The latest Federal Reserve report on business conditions across the country found the economy is still moving, although it has been slowed down by several factors. The report, known as “The Beige Book”, was released Wednesday.
“Economic activity grew at a modest to moderate rate, according to the majority of Federal Reserve Districts,” the report said. “Several Districts noted, however, that the pace of growth slowed this period, constrained by supply chain disruptions, labor shortages, and uncertainty around the Delta variant of COVID-19.”
Among the findings in the economic report’s national summary:
A majority of districts indicated positive growth in consumer spending.
Auto sales were widely reported as declining due to low inventory levels and rising prices.
Travel and tourism activity varied by district. Some saw increased leisure travel while others saw declines that coincided with case increases and the start of the school year.
Manufacturing, trucking and freight grew “moderately to robustly” in most parts of the country.
Outlooks for near-term economic activity remained positive overall. However, some districts noted increased uncertainty and more cautious optimism than in previous months.
When it came to employment, wages and prices, the economy report reflected some of the similar sentiments seen in recent Labor Department data.
“Employment increased at a modest to moderate rate in recent weeks, as demand for workers was high, but labor growth was dampened by a low supply of workers,” the report said. “The majority of districts reported robust wage growth. Firms reported increasing starting wages to attract talent and increasing wages for existing workers to retain them. Many also offered signing and retention bonuses, flexible work schedules, or increased vacation time to incentivize workers to remain in their positions.”
The economy report added that “most districts reported significantly elevated prices, fueled by rising demand for goods and raw materials.” Last week, the Labor Department reported its producer price index rose to 8.6 percent in September compared to the previous year. That’s the largest year-to-year increase since wholesale prices were first calculated in 2010. Consumer prices rose 5.4 percent between September of 2020 and September 2021. That’s the largest year-over-year consumer price rise since 2008.