According to an article in the Dallas Morning News, manufacturing activity in Texas has declined significantly, signaling a bleak outlook for jobs and businesses.
The article said:
“Texas manufacturing activity continued to deteriorate in February, according to business executives responding to the Texas Manufacturing Outlook Survey,” the Dallas Fed said in a Monday report. “All indexes for current activity remained at extremely low levels.” To wit: “The production index fell to a new low, with nearly half of the respondents indicating declines in output. The share of respondents reporting declines in capacity utilization, volume of new orders and shipments exceeded those noting improvements by four-to-one.”
Not only is this decline a sign of more possible job losses ; but it is a sign that the slow down in the economy has reached a point where companies begin to manufacture less. In layman’s terms, people are not buying so companies are creating less of everything.
Less cars, office supplies, furniture, clothes, shoes etc. This decrease in manufacturing means more job losses for those working in factories and more job losses for those who sell the things that people make in factories and so on.
We may even see some bankruptcies in the manufacturing sector which could have a tsunami like effect on the rest of the economy triggering both job losses and bankruptcies. For the past few decades America’s manufacturing sector has been battered by many factors including increased labor costs and foreign competition; but this economic downturn could be the death blow to some American manufacturing companies which could have long-term consequences for the entire economy especially in terms of the amount and type of job losses that remain permanent.