Just Released: April Empire State Manufacturing Survey
According to the most recent Empire State Manufacturing Survey, manufacturing conditions are continuing to improve in New York State, but only barely. The headline general business conditions index from the April 2013 report was 3.1—down 6 points from March and not much above zero. The positive reading indicates that activity is growing, though its decline suggests that the pace of growth has slowed. Employment indexes, however, climbed higher and suggested a modest increase in hiring and hours worked. It will be particularly important to see how next month’s report turns out to get a clearer sense of whether regional manufacturing conditions are getting better or if the slow growth signaled by the past few reports is fizzling out.
This month’s survey also included supplementary questions on employment issues. One of the questions asked manufacturers how difficult it is to find workers with specific types of skills. As was the case in last April’s survey, when these questions were also asked, workers with advanced computer skills were the hardest to find. This was also the case in earlier surveys. The second hardest-to-find skill set turned out to be punctuality and reliability, surpassing basic math skills (which had ranked second in last year’s survey). Interestingly, compared with past reports, companies appear to be having a bit less trouble finding workers with interpersonal and basic English skills.
Looking forward to trends in wages, we note that four out of five companies surveyed anticipated at least some increase in the wages of their average worker (not including benefits). The average and median increases among survey respondents were both roughly 2½ percent. Well over 30 percent of firms expect that it will get increasingly difficult to retain skilled workers over the next year, while just 2 percent expect it to get easier. Firms also believe that it will become somewhat harder to retain unskilled workers, though not by so wide a margin. All in all, these results are not substantially different from those in last April’s survey, suggesting that manufacturers are continuing to see gradual but steady tightening in the labor market.
The views expressed in this post are those of the authors and do not necessarily reflect the position of the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions are the responsibility of the authors.
Jason Bram is a senior economist in the Federal Reserve Bank of New York’s Research and Statistics Group.
Richard Deitz is an assistant vice president in the Group.