Texas manufacturing sees sharp output jump and record order backlog in September

According to the Federal Reserve Bank of Dallas, Texas manufacturing activity accelerated sharply in September, with the production index climbing 13.4 points to 29.5, roughly three times its long-run average. More than 41% of firms reported higher output, while new orders rose to 30.7 and the unfilled orders index surged to 22.7, signaling a backlog that factories are struggling to fill. Capacity utilization, shipments and new-order measures all posted above-average readings, and hiring rose for the fifth consecutive month, pushing the employment index to 15.1.

Cost pressures grew as raw-material prices and wages indexes rose sharply, and some firms cited high diesel costs. While the general business activity index slipped slightly, it stayed positive, and manufacturers expect continued growth despite uncertainties around energy costs, interest rates and trade policy.