Manufacturers' Forecasts Show Improvement Measures of expected future manufacturing performance increased last month. The future general activity diffusion index increased from 5.4 in July to 11.4 in August. The index remains lower, however, than the levels recorded during the first five months of the year. More than 44 percent of the firms expect increases in new orders, and 39 percent expect increases in shipments. Unfilled orders are expected to remain near current levels, and the percentage of firms expecting shorter delivery times is only slightly larger than those expecting longer deliver times.
Some optimism is evident in responses regarding employment forecasts.
The future employment index increased from -7.0 to 12.1, its first increase in three months and its highest reading since March. On balance, firms also expect increases in the average workweek over the next six months. While current survey indicators improved in August, most remained lower than their readings over the first five months of 1999. The region's manufacturing firms report continued growth in shipments and new orders in August, and more firms report increases in prices of manufactured goods than in previous surveys. Forecasts, while improved, are still muted, compared with forecasts earlier in the year.