Fed Report Shows Some Improvement In IT Economy

Anecdotal evidence suggests a mild upswing in IT employment and investments.

The Federal Reserve Board, after surveying its 12 district banks, suggests muted improvement in the nation's IT-related economy, according to the board's most recent Beige Book released Wednesday.

The Beige Book, published eight times a year, gathers anecdotal information on current economic conditions from the Fed's district banks. Information is based on interviews with key business contacts and analysis by Fed bank and branch directors. What follows are IT-related excerpts from the most recent Beige Book:

Third District (Philadelphia). Some securities firms are adding employees and increasing IT capacity in response to greater business volume. IT companies indicated that demand for their services has strengthened due to improvement in their clients' businesses, an increase in information-systems requirements to support regulatory compliance, and a growing need to upgrade computer systems.

Fifth District (Richmond, Va.). In Greensboro, N.C., an agent reported an "active market" and said that the future was expected to be even brighter as a new computer manufacturing facility brought additional jobs to the area.

Sixth District (Atlanta). Contacts in some parts of the district reported that demand for workers in technology service industries has improved. Less optimistic was the report that a computer circuit-board manufacturer plans to cut 525 jobs in response to strong competition from Asian producers, and a machine-tool firm reported a decline in new orders.

Ninth District (Minneapolis). A representative of a placement firm for technology professionals in Minnesota expects the job market for information technology workers to steadily improve during 2005.

Eleventh District (Dallas). Demand picked up slightly for industrial-communications equipment, such as switches and power sources, and growth is now about the same as a year ago. Those firms say demand from businesses has improved recently, but consumer activity is unchanged since last year. Further layoffs are anticipated as a result of investments in productivity-enhancing capital equipment.

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