Dear Friends and Colleagues,

The Bank is excited to welcome new leadership this August, and we hope you’ll take a minute to learn more about our incoming president and CEO, Beth Hammack. During any change, it’s hard not to reflect on the staying power and purpose of the Federal Reserve’s community development work, which is larger than any person or initiative: to help improve economic outcomes in lower-income communities and ensure that all people can participate and prosper in the economy. Piecing together the puzzle that is the economy is a continuous challenge. It is also one that motivates us to ensure that our understanding of the economy —as complex as it is—reflects everyone, particularly those who may face barriers related to income, race, ethnicity, gender, or geography.

To do this well, each Reserve Bank tailors its community development function to respond to the economic needs of the region it serves. In doing so, we use available data and conversations with community members to keep a pulse on emerging trends. For example, you may have heard me or one of my colleagues ask a question like

• How have lower-income people’s needs changed in the past few weeks, months, or years?
• What has stayed the same?
• What policies and programs are working, and what could work better?

We would like to extend a special thank you to our former president Loretta Mester, whose constant interest in and inquiries about how the economy works—or may not be working—for businesses, workers, and their families encouraged us to deepen our understanding of the diversity of people's lived experiences while contemplating solutions. Rest assured that we will continue to ask questions, listen and elevate solutions.

You'll see that below, we continue to strive to bring you information on short-term developments but also long-term, stickier structural issues. Thanks always to our colleagues at the Federal Reserve and our partners in the community for your commitment to improving the lives of lower-income people—today and for future generations.

Sincerely, 

Emily Garr Pacetti and the Cleveland Fed Community Development team

Featured

Cleveland Fed welcomes incoming president and CEO 

On May 29, the Cleveland Fed announced the appointment of Beth Hammack as its next president and chief executive officer. “Beth Hammack is the ideal leader to build on the great work already underway at the Cleveland Fed to promote a healthy economy and financial stability within the region and on the national stage,” said Heidi Gartland, chair of the presidential search committee and the Cleveland Fed’s board of directors. Learn more about Hammack and the search process that led to her selection.

Decline in affordable housing noted in Community Issues Survey

Earlier this year, we surveyed nonprofits and other organizations who work directly with low- and moderate-income communities in our region. Their input helps us learn more about the state of LMI households and the organizations that serve them during a time of high inflation and high interest rates. Key takeaways include:

• Job availability remains strong but shows signs of slowing.

• Access to affordable housing continues to be limited due to supply shortages, increased property taxes, and strain from growing populations.

• Household budgets are still being strained by inflation.

• Because of the current job market, nonprofits are having difficulty hiring and retaining staff while still trying to meet the needs of their communities.

Read more.

Keeping a pulse on the Fourth District

The Federal Reserve’s Beige Book includes sections devoted to the conditions of lower-income individuals and communities. The most recent report includes the following insights from the Fourth District: 

• Affordable housing developers said that demand remained high but that community opposition and difficulty accessing financing were slowing housing production.
• Increased housing costs contributed to a recent uptick in delinquent utility bill payments, according to some contacts.

 Find a summary of entries related to conditions in LMI communities here.

Affordable Housing and Quality Neighborhoods

Survey findings indicate families worry about ability to pay for unexpected expenses 

The Federal Reserve’s Survey of Household Economics and Decisionmaking tracks financial circumstances and risks for low- and moderate-income families. This year’s survey includes topics like inflation, emergency savings, and new areas such as food sufficiency and caregiving.

New reports examine home lending trends in the region by race and income

Increased home purchase loans to Black borrowers in select counties in the region contributed to higher Black homeownership rates, but the gap with white homeownership rates remained large, a survey of mortgage data shows. Higher interest rates, increased house prices, and slower income growth made borrowing more expensive for all groups. Read more.

Small Business

Fed report: Small-business leaders reveal conditions and challenges of 2023

A small-business report from the Federal Reserve suggests a further decrease of effects from the COVID-19 pandemic and a modest improvement in small-business conditions. Still, small businesses continue to face headwinds. See how small employer firms were faring in 2023 and their outlooks for 2024 in the 2024 Report on Employer Firms: Findings from the 2023 Small Business Credit Survey.

Chartbooks now available with latest data by firm type and geography 

Analyzing small-business data across firm and owner characteristics can provide a helpful framework for understanding business experiences and credit outcomes. The 2024 Firms in Focus chartbooks (including data for Cleveland and data broken down by state, including for Pennsylvania and Ohio) are now available.

Are you a nonprofit who works with or supports small businesses? Click here to learn more about becoming a partner.

Workforce

Unpaid debts result in 1.7 million suspensions of Ohio driver’s licenses in an average year, which could adversely impact the labor market. Community Development policy advisor, Kyle Fee, recently shared more on the impact of debt-related driver's license suspensions in Ohio in this Crain's Forum op-ed. You can read the full Community Development report here.

Access to high-quality early childhood education can support families’ participation in the economy 

We spoke with Community Advisory Council member and Executive Director of King’s Daughters Child Care, Jamie Remp, about the importance of high-quality early childhood education. Learn how this relates to the economy in our latest blog.  

How organizations can more effectively utilize public assistance calculators

The Atlanta Fed designed the Career Ladder Identifier and Financial Forecaster (CLIFF) tools to help workers make more informed financial decisions about job training and employment in the context of public assistance loss and paying for basic expenses. A recent discussion paper covers ways that organizations can more effectively incorporate public assistance calculators into existing financial and career coaching contexts.

Events

FedTalk Recordings

Watch the recordings from our latest FedTalks. Recent topics include supervising banks and addressing the worker skills gap.

FedTalk: Childcare and Our Economy: Understanding Constraints and Possible Solutions

July 17

Small Business Credit Survey Partnership Meeting (For organizations serving small businesses in Ohio, Pennsylvania, West Virginia, and Kentucky)

July 25

Pittsburgh NeighborWorks Training Institute 2024

August 26–30 

Minorities in Banking Forum

 October 2–3 

Meet the Federal Reserve Bank of Cleveland’s Community Development Department. 

Got this through a forward? Subscribe here for 2–4 updates per year.