U.S. economy grew modestly in July and August, says Fed
Staff Writer |
The U.S. economy expanded modestly in July and August as manufacturing picked up slightly, retail sales were flat and payrolls increased moderately, the Federal Reserve said.
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Job growth was "moderate," the beige book said. The Labor Department reported strong employment gains averaging about 273,000 in June and July but a slowdown to just 151,000 additions in August.
Yet hiring may be at least partly constrained by a smaller pool of available workers as a result of the 4.9% unemployment rate.
The Fed said the labor market "remained tight" in the Boston, Chicago, New York, San Francisco, St. Louis and Minneapolis districts. And there were "an unusually high number of job openings" in Boston.
"In many districts, businesses reported trouble filling job vacancies for high-skilled positions, especially those aimed at technology specialists, engineers and selected construction workers," the report said.
That led to strong wage gains in some areas, particularly for high-skilled workers, such as technology specialists in San Francisco and construction and retail workers in Cleveland.
Retail sales "appeared little changed" during the summer, in line with the government’s flat reading of July sales following three strong months of gains. While the Boston, Cleveland and San Francisco bank districts cited modest growth, store sales fell in the Chicago, Dallas and Kansas City areas.
Auto sales, which has been a pillar of economic growth, slowed in a number of regions, including New York, Cleveland, San Francisco, Atlanta and Chicago, but "remained at high levels in general."
Tourism was largely unchanged, as a dip in demand for hotel rooms in Dallas, St. Louis and New York was offset by vibrant activity in the Chicago and San Francisco areas.
The strong dollar curtailed visits to Minneapolis and San Francisco. And there were fewer foreign visitors in Atlanta, leading Fed contacts there "to monitor the potential impact of the Zika virus on international travel." ■