Some firms that expect revenue gains predict flat earnings because of escalating labor costs, while others express confidence that they have taken actions that will enable earnings to continue to grow. Temporary Employment Firms Expansion continues at First District temporary employment firms, although growth has slowed from earlier this year at some firms. Contacts report a sharp drop in activity early in the third quarter, but most recovered relatively quickly. Overall revenues are 10 to 33 percent higher than year-earlier levels. The rate of increase in wages reportedly has begun to moderate.
Contacts are cautiously optimistic about the industry's future.
All expect the usual slowdown around the holidays and some anticipate additional softening of the regional economy. Commercial Real Estate Commercial real estate in New England is doing well. Capital market problems in August created shortages of financing in September and October. As a result, sales prices of commercial properties in Boston have declined by 10 to 15 percent since August. Contacts report very low vacancy rates for office and retail space.