Liberty Street Economics

« | Main | »

July 18, 2018

Just Released: Beige Book Points to Moderate Growth and Tight Labor Markets

LSE_Just Released: Beige Book Points to Moderate Growth and Tight Labor Markets

The New York Fed’s latest Beige Book report—based on information collected through July 9—points to sustained moderate growth and tight labor markets in the region. Manufacturers and wholesalers noted a persistent rise in economic activity over the first half of this year. However, a number of contacts in these sectors remarked that tariffs have raised their costs, and uncertainty about future trade policy was cited as a concern by businesses in a variety of industries. Meanwhile, businesses in most service industries continue to report flat to modestly expanding activity. And while consumer spending has remained fairly steady, consumer confidence edged up to a cyclical high, in large part due to an exceptionally positive assessment of the labor market.


Eight times per year, each of the nation’s twelve Federal Reserve Banks produces a report on current economic conditions in its District, based on largely anecdotal information obtained from a variety of regional business contacts and related sources. The New York Fed’s report covers New York State, northern New Jersey, and southwestern Connecticut. The twelve District reports are combined with a national summary to produce what has come to be known as the Beige Book—a report that provides some of the most timely information available on economic conditions.

With sustained growth, the region’s labor markets generally remain tight. In fact, one business contact observed that almost all job seekers are already employed, and several businesses reported trouble filling more senior positions and finding technically skilled workers, especially in information technology. Hiring activity in the region has been steady overall but mixed across industries. Business contacts in manufacturing, wholesale and retail trade, and finance reported a pickup in hiring activity in recent months, while those engaged in business services and information noted some pullback. Despite the tight labor market, contacts in most industries say wage growth has remained fairly moderate.

That said, it does appear that many businesses are facing other cost pressures. Over the past year, businesses in a wide range of sectors have pointed to increasingly widespread increases in input prices and a growing number of businesses have begun to raise selling prices. Looking ahead, many businesses in leisure and hospitality, wholesale trade, and real estate said they anticipate further price hikes.

Housing markets throughout the region have generally continued to strengthen. In many areas, a dearth of homes on the market has restrained sales volume but driven up prices. But in and around New York City, the high end of the sales market has been weak. The rental market has also softened a bit in New York City but has generally firmed elsewhere in the region.

Overall, the latest Beige Book report points to moderate growth and tight labor markets in the region. Whether the pace of growth will pick up or be constrained by the recent tariffs and uncertainty about the outlook for trade policy remains to be seen. The next Beige Book report, to be released on September 12, will provide additional information on the region’s economic performance and may shed some light on these important issues.

Disclaimer

The views expressed in this post are those of the authors and do not necessarily reflect the position of the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions are the responsibility of the authors.



Abel_jaisonJaison R. Abel is an assistant vice president in the Federal Reserve Bank of New York’s

Bram_jasonJason Bram is a research officer in the Bank’s Research and Statistics Group.

How to cite this blog post:

Jaison R. Abel and Jason Bram, “Just Released: Beige Book Points to Moderate Growth and Tight Labor Markets,” Federal Reserve Bank of New York Liberty Street Economics (blog), July 18, 2018, http://libertystreeteconomics.newyorkfed.org/2018/07/just-released-beige-book-points-to-moderate-growth-and-tight-labor-markets.html.

About the Blog

Liberty Street Economics features insight and analysis from New York Fed economists working at the intersection of research and policy. Launched in 2011, the blog takes its name from the Bank’s headquarters at 33 Liberty Street in Manhattan’s Financial District.

The editors are Michael Fleming, Andrew Haughwout, Thomas Klitgaard, and Asani Sarkar, all economists in the Bank’s Research Group.

Liberty Street Economics does not publish new posts during the blackout periods surrounding Federal Open Market Committee meetings.

The views expressed are those of the authors, and do not necessarily reflect the position of the New York Fed or the Federal Reserve System.

Economic Research Tracker

Image of NYFED Economic Research Tracker Icon Liberty Street Economics is available on the iPhone® and iPad® and can be customized by economic research topic or economist.

Economic Inequality

image of inequality icons for the Economic Inequality: A Research Series

This ongoing Liberty Street Economics series analyzes disparities in economic and policy outcomes by race, gender, age, region, income, and other factors.

Most Read this Year

Comment Guidelines

 

We encourage your comments and queries on our posts and will publish them (below the post) subject to the following guidelines:

Please be brief: Comments are limited to 1,500 characters.

Please be aware: Comments submitted shortly before or during the FOMC blackout may not be published until after the blackout.

Please be relevant: Comments are moderated and will not appear until they have been reviewed to ensure that they are substantive and clearly related to the topic of the post.

Please be respectful: We reserve the right not to post any comment, and will not post comments that are abusive, harassing, obscene, or commercial in nature. No notice will be given regarding whether a submission will or will
not be posted.‎

Comments with links: Please do not include any links in your comment, even if you feel the links will contribute to the discussion. Comments with links will not be posted.

Send Us Feedback

Disclosure Policy

The LSE editors ask authors submitting a post to the blog to confirm that they have no conflicts of interest as defined by the American Economic Association in its Disclosure Policy. If an author has sources of financial support or other interests that could be perceived as influencing the research presented in the post, we disclose that fact in a statement prepared by the author and appended to the author information at the end of the post. If the author has no such interests to disclose, no statement is provided. Note, however, that we do indicate in all cases if a data vendor or other party has a right to review a post.

Archives