Another strong indicator today that the Texas economy may sputter somewhat in 2019, News Radio 1200 WOAI reports.
The monthly Texas factory outlook survey conducted by the Federal Reserve Bank of Dallas shows the index of manufacturing activity and the prospects for future growth, while still positive, hit the lowest level since mid 2016 in December.
"Perceptions of broader business conditions turned slightly negative in December," the Dallas Fed said in its report. "The general business activity index plummeted 23 points to -5.1, hitting its lowest level since mid-2016. The company outlook index also fell markedly, dropping 17 points to -3.4, also a two-and-a-half-year low. More than 20 percent of manufacturers noted their outlook worsened this month."
The number of manufacturing firms reporting net layoffs jumped into double digits in December for the first time in more than two years, although the number of firms which are hiring still outpaces the number with layoffs.
Among the pressures facing Texas manufacturers include the tariff and trade war, which is drying up foreign markets and making the price of raw materials more expensive, and the rising costs of labor, due to the historically low Texas unemployment rate.
Nearly one third of manufacturing firms in the state reported an increase in wages and benefits paid in December.