Business activity in the New York and Northern New Jersey area saw stabilization in March after months of decline. This positive trend was reflected in the New York Federal Reserve March 2024 Business Leaders Survey index moving higher by eight points to reach 0.6. However, the business climate index dropped by two points to -26.4, indicating that business conditions are still “worse than normal.”
Despite this, Richard Deitz, the economic research adviser at the New York Fed, noted that business activity in the New York-Northern New Jersey service sector remained steady in March, breaking the streak of consecutive declines. Employment and capital spending stayed flat, but firms expressed optimism about the future business climate.
The survey of firms in the region found that 30% reported improved business conditions, while another 30% reported worsened conditions. Capital spending stayed flat, and prices paid by businesses rose by five points. The wages index saw a three-point decline, indicating a slowdown in wage increases. Employment levels remained unchanged.
This report follows the Empire State Manufacturing Survey from the previous week, which indicated a significant drop in manufacturing activity in the region. While these regional reports cover a small area, they do offer insight into the broader movements of the economy. Overall, it seems that while businesses are becoming more optimistic about their future prospects, there is still much work to be done to improve overall economic conditions in the region.
