Manufacturing productivity soars in Texas
A gauge of Texas factory shipments soared in May to its highest point in nearly 10 years, generating a surge in statewide manufacturing activity and boosting optimism throughout the sector, according to a report Tuesday from the Federal Reserve Bank of Dallas.I suspect some of this growth is from the lifting of the heavy hand of regulations imposed by the Obama administration. This is also coming at a time of robust growth in the energy sector and increased exports from Texas. New petrochemical plans are also coming on line.
The state production index, a key measure of business at plants statewide, jumped to a reading of 23.3 in May — up from 15.4 in April and rocketing to its highest point since April 2014, according to the Texas Manufacturing Outlook Survey.
The greater, positive figure indicated that statewide factory production expanded at a markedly faster pace this month.
The sharp increase on a measure of shipments helped fueled the expansion. That index jumped to 24.7 in May from 9.5 the prior month, reaching its highest reading since September 2007, before the recession.
Several other underlying measures of factory activity also rose to levels not seen since the middle of 2014, when oil prices were still running more than $100 per barrel and the Texas economy was “growing at a breakneck pace,” Emily Kerr, a Dallas Fed senior business economist, said in a release.
The production index tracks closely with the overall Texas economy, so it provides one of the most current glimpses of broader economic conditions across the state. The state’s manufacturing sector — which produces about 11 percent of the country’s total manufactured goods, second behind only California — has now increased output for 11 consecutive months.