By Xavier Fontdegloria


Growth in Texas factory output slowed in October compared with the previous month amid severe supply-chain bottlenecks, according to data from the Federal Reserve Bank of Dallas released Monday.

The production index of the Texas Manufacturing Outlook Survey, a key measure of state manufacturing conditions, decreased to 18.3 in October from 24.2 in September. The reading signals solid output growth, the Dallas Fed said.

The index for general business activity--which assesses broader business conditions in the manufacturing sector--rose to 14.6 from 4.6 the prior month. The indicator came in above economists' forecasts, who polled by The Wall Street Journal expected it to be at 6.5. Any level above zero signals growth.

The industrial sector continues to grow across the U.S. amid strong demand despite that supply-chain bottlenecks and labor shortages are constraining output, surveys across the country show.

Other measures of manufacturing activity also indicated notable growth, although movements compared with the previous month were mixed, the Dallas Fed said.

The survey's demand indexes rose, suggesting demand for goods remains strong. The new orders index increased to 14.9, and the growth rate of orders index climbed to 13.6.

The shipments and capacity utilization indexes slipped slightly to 13.8 and 20.1, respectively, the data showed.

Supply-chain disruptions were widespread, according to the survey. The delivery time index edged up to 25.9, while the unfilled orders index rose to 20.9.

"We are unable to secure enough raw materials to meet our growth demand from customers," a respondent from the chemical manufacturing sector said.

Labor market measures indicated robust employment growth and longer workweeks. The employment index increased to 28.3, a six-month high, and the hours worked index was largely steady at 18.5.

Prices continued to increase at a robust pace. The raw materials prices remained near an all-time high but edged down to 76.3, while the finished goods prices index rose to a new high of 49.8.

Expectations regarding future manufacturing activity improved in October. The future general business activity index rose to 15.0, and the future production index increased to 46.8, the Dallas Fed said.


Write to Xavier Fontdegloria at


(END) Dow Jones Newswires

October 25, 2021 11:09 ET (15:09 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.