New York factory activity jumps to 4-year high in August
The New York Fed’s Empire State manufacturing index rose to 20.6 in August from 15.6 in July, above the 10.0 consensus estimate, while new orders, shipments and employment remained positive.
New York State’s factory activity index jumped to its highest reading in more than four years in August, the latest sign that the AI race is reshaping America’s industrial landscape.
The Empire State manufacturing index jumped to 20.6 in August, from 15.6 in July, the Federal Reserve Bank of New York reported Monday — more than twice the 10.0 consensus estimate.
The result came just weeks after the national ISM Manufacturing PMI also reached a more than four-year high in July.
Two different manufacturing gauges now point to the same conclusion: the U.S. industrial economy is gaining momentum, and AI investment could be an important part of the explanation.
New York Manufacturing Hits 4-Year Highs The important part is what sits underneath that headline number.
Orders remain strong, employment is expanding and companies expect hiring to accelerate. “New York State manufacturing activity increased at its fastest pace in over four years in August.
Employment continued to pick up modestly,” said Richard Deitz, economic research advisor at the New York Fed.
New orders remained firmly positive at 17.3, while shipments registered 11.7.
The employment index remained positive at 9.3, while the six-month employment expectations index jumped to 28.2, its highest level in four years.
Yet, unfilled orders jumped to 15.5 from 5.0.
Delivery times also lengthened sharply to 20.6.
Supply availability also deteriorated further in August.
The index fell to -13.4, while prices paid climbed to 58.6.
The ISM survey showed similar pressure nationally.
Supplier deliveries slowed again, while prices remained elevated, and manufacturers cited electronic components, semiconductors, and memory as items in short supply. “Delivery times were substantially longer and supply availability continued to worsen,” Deitz added.
The message is increasingly difficult to ignore.
Demand is strong enough to push factories harder, while supply chains are struggling to keep pace.
Several publicly traded companies with manufacturing operations in New York have seen their shares benefit from the AI investment boom.
GlobalFoundries Inc. (NASDAQ: GFS ), which is expanding semiconductor manufacturing in Malta, New York, has rallied 54% year to date.
Corning Inc. (NYSE: GLW ), which actively manufactures in New York state and produces semiconductor optics, has gained 96%.
Its most recent expansion includes three new facilities in North Carolina and Texas.
GE Vernova Inc. (NYSE: GEV ), a major power-generation equipment manufacturer, is up 63%.
Last year, the company announced a $41 million investment at its facility in Schenectady.
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Beyond Silicon Valley, Spending is Spreading Hyperscalers — including Microsoft Corp. (NASDAQ: MSFT ), Alphabet Inc. (NASDAQ: GOOGL ), Amazon.com Inc. (NASDAQ: AMZN ) and Meta Platforms Inc. (NASDAQ: META ) — are spending heavily on data centers, chips, power infrastructure, cooling and networking equipment.
This second wave of demand is benefiting manufacturers, construction companies and industrial suppliers, according to Bank of America’s economist Aditya Bhave. "AI capex is and should continue to be a tailwind for growth," Bhave said in a recent note.
According to Bank of America, hyperscaler capital spending plans show no signs of slowing and are expected to grow another 35% next year, surpassing $1 trillion. "The investment boom is generating positive second-order effects across the economy," he added.
The evidence is already emerging in the manufacturing data.
Bank of America estimates that nearly all of the recent increase in U.S. manufacturing production reflects growth in industries closely tied to AI infrastructure.
That includes fabricated metal products, machinery, computer and electronic products, and electrical equipment, appliances and components.
Labor Market Shows Similar Pattern AI-related manufacturing industries have added 23,000 jobs so far this year after shedding a combined 120,000 jobs in 2024 and 2025.
The AI buildout is also creating demand for construction workers.
Nonresidential construction employment has increased by 75,000 jobs year to date and by 600,000 since January 2022.
Bank of America estimates that much of the recent increase is linked to data-center construction.
Nonresidential construction activity excluding data centers began declining on a year-over-year basis in early 2025.