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New England economy growing, but hiring lags

But region’s firms are hopeful, survey says

New England business revenues are on the upswing, but an uncertain economic and political outlook has stopped many employers from hiring, according to a survey released yesterday by the Federal Reserve.

“With the exception of software and [Information Technology] services, contacts say their firms are doing mostly replacement hiring,’’ the survey found.

Known as the Beige Book, the survey is published eight times a year in advance of the Fed’s interest rate setting meetings. Fed policy makers next meet Dec. 13. Nationally, the survey found that economic activity increased “at a slow to moderate pace’’ and consumer spending rose modestly since the last survey in early October.


In New England, retailers said their estimates of 2011 annual sales are generally more positive than they were in October. Many expressed optimism about 2012, reporting that consumers are slowly regaining confidence.

Software and information technology companies, which have helped New England weather the economic downturn better than other regions, reported that demand for their products and services remains good, with revenues increasing from mid-single digits to 20 percent from July to September, compared with the same period a year ago.

Manufacturers reported a mixed outlook clouded by concerns about the global economy. All but one of the manufacturers surveyed reported increased sales, with many reporting double-digit growth from last year. Most firms reported the strongest demand from Asia, followed by domestic sales.

“Even Europe results remain fairly robust,’’ the survey said, despite the debt crisis affecting many European nations.

Overseas business travel also continued to show strength, travel and tourism businesses told the Fed. Domestic leisure travel, however, was fueled mainly by affluent consumers. Hotel bookings for 2012 appeared strong, but booking for holiday parties was one weak spot, the survey found.

Residential real estate was described as “stable and consistent’’ though many firms reported that the beginning of a market recovery remains fairly distant. Tighter credit standards constrained some buyers. In greater Boston, median sale prices in October fell 10.5 percent from last year, according to the Fed.


Megan Woolhouse can be reached at mwoolhouse@globe.com.