In an earlier post, we highlighted the details of today’s manufacturing survey from the Dallas Fed. One more area to note in the report is supply chains. The index for Delivery Times remains off its peak from March, but this month experienced a small uptick to 21.4. That remains well above any historical precedence prior to the pandemic. Additionally, the expectations index for Delivery Times rose 9.9 points which ranks in the top 4% of all month-over-month moves. In other words, the Dallas Fed’s survey showed the region’s manufacturers neither reported improvement in supply chains nor did they report an optimistic outlook on the matter.
The special questions of this month’s survey added further fuel to the fire. As shown below, the regional bank asked “When do you expect supply chains to return to normal?” This question was first asked back in June of this year. Back then 71.8% of respondents reported that they expected the issues to resolve themselves within 9 months. But three months later, the answers to the same question had a more pessimistic tone. The entire distribution shifted, meaning a larger share of businesses expect supply chain problems to linger around longer. In fact, this time around only 58.7% reported expecting things to get back to normal within 9 months. Meanwhile, those expecting these issues to last 10 to 12 months jumped 8.1 percentage points and nearly 5 percentage points more expect the issues to last for more than a year. Click here to view Bespoke’s premium membership options.