Thread by @sam_a_bell

Jay Powell says labor market is not tight

Beige book disagrees: "Employment was steady to rising modestly in most Districts, while labor markets remained tight throughout the nation."

https://twitter.com/federalreserve/status/1217522147104645121

"Wage growth was characterized as modest or moderate in most Districts—similar to the prior reporting period—and there were scattered reports of wage increases from year-end hikes in minimum wages." @ernietedeschi

@ernietedeschi Boston region

"Respondents in these three sectors also reported continued tight labor markets, but none mentioned increasing wages (other than scheduled minimum wage rises in some states)."

@ernietedeschi New York

"The labor market has remained tight across the District, while hiring has been restrained... Businesses in most sectors reported that wage growth has been modest and little changed, though contacts in finance reported flat wages overall."

@ernietedeschi Philadelphia

"Labor markets remained excessively tight throughout the District, and wages continued growing moderately."

@ernietedeschi Heaven forbid!

"Another noted that a new hire took another job during the firm's onboarding orientation."

@ernietedeschi Richmond

"The tight labor market led some firms to increase benefits and wages, ease background screening requirements, and invest in labor-saving technology. To retain workers, firms have increased wages, training, and talent development."

@ernietedeschi Atlanta

"Businesses reported continuing to explore new recruiting and retention tactics, such as offering a variety of benefits, paying for training and certifications, and clearly demonstrating potential career paths..."

@ernietedeschi "... Many firms continued to pursue investments in automation and technology, which are expected to ultimately reduce headcount requirements. On average, firms maintained merit increases of 2.5-4 percent, though wage pressure continued to build for lower-skilled positions."

@ernietedeschi St. Louis

"Firms' reported ability to raise wages remains positively related to their size, with smaller firms struggling to increase wages. Arkansas, Illinois, and Missouri minimum wage increases have also come into effect with the new year..."

@ernietedeschi "... Uncertainty over how this will impact market wages of various positions has led some Missouri contacts to delay hiring for at least a month. An Arkansas contact reported multiple retailers are hiring fewer workers to counteract the increase in labor costs."

@ernietedeschi Minneapolis

"Fewer than half of staffing firms polled by the Minneapolis Fed said wages grew by more than 3 percent over the past 12 months, though more than 60 percent said they expected wage increases above 3 percent over the coming year."

@ernietedeschi "a contact in Michigan's U.P. said housekeeping positions have recently seen wage increases of 10 percent or more... a manufacturer of hardwood products with plants in Wisconsin that has been 'significantly affected' by tariffs cut wages by 10 percent."

@ernietedeschi Kansas City

"...labor shortages were cited as the single biggest problem among a majority of respondents. Wages continued to expand at a modest pace."

🤔🤨

@ernietedeschi you know what to do KC

@ernietedeschi Dallas

"A survey of more than 300 Texas businesses showed that 2019 wage growth was 3.9 percent, on average, down from 4.5 percent in 2018 but about the same as in 2017. Expectations among surveyed firms were for 3.8 percent wage growth in 2020, on average."

@ernietedeschi San Fran

"Worker turnover remained high, with firms reporting increased investment in job training and automation as ways to enhance productivity... Entry-level wages also rose in many sectors including finance, tourism, and retail despite reports of decreasing labor quality."

@ernietedeschi "A business services provider in the Pacific Northwest and a hotelier in California each raised concerns about wage compression in the face of increasing entry-level and minimum wages. Employers across the District also observed that benefit packages expanded..."