Business conditions in the Carolinas have improved slightly in recent weeks, buoyed by a bump in sales and shipments, though companies remain reluctant to hire, according to a new report from the Federal Reserve.
The monthly Carolinas Survey of Business Activity's main index, which measures current business activity, edged back into positive territory in September after posting a negative reading the month before. That suggests a slightly larger share of survey respondents reported an increase in activity, compared to those who noted a decrease.
Businesses reported improving sales and shipments, likely driving the overall increase, the Fed found. The general business activity expectations index, a measure of what companies expect for the next few months, rose in September, too.
Yet business leaders remain hesitant to hire, the survey showed. The current labor demand indicator inched up a point in September, remaining in positive territory - but for the past three months, it has held at a level well below that of earlier this year, meaning businesses' demand for labor is still weak.
The expected labor demand measure continued to fall, too, though it remains in positive territory.
Meanwhile, more Carolinas firms appeared to be cutting their work hours, a sign that conditions remain uncertain even for existing workers. The Fed's current average workweek index dipped into negative territory to its lowest reading since February.
In another grim sign for job seekers, businesses reported finding the right skills for open positions had become more difficult in recent months, the Fed found.
Business spending and spending plans slipped in September, with the current business services spending index falling 10 points from the month before. Measures of capital and equipment spending fell in September, too.
As for future spending, each of the Fed's three business spending expectations indexes remained positive, though they declined overall, with the index measuring how much businesses plan to spend on business services falling to its lowest reading since October 2010.
Overall, the September survey found "firms saw little improvement in economic conditions in recent weeks," the Fed report said, "although the environment did not appear to be worsening."
