Dallas Fed manufacturing business index -20.0 vs -23.2 prior

• Production -4.8 vs -4.8 prior
• New orders -18.1 vs -16.6 prior
• Shipments -2.2 vs -17.0 prior
• Employment +10.0 vs +2.2
• Company outlook -16.9 vs -10.7

I have been looking for green shoots in manufacturing after a tough year and there are some emerging but not in this report. The forward looking metrics largely worsened.

The comments in the report are often insightful:

Chemical manufacturing

• The chemical industry in general is in a slump currently.

Computer and electronic product manufacturing

• Interest hikes obviously significantly affect industrial
  production. We are seeing it across the board in 12 different segments
  of our industry. I wish the Federal Reserve would look at the
  industrial side and start cutting interest rates slowly. How much does
  the industrial backbone of this country have to suffer to lower
  inflation? We know the effect of interest [actions] does have a lag in
  economic results—why not prevent a recession by starting to lower
  interest rates now, rather than creating havoc in manufacturing?

• We continue to be concerned by all of the talk of a recession. We
  aren’t seeing that reflected in reduced customer demand yet. We intend
  to make significant capital investments over the next six months to
  expand capacity and reduce our unit costs, as we hope to gain market
  share in the event of a recession.

Fabricated metal product manufacturing

• We have the biggest backlog of projects ever. We are not able to expand due to the difficulty in hiring workers for the plant.
• Supply constraints are improving, but there are still some ongoing challenges.

Machinery manufacturing

• The summer doldrums are real … at least they are this month.
  Order interest has declined significantly, and order entry has slowed
  to a crawl. We’re bidding smaller jobs now than we have in 24 months.
  Raw material prices have eased, but so have selling prices to the point
  of creating margin erosion.
• We are seeing a slight increase in business; however, we will have to see if this trend will continue.

Paper manufacturing

• Our industry is down approximately 6 to 7 percent for four quarters in a row.

Primary metal manufacturing

• High interest rates are hurting some businesses like real estate
  and commercial construction. Other industries like transportation are
  still good. The Federal Reserve needs to stop rate increases to let
  businesses and consumers settle down.

Printing and related support activities

• We are very fortunate to have some nice large jobs in the plant
  right now that are keeping us busy when many in our industry, including
  our competitors, are slow right now. We see our activity staying
  pretty strong into the fall, so we are fortunate. We had hoped to not
  have to raise prices but are having pressure from others to hire away
  our workers, so we are implementing wage increases that need to be
  covered by raising prices again.

Textile product mills

• Our manufacturing of home goods, like mattress components,
  comforters and pillows, has decreased. Talking to suppliers and
  customers, the consensus of the bedding industry outlook continues to
  look bleak. High interest rates appear to be the main driver, as home
  sales are weak, and the associated new-mattress purchase that is known
  in our industry to go hand in hand is not happening. We have had to
  downsize the company three times in the past nine months—from three
  production sites to one.