The Philly Fed Business Outlook Survey headlines for September 2011 show the index, although improved, remains in recessionary territory.
Responses to the Business Outlook Survey this month suggest that regional manufacturing activity is continuing to contract, but declines are less widespread than in August. The survey’s broad indicators for activity, shipments, and new orders all remained negative for the second consecutive month. Responding firms, however, indicated that employment was slightly higher this month. The broadest indicator of future activity remained positive and rebounded this month, suggesting that recent declines are not expected to continue over the next six months.
Remember, surveys are supposed to be a peek at the future, but Econintersect continues to warn these are no more than interesting bar room talk. This is not data; rather it is opinion which leads hard data by a month or so, and often the hard data differs from the corresponding prior opinion.
Econintersect believes the important elements of this survey are new orders and unfilled orders. The number of respondents who thought new orders and unfilled orders were improving fell this month.
As we are looking for deteriorating conditions, this month I have graphed the respondents who say conditions are declining. They also fell in number this month.
At this point, conditions are not worsening – but arguably strongly in the “not good” category.
Surveys are NOT hard data. They are a quantification of opinion. Econintersect analysis indicates economic growth is continuing to slow. However, based on last year, this negative result might be a New Normal seasonal factor.