National, global concerns slowing New England economy
Concerns about national and global economic trends has stunted business activity in New England, which had been growing modestly this year, according to a Federal Reserve survey.
Some manufacturers reported a slowdown in demand while retail activity across the region was mostly flat compared to a year ago, according to the survey, known as the Beige Book. The Fed’s snapshot of the region’s economic conditions also underscored what unemployed workers already know: “Firms are doing little hiring.’’
“Despite continued favorable conditions at some companies, nearly all manufacturing contacts voice concern regarding the current state of economic uncertainty,’’ the report said. More than one commented that the country is “talking itself into a recession.’’
The Beige Book survey, a collection of anecdotal information from businesses across the Fed’s 12 districts, is published eight times a year in advance of the central bank’s rate setting meetings. Policy makers , looking for ways to jump start the nation’s economy and stave off another recession, will next meet Sept. 20-21.
The survey noted several bright spots in the New England economy. Tourism, staffing, and information technology firms in the region reported growth. The software and information technology sector, one of the region’s strongest, reported year-over-year revenue increases, ranging from 4 percent to 30 percent, driven by “notable increases’’ in both sales and service revenues.
Many of these firms reported difficulties finding qualified software engineers, programmers, and sales personnel, adding that they have bolstered their recruitment efforts
Tourism activity has grown 7 percent growth since the beginning of the year, the survey noted, but industry scaled back its 2011 forecast to 5 percent growth for the year, due to lower consumer confidence and potential reductions in business travel. The softening has also led to an increase in promotional travel offers, the report said.
Semiconductor and related manufacturers, which have helped the Massachusetts economy weather the post-recession period better than many other states, reported a decline in demand but attributed it to cyclical buying trends, the report said. A number of firms also noted a slowdown in demand for their products in Europe, where national debt crises have hurt the economy.
Residential homes sales in New England continued to be sluggish; the median sale price of single-family homes and condos remained close to that of a year ago. The survey also reported that listings in New England were on the rise.
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