June 29, 2026
Texas factory output growth slows further
Texas manufacturing output growth decelerated in June, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, fell five points to 4.1, a reading suggestive of a below-average pace of output expansion.
Other measures of manufacturing activity remained positive but showed signs of slower growth in demand. The capacity utilization index ticked up two points to 7.3, and the shipments index was unchanged at 7.1. However, the new orders index fell further, to 2.3 from 6.4.
Perceptions of broader business conditions were fairly stable in June. The general business activity index was flat, with the zero reading indicating no change in activity from May. The company outlook index increased to 2.3 from 0.3, signaling a slight improvement in outlooks. The outlook uncertainty index fell eight points to 10.9.
Employment growth resumed in June, and work hours rose. The employment index moved up to 13.9 from 0.2. The hours worked index increased four points to 5.9.
Selling price and wage pressures increased, while input price pressures held steady. The finished goods prices index rose 10 points to 28.6. The raw materials prices index remained unchanged at 42.4. The wages and benefits index ticked up two points to 26.0.
Expectations are for increased manufacturing activity six months from now. The future production index fell two points to 34.8, and the future general business activity index jumped 12 points to 25.9. Other indexes of future manufacturing activity remained in positive territory.
Next release: Monday, July 27
Data were collected June 16–24, and 64 of the 112 Texas manufacturers surveyed submitted responses. The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state’s factory activity. Firms are asked whether output, employment, orders, prices and other indicators increased, decreased or remained unchanged over the previous month.
Survey responses are used to calculate an index for each indicator. Each index is calculated by subtracting the percentage of respondents reporting a decrease from the percentage reporting an increase. When the share of firms reporting an increase exceeds the share reporting a decrease, the index will be greater than zero, suggesting the indicator has increased over the prior month. If the share of firms reporting a decrease exceeds the share reporting an increase, the index will be below zero, suggesting the indicator has decreased over the prior month. An index will be zero when the number of firms reporting an increase is equal to the number of firms reporting a decrease. Data have been seasonally adjusted as necessary.