PROVIDENCE – In the Federal Reserve’s February 2018 Beige Book, First District, the Federal Reserve Bank of Boston said that the region’s economic activity expanded at a “moderate pace.”
The report noted that office leasing activity in the greater Providence area remained robust, driving further increases in rents.The report also said that suburban office space remained “less sought after.” The Rhode Island industrial property market also continued to experience strong demand.
The Beige Book report noted that most responding firms in the First District said that labor markets were tight, while retail contacts said they expected the labor market to tighten even further over the year. Staffing firms in the region noted that there was higher labor demand across the board.
According to those surveyed, the region experienced an overall increase in year-over-year retail sales, which was attributed to a “buoyant consumer sentiment” by some responding firms. However, some firms were less optimistic, saying consumers likely will be cautious going forward, one citing the volatility in the stock market.
Most manufacturing respondents in the region said that they have not made any major revisions to hiring despite noting a tight labor market, resulting in higher starting salaries and longer waits to fill open positions.
Nearly all responding manufacturers reported higher sales levels than one year ago. Some shortages in manufacturing supplies were reported – which some firms attributed to a lack of trucking capacity.
Overall, manufacturers reported a positive outlook going forward.
The report also said that residential real estate markets in the First District showed declines in closed sales despite strong demand. Closed sales for single-family homes decreased in four out of the six reporting areas at the time of the report, with New Hampshire and Maine reporting moderate increases.
The First District report was conducted for February and was released on March 7.
Chris Bergenheim is the PBN web editor.
