Manufacturing Activity Little Changed in First Half of March

An index measuring manufacturing activity across the central Atlantic region remained about flat in March, a month that saw the coronavirus outbreak intensifying in the U.S., the Federal Reserve Bank of Richmond said in a report Tuesday. 

The bank's composite manufacturing index rose to 2 in March from -2 in February. Positive readings signal expansion, while negative readings indicate contraction. 

Shipments and new orders rose from February, but employment fell, the report said. 

Firms were pessimistic, expecting weaker business conditions and a drop in shipments and new orders in the coming months, according to the report. The reported weakening local business conditions and a decrease in backlog of orders. 

Though employment dropped, firms reported continued growth in wages in recent weeks. They also struggled to find workers with necessary skills and expected the challenge to persist in the next six months, the report said. 

Firms reported a drop in growth rates of prices paid and prices received, the survey said.

The index tracking the average workweek rose to 3 from -4 in February, the report said. The reading for wages fell to 20 from 26 in the prior month. The shipments index rose to 13 from 1 a month ago. 

The Richmond Fed district includes Virginia, North Carolina, South Carolina, the District of Columbia, Maryland and the bulk of West Virginia.