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September 29, 2025
Growth moderates in the Texas manufacturing sector
Special questions: Wages, prices, outlook concerns, tax reform and remote work
Texas factory activity continued to expand in September, albeit at a slower pace, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, came in at 5.2, down 10 points from August and indicative of below-average output growth.
Other measures of manufacturing activity also moved down this month, with most pointing to notably slower growth than in August. The capacity utilization index slipped to 3.9 from 13.7. The shipments index retreated eight points to 6.7. The new orders index fell eight points to -2.6, with the negative reading indicating a slight decline in demand in September after an uptick in August.
Perceptions of broader business conditions worsened somewhat this month, as the general business activity index fell seven points to -8.7. Outlooks were stable, with the company outlook index coming in near zero in September. The outlook uncertainty index edged down to 13.9, a slightly below-average reading.
Labor market measures suggested a slight decline in employment and a slight increase in work hours. The employment index dropped 12 points to -3.4, its lowest reading since April. Thirteen percent of firms noted net hiring, and 16 percent noted net layoffs. The hours worked index also slipped 12 points but remained positive at 3.4, suggesting somewhat longer workweeks in September.
Price and wage pressures were largely unchanged this month. The raw materials prices index remined elevated at 43.4. The finished goods prices index edged down to 11.7. The wages and benefits index held steady at 15.9, slightly below its average reading.
Expectations for manufacturing activity six months from now remained positive, though optimism waned somewhat. The future production index fell to 31.6 from 40.4, while the future general business activity dropped 16 points to 8.4. Most other indexes of future manufacturing activity also moved down but remained positive, still indicating increased activity six months ahead.
Next release: Monday, October 27
Data were collected Sep. 16–24, and 72 of the 116 Texas manufacturers surveyed submitted responses. The Dallas Fed conducts the Texas Manufacturing Outlook Survey monthly to obtain a timely assessment of the state’s factory activity. Firms are asked whether output, employment, orders, prices and other indicators increased, decreased or remained unchanged over the previous month.
Survey responses are used to calculate an index for each indicator. Each index is calculated by subtracting the percentage of respondents reporting a decrease from the percentage reporting an increase. When the share of firms reporting an increase exceeds the share reporting a decrease, the index will be greater than zero, suggesting the indicator has increased over the prior month. If the share of firms reporting a decrease exceeds the share reporting an increase, the index will be below zero, suggesting the indicator has decreased over the prior month. An index will be zero when the number of firms reporting an increase is equal to the number of firms reporting a decrease. Data have been seasonally adjusted as necessary.
September 29, 2025
Results summary
Historical data are available from June 2004 to the most current release month.
| Business Indicators Relating to Facilities and Products in Texas Current (versus previous month) | ||||||||
| Indicator | Sep Index | Aug Index | Change | Series Average | Trend* | % Reporting Increase | % Reporting No Change | % Reporting Decrease |
Production | 5.2 | 15.3 | –10.1 | 9.6 | 7(+) | 25.9 | 53.4 | 20.7 |
Capacity Utilization | 3.9 | 13.7 | –9.8 | 7.4 | 3(+) | 23.8 | 56.2 | 19.9 |
New Orders | –2.6 | 5.8 | –8.4 | 4.7 | 1(–) | 27.0 | 43.4 | 29.6 |
Growth Rate of Orders | –6.4 | 2.6 | –9.0 | –1.1 | 1(–) | 21.9 | 49.8 | 28.3 |
Unfilled Orders | –8.4 | –5.1 | –3.3 | –2.6 | 13(–) | 8.0 | 75.6 | 16.4 |
Shipments | 6.7 | 14.2 | –7.5 | 7.9 | 3(+) | 30.2 | 46.3 | 23.5 |
Delivery Time | –8.2 | 2.3 | –10.5 | 0.6 | 1(–) | 3.0 | 85.8 | 11.2 |
Finished Goods Inventories | –9.7 | 3.8 | –13.5 | –3.2 | 1(–) | 11.1 | 68.1 | 20.8 |
Prices Paid for Raw Materials | 43.4 | 43.7 | –0.3 | 27.5 | 65(+) | 45.1 | 53.2 | 1.7 |
Prices Received for Finished Goods | 11.7 | 15.1 | –3.4 | 8.7 | 9(+) | 20.5 | 70.7 | 8.8 |
Wages and Benefits | 15.9 | 15.4 | +0.5 | 21.0 | 65(+) | 16.2 | 83.5 | 0.3 |
Employment | –3.4 | 8.8 | –12.2 | 7.2 | 1(–) | 12.7 | 71.3 | 16.1 |
Hours Worked | 3.4 | 15.0 | –11.6 | 3.0 | 3(+) | 18.3 | 66.8 | 14.9 |
Capital Expenditures | 13.3 | 14.6 | –1.3 | 6.6 | 5(+) | 21.9 | 69.5 | 8.6 |
| General Business Conditions Current (versus previous month) | ||||||||
| Indicator | Sep Index | Aug Index | Change | Series Average | Trend** | % Reporting Improved | % Reporting No Change | % Reporting Worsened |
Company Outlook | –1.0 | 3.3 | –4.3 | 4.2 | 1(–) | 19.9 | 59.2 | 20.9 |
General Business Activity | –8.7 | –1.8 | –6.9 | 0.3 | 2(–) | 17.9 | 55.5 | 26.6 |
| Indicator | Sep Index | Aug Index | Change | Series Average | Trend* | % Reporting Increase | % Reporting No Change | % Reporting Decrease |
Outlook Uncertainty | 13.9 | 18.3 | –4.4 | 17.2 | 53(+) | 26.4 | 61.1 | 12.5 |
| Business Indicators Relating to Facilities and Products in Texas Future (six months ahead) | ||||||||
| Indicator | Sep Index | Aug Index | Change | Series Average | Trend* | % Reporting Increase | % Reporting No Change | % Reporting Decrease |
Production | 31.6 | 40.4 | –8.8 | 36.1 | 65(+) | 45.1 | 41.4 | 13.5 |
Capacity Utilization | 23.8 | 40.4 | –16.6 | 33.0 | 65(+) | 38.7 | 46.3 | 14.9 |
New Orders | 34.3 | 36.0 | –1.7 | 33.5 | 35(+) | 49.0 | 36.3 | 14.7 |
Growth Rate of Orders | 32.7 | 28.4 | +4.3 | 24.8 | 28(+) | 44.4 | 44.0 | 11.7 |
Unfilled Orders | –0.8 | 11.6 | –12.4 | 2.7 | 1(–) | 12.0 | 75.2 | 12.8 |
Shipments | 30.0 | 37.2 | –7.2 | 34.5 | 65(+) | 44.5 | 41.0 | 14.5 |
Delivery Time | –0.8 | –1.9 | +1.1 | –1.4 | 7(–) | 7.3 | 84.6 | 8.1 |
Finished Goods Inventories | –10.3 | –1.3 | –9.0 | –0.3 | 7(–) | 5.9 | 77.9 | 16.2 |
Prices Paid for Raw Materials | 47.1 | 47.8 | –0.7 | 33.7 | 66(+) | 52.2 | 42.7 | 5.1 |
Prices Received for Finished Goods | 39.7 | 35.5 | +4.2 | 21.3 | 65(+) | 48.5 | 42.6 | 8.8 |
Wages and Benefits | 28.4 | 42.1 | –13.7 | 39.0 | 65(+) | 32.8 | 62.8 | 4.4 |
Employment | 12.7 | 27.6 | –14.9 | 22.8 | 64(+) | 31.9 | 48.8 | 19.2 |
Hours Worked | 3.2 | 6.8 | –3.6 | 8.7 | 3(+) | 14.6 | 74.0 | 11.4 |
Capital Expenditures | 12.5 | 23.3 | –10.8 | 19.4 | 64(+) | 27.5 | 57.5 | 15.0 |
| General Business Conditions Future (six months ahead) | ||||||||
| Indicator | Sep Index | Aug Index | Change | Series Average | Trend** | % Reporting Increase | % Reporting No Change | % Reporting Worsened |
Company Outlook | 11.7 | 26.8 | –15.1 | 18.3 | 5(+) | 31.9 | 47.9 | 20.2 |
General Business Activity | 8.4 | 24.8 | –16.4 | 12.3 | 5(+) | 26.9 | 54.6 | 18.5 |
*Shown is the number of consecutive months of expansion or contraction in the underlying indicator. Expansion is indicated by a positive index reading and denoted by a (+) in the table. Contraction is indicated by a negative index reading and denoted by a (–) in the table.
**Shown is the number of consecutive months of improvement or worsening in the underlying indicator. Improvement is indicated by a positive index reading and denoted by a (+) in the table. Worsening is indicated by a negative index reading and denoted by a (–) in the table.
Data have been seasonally adjusted as necessary.
Historical Data
Historical data can be downloaded dating back to June 2004.
Indexes
Download indexes for all indicators. For the definitions of all variables, see Data Definitions.
All Data
Download indexes and components of the indexes (percentage of respondents reporting increase, decrease, or no change). For the definitions of all variables, see Data Definitions.
September 29, 2025
Special questions
For this month’s survey, Texas business executives were asked supplemental questions on wages, prices, outlook concerns, tax reform and remote work. Results below include responses from participants of all three surveys: Texas Manufacturing Outlook Survey, Texas Service Sector Outlook Survey and Texas Retail Outlook Survey. View individual survey results.
