Twelfth District Beige Book

Economic activity in the Twelfth District remained largely stable during the April through mid-May reporting period. Employment levels were generally unchanged, with most employers holding head counts flat and hiring selectively. Wages rose slightly. Prices increased moderately, largely driven by higher fuel costs due to the ongoing conflict in the Middle East. Retail sales and demand for consumer and business services were unchanged on net. Manufacturing activity rose somewhat, while conditions in agriculture and resource-related sectors weakened somewhat. Activity in residential real estate continued to cool slightly, and commercial real estate activity was unchanged on net. Conditions in the financial services sector were stable overall. Rising needs and reduced funding continued to strain community organizations’ ability to provide support and services. Contacts reported a weak economic outlook, though sentiment was slightly more optimistic than in the prior period.

Economic activity in the Twelfth District was somewhat subdued but largely stable during the mid-February through March reporting period. Employment levels remained generally stable, and most employers held their head counts flat and hired only to replace departing workers. Wages continued to rise at a slight pace. Prices rose moderately, driven primarily by sizable increases in energy costs. Retail sales grew slightly on net, while demand for consumer and business services was stable overall. Activity in manufacturing, commercial real estate, and financial services was steady. Conditions in agriculture, resource-related sectors, and residential real estate softened a little. Community needs remained elevated, and rising gas prices strained household budgets. Contacts reported a weaker economic outlook and heightened uncertainty stemming from the impact of the ongoing conflict in the Middle East on energy markets and global supply chains.

Economic activity in the Twelfth District slowed slightly during the January through mid-February reporting period. Overall employment levels were stable on net, but there were reports of layoffs in the technology sector and attrition without replacement in other sectors. Wages grew at a slight pace, and annual pay increases were generally in line with historical averages. Prices rose moderately, and several contacts reported their input costs rising at a faster pace than their selling prices. Retail sales declined slightly, with consumers reportedly pulling back spending following the holiday shopping season, and contacts continued to describe a bifurcated, or K-shaped, economy. Demand for consumer and business services and residential real estate weakened slightly overall. Conditions in the manufacturing, agriculture, and resource-related sectors were stable on net, while activity in commercial real estate and financial services varied by market segment but were unchanged on balance. Demand for community support services, particularly for housing and food assistance, remained high. The economic outlook improved overall, with a higher share of contacts expecting economic activity this year to be similar to or slightly stronger than last year.

Economic activity in the Twelfth District expanded modestly during the mid-November through December reporting period. Employment levels were largely stable, although some contacts reported recent and planned layoffs. Wages grew somewhat, and the rate of price increases intensified in recent weeks from a modest to a moderate pace. Retail sales grew modestly overall, with muted holiday shopping in November giving way to stronger-than-expected spending in December, stemming mainly from high-income consumers. Conditions in the services, real estate, agriculture, and resource-related sectors were stable on net, while manufacturing activity softened somewhat. Lending activity increased slightly, as borrowing rates fell. Demand for community services, particularly for food assistance and childcare, remained high. Contacts’ economic outlook improved slightly since the previous report.

Economic conditions in the Twelfth District were mixed during the October to mid-November reporting period. Employment levels largely held steady as most employers hired primarily to replace voluntary departures. Wages rose somewhat, and prices were up modestly. Activity in retail trade, agriculture, and residential real estate eased slightly while activity in services and commercial real estate remained largely unchanged on balance. Manufacturing activity was mixed. Lending activity strengthened marginally. Conditions in community support organizations and small businesses worsened somewhat. Contacts’ economic outlook was little changed over the reporting period.

Economic activity in the Twelfth District edged down slightly during the mid-August to September reporting period. Employment levels were little changed on net as most employers held head counts steady. Wages grew slightly, and prices rose modestly. Activity in retail trade and residential real estate decreased somewhat while commercial real estate activity was unchanged on balance. Manufacturing and lending activity remained largely stable. Conditions in agriculture and resource-related sectors weakened slightly. Conditions in the consumer and business services sector were mixed. Conditions in community support organizations and small businesses weakened modestly. Contacts’ economic outlook weakened somewhat relative to the prior reporting period.

Economic activity in the Twelfth District edged down slightly during the July to mid-August reporting period. Employment levels were down slightly as employers laid off workers and did not fill vacated positions. Wages grew somewhat, and prices rose modestly overall. Conditions in retail trade and the consumer and business services sector weakened slightly. Manufacturing activity declined modestly, and conditions in agriculture and resource-related sectors were somewhat weaker. In both residential and commercial real estate, activity was slow but unchanged. Financial sector conditions were stable. Community support organizations struggled to balance the continued demand for services against declines in funding. Looking ahead, contacts’ economic outlook weakened some relative to the prior reporting period.