Washington, D.C., Mar. 4-- Employment is growing slowly as the U.S. economy continues to expand, the Federal Reserve reported Wednesday.
The latest "beige book," a survey of anecdotal reports from the Fed's 12 district banks, said employment generally showed modest increases in January and February.
The economy's ability to create jobs has emerged as one of the hottest issues in the 2004 presidential campaign, and the puny employment-growth numbers of recent months have raised questions about how durable the current economic expansion will prove.
Wages and salaries have increased slightly in recent weeks but employers are grumbling about big rises in employee health-care costs, the Fed reported. The Fed's Boston district bank reported that temporary-help firms were sending more workers to manufacturing companies, software developers and government agencies. Demand is gradually increasing at employment agencies in New York. The San Francisco district found that retailers, builders and agricultural employers "have been increasing their hiring moderately."
Overall economic activity "was variously described as moderate in Boston, Philadelphia, Cleveland, Atlanta, Chicago, St. Louis and Kansas City; firm in Minneapolis, sound in San Francisco and showing signs of accelerating in New York, Richmond and Dallas," the report said.
Despite surges in some raw-material costs, such as steel and lumber, most districts reported "fairly stable or slowly rising retail prices" in the past two months.
Economists at Bear Stearns called the latest beige book "modestly upbeat."
While the beige book offered impressionistic images, traders and investors are fixated on something far more concrete: the scheduled release Friday of February payrolls data. Those numbers will provide more evidence on whether the recovering economy is finally starting to generate new jobs on a significant scale.
