The Southeast economy's performance in 2013 was much like it was the year before. Despite strengthening in some key sectors, overall economic activity was restrained, wrote Atlanta Fed economic policy analysis specialist Shalini Patel in "2013: Another Year of Modest Growth."
The article, featured in the fourth-quarter 2013 edition of EconSouth, recaps the economic year in the Southeast and looks ahead to 2014.
The hospitality industry was a source of economic strength in the region, Patel said. Tourism grew at a "reasonably fast" pace, thanks to growth in business and leisure travel, which offset a slowdown in government travel. Looking ahead to the first two quarters of 2014, the hotel sector is already showing strong advance bookings, she noted.
Strong auto sales were another bright spot, along with improvements in the region's housing markets. The gains in housing were relatively broad as home sales in each southeastern state were ahead of year-ago levels for all of 2013. The Atlanta Fed's business contacts noted that lower inventories had constrained sales and pushed up prices. Industry observers also noted a slowdown in sales in recent months, the article said.
While the southeastern economy did progress in 2014, business contacts throughout the region noted the effects of policy uncertainty on consumer and business confidence. "Many contacts noted that all of these uncertainties were leading to decision-making paralysis, causing businesses to sit on their hands' until confidence returns," Patel noted. Not surprisingly, then, about half of the Atlanta Fed's contacts indicated they expect growth to continue at current levels in 2014 and only 29 percent expect higher growth. Another roughly 20 percent expect growth to be lower in the short term, the article noted.
To read more about how the southeastern economy performed in 2013 and the outlook for the upcoming year, read the full article in the fourth-quarter 2013 issue of EconSouth.