July 19, 2013
The Southeast economy's trend of modest growth continued in May, according to the Atlanta Fed's latest Data Digest. In addition to the continued, albeit slow, growth in total employment, the region's manufacturing sector expanded for the fifth consecutive month and the housing market strengthened further.
Southeast labor markets continued to show slow but steady improvement. Some sectors have seen particularly strong job growth, including the business services and leisure and tourism sectors. Meanwhile, the government sector is still shedding jobs across much of the region. Earlier this year, Tennessee saw its unemployment rate creep above the national average, where it has remained for four consecutive months. Tennessee is joined by Georgia and Mississippi, which also have jobless rates above the national average.
The region's manufacturing sector continued to expand in May, although the pace of expansion decelerated slightly. The Southeast Purchasing Managers Index (PMI), produced by the Econometric Center at Kennesaw State University, fell 2.3 points to 53.2. The component indexes for each of the southeastern states were also in expansionary territory, as indicated by a reading above 50.
The spring also brought about a continued recovery in regional housing markets. Although prices fell on a year-over-year basis in Alabama and Mississippi, the remaining southeastern states experienced rising home prices. In addition, the Atlanta Fed's monthly poll of residential brokers and builders reported stronger sales and lower inventories compared to year-ago levels across much of the region. A majority of brokers and builders also noted that their outlook for sales is slightly higher than it was a year ago.