State Economic Watch

Manufacturing activity in the Third Federal Reserve District has fallen sharply according to the May Manufacturing Business Outlook Survey from the Federal Reserve Bank of Philadelphia. The top line general business activity index fell into negative territory, declining to -0.4 in May compared to +26.7 in April. New orders and shipments also plunged m/m, with the new orders index falling from +33 in April to -1.7 in May, and shipments index declining to +4.9 from +34 in the prior month. The employee count index moved slightly higher m/m, but remained in negative territory at -2.8, while average workweek fell to +1.2 from +7.7. Despite the current gloom, the six-month forward expectations indexes generally improved, with the general business conditions forward index increasing to +53.2 from +40.8 in April. The new orders and shipments forward indexes also improved m/m. On the downside, the employment forward indexes fell, with both the employee count and average workweek expectations i...

Economists at the Federal Reserve Bank of Kansas City don’t think that current high oil prices will encourage more drilling in Oklahoma. In the latest edition of the Oklahoma Economist , the authors note that despite current high spot prices, oil futures prices are below the level that Oklahoma producers need to support any meaningful increase in drilling activity. Additionally, they note that Oklahoma’s energy production is more highly concentrated in natural gas than in oil, and that natural gas prices in the US, unlike those in Europe or Asia, have not risen in response to the Iran conflict.

Last month this blog posted a story about the possible rebirth of the abandoned, partially constructed VC Summer nuclear power plant in South Carolina. After state-owned Santee Cooper and what was then South Carolina Electric and Gas pulled the plug on the project, SCANA, SCE&G’s parent, filed for bankruptcy. Dominion Energy bought SCANA, while NextEra Energy made a failed bid for Santee Cooper. This morning, NextEra announced that it will acquire Dominion in an all-stock deal. The timing is interesting because just last week, the South Carolina Public Service Commission approved a $5 billion 2,200 MW natural gas project to be jointly constructed by Dominion and Santee Cooper. This was subsequent to the December MOU between Santee Cooper and Brookfield Asset Management to potentially restart construction on the Summer facility. Additionally, earlier this month Brookfield established a partnership with The Nuclear Company for the project. While the NextEra-Dominion merger is subje...

While conditions improved modestly in the last month, the New York-Northern New Jersey service sector remained in contraction territory in May, according to the results of the Federal Reserve Bank of New York’s Business Leaders Survey . The top line business activity index remained in negative territory, but improved to -5.8 in May from -14 in April, while the business climate index sat at a very unfavorable -46.9, only 2.4 points better than in April. The one bright spot in the report was  employment, with the employee count edging into positive territory at 1.9 from -2.4 in April. The six-month forward expectations indices indicated a slight uptick in optimism, with the forward-looking business activity index increasing 7.3 points to 10.2, while the business climate expectations also increased 7.3 but remained in negative territory at -14. The forward-looking employment and capex indexes were flat m/m. Both remained in minimally positive territory. 

The Federal Reserve Bank of New York released a very solid May Empire State Manufacturing Survey this morning. The survey’s results indicate strong growth in the New York manufacturing sector. The headline general business conditions index increased 8.6 points to 19.6, while the new orders index rose 3.4 points to 22.7. The May increases pushed both indexes to four year highs. The employment indexes however, dipped slightly lower in the month. Finally, the six-month forward looking indexes reflected growing optimism, with general business conditions expectations index increasing to 33.5 from 19.6 in the prior month. Likewise, the new orders, shipments, and capex expectations indexes also improved m/m. The employment expectations indexes were mixed, with the employee count index increasing 2.5 points while the average workweek index fell five points.

The US Census Bureau released its Vintage 2025 population estimates for towns and cities today. The report reflects data from the July 1, 2024 and July 1, 2025 period.  Not surprisingly, Census found that the cities with the largest percentage increases in population during this period were all in Texas. We note that for the purposes of this exercise, Census defines US cities as those with populations of 20,000 or more. The picture is similar for pure numeric rankings. Of the cities to see the largest numeric increase in population during the reference period, Texas cities ranked second, third and fourth, while Charlotte, NC took the number one spot and Seattle, WA number five.