Memphis Burgundy Book: Business Contacts Report Marginally Positive Outlook for 2014

MEMPHIS, Tenn. – A November survey of business contacts suggests more optimism than pessimism about the pace of economic activity in 2014, according to the most recent edition of the Memphis Burgundy Book released today by the Federal Reserve Bank of St. Louis. In the Memphis zone, 45 percent of respondents believe that conditions will be better next year, while 25 percent believe conditions will be worse.

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: https://research.stlouisfed.org/regecon/burgundybooks/13/12/BB1213Mem.pdf

The Memphis zone of the Federal Reserve comprises northern Mississippi, eastern Arkansas, and western Tennessee and a total population of approximately 3.1 million people, including the 1.3 million who live in the Memphis Metropolitan Statistical Area (MSA).

The zone’s unemployment rate averaged 9.6 percent in the third quarter, down slightly from the previous quarter (10 percent).  Labor market conditions generally remain the strongest in the Jonesboro MSA.

Anecdotal reports suggest some preference among manufacturers to delay planned capital outlays. Three-quarters of those firms surveyed plan to keep capital expenditures unchanged over the next three months.

Residential housing conditions are mostly positive; on the commercial side, the apartment and industrial markets continued to improve at a moderate pace.

Real per capita incomes in Arkansas, Mississippi and Tennessee grew at about the same rate as the nation over the past year. Families aggressively reduced their credit card balances in the third quarter.

Nonperforming loans at Memphis banks fell again in the third quarter. Memphis-zone bankers expect loan demand to stay the same or improve during the next three months.

This year’s corn and soybean harvest exceeded the expectations of many in the farm sector.

A late-fall survey of agricultural banks revealed that proportionately more bankers expect farm income, loan repayments and capital expenditure to increase over last year’s levels.

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/20131212-burgundybooks.cfm. They are available in both English and Spanish. 

The next Burgundy Book will be released on March 13, 2014.