The worst of the crisis seems to be over, as “economic activity increased modestly from January to mid-February” in most parts of the country, according to the Fed’s Beige Book.
US companies are optimistic about the coming months, thanks to the current vaccination campaign, but the recovery in the employment situation remains slow, according to a central bank survey released on Wednesday.
“Most companies remain optimistic for the next 6-12 months,” noted the Fed in its Beige Book, a study carried out among companies in the country, questioned before February 22.
The worst of the crisis seems to have passed in the United States, since “economic activity increased modestly from January to mid-February” in most parts of the country.
The labor market situation remains mixed, since “employment levels have increased (…), albeit slowly” in most regions, underlines the Fed.
Because despite the still very high level of unemployment in the United States, many companies have “difficulties in attracting and retaining qualified workers”, forcing many companies to offer higher wages.
Indeed, in addition to the fear of contracting the Covid in the workplace, the distribution of more generous and prolonged unemployment benefits remains an obstacle to returning to work, as does childcare, according to this report.
For example, businesses in the Richmond (East Virginia) region “point out that few women have returned to work because of childcare and home schooling needs.”
The report also underlines the good health of the real estate sector, with a still very strong demand for new and old houses. On the other hand, the situation has “deteriorated a little” for commercial real estate – hotels, shops, offices.
And manufacturing activity, which is facing a rise in the prices of raw materials and spare parts, as well as the global shortage of electronic chips, has seen its activity increase “modestly”.
The next meeting of the Fed’s Monetary Policy Committee (FOMC) will take place on March 16 and 17.