By Maria Martinez
Manufacturing activity across the central Atlantic region of the U.S. grew in January but at a slower pace than that of December, data from a survey from the Federal Reserve Bank of Richmond showed Tuesday.
The Fifth District Survey of Manufacturing Activity's composite index fell to 14 in January from the 19 reading registered in December. Economists polled by The Wall Street Journal forecast the figure at 17.
The indicator is compiled by surveying manufacturing firms across the Fifth Federal Reserve District, which encompasses the District of Columbia, Maryland, North Carolina, South Carolina, Virginia and most of West Virginia. Positive readings signal expansion, while negative readings indicate contraction.
All three components of the index--new orders, shipments and employment--had positive readings in January, but only employment increased compared with the previous month.
The employment index rose significantly to 23 compared with December's 20. "Survey results indicated that many firms increased employment and wages in January. However, manufacturers struggled to find workers with the necessary skills," the Richmond Fed said.
The new orders index declined to 12 from 24 in the prior month and the shipments index fell to 10 in January from 12 in December, data showed.
Manufacturers reported lengthening vendor lead times, as this index rose to 39, its highest reading since January 1996. "Overall, manufacturers were optimistic that conditions would continue to improve in the coming months," the report said.
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(END) Dow Jones Newswires
January 26, 2021 10:25 ET (15:25 GMT)Copyright (c) 2021 Dow Jones & Company, Inc.