Federal Reserve Chairman Jerome Powell said Monday that despite solid economic progress, the country still faces a number of challenges ranging from slow wage-growth for lower-income workers to sluggish productivity and an aging population.
Powell said in remarks at a Fed award ceremony that these challenges remain even though unemployment is near five-decade low and the financial system has been bolstered since the 2008 financial crisis.
While there have been recent gains in wage growth, Powell said that wages for lower-income workers have grown quite slowly over the past few decades.
He also noted that a decadeslong decline in economic mobility has made it more difficult for lower-income Americans to move up the economic ladder.
In his remarks, Powell praised the work of the Fed’s community development staff and former Fed Chair Janet Yellen, who put a special emphasis on efforts to help disadvantaged communities during her 16 years at the Fed, including the last four as Fed chair.
Powell did not discuss the Fed’s current interest-rate policies in his appearance.
The central bank has raised rates three times this year and is expected to boost rates for a fourth time at its Dec. 18-19. Powell sent the stock market surging last week when he signaled that the Fed may decide to slow the pace of rate hikes next year.
Investors had been hoping to learn more about Powell’s current thinking in testimony he was scheduled to deliver Wednesday before the congressional Joint Economic Committee. However, that appearance was canceled because of the government closure for the funeral of former President George H.W. Bush.
Both Powell and Fed board member Lael Brainard praised the work that Yellen did to help disadvantaged communities.
“Chair Yellen was attentive to low- and moderate-income communities, recognizing that Americans on the most precarious rungs of the ladder often feel the impacts of a downturn soonest and the longest,” Brainard said.
Both officials spoke at a ceremony honoring Yellen’s work with the presentation of a newly established Janet L. Yellen Award for Excellence in Community Development.
This year’s award, which goes to a Fed staffer who has excelled in work to help disadvantaged communities, was presented to Ariel Cisneros of the Federal Reserve Bank of Kansas City.