Texas manufacturers ramped up production, hiring and shipments in September at a pace far above historical norms, according to the Federal Reserve Bank of Dallas’s latest Texas Manufacturing Outlook Survey, even as new orders piled up faster than factories could fill them.
The survey’s production index jumped 13.4 points to 29.5 in September, up from 16.1 in August. That reading is roughly three times the index’s long-run average of 9.7 and represents the ninth consecutive month of expanding output. More than 41 percent of manufacturers surveyed reported higher production, compared with 12 percent who reported a decline.
Demand kept pace with the production surge. The new orders index rose to 30.7 from 22.0, more than six times its historical average of 4.8, while the growth rate of orders index climbed 11 points to 19.1, far above its long-run average of negative 1.0.
But factories are struggling to keep up. The unfilled orders index swung from negative 1.3 in August to 22.7 in September, well above its historical average of negative 2.6. Delivery times stretched out, with that index rising to 17.5 from 12.5, and finished goods inventories fell into contraction territory at negative 9.5, down from 2.9 the prior month.
Capacity utilization climbed 11.1 points to 23.9, and shipments rose 10.7 points to 24.8. The Dallas Fed noted that capacity utilization, shipments and new orders all posted above-average readings for the month.
Hiring accelerates
Texas manufacturers added workers for a fifth straight month, with the employment index rising 7.1 points to 15.1 — more than double its series average of 7.1. Hours worked barely moved, edging to 5.6.
Individual manufacturers described order books swelling faster than expected. A machinery manufacturer said it anticipates a record year of revenue and net income in 2026 given an ever-increasing backlog. Another reported what it called
You must be logged in to post a comment Login