Statewide manufacturing rallies over past month

New York manufacturers’ business conditions made their second-largest monthly gain this month as the
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New York manufacturers’ business conditions made their second-largest monthly gain this month as they swung from a record low in March, but economists warn the industry’s vicissitudes are not over.

The Federal Reserve Bank’s Buffalo branch released today its monthly Empire State Manufacturing Survey, which showed the general business conditions index rising to 0.63 in April from -22.3. That index’s 22.93 monthly gain is smaller only than May 2003’s record increase of 29.2 points.

With the nation apparently sinking into recession, New York manufacturers’ general business conditions had been declining rapidly since February. Although manufacturers’ new order and shipment indexes rose into positive territory, it is not clear what drove April’s gains.

“It’s not as though people are saying things have rebounded or things have gotten better. It’s stabilized,” said Fed economist Jason Bram.

Because the Fed started the manufacturing survey in July 2001 — at the tail end of the nation’s last eight-month recession — Bram said it is hard to say what April’s upswing means. The future activity index for the next six months fell 6.2 points to 19.57 in April.

The Fed also asked manufacturers about their workforce outlook for the next 12 months. Forty-nine percent of manufacturers said employment levels would increase, while 29 percent predicted decreases.

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