Research >> Economics
Richmond Fed's Current Activity fell to 1 in February 2022
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Fifth District manufacturing activity softened in February, according to the most recent survey from the Federal Reserve Bank of Richmond. The composite index fell from 8 in January to 1 in February, due to declines in the indexes for shipments and new orders. Both indexes turned negative, with the shipments index dropping notably from 14 in January to −11 in February. However, the third component in the composite index, employment, increased to 20 from 4 in January. Firms reported decreases in order backlogs, as the index became negative for the first time since June 2020. Vendor lead times increased for many firms as that index remained at near-historic highs. Firms' perceptions about changes in local business conditions remained slightly negative; however, firms remained optimistic about future conditions.
Reported hiring increased in February as more manufacturing firms increased employment. Firms continued to report increasing wages while also citing challenges finding workers with the necessary skills. Firms expect this challenge to last for at least the next six months as the expectations index remained in negative territory.
Posted: February 22, 2022 Tuesday 10:00 AM