Memphis Burgundy Book: Businesses Express Modest Improvement In Outlook For Local Conditions

MEMPHIS, Tenn. – A majority of business contacts surveyed expect local business conditions to improve slightly during the next three months, according to the most recent edition of the Memphis Burgundy Book released today by the Federal Reserve Bank of St. Louis. Some skepticism remains however, with one-quarter of business contacts expecting local conditions to worsen.

The Burgundy Books offer comprehensive data and information on the economic conditions of each of the St. Louis Fed’s four zones: St. Louis, Little Rock, Louisville and Memphis.  The publication, which is released quarterly, includes the following sections: labor markets, manufacturing, real estate and construction, the household sector, banking and finance, and agriculture and natural resources.  Audio summaries of economic conditions in the zones are also available.

View the entire Memphis report at:
research.stlouisfed.org/regecon/burgundybooks/13/06/BB0613Mem.pdf

Compared with the nation, the Memphis zone saw weaker payroll employment growth in the first quarter. Employment gains were quite strong in the education and health and in the natural resources, mining, and construction industries. However, employment growth was comparatively weak in trade, transportation, and utilities, which is the Memphis MSA’s largest industry. In addition, unemployment rates in most areas of the Memphis zone exceeded the national rate in the first quarter.

Manufacturing employment rose at a healthy rate over the first four months of 2013; gains were especially strong statewide in Tennessee.

Residential real estate activity was vibrant in the first quarter, though the pace of home price increases lagged that of the nation. Office vacancy rates rose sharply in the first quarter, but retail asking rates increased.

Consumer auto debt advanced at a robust pace, while households, like most areas of the District, continued to reduce their mortgage debt balances in the first quarter.

Bank profitability in the first quarter varied greatly in the Memphis zone, with Tennessee and Mississippi banks underperforming their peers in Arkansas and in the nation.

Farmers in the Memphis zone intend to reduce their planned cotton and rice acreage in 2013, while increasing the number of acres devoted to corn production.

To view all of the Burgundy Books, see research.stlouisfed.org/regecon/district.html.

In addition, MP3 audio clips of highlights from the Burgundy Books can be heard at stlouisfed.org/newsroom/multimedia/audio/20130613-burgundybooks.cfm. They are available in both English and Spanish. 

The remaining Burgundy Books for 2013 will be released on September 12 and December 12.