Wherever you read comments on the current economy you see slow, steady, moderate and mixed. I guess that means we are going forward at a snails pace. But I continue to believe slow and steady wins the race.
Anecdotal reports from the Federal Reserve Banks suggest economic activity continued to expand in all Districts in September and early October but the pace of growth decelerated since August. Growth was similar to that observed in the last Beige Book in seven Districts--Atlanta, Boston, Chicago, Minneapolis, New York, Philadelphia and St. Louis. The economy grew at a slower rate in five Districts--Cleveland, Dallas, Kansas City, Richmond and San Francisco. The expansion was variously characterized as "moderate," "modest" and "mixed."
Labor markets remain tight across much of the country, and there continues to be moderate upward pressure on wages and benefits. Job growth eased in some regions, however, and wage pressures softened.
Most Districts report worker shortages in a variety of occupations, with sizable wage increases for workers in short supply. Positions mentioned as difficult to fill include scientific, technical, accounting, finance, engineering, marketing, health-care, truckers, welders, ironworkers, crane operators, office workers and energy-service workers. Low-skilled and entry-level workers are in short supply in some areas, including those in the retail and hospitality industries.
The Ninth District economy grew modestly since the last report. Growth was noted in tourism, services, manufacturing, energy, mining and agriculture. Consumer spending and commercial real estate growth slowed, while commercial construction was steady. Residential construction and real estate continued to weaken. Employment growth was mixed, with tightening conditions in Montana and the Dakotas, but with unemployment rates higher than a year ago in Minnesota and Wisconsin. Overall wage increases were moderate, while prices increased for diesel fuel and decreased for gasoline and lumber.
Employment growth was mixed. Labor markets generally continued to tighten in Montana and the Dakotas, but unemployment rates were higher than a year ago in Minnesota and Wisconsin. In addition, August nonfarm employment growth was stronger in Montana and the Dakotas (above 2 percent) compared with Minnesota and Wisconsin (below 1 percent).
In Minnesota, a medical devices company recently announced plans to eliminate several jobs. August seasonally adjusted initial claims for unemployment insurance in Minnesota were 7 percent higher than a year earlier. A temporary staffing agency survey of Minneapolis-St. Paul businesses showed that 44 percent of respondents expected to hire workers during the fourth quarter, while 24 percent expected to reduce staff. In last year's survey, 36 percent expected increased hiring and 11 percent anticipated decreases.
Overall wage increases were moderate. After a 13-day strike, clerical, health care and technical workers at the University of Minnesota agreed to annual raises of 2.25 percent to 2.5 percent for two years.