Beige Book reports growth in manufacturing, services

Overall, manufacturing activity increased slightly across the district.

Firms in aerospace, motor vehicle parts, oil and gas field machinery, paper and biofuel manufacturing reported plans to hire more workers and expand production. However, firms in plastic products, household appliances and wood products reported decreased operations or cash flow problems.

The services sector expanded as well, with firms in business support, health, professional, scientific and technical services planning to add workers.

Retail sales increased at a moderate rate, and auto sales were higher than the same time last year. Auto dealers reported that demand has been high for hybrids, small sedans and smaller sport utility vehicles and low for large vehicles and SUVs.

Home sales varied across the district, with St. Louis reporting declines but Little Rock, Ark., showing no change. Meanwhile, residential construction continued to fall, as single-family housing permits fell in nearly every metro area.

Commercial real estate market conditions were mixed throughout the district. Office vacancy rates dropped in some areas, industrial vacancy rates climbed, and other areas reported growth in industrial leasing activity.

In the banking and finance sector, loans outstanding at a sample of small- and mid-sized banks increased 1.7 percent in the second quarter, and real estate lending increased 1.5 percent. Deposits increased by a small margin.

Major district crops were at or ahead of their five-year average paces, with the exception of Missouri’s soybeans. The winter wheat harvest was about 95 percent complete throughout the district, except in Indiana and Missouri, where the harvest was about 80 percent complete.