The Federal Reserve Bank of New York works to promote sound and well-functioning financial systems and markets through its provision of industry and payment services, advancement of infrastructure reform in key markets and training and educational support to international institutions.
The Outreach and Education function engages, empowers and educates the Second District communities that the Bank serves, especially civic leaders, students, educators, small business owners, policymakers and the general public. It furthers the Bank's commitment to the region by listening to the communities we serve and leveraging our unique attributes to positively impact school and university programs, as well as analysis and research.
The Federal Reserve Bank of New York’s December 2014 Business Leaders Survey indicates that activity in the region’s service sector expanded modestly. The survey’s headline business activity index fell ten points to 7.8, indicating a slower pace of growth than in November. The business climate index inched down two points to -7.8, suggesting that on balance, respondents continued to view the business climate as worse than normal. The employment index climbed three points to 16.3, pointing to solid gains in employment, while the wages index drifted down five points to 25.6. After declining sharply last month, the prices paid index climbed four points to 42.2, indicating a slight pickup in the pace of input price increases, while the prices received index fell eight points to its lowest level in two years, at 5.4, pointing to a slowing of selling price increases. The current capital spending index declined ten points to 10.1, while the index for future capital spending rose six points to 25.0. Indexes for the six-month outlook for business activity and employment fell noticeably from last month, suggesting that firms were less optimistic about future conditions.
Growth in business activity in the region’s service sector slowed this month, according to the December 2014 survey. The survey’s headline business activity index fell ten points to 7.8, pointing to a modest improvement in business conditions. This month, 35 percent of respondents reported that conditions improved, while 27 percent reported that conditions worsened. The business climate index inched down two points to -7.8, suggesting that on balance, the business climate continued to be viewed as worse than normal.
Employment Continues to Expand
TThe employment index climbed three points to 16.3, pointing to continued moderate gains in employment levels. The index for wages fell five points to 25.6, a sign that wages grew more slowly this month. After declining steeply last month, the prices paid index climbed four points to 42.2, indicating a slightly faster pace of input price increases, although the index remained well below the levels seen throughout much of the past year. The prices received index declined eight points to 5.4, signifying a slowing of selling price increases. The capital spending index fell 10 points to 10.1, suggesting that capital expenditures grew more slowly in December.
Firms Less Optimistic
Indexes for the six-month outlook indicated that firms were less optimistic this month about future business conditions. The index for expected business activity dropped fourteen points to 30.0, and the index for future business climate fell nine points to 22.1. The index for expected employment declined nine points to 23.3. The future prices paid index fell for a second consecutive month, declining five points to 49.2, while the future prices received index climbed six points to 26.7, suggesting that steeper price increases are expected in the months ahead. The index for expected capital spending rose six points to 25.0, signifying that capital spending plans remain strong.
The Business Leaders Survey is a monthly survey conducted by the Federal Reserve Bank of New York that asks companies across its District – which includes New York State, Northern New Jersey, and Fairfield County, Connecticut – about recent and expected trends in key business indicators. This survey is designed to parallel the Empire State Manufacturing Survey, though it covers a wider geography and the questions are slightly different. Participants from the service sector respond to a questionnaire and report on a variety of indicators' both in terms of recent and expected changes. While January 2014 is the first published report, survey responses date back to September of 2004 and all historical data are available on our website.
The survey is sent on the first business day of each month to the same pool of about 150 business executives, usually the president or CEO, in the region's service sector. In a typical month, about 100 responses are received by around the tenth of the month when the survey closes.
Respondents come from a wide range of industries outside of the manufacturing sector, with the mix of respondents closely resembling the industry structure of the region.
The survey's headline index, general business activity, is a distinct question posed on the survey (as opposed to a composite of responses to other questions). Currently, no indexes are seasonally adjusted since none of the series exhibits stable seasonal patterns from a statistical perspective.