Federal Reserve Bank of San Francisco

Economic Research

Western Economic Developments September 1996

Date of Publication: 1996-09-01

1996-09-01

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Executive Summary

  • The District economy has expanded more strongly thus far in 1996 than it did in 1995. In July, payroll employment was 3.2 percent above its year earlier level, although growth for that month was somewhat below the brisk pace recorded in the second quarter.
  • Strong growth continued in California, with payroll employment expanding at a 2 percent annualized pace on average in June and July. The Washington economy, boosted by expansion at Boeing, accelerated noticeably in recent months.
  • Signs of slightly moderated growth have appeared in the fast growth Intermountain states and Oregon. However, among all District states, only Hawaii and to a lesser extent Alaska showed any significant weakness.
  • Several District states have experienced sustained or increasing labor market tightness. Average hourly wage figures reveal that the associated labor shortages have had a noticeable effect on wage growth in manufacturing, construction, and wholesale and retail trade in several states.