July was a strong month for Texas manufacturing

Summer is always hot in Texas, but this month the state's manufacturing sector was on fire.

In its most recent report, the Federal Reserve Bank of Dallas found that factory activity increased, manufacturing businesses expanded their payrolls and that producers in general have a positive outlook on the state's economic prospects.

Specifically, the state's production index increased from a 15.5 in June to a 19.1 in July. This is a significant indicator that the manufacturing sector is growing.

The Dallas Fed found that increased demand is largely to thank for the growth in Texas-based manufacturing. According to the report, the number of new orders doubled in July, and shipments increased significantly. Capacity utilization also rose. Now Texas produces 11 percent of all the goods made in the U.S., second only to California.

In addition, Texas manufacturers benefited significantly from the state's rapidly increasing oil production, which has stabilized and, in some cases, even lowered energy prices.

All told, manufacturing jobs make up about 9 percent of the state's private-sector payrolls. And it is likely that this will continue to grow, thanks to an increasingly positive view of Texas's business climate. The Dallas Fed found that factory managers have an increasingly positive view of current conditions and those predicted for the next six months. As such, they have increased staff numbers and lengthened hours.

The Texas business climate, which features low taxes and minimal regulations, is a good environment for companies to grow and develop. In addition, the state supports CNC machine services, which can help manufacturing businesses operate more efficiently.