Fed Beige Book: Hiring Expected to Remain Low Until Next Year

Posted December 4, 2024

The Federal Reserve Board released the Beige Book for November reported balance across sectors with strong demand for hiring and capital expenditures rising in the near term.

While employment levels in the Tenth District remained mostly steady, hiring activity is expected to pick up next year thanks to demand and an overstretched workforce. However, most contacts in the Tenth District reported the quality of applicants for skilled positions diminished relative to last year, according to the Fed. As a result, some companies indicated hiring standards for lower-skilled positions may have to be tightened.

Moreover, contacts indicated they do not plan to raise wages substantially over the next year.

The manufacturing sector experienced little change with professional and consumer services activity growing at a moderate pace.

Among manufacturing and services firms, planned capital expenditures grew modestly with many other contacts opting to self-fund capital expenditures to avoid high borrowing costs.

Investor sentiment in commercial real estate improved in recent months, however, loan demand was relatively low due to higher interest rates.

Loan demand in most sectors experienced little change overall. Residential mortgage loans, in particular, saw an increase in demand despite previous predictions. Banks reported credit standards for commercial and industrial loans tightened somewhat due to a change in expectations for the economic outlook.

View the full Federal Reserve Board Beige Book November 2024 report, here.