(Reuters) -U.S. economic activity was little changed and employment was largely stable in recent weeks even as more businesses reported headcount reductions, the Federal Reserve said on Wednesday, reinforcing concerns about labor market softening. 

"In most Districts, more employers reported lowering headcount through layoffs and attrition, with contacts citing weaker demand, elevated economic uncertainty, and, in some cases, increased investment in artificial intelligence technologies," the Fed said in its latest "Beige Book" report, a compendium of survey results, interviews, and other qualitative data from the 12 regional Fed banks.

"Nevertheless, labor supply in the hospitality, agriculture, construction, and manufacturing sectors was reportedly strained in several Districts due to recent changes to immigration policies." 

Published two weeks ahead of each Fed interest-rate-setting meeting, the report is meant to help central bankers assess the nation's health with more timely, and often more colorful, insight than is available in the official statistics. 

With the data vacuum left by the government shutdown, the Beige Book may get more weight than usual in Fed policymaker deliberations, following their decision last month to reduce the policy rate a quarter of a percentage point.

Fed Chair Jerome Powell this week said he felt the outlook for inflation and the labor market has not changed much since that decision, though economic growth has been somewhat stronger than expected.

Though financial markets are betting heavily on another interest-rate reduction at the Fed's October 28-29 meeting, central bankers appear closely divided and say they are tracking conversations with business and community leaders particularly closely. 

"Anecdotes become data," St. Louis Federal Reserve President Alberto Musalem said last week. "Sometimes you have moments where you have been hearing a story for the past six or 12 months, but suddenly a new story emerges and you get these inflection points and, you often get those in the conversations before you get them in the data."

The latest Beige Book summarizes information collected from the commercial and community contacts of each of the Fed's 12 regional banks through October 6.

It landed on the day that the Bureau of Labor Statistics had been scheduled to release a key inflation report, now delayed by the government shutdown until October 24.

"Tariff-induced input cost increases were reported across many Districts, but the extent of those higher costs passing through to final prices varied," the Fed said in the report, which featured the word 'tariff' 64 times, fewer than the previous report.

In the Fed's August Beige Book, "tariff" arose 100 times.  

Meanwhile there were fresh hints that companies were dealing with a smaller pool of available workers due to the Trump administration's immigration crackdown, as well as uncertainty about or outright softening in demand for their services and products. 

"A few contacts in construction and manufacturing noted more difficulty finding workers for their entry-level positions,and they attributed that to reduced immigration," the San Francisco Fed said.  

"A South Carolina home builder reported a decline in demand due to increased prices, which they said would result in imminent layoffs," the Richmond Fed reported.