Fed: Economic Growth Slow But Continuing

Wednesday, March 6, 2013, 4:14pm


 

Economic growth in the Greater Boston area and throughout New England is on a sluggish upward trajectory, according to the Federal Reserve’s most recent Beige Book report.

The report, which was released today, is based on interviews with area business leaders. Retailers largely reported sales increases of just 1 to 3 percent over the same time last year.

Manufacturing firms painted a mixed picture, with half of the dozen firms surveyed reporting higher sales from a year ago, two reporting flat sales and four reporting lower sales.

Software and information technology services also reported less-than-impressive activity. However, some contacts who spoke with the Fed reported considerable growth since 2010, some as a result of expanded accounts with global insurance companies, while others replied that they would shed jobs or maintain a level headcount. Most expect more robust growth during the second quarter of 2013.

Commercial real estate is a mixed picture. Leasing inquiries remain steady in Boston, but one contact reported little urgency to sign deals, the report notes.

Staffing services firms reported a pickup in activity during the fourth quarter, however, with most reporting that permanent and temporary-to-permanent placements are up from the same time a year ago.

And residential real estate also reported year-over-year growth. While Realtors are confident in buyer demand, they worry that low inventory could quash sales growth. Though the Realtors surveyed by the Fed were generally optimistic that growth would continue and home prices would appreciate, many also expressed concern that the improvement could be dampened if economic recovery slows.

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