The Philadelphia Fed’s August Manufacturing Business Outlook Survey shows that manufacturing activity continued to expand strongly. The general activity index rose to 47.4, its highest level since April 2021, while employment also increased significantly. New orders and shipments eased from July but remained at healthy levels.
Looking ahead, manufacturers became much more optimistic. The six-month outlook for general activity jumped to 73.6, the highest reading since 1983, with nearly 75% of firms expecting growth. Expectations for new orders, shipments, employment, and capital spending also increased sharply.
The main concern remains prices. Although current price pressures eased, they remained elevated, and future price indexes increased. About 44% of firms expect industry costs to change in the near term, and 80% of those expect competitors to raise prices. Overall, the survey points to a manufacturing sector that is growing strongly, with businesses increasingly optimistic about the next six months but still facing inflation and cost pressures
