By Maria Martinez
Manufacturing activity in the Philadelphia area lost some steam in August compared with the previous month, according to data from a survey released Thursday by the Federal Reserve Bank of Philadelphia.
The index for current general activity fell to 19.4 in August from 21.9 in July, below the 22.0 reading forecast by economists' polled by The Wall Street Journal.
The survey polls manufacturers in the Third Federal Reserve District--which covers eastern Pennsylvania, southern New Jersey and Delaware--about the direction of change in overall business activity at their plants on a monthly basis. Any reading above zero indicates expansion.
The index signals that overall manufacturing activity in the region continued to expand robustly, but at a slower pace, declining for the fourth consecutive month after reaching a long-term high reading in April.
Factories across the U.S. are struggling to keep up with demand due to widespread input and labor shortages.
In August, 28% of firms in the Philly Fed's district reported increases in overall activity, while 9% reported decreases compared with July.
The survey's indicators for general activity and shipments declined in August, but remained at high levels.
The new orders index rose 6 points to 22.8, while the current shipments index fell 6 points to 18.9 in August.
The employment index increased 3 points to 32.6, the report said. More than 39% of the respondents reported employment increases and 7% declared decreases.
Respondents in the survey continued to report price pressures and both price indexes rose. The prices paid diffusion index increased 2 points to 71.2 in August, while the prices received index rose 7 points to 53.9 in August.
The respondents continue to expect growth over the next six months, although most of the survey's future indexes declined. The diffusion index for future general activity decreased about 15 points to 33.7 in August, its second consecutive decline after reaching a 30-year high in June. The future new orders and shipments indexes also declined. The future employment index fell almost 14 points to 42.7 from 56.6, but remained at an elevated level, with over 48% of the firms polled expecting to increase payrolls in the near future.
Write to Maria Martinez at firstname.lastname@example.org
(END) Dow Jones Newswires
August 19, 2021 09:28 ET (13:28 GMT)Copyright (c) 2021 Dow Jones & Company, Inc.