The Empire State Manufacturing Index (ESMI) is a survey given out by the Federal Reserve Bank of New York to manufacturing companies within the state of New York.

It’s used to gauge the health and performance of the manufacturing sector within New York.

As one of the most influential indicators of the state’s economic vitality, the ESMI provides a snapshot of current manufacturing trends and serves as a reliable proxy for the broader U.S. manufacturing industry.

What is Empire State Manufacturing Index (ESMI)?

The Empire State Manufacturing Index is a monthly survey conducted by the Federal Reserve Bank of New York.

New York Fed District

The survey is sent on the first day of each month to about 200 manufacturing executives in New York State, typically the president or CEO.

The survey collects data on various aspects of manufacturing activity, such as new orders, shipments, employment, prices, and general business conditions.

Empire State Manufacturing Index

How to Understand the ESMI

Understanding the Empire State Manufacturing Index involves the following key points:

  • Diffusion index: The ESMI is a diffusion index, meaning it measures the degree to which manufacturing activity is expanding or contracting. A reading above zero indicates expansion, while a reading below zero signifies contraction.
  • Components: The ESMI is comprised of several sub-indices, each reflecting a different aspect of manufacturing activity. These sub-indices include new orders, shipments, employment, prices paid, and prices received.
  • Seasonal adjustments: The index values are seasonally adjusted to account for fluctuations related to factors such as holidays, weather, or production cycles.

Why is the Empire State Manufacturing Index (ESMI) important?

The Empire State Manufacturing Index is essential for several reasons:

  • Economic indicator: The ESMI is a leading indicator of New York State’s manufacturing sector, which is a vital component of the state’s economy. A strong manufacturing sector can contribute to job growth and overall economic well-being.
  • Proxy for the broader U.S. manufacturing industry: The index can also serve as a proxy for the broader U.S. manufacturing industry, as New York’s manufacturing sector shares similarities with other regions.
  • Investment tool: Investors can use the ESMI to inform their decisions regarding stocks, bonds, or other investments related to the manufacturing sector.
  • Policy analysis: Policymakers and economists can use the ESMI to analyze the impact of monetary and fiscal policies on the manufacturing sector and gauge the overall health of the economy.

Who publishes the Empire State Manufacturing Index?

The Empire State Manufacturing Index is calculated and published by the Federal Reserve Bank of New York, one of the twelve regional banks in the Federal Reserve System.

When is the Empire State Manufacturing Index released?

The Empire State Manufacturing Index is released monthly, typically around the middle of the month.

The index data and reports can be accessed through the Federal Reserve Bank of New York’s website.

Additionally, various financial news outlets and market data providers offer coverage and analysis of the ESMI.