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SOUTHEASTERN MANUFACTURERS LESS OPTIMISTIC

 ATLANTA, June 14 /PRNewswire/ -- The percentage of southeastern manufacturing firms that reported production increases in May was slightly below April's figure, according to the Federal Reserve Bank of Atlanta's monthly survey of regional manufacturing conditions.
 For production, 32 percent of the 124 plants responding to the survey reported a boost in output in May, compared with 34 percent in April. The percentage of plants reporting increases in shipments and new orders declined for the third straight month, although positive responses continued to outweigh negative replies. National business activity, as viewed by southeastern plants, was noticeably weaker than the region's, with only 21 percent reporting increased national activity in May.
 Expectations for increased production six months from now remained positive, but were down considerably from six months earlier. In May, 47 percent of the manufacturers expected production to improve in six months, compared with 51 percent in April and a recent high of 72 percent reported in December.
 For current conditions, the diffusion index for production was 12 in May, down slightly from April's revised 15. (The diffusion index is calculated as the percent of plants reporting increases minus the percent reporting declines.)
 Most plants continued to report no change in employment conditions. However, for the first time since January 1992, the number of plants reporting declines in employment rolls was above those reporting hiring additional workers.
 Looking ahead, 21 percent of responding plants expect employment growth in six months, which is slightly above April's figure. This share remains well below a high in November 1992 when 41 percent of those responding expected to increase their future hiring. Those expecting declines in six months rose from 24 percent in April to 30 percent in May.
 Prices for finished products and raw materials were unchanged at the majority of responding plants. Those expecting no change in six months for prices of their finished goods rose to 71 percent in May from 63 percent in April.
 The Federal Reserve Bank of Atlanta Survey of Southeastern Manufacturing Conditions for May is based on information from 124 manufacturing plants throughout the Sixth Federal Reserve District, which includes the states of Alabama, Florida and Georgia, along with portions of Louisiana, Mississippi, and Tennessee. These plants represent a cross-section of industries in the region.
 SUMMARY OF SOUTHEASTERN MANUFACTURING CONDITIONS(b)
 Federal Reserve Bank of Atlanta, Research Department
 May 1993(a)
 May vs. April
 (Percent)(d)
 Diffusion
 SOUTHEASTERN PLANT INDICATORS Decr. No Chg. Incr. Index(c)
 Production 20.2 47.6 32.3 12.1
 Volume of shipments 21.8 46.0 32.3 10.5
 Volume of new orders 21.0 49.2 29.8 8.8
 Backlog of orders 28.5 52.8 18.7 -9.8
 Inventories:
 Materials 22.3 59.5 18.2 -4.1
 Plants' finished goods 27.5 47.5 25.0 -2.5
 Number of employees 17.7 65.3 16.9 -0.8
 Average employee workweek 23.8 61.5 14.8 -9.0
 Prices received for finished product 10.7 75.4 13.9 3.2
 Prices paid for raw materials 9.3 75.4 15.3 6.0
 Volume of new orders for exports 10.7 74.8 14.6 3.9
 Supplier delivery time(e) 7.0 87.7 5.3 1.7
 INDUSTRY BUSINESS ACTIVITY, NATIONAL 22.0 56.9 21.1 -0.9
 Six mos. from May
 (Percent)(d)
 Diffusion
 SOUTHEASTERN PLANT INDICATORS Decr. No Chg. Incr. Index(c)
 Production 20.8 32.5 46.7 25.9
 Volume of shipments 22.1 30.3 47.5 25.4
 Volume of new orders 22.5 35.8 41.7 19.2
 Backlog of orders 27.0 50.8 22.1 -4.9
 Inventories:
 Materials 26.7 60.8 12.5 -14.2
 Plants' finished goods 27.5 55.0 17.5 -10.0
 Number of employees 30.3 48.4 21.3 -9.0
 Average employee workweek 16.0 70.6 13.4 -2.6
 Prices received for finished product 10.1 71.4 18.5 8.4
 Prices paid for raw materials 7.6 55.9 36.4 28.8
 Capital expenditures 15.8 51.8 32.5 16.7
 Volume of new orders for exports 8.5 67.9 23.6 15.1
 Supplier delivery time(e) 5.4 82.9 11.7 -6.3
 INDUSTRY BUSINESS ACTIVITY, NATIONAL 17.6 38.7 43.7 26.1
 (a) May and Revised April tables are available on the U.S.
 Department of Commerce Bulletin Board.
 (b) Data from 124 respondents. Normal seasonal fluctuations are
 taken into account by respondents.
 (c) The diffusion index is calculated as the percentage of total
 respondents reporting increases minus the percentage reporting
 declines.
 (d) Figures may not sum exactly to 100 because of rounding.
 (e) Decrease equals slower; increase equals faster.
 NOTE: For background on the Survey of Southeastern Manufacturing Conditions, see the article by R. Mark Rogers, "Tracking Manufacturing: The Survey of Southeastern Manufacturing Conditions" in the September/October 1992 issue of the Federal Reserve Bank of Atlanta's Economic Review.
 -0- 6/14/93
 /CONTACT: Tony Heffernan of the Federal Reserve Bank of Atlanta, 404-521-8748/


CO: Federal Reserve Bank of Atlanta ST: Georgia IN: FIN SU: ECO

BN-RA -- AT006 -- 1495 06/14/93 10:03 EST
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Date:Jun 14, 1993
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