For release on delivery
6:00 p.m. EST
December 3, 2018
Celebrating Excellence in Community Development
Welcoming Remarks by
Jerome H. Powell
Chairman
Board of Governors of the Federal Reserve System
at
Inaugural Janet L. Yellen Award for Excellence in Community Development
Washington, D.C.
December 3, 2018
Thank you, Anna. It's an honor to be part of this important occasion. Tonight is an
opportunity to recognize the vital contributions of the Federal Reserve's community
development staff, and an opportunity to honor Chair Yellen, who did so much to advance the
Fed's community development mission.
Briefly, I would like to focus on the importance of promoting a strong economy that
extends opportunity to all and on the role our community development staff plays to advance that
goal.
The Federal Reserve's mission is to promote a strong economy and sound financial
system; I am glad to say we have made a great deal of progress toward those goals.
Unemployment is 3.7 percent, the lowest in nearly half a century. Over 17 million jobs have
been created during this expansion, with an additional 250,000 created in October.
Beyond the labor market, there are other signs of economic strength. The steady decline
in the unemployment rate is mirrored by the decline in financial hardship reported by
respondents to the Federal Reserve's Survey of Household Economics and Decisionmaking over
the past five years.1 Wage gains, increased household wealth, and elevated consumer confidence
are supporting robust consumer spending. Since the crisis, we have also taken numerous steps to
make the financial system safer and stronger, leaving it better equipped to support the financial
needs of consumers and communities through good times and bad.2
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However, the benefits of this strong economy and sound financial system have not
reached all Americans. The aggregate statistics tend to mask important disparities by income,
race, and geography.
Moreover, the economy faces a number of longer-term challenges.3 While there have
been gains in the pace of wage growth recently, wages for lower-income workers have grown
quite slowly over the past few decades. Productivity has picked up in recent months after several
years of very slow growth, but it is not clear whether this is a trend that will be sustained. An
aging population is limiting growth in labor supply, which in turn limits potential growth. And a
decades-long decline in economic mobility in the United States reflects the difficulty faced by
lower-income Americans in moving up the economic ladder.4
The Fed's community development function plays a key role in helping us carry out our
broad responsibilities. Information gathered by the community development staff ensures that
the perspectives of individuals and communities inform the Fed's research, policy, and actions.
Soliciting diverse views on issues affecting the economy and financial markets improves the
quality of our research, the fairness of our policies, and the transparency of our actions. Raising
awareness of emerging economic trends and risks makes regulation and supervision more
responsive to evolving consumer financial services markets and technologies. The Fed's
community development function also advances our Community Reinvestment Act
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responsibilities by analyzing and disseminating information related to local financial needs and
successful approaches for attracting and deploying capital. These efforts strengthen the capacity
of both financial institutions and community organizations to meet the needs of the communities
they serve.
In addition to providing us with a richer, more nuanced understanding of current
economic and financial conditions, the Federal Reserve's community development staff is deeply
engaged in helping lower-income and underserved communities overcome their challenges and
capitalize on their assets. One thing that was apparent during the recession and the uneven
recovery that followed was that people and the places they live are linked. When one struggles,
both struggle. Successful community development invests in and builds up both the physical
infrastructure and human capital in underserved areas. The Federal Reserve is uniquely
positioned to bring together diverse stakeholders to disseminate information, exchange ideas, and
identify shared interests that foster local partnerships and comprehensive solutions.
This event is an opportunity to recognize your efforts to advance solutions that build
resilient and more prosperous communities. I want to thank Ariel Cisneros--our distinguished
inaugural recipient of the Yellen Award for Excellence in Community Development--as well as
each of you for your individual and collective service to this effort.
And speaking of service: It is fitting that this award for excellence in community
development will today and thenceforth be given in honor of Janet Yellen. During your tenure
as Chair, Janet, you elevated the importance of economic and financial inclusion and the Fed's
role in community development. You reminded us that an inclusive economy is a vibrant
economy. Governor Brainard, the principal oversight governor for community development, and
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I are honored to carry this message forward. The economy benefits when we successfully tap
into the underutilized potential of more of our fellow Americans.5
Thank you, Janet, for everything that you accomplished as Chair and over a lifetime of
public service that thankfully continues today. And congratulations, Ariel, for what you have
accomplished in service to others, which has made you such a deserving recipient of this award.