Labor market conditions across the United States showed some signs of ease, according to the recent US Federal Reserve Beige Book report released on October 18. The report highlighted that while there were still challenges in recruiting skilled tradespeople in most Federal Reserve districts, the labor tightness continued to alleviate. Some districts also observed older workers remaining in the workforce. Wage growth remained modest in most districts, with fewer candidates pushing back on wage offers.
Here is a summary of the labor trends in different districts:
- Boston: Employment levels increased slightly, but one manufacturer was implementing layoffs. Wages saw only marginal growth, and there were slight-to-modest improvements in hiring and retention. The labor market remained tighter than average.
- New York: Labor conditions remained solid, with modest employment growth, although retail jobs saw a decline. Wage growth remained steady, and businesses anticipated modest increases in headcounts. However, a staffing firm in New York City noticed a slight softening in conditions recently.
- Philadelphia: Employment grew slightly, and candidates were more willing to accept job offers they may have declined in previous months. Wage pressure for skilled trade workers persisted due to the shortage of qualified candidates.
- Cleveland: Little employment growth was reported since the previous Beige Book report, with some manufacturers and auto dealers reducing staffing levels due to weaker profits and slower demand. Wage pressures eased in this district.
- Richmond, Virginia: Employment grew modestly, but firms faced challenges in finding front-line workers. Shortages of skilled trade workers were also reported, although a staffing firm specializing in executive-level marketers mentioned an excess of candidates for open roles.
- Atlanta: Labor markets softened, particularly in the shortage of skilled labor in construction. Some contacts in retail, manufacturing, and staffing reduced headcount or adjusted hours due to weaker demand. However, wage growth remained elevated.
- Chicago: Moderate employment growth was observed, but contacts reported difficulties in finding workers, especially those with higher skills. Workers showed less job-hopping behavior and pushback on wage offers.
- St. Louis: The labor market remained tight, with slight employment growth. Several industries reported a mismatch between labor supply and demand, with plenty of applicants but few with the required skills.
- Minneapolis: Employment grew modestly, but overall labor demand was somewhat slower. Fewer job openings were observed, except in the healthcare sector. Some employers were less desperate to fill positions than before.
- Kansas City: Labor market conditions remained unchanged on average. Manufacturing saw a slight gain in jobs, but these were mostly long-vacant positions rather than workforce growth. Wage growth slowed to a moderate pace.
- Dallas: Modest job growth was recorded, but some cargo carriers and high-tech companies reported layoffs. The labor market was looser than before, with wage growth continuing to normalize. Staffing firms noted that wage pressure eased due to firms being more resistant to hybrid and remote work arrangements.
- San Francisco: Labor market tightness eased slightly, but employment levels remained stable. Challenges in recruiting highly skilled workers persisted in various sectors such as nonprofits, financial services, hospitality, construction, and retail. Some sectors imposed hiring freezes, and financial services and technology firms relied on attrition and layoffs to lower headcounts. The demand for remote work flexibility also diminished among employees in Northern California.
Overall, the labor market showed signs of easing in some areas, with improvements in hiring and a decrease in wage pushback. However, challenges in recruiting skilled workers and labor market tightness remained significant concerns in several districts.