District shows strong results in March, April

Consumer spending in the district rose solidly in March and early April. Most retailers and mall managers reported sizeable sales increases compared with a year ago, especially in apparel, appliances and jewelry.

Motor vehicle sales were the exception, remaining lower than a year ago but up slightly from the last survey. Dealers noted weakening sales in trucks and sport utility vehicles, which they attributed to higher gasoline prices.

District manufacturing activity continues to expand. Plant managers reported increases in production, shipments and orders compared with the previous survey, and many firms continued to add employees. Most plant managers also noted few difficulties in obtaining materials, though some reported delays in shipments of steel and aluminum.

Residential real estate activity also increased. Most builders reported solid growth in single-family housing starts since the previous survey. However, commercial real estate remained generally unchanged since the last survey and relatively weak overall.

District energy activity continued to rise in March and early April. The count of active oil- and gas-drilling rigs in the region increased from the previous survey and was well above year-ago levels. Several energy firms said drilling activity was slightly less than desired, due to persistent shortages of labor and equipment.

Wage pressure remained modest, but many manufacturers and some retailers raised prices. The number of firms reporting worker shortages continued to increase, especially in the areas of truck driving and computers. Layoff announcements in the district exceeded hiring announcements for the first time in over a year, due to sizeable cuts at a few large companies.

The Beige Book is a collection of anecdotal information compiled from various businesses and community leaders, which is used to put together a snapshot of the state of the economy.