The broad-based slowdown in the energy industry caught up with regional manufacturers in January, according to a survey released Thursday by the Federal Reserve Bank of Kansas City.
The Kansas City Fed said its monthly index that measures manufacturing activity in its seven-state region fell to 3 in January. While still positive, the gauge was down from 8 in December and 6 in November.
“We saw weaker activity in some energy sector-related manufacturing in January, and that pulled the overall index down somewhat,” Chad Wilkerson, a Fed vice president and economist said in the report. The weakest activity was in energy-dependent Oklahoma, he said.
The monthly index measures production, new orders, employment, supplier delivery time and raw materials inventory. The Fed’s district covers Kansas, the northern part of Missouri, Nebraska, Colorado, Wyoming, Oklahoma, and northern New Mexico.
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Despite January’s dip, Wilkerson said some companies reported “modest” overall growth and business expectations for future activity remained solid.
The report also noted that factory employment activity in the region hit a five-month low.
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