Economic activity in most of the Federal Reserve Bank’s 12 districts expanded at a modest or moderate survey from early April through late May, according to the Fed’s latest Beige Book survey.
Most of the 12 districts reported that firms expressed positive near-term outlooks; however, optimism waned somewhat in a few districts.
The Fed compiles the Beige Book, which is published eight times per year, through reports from bank and branch directors, plus interviews and online questionnaires of businesses, community contacts, economists and market experts.
The majority of districts continued to report moderate growth in manufacturing, energy, nonfinancial services and construction activity. Agricultural conditions remained mixed, with some regions negatively affected by unusually wet weather.
Most districts reported that employment and wages continued to grow at a modest to moderate pace. Meanwhile, many firms cited shortages across a broadening range of occupations and reported offering higher wages to attract workers where shortages were most severe.
Here’s a look at some specifics on the economic conditions in the Federal Reserve’s Eighth District, which has its headquarters in St. Louis, and the Fed’s 10th District, which is based in Kansas City:
In this district, which includes eastern Missouri and all or parts of Arkansas, Indiana, Kentucky, Mississippi and Tennessee, economic activity has continued to increase at a modest pace, and survey respondents continue to hold a generally optimistic outlook for overall activity for the remainder of 2017.
Most sectors presented moderate growth, although auto dealers indicated slowing sales and they expect this downward trend to continue into the third quarter.
District labor market conditions continue to improve, with modest employment growth and moderate growth in wages. The report said that construction, manufacturing, and banking had increased wages to retain and attract employees. However, a shortage of workers in information technology has not resulted in increased wages.
Real estate’s low inventories and higher construction costs continue to reduce home sales and push up prices in the region.
In this district, which includes the western part of Missouri and all or parts of Colorado, Kansas, Nebraska, New Mexico, Oklahoma and Wyoming, economic activity increased moderately in April and early May, and most sectors expected continued growth in future months.
Manufacturing and real estate activity expanded at a moderate pace, and energy activity continued to increase modestly. Agricultural conditions remained generally weak due to subdued farm income and continued low commodity prices.
The district reported modest growth of employment and moderate growth of wages. Survey respondents noted a shortage of commercial drivers, skilled technicians and service workers.
Input prices were up slightly, and bankers reported steady overall loan demand, stable deposit levels and a slight decline loan quality.