By Catie George, Director, Communications & Storytelling
The Dallas Regional Chamber (DRC) hosted one of its most historic events Thursday, Nov. 14, when Federal Reserve Chair Jerome Powell spoke to more than 800 community members and leaders at the Music Hall at Fair Park.
Chair Powell covered the state of the economy, inflation, and artificial intelligence (AI). Read the takeaways from the special event below.
Dallas’ economic status set the stage for Chair Powell’s visit
Dallas-Fort Worth is the fourth-largest market in the United States and is on pace to pass Chicago by 2028 to be the third-largest market in the country. If Dallas-Fort Worth were a country, its economy would be ranked 23rd globally.
“Chair Powell’s decision to come to speak to us underscores [the fact] that the Dallas Region is a key player in shaping the national economic conversation,” said Cynt Marshall, CEO of the Dallas Mavericks and 2024 DRC Board Chair. “What great timing to have Jerome Powell speak to us at this moment in time. As head of the Federal Reserve, Chair Powell’s decisions have profound effects on every part of our lives and businesses, shaping our economy, impacting industries, and touching communities.”
Chair Powell’s outlook on the economy is promising
Before the keynote conversation, Chair Powell gave remarks about his overview of the current state and expectations of the economy.
“We remain resolute in our commitment to the dual mandate given to us by Congress: maximum employment and price stability,” said Powell. “Our aim has been to return inflation to our objective without the kind of painful rise in unemployment that has often accompanied past efforts to bring down high inflation. That would be a highly desirable result for the communities, families, and businesses we serve. While the task is not complete, we’ve made a good deal of progress toward that outcome.”
Powell shared that the country has largely recovered from the COVID-19 pandemic’s economic effects, including inflation—a major global concern post-pandemic.
“Looking back, the U.S. economy has weathered a global pandemic and its aftermath and is now back to a good place,” he said. “The labor market remains in solid condition. Inflation has eased substantially from its peak, and we believe it’s on a stable path to our 2% goal. We are committed to retaining our economy’s strength by returning inflation to our goal while supporting maximum employment.”
However, Chair Powell’s positive outlook does not mean a quicker decline in interest rates.
“The recent performance of our economy has been remarkably good, by far the best of any major economy in the world,” Powell commented. “The economy is not sending any signals that we need to be in a hurry to lower [interest] rates. The strength we’re currently seeing in the economy gives us the ability to approach our decisions carefully.”
Talent and employment trends are an indicator of economic strength
Powell’s positive assessment of the economy carried over to the fact that the U.S. is experiencing historically low unemployment levels.
“The labor market remains in solid condition, having cooled off from the significantly overheated conditions of a couple of years ago, and it is now, by many metrics, back to more normal levels that are consistent with our employment mandate,” Powell said. “The number of job openings is now just slightly above the number of unemployed Americans seeking work.”
Chair Powell shared more positive news for companies: the Great Resignation sparked by the pandemic has come to an end.
“The rate at which workers quit their jobs is below the pre-pandemic pace after touching historic highs two years ago,” said Powell. “Wages are still increasing but at a more sustainable pace, and hiring has slowed from earlier in the year.”
The DRC’s Economy in Brief provides a one-stop resource for regional, state, and national unemployment rates and total employment. The DRC also provides Talent and Workforce Resources to help companies find and retain talent and job seekers match with living-wage roles.
Artificial Intelligence is increasing productivity but still requires caution
Generative AI, capable of producing text, images, or other materials, is still a relatively new phenomenon. While it has shown great capacity for increasing productivity, Powell comments that it is still relatively rare in the financial sector.
“Generative AI is just in the early stages, and certainly, the companies, the banks in particular, that we deal with are not really using it yet,” said Powell in his conversation with The Washington Post Opinion Columnist Catherine Rampell. “They’re very aware of the risks in it.”
The fact is that more time is needed to see just what effects AI will have.
“You can find estimates from credible organizations that generative AI will create a large burst in productivity in the next decade. You can also find skeptics, very credible skeptics, who think that that’s usually overdone,” said Powell. “The history has been that there’s innovation, there’s technology. It doesn’t show up in the productivity statistics at all [at first], and then it shows up a lot but much later. So, it’s usually later and bigger than we expect. That may be the case here. It is an extraordinary set of developments, and the ability to replace a lot of work that’s currently done by humans, including well-educated humans, is obvious.”
Watch the live stream on the Dallas Regional Chamber’s YouTube channel to view the full event, which was made possible because of the generous partnership of the Dallas Federal Reserve and the World Affairs Council.