Fed says economy grows, but storms hurt some areas
WASHINGTON — The economy has continued its slow growth but harsh snowstorms crimped activity in some parts of the country last month, according to a Federal Reserve report.
The Fed's Beige Book survey, released today, showed that the nation's recovery is managing to plod ahead though not at a strong enough pace to persuade companies to ramp up hiring. The Fed said "economic conditions continued to expand ... although severe snowstorms in early February held back activity" in some places.
Of the Fed's 12 regions surveyed, the Richmond district, which includes Maryland, Virginia and the Carolinas, was hurt the most by the bad winter. That region reported economic activity had "slackened or remained soft across most sectors" because of the weather.
Although economic setbacks from the weather are temporary, they come at a fragile time: the economy is struggling to recover from the worst and longest recession since the 1930s.
After a big growth spurt at the end of 2009, many economists believe the recovery lost steam in the first three months of this year. They predict it will grow at a pace of around 3 percent from January to March. That won't be fast enough to drive down the unemployment rate, now at 9.7 percent.
Even though companies have slowed the pace of massive layoffs, they aren't in the mood to hire. The jobs market "remained soft throughout the nation," the Fed reported.
