Retailers report strong sales growth and little price inflation. Most manufacturers are also seeing their business grow and indicate they are not raising prices. Labor markets remain tight. Most companies say base wages are rising at a 3 to 5 percent pace, although increasing numbers say they are raising wages more than this. In addition, temp firms report wages are up 5 to 10 percent from a year earlier.
Firms continue to implement technologies or strategies that economize on labor and other inputs.
Respondents in all sectors characterize their results as strong. Permanent employment is said to be holding steady. Most retailers indicate that base wages are increasing at a 3 to 5 percent rate, although overall compensation is increasing faster because of performance-based incentives. However, contacts in faster-growing sectors are raising wages at a 5 to 10 percent pace in order to attract scarce labor. Retailers continue to report little evidence of inflation except in the fast-growing tourist sector.