Overall, the Fed reports from all 12 Federal Reserve Districts that economic activity increased in September through early October—noting the pace of growth was “split between modest and moderate.”
According to the report, although low home inventory levels continued to constrain residential sales in many areas, residential construction continued to increase. Meanwhile, growth in commercial construction was up slightly on balance. Additionally, nonresidential real estate activity increased slightly overall, and loan demand was generally stable to modestly higher.
Employment growth was modest on balance, with most Districts reporting "flat to moderate increases." In addition, labor markets were widely described as "tight."
Specifically, the report noted that many Districts struggled to find qualified workers particularly in construction—and these shortages were also restraining business growth. Firms in several districts reported that scarcity of labor, especially related to construction, would be exacerbated by hurricane recovery efforts.
Despite widespread labor tightness, the majority of districts reported only "modest to moderate" wage pressures. However, some Districts reported stronger wage pressures in certain sectors, including transportation and construction. Growing use of sign-on bonuses, overtime, and other nonwage efforts to attract and retain workers was also reported.
By enabling the comparison of economic conditions in different regions, the Federal Reserve District can create an outlook for the national economy, creating an opportunity to characterize dynamics and identify emerging trends that aren’t readily apparent.
To view the full report, click here.