Labor market conditions remained stable or continued to show modest improvement during the period from mid-February through the end of March, according to the Federal Reserve’s Beige Book report released Wednesday. Difficulty finding skilled workers was frequently reported and districts noted modest upward pressure on wages and overall prices.

However, multiple districts also reported layoffs related to the decline in oil and gas prices.

Increases in hiring or employment levels were reported in the New York, Richmond, Atlanta, Chicago, St. Louis and Dallas districts. In Boston, only stronger-performing firms made significant increases to employment levels, while payrolls in Cleveland remained generally stable.

Labor market changes in Minneapolis were described as mixed, since several layoffs were announced. Layoffs in the manufacturing and energy sectors were reported in multiple districts including Cleveland, Atlanta, Minneapolis, Kansas City and Dallas. These reductions were primarily related to the decline in gas and oil prices and the resultant decline in upstream demand such as iron ore mining and steel manufacturing.

Skilled workers continue to be in high demand in Chicago, and firms in many districts — including Richmond, Atlanta, St. Louis, Kansas City and Dallas — reported difficulty finding skilled workers, especially in professional and business services and the IT sectors. The Richmond, Atlanta and St. Louis districts specifically noted an increasing incidence of voluntary turnover of employees.

Staffing-firm observations include:

• A central Pennsylvania staffing contact reported his firm was very busy and the area unemployment rate was very low. The contact also reported there were more open positions than people unemployed. Most contacts, including those from staffing firms, continued to note little significant change in wage pressures.
• Hiring in the Dallas district was noted by most airlines and restaurants, and scattered employment increases were seen among staffing, retail and transportation services firms. Staffing firms said Dallas was the source of much of the demand growth in Texas, while demand abated in Houston and Fort Worth, with low oil prices cited most often as the basis for the weakness.
• A staffing firm in the Chicago district reported steady demand for its services. In contrast, some manufacturers facing weaker demand reported cutting back on hours. Contacts continued to indicate demand was strongest for skilled workers, particularly for those in professional and technical occupations and skilled manufacturing and building trades.