs -1.7 last month
• Finished goods inventories vs 3.3 last month
• Wages and benefits 36.7 vs 36.6 last month
• Capital expenditures 7.1 vs 13.6 last month

Much of this survey is built around the oil and gas industry, which isn’t exactly running along the same lines as the rest of the economy.

Selected comments in the report from non-energy companies:

The outlook has dimmed slightly. Some raw material costs have decreased, while others continue to increase or stay the same (higher level). Some customers are quietly cutting back on orders. We are in the food business, so the change is subtle

As a contract manufacturer for many different sectors, we see that home goods sales such as mattress subcomponents and comforters and pillows have consistently dropped and are half of what they were this time last year.

We have been anticipating (and experiencing) a decline in business for several months now. The rate increases are starting to go too far.

Inflation in raw material costs continues to be a drag on our profitability. We are unable to pass these costs on to our customers.

Many items that were in short supply this spring are plentiful now.

Business is slowing. Companies are being more deliberate in how they spend money.

We are still running strong and steady; however, we feel that the worsening economy will eventually catch up with us and may bring us back to reality.

We are still seeing issues with materials we source, particularly solar panels and products with aluminum. Lead times are four to six months in areas that had been two to four weeks.

Our production constraint has shifted from supply chain to labor. We cannot hire fast enough to increase production as fast as we would like to.