Growth Continues but Indicators Fall Back Some
The diffusion index of current activity, the survey's broadest measure of manufacturing conditions, decreased from 32.5 in April to 23.8 this month (see Chart). Although growth this month did not match the stronger pace of growth reported in April, the percentage of firms reporting increases (41 percent) exceeded the percentage reporting decreases (17 percent) for the 12th consecutive month. Both the new orders index and the shipments index showed a similar pattern, each falling about eight percentage points. Firms reported higher unfilled orders this month and longer delivery times, suggesting continued strength. The current inventories index remained positive for the second consecutive month.
There was a notable improvement in manufacturing employment at the firms in our survey this month. Thirty-four percent of the manufacturers reported higher employment, and 11 percent reported lower employment. The current employment diffusion index jumped from 12.2 to 22.6, its highest reading since April 1973. Respondents also reported that the average workweek expanded again this month. The workweek index rose from 10.4 to 12.7.
The diffusion index of current activity, the survey's broadest measure of manufacturing conditions, decreased from 32.5 in April to 23.8 this month (see Chart). Although growth this month did not match the stronger pace of growth reported in April, the percentage of firms reporting increases (41 percent) exceeded the percentage reporting decreases (17 percent) for the 12th consecutive month. Both the new orders index and the shipments index showed a similar pattern, each falling about eight percentage points. Firms reported higher unfilled orders this month and longer delivery times, suggesting continued strength. The current inventories index remained positive for the second consecutive month.
There was a notable improvement in manufacturing employment at the firms in our survey this month. Thirty-four percent of the manufacturers reported higher employment, and 11 percent reported lower employment. The current employment diffusion index jumped from 12.2 to 22.6, its highest reading since April 1973. Respondents also reported that the average workweek expanded again this month. The workweek index rose from 10.4 to 12.7.
