The District has continued to see steady, ongoing growth in economic activity throughout the last few months but at a pace that’s somewhat slower than it was earlier this year.
Anecdotal accounts from District contacts are consistent with a slight softening in economic activity. Some of this softening is attributable to developments in the auto sector. As auto sales have slowed, auto makers have reduced production. Given that the District’s auto production accounted for almost 16 percent of national light-vehicle production and about 30 percent of national passenger-car production in 2016,1 these cuts have had and are likely to continue to have a negative impact on the manufacturers and service providers tied to the industry. Nevertheless, reports from freight and construction contacts suggest that conditions remain relatively favorable for their firms, though these firms tend to see more activity at this time of the year.
Generally good economic conditions continue to support a strong labor market in the District. Through June, District employment grew 1.1 percent relative to that of this time a year ago, while the District’s unemployment rate has remained low and stable at about 5.0 percent for slightly longer than the last two years.
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Fourth District Beige Book
The Beige Book, released 8 times a year, contains reports of economic conditions across the United States by region. Reports are based on information gathered primarily through interviews with business people and are prepared by each of the 12 Federal Reserve Banks for their respective Districts.
Below is the most recent summary from the Fourth District’s Beige Book report.Summary of Economic Activity
Aggregate business activity grew at a moderate pace in the Fourth District since our last report, an improvement from the modest growth seen in the prior period. Labor markets expanded, with wage pressures reported primarily in the construction, manufacturing, and energy sectors. Upward pressure on prices paid was prevalent in the construction industry. Freight carriers and construction contractors increased billing rates and reported little pushback. Consumer spending at brick-and-mortar establishments rose slightly, while new motor vehicle sales strengthened. Manufacturing activity grew slightly overall, but production at District motor vehicle assembly plants trended lower. Nonfinancial services firms saw moderate gains in activity. Year-to-date residential real estate unit sales stayed above year-ago levels and selling prices were higher. Activity in the commercial real estate market remained elevated.