Texas factor activity increased at an above average pace in December, according to the Dallas Federal reserve’s Texas manufacturing Outlook Survey with 36% of interviewees reporting a production increase.
Nonetheless inflation and labor remained an area of uncertainty for many of the executives interviewed.
“Ingredient costs have increased, in some cases dramatically,” noted one food manufacturer. “The specter of inflation, regardless of degree, has created upward pressure on employee compensation and retention. In some areas, there is a labor “puddle” instead of a pool to draw from.”
Supply chains were another issue mentioned by various of the executives interviewed.
“Supply-chain issues are having a huge impact,” noted a machinery manufacturer I the survey. “We’re waiting months for materials, and because of issues in 2020 (due to COVID), we’re having to prepay for a lot of the materials. So we have a lot of money tied up in materials that we won’t get until sometime next year.”