Empire State Manufacturing Survey

What Is the Empire State Index?

The Empire State Manufacturing Survey is a monthly diffusion index of manufacturing activity in New York State, produced by the Federal Reserve Bank of New York. It surveys manufacturing firms about current and expected business conditions across sub-categories: new orders, shipments, unfilled orders, delivery time, inventories, prices paid, prices received, employment, and average workweek.

The Empire State is scaled around zero (positive values signal expansion, negative signal contraction). The release is the earliest regional Fed manufacturing survey each month, typically arriving on the 15th.

Why It Matters for Markets

The Empire State Index is the first reading of monthly manufacturing activity, making it a leading indicator of the national ISM Manufacturing PMI (released on the first business day of the following month). The two indices broadly track each other with the Empire State providing the earliest signal.

For markets, the release moves manufacturing-sensitive equities and bond yields on surprises. The reaction is smaller than ISM or Philly Fed (smaller geographic scope) but the early timing makes it a useful data point for positioning ahead of larger releases.

How to Read the Print

Headline index vs zero line. Above zero is expansion, below zero is contraction. Sustained readings 5+ points below zero signal regional manufacturing weakness.

New orders sub-index. Forward-looking; leads the headline by 1-2 months.

Prices paid sub-index. The manufacturing-input inflation signal. Sustained elevated readings signal upstream cost pressure.

Future activity sub-indices. The Empire State asks about 6-month-ahead expectations as well as current conditions. The future component is a useful business-sentiment gauge.

Inventory and unfilled orders. The interplay between these two sub-indices reveals manufacturing-cycle dynamics. Rising unfilled orders with falling inventories signals a backlog building (positive for future production); the reverse signals a backlog drawdown.

Historical Context

The Empire State data series goes back to 2001, shorter than the Philly Fed. The 2010-2019 average was approximately 7. The pandemic shock produced the lowest reading in the data series at -78 in April 2020. The 2021 recovery brought the index to a peak of 43 in July 2021.

Through 2024-2025, the Empire State has run in the -5 to +10 range, broadly tracking the weak national manufacturing picture. The new orders sub-index has been a reliable forward signal: positive new orders readings have typically preceded headline-index recoveries within 1-2 months.