Cover Story - Florida and Georgia Find Jackpots With Lotteries
Base Closing Woes Don't Materialize
|Views from the Region
he Federal Reserve Bank of Atlanta periodically polls business representatives throughout the Southeast about their opinions on economic trends, and their observations are published in the Fed's Beigebook. In the Beigebook issued May 8, business representatives' comments suggest that the economy continued to expand in early spring, although reports showed some softness as well as strength. Here is a summary of their views.
- Most district retailers reported that same-store sales in March and early April exceeded year-ago levels. However, some retailers noted that increasing competition and cold weather in early March did cut into sales.
- Home-related products continued to be a strong seller across the district, but apparel sales were mixed.
Tourism and Business Travel
- The majority of industry contacts reported that factory activity edged down or was steady in March and early April.
- New orders and production for some textile and carpet manufacturers have picked up recently. However, reports of downsizings and plant closings of weaker, less competitive apparel firms continued in parts of Mississippi and Alabama. Some contacts expressed concern over growing paper inventories, and several lumber mills have cut back on total hours worked.
- More positively, strong business activity was reported for producers of electrical and electronic machinery. A large consumer-durable manufacturer is also expanding in the western part of the district.
- The outlook is positive for the tourism and convention sectors, according to industry contacts.
- South Florida destination resorts are close to fully booked, and summer advance bookings are ahead of last year's. In Nashville, hotel managers feel that the third and fourth quarters will be strong with rising occupancy rates. Casino operators along Mississippi's Gulf Coast reported continued good traffic with gambling revenues rising moderately over last year.
- Most real estate contacts reported that single-family home sales were ahead of year-ago levels in March and anticipated strong April sales as well.
- Contacts from across the district reported that commercial and multifamily real estate markets continued to improve. Low vacancy rates and higher rents are propelling new apartment and office development. Most real estate professionals continue to anticipate that new commercial and multifamily construction will grow this year.
Wages and Prices
- Contacts in the banking industry described overall loan demand as steady. Bankers reported that commercial lending continued to outpace consumer lending.
- Bankers also found automobile financing to be strong and mortgage lending up slightly.
- Some merchants and other service industry spokespeople reported that the ability to fill entry-level positions has become a challenge. Atlanta's boom in new retail and service businesses has forced many employers to pay well over minimum wage.
- Manufacturing contacts reported fewer increases in prices for both finished goods and materials than was the case in late winter. Some factory contacts noted price deflation, especially in paper products.