It was the first time the index fell below zero since July 2009.
Manufacturing unexpectedly plunged in New York in November, the first contraction since July 2009 when the economy exited recession, official data showed on Nov. 15.
The Federal Reserve Bank of New York reported its manufacturing activity index dropped to minus 11.1 points in November, from a positive 15.7 points in the previous month.
The Empire State Manufacturing Survey index is considered a bellwether of the manufacturing sector which has been a key strength in the economic recovery.
It was the first time the index fell below zero since July 2009, the month after the worst recession in decades was officially declared over.
The sharp 27-point decline surprised analysts, who had forecast on average a slip to a positive 11.7-point reading.
The new orders index plummeted to minus 24.4 points, from positive 12.9 points in October.
Copyright Agence France-Presse, 2010