The supply chain disruption, the labour shortage and a covid resurgence triggered by the Delta variant caused the economic slowdown in the United States from mid-August to September, as per a Federal Reserve survey.
The Federal Reserve in its latest survey on economic conditions said that the outlook for near-term economic activity has remained overall positive. However, it added that some districts have noted the increased uncertainty and more and more cautious optimism than in the last months.
The Federal survey, also known as the Beige Book, is based on information collected from its 12 regional reserve banks.
The economic activity and the growth of employment were modest to moderate in recent months because the demand for the workers was high and the labour growth was reduced by low supply of workers according to Xinhua news agency.
"Firms reported high turnover, as workers left for other jobs or retired. Child-care issues and vaccine mandates were widely cited as contributing to the problem, along with Covid-related absences."
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The survey also noted that most districts reported "significantly elevated prices," fuelled by rising demand for goods and raw materials.
"Reports of input cost increases were widespread across industry sectors, driven by product scarcity resulting from supply chain bottlenecks," it said.
According to a report released by the Fed on Monday, US industrial production tumbled in September due to the lingering effects of Hurricane Ida and severe supply constraints.
Total industrial production fell 1.3 per cent in September, following a revised decline of 0.1 per cent in August, the central bank said.
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