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Mid-Atlantic manufacturing activity increases in April

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Mid-Atlantic manufacturing activity increases in April

Employment sees strong gains.

According to a monthly survey by the Federal Reserve Bank of Philadelphia, the mid-Atlantic region’s manufacturing sector is continuing to grow.

Manufacturing activity in the region increased modestly in April, with indicators for general activity and new orders were positive but low. Firms reported overall declines in shipments this month, but employment and work hours increased.

Firms reported continued price reductions in April, with indicators for prices of inputs and the firms’ own products remaining negative.

Responses suggest some improvement in labor market conditions compared with March.

The survey’s indicators of future activity suggest a continuation of modest growth in the manufacturing sector over the next six months.

The survey’s broadest measure of manufacturing conditions, the diffusion index of current activity, increased from 5.0 in March to 7.5 this month. The index has hovered in a single-digit range for the first four months of 2015. The demand for manufactured goods, as measured by the survey’s current new orders index, was virtually flat this month.   The index was only slightly positive and fell 3 points from its reading in March.

The current shipments index rebounded 6 points but remained negative for the second consecutive month.        

Firms’ responses suggest some improvement in labor market conditions compared with March. The current employment index increased 8 points, to 11.5, its highest reading in five months. The percentage of firms reporting an increase in employees in April (21%) exceeded the percentage reporting a decrease (9%).

Optimism about the next six months rose somewhat during the month, with the diffusion index for future activity increasing from 32.0 in March to 35.5 this month, but remains well below the readings over the past year.

 

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