The Empire State Manufacturing Survey indicates that conditions for New York manufacturers deteriorated significantly in December. The general business conditions index, at -25.8, held near the record low set in November. The new orders and shipments indexes also remained near their recent record lows, and the unfilled orders index dropped to a new low. The indexes for prices paid and prices received fell below zero, and employment indexes remained deep in negative territory. Future indexes remained subdued, with the capital spending and technology spending indexes remaining well below zero.
In response to a series of supplementary questions (see Supplemental Report tab), manufacturers predicted that growth in prices paid in most budget categories would decelerate in calendar year 2009. Respondents indicated that across all categories, prices paid had risen 6.7 percent on average in 2008 but were expected to rise by a more moderate 3.5 percent in 2009. The most pronounced downshift in price increases was foreseen for commodities. A comparison of expected price changes from the December 2007 survey with the actual changes reported currently reveals that prices paid rose only slightly more in 2008 than had been expected in last year’s survey. Respondents were also asked to gauge the likelihood that the prices they paid overall would increase or decrease within certain specified ranges. The average respondent saw a roughly 12 percent chance that prices would rise by 8 percent or more and a 4 percent chance that prices would decline by 8 percent or more.
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