Manufacturing contracts in central-Atlantic region
Manufacturing in the central-Atlantic region experienced a sharp pullback in July as shipments and new orders further contracted, according to the Federal Reserve Bank of Richmond’s Fifth District Survey of Manufacturing Activity.
In July, the seasonally adjusted composite index for manufacturing was -17, a 16-point decline from June’s -1 reading. Numbers above zero represent expanding activity, while negative means contraction.
Contributing to the decline in activity was a 23-point decline in shipments to finish at -23 for the month and a 18-point deduction for new orders to end at -25.
Hiring also slowed at the central-Atlantic plants, dropping seven points and finishing at one for the month. However, the wage index did improve by increasing two points to nine.
Raw material costs as reported by manufacturers in the district rose 1.33 percent.
Overall, expectations going forward are less optimistic than six months prior, according to the report, but still remain in positive territory. Indexes for both expected shipments and new orders decreased 13 points to finish at 16. Expected manufacturing employment declined seven points and finished at six.
The survey covers plants in Washington D.C., Maryland, Virginia, North Carolina, South Carolina and most of West Virginia.
A July survey in the Federal Reserve Bank of New York reported modest expansion of five points to rise to 7.4 in July, while the Federal Bank of Philadelphia’s survey reported a nearly 4-point increases but remained negative at -12.9.
For the Federal Reserve Bank of Richmond’s full survey results, go to http://www.richmondfed.org/research/regional_economy/surveys_of_business_conditions/manufacturing/2012/mfg_07_24_12.cfm#tabview=tab0