Beige Book: Pittsburgh region's hiring, pay sluggish
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The snow has been good for one thing: Tourism across the country has picked up in the last six weeks, according to a report from the Federal Reserve.
Skiers have been heading out because of higher snowfalls. New York City hotels are having a robust season, too, not because of snow, but because of Hurricane Sandy. Rooms are still full of displaced residents as well as utility workers and insurance adjusters assigned to help with the mess left by the storm.
The Fed released its latest "Commentary on Current Economic Conditions" Wednesday -- a summary of field reports from around the country on how business is doing in different sectors -- with a limited mention of the federal budget sequestration and how it will affect the defense industry and retail and tourism spending. The sequestration, which went into effect Friday, means automatic spending cuts to federal programs.
In most of the country, the Fed reported the residential real estate market was up, while the commercial real estate market tended to be mixed in different districts. In the Cleveland District, which includes Pittsburgh, both residential and commercial real estate are still being held back by trouble obtaining financing.
Builders reported paying higher prices for lumber and slightly higher prices for concrete. General contractors are worried that a dwindling number of subcontractors may mean subcontracting companies could be raising their prices later this year.
In this region, the Fed reported hiring was sluggish, although staffing firms said job openings and placements are picking up with jobs available in shale gas, motor vehicles and professional business services.
Salaries were not rising in the Cleveland District and rose only on a limited basis across the country.
Retailers mostly reported slowed sales, saying rising wage taxes pulled back spending. Automobile dealers reported their sales were up for January and February, mostly because of good weather and pent-up demand.
Manufacturers reported that orders in the Cleveland District were steady or up slightly in the last six weeks but defense contractors were worried about the effects of the sequestration. Manufacturers also said that while wages were remaining steady, the cost of health insurance continues to rise.
Bankers were considering layoffs because of the shrinking interest rates.
And while coal production declined in West Virginia and eastern Kentucky, shale gas companies were adding to their payrolls.
Truck drivers may be able to demand a little more money as freight companies are worried about a potential driver shortage in the summer.
First Published March 7, 2013 12:00 am