Texas Manufacturing Begins the Year with Strong Expansion and Rising Confidence

Texas manufacturing opened the year with solid expansion and renewed momentum, according to the latest Texas Manufacturing Outlook Survey released by the Federal Reserve Bank of Dallas.

The data signals strengthening industrial performance, rising demand, and growing confidence across key manufacturing indicators, reinforcing Texas’ leadership as one of the most competitive industrial economies in the United States.

Production and Demand Accelerate

The production index climbed to 11.2 points, reflecting growth at a pace above the historical average. This expansion was supported by broad-based improvements across core sector indicators.

New orders advanced to 11.8 points, signaling increasing demand and stronger commercial activity. Capacity utilization rose to 7.1, demonstrating improved operational intensity across facilities statewide.

Meanwhile, the shipments index reached 12.0 points, indicating higher goods movement and renewed momentum throughout supply chains.

Collectively, these figures point to strengthening industrial activity and a manufacturing base positioned for continued expansion.

Business Confidence and Employment Strengthen

Overall business conditions remained stable, providing a consistent foundation for growth. Importantly, the company outlook index returned to positive territory at 2.9 points, reflecting improving expectations among Texas manufacturers.

The labor market also showed encouraging signs:

• The employment index increased to 8.2, signaling renewed job creation.
• Hours worked remained stable, indicating operational consistency and workforce stability.

These labor dynamics underscore the resilience of Texas’ industrial ecosystem and its ability to scale alongside demand.

Pricing Stability and Forward-Looking Optimism

Finished goods prices increased moderately, consistent with healthy demand conditions, while raw material costs remained stable, supporting margin predictability for producers.

Looking ahead, manufacturers express strong medium-term confidence:

• The future production index stands at 29.2
• The future general business activity index reached 16.6

These forward indicators suggest expectations of stronger manufacturing performance over the next six months, despite broader global economic complexities.

A Strategic Opportunity for Expansion

The latest data reinforces Texas’ role as a leading U.S. manufacturing hub, defined by resilience, scale, workforce depth, and long-term competitiveness.

For companies evaluating expansion, nearshoring, or supply chain optimization, this environment presents tangible opportunity.

The Rio South Texas Region sits at the strategic intersection of U.S. industrial capacity and binational market access. With strong logistics infrastructure, workforce readiness, and direct connectivity to Mexico’s manufacturing base, the region offers a powerful platform for sustainable growth.

Through coordinated regional leadership and investor support, COSTEP works alongside manufacturers and site selectors to streamline site selection, facilitate partnerships, and accelerate successful market entry.

If your company is planning its next phase of North American growth, now is the time to act.

Rio South Texas Region: One Region, Two Countries, One Future.