In the latest issue of the Federal Reserve’s Beige Book, all Federal Reserve districts except one (Boston) indicated moderate or modest economic growth since the previous Beige Book.1 St. Louis was one of six districts to report moderate growth; the others were the Chicago, Cleveland, Minneapolis, Dallas and San Francisco districts. The Boston District reported mixed economic conditions, and the remaining districts reported modest growth.
Reports on residential construction and real estate activity were mixed, while commercial construction and real estate activity grew in most districts. Regarding residential real estate, home sales in the St. Louis District fell on a year-over-year basis, and August year-to-date single-family housing permits decreased in the majority of the District’s metro areas compared with the same period one year ago. Commercial and industrial real estate market conditions were mixed throughout the District.
The pace of employment growth was about the same as reported in the previous Beige Book, and most districts reported that some employers had difficulty finding qualified workers for certain positions. A number of districts said wage growth was modest, though several also reported upward wage pressures for particular industries and occupations, such as skilled labor in construction and manufacturing.
Anecdotal information suggests that employment in the St. Louis District grew moderately since the previous report, while wages and prices grew modestly. One contact in the St. Louis District noted increased turnover of skilled employees who were switching to higher-paying jobs.
Manufacturing activity increased in most districts since the previous Beige Book, and the outlook for manufacturing was positive in a number of districts. Growth was reported across a broad range of products, with the St. Louis District noting strength in the aerospace sector and increased demand for construction materials or equipment. Several manufacturing firms reported plans to add workers, expand operations or open new facilities in the St. Louis District, while a smaller number of contacts reported plans to reduce employment.
1 Moderate growth is a larger increase than modest growth.