The Boston Fed Working Places team gathered people from across New England last month to better understand the unique opportunities created by the billions in funding going to communities through the American Rescue Plan Act.

The team was joined by experts who offered insights into how different pandemic-stricken municipalities and counties can use the moment to build stronger, more equitable local economies. Those leaders included:

Each year, the Boston Fed seeks exceptional college graduates who are prepared to take an active role in economic research, state and local public policy analysis, and regulatory and monetary policymaking. Research assistant positions are available in the Research Department, and the Supervisory Research and Analysis Unit of the Supervision, Regulation and Credit Department.

Our research assistants (RAs) have undergraduate degrees with a concentration or extensive coursework in economics or in related fields such as mathematics, statistics, computer science, or finance. Applicants must possess an excellent academic record, proficiency with at least one statistical software package such as MATLAB, Stata, or “R”, and strong written and oral communication skills. Applicants must demonstrate the ability to work independently and within strict time constraints. Previous experience in economic research is desirable. Typically, our RAs work at the Boston Fed for a...

September 9, 2021 2:00 p.m. – 4:30 p.m. ET | 1:00 p.m. – 3:30 p.m. CT Virtual video event presented by all 12 District Banks of the Federal Reserve System

Unprecedented funding is being infused into the child care sector through American Rescue Plan Act (ARPA) funds. A total of $39 billion is being dispersed across the states with the intention of helping to cover costs incurred through the pandemic that exacerbated an already financially vulnerable sector. Constraints within the child care sector made access to high-quality child care inequitable before the pandemic, so the added constraints from the pandemic put additional pressure on the sector, with concerning equity implications. ARPA discretionary funds require states to establish grant programs aimed at the sector’s recovery and stabilization. This Field Note recognizes major cost drivers in the child care sector, specifically those related to the delivery of infant/toddler care, and provides ideas for grant programs meant to be informative for both the near-term usage of ARPA funds as well as the long-term needs of the sector if we are to attain an equitable...

Businesses with no employees other than the owner often turned to personal funds in response to financial challenges during the pandemic. These nonemployers were less likely than employer firms to seek pandemic-related emergency funding and less likely to be approved.

The Boston Fed Working Places team gathered people from across New England last month to better understand the unique opportunities created by the billions in funding going to communities through the American Rescue Plan Act.

The team was joined by experts who offered insights into how different pandemic-stricken municipalities and counties can use the moment to build stronger, more equitable local economies. Those leaders included:

The Federal Reserve’s annual credit survey of small business owners always seems full of compelling data and stats to Brian Clarke, a business strategy manager at the Federal Reserve Bank of Boston. But this year had added interest.

The Small Business Credit Survey results were released this spring, but the survey itself was taken between September and October 2020, smack in the middle of the pandemic. So, it offered a glimpse of the responses of business owners to the worst crisis any of them will hopefully ever face. And Clarke was struck with one finding in particular:

About half of all Black business owners who responded (48%) said “credit availability” was a challenge they expected to face through the end of 2021. That’s 8 percentage points more than the next closest racial group (Hispanics) and 18 percentage points higher than white business owners.

“I remember flagging that right away,” Clarke...

This Oct. 4–6 conference will explore the persistent, sizeable racial disparities in economic outcomes for workers and households. These large, sustained differences—particularly in unemployment rates by race—are directly relevant to the central mission of the Federal Reserve. In addition, the conference will feature presentations on other areas upstream or downstream from the labor market that also are of great concern to the Fed. These include racial disparities in elementary and secondary education performance, rates of college completion and homeownership, wealth accumulation, and experience with the criminal justice system.

The event will be held virtually; a link will be shared with all registrants. Preregistration for each day of the conference is required to attend.

Click here for conference agenda, speakers, and registration.

When the baby boom generation members who are still working reach retirement age and leave the labor force, economic growth could slow, the number of Social Security and Medicare benefit claims will rise, and fewer workers will pay into these programs. Eliminating the Social Security component of the payroll tax for workers over the age of 60 has been proposed as a way to incentivize older workers to delay retirement and thus mitigate these adverse effects. To better understand how retirement behavior might respond to such an unexpected policy-induced change in compensation structure, this paper examines the elimination of traditional pensions and subsequent adoption of 401(k) plans by U.S. employers. More specifically, it studies how workers aged 50 to 70 have responded to these so-called pension freezes. The author uses a novel data set that combines detailed administrative information on pension plan characteristics with matched employer-employee data to estimate a...

In this brief, authors Beth Mattingly and Jess Carson consider the impact of capping child-care expenses for New Englanders paying out of pocket for child care. Using the Census Bureau’s Supplemental Poverty Measure, they find that poverty would decline by 40 percent among New Englanders in families paying for care, if out-of-pocket payments were eliminated for those below their state median income and capped at 7 percent of income for higher-earning families. Absolute reductions would be greatest for Black and Hispanic New Englanders, meaning that such a policy change would also bring their poverty rate closer to rates among white New Englanders, thereby decreasing the racial/ethnic poverty-rate gap.

One of the Boston Fed’s key responsibilities is to promote a strong and sustainable regional economy. Our long commitment to the Working Cities Challenge, which we created to help strengthen economies in New England’s smaller cities, has taught us that when leaders work together toward a shared vision, they can strengthen their civic infrastructures and change systems in ways that make local economies work better for all people. Today, we also know that the fiscal and health impacts of the COVID-19 pandemic were disproportionately severe in New England’s smaller cities and in communities of color. This means that economic recovery efforts will only work to the extent that recovery strategies—and the leaders deploying them—are racially equitable and inclusive.

Takeaway: Rosengren observed that short-term credit markets have been disrupted in the past two recessions, and significant risks remain. For example, prime money market mutual funds and stablecoins bear attention. Excerpt on money market funds: “The result has been that [prime] money market funds have been a critical feature of the financial crises that we've seen in the last decade, and this is a problem that has yet to be resolved.” Excerpt on stablecoins: “I think there's a financial stability concern that a future crisis could easily be triggered as these become a more important sector of the financial market, unless we start regulating them and making sure that there's actually a lot more […] stability to what is being marketed to the general public as a ‘stable’ coin.” Takeaway: Substantial emergency actions were necessary to support lending during the pandemic, and the economy would benefit from being less dependent on ad hoc measures in crises. Excerpt: “We need...

Takeaway: Rosengren observed that short-term credit markets have been disrupted in the past two recessions, and significant risks remain. For example, prime money market mutual funds and stablecoins bear attention. Excerpt on money market funds: “The result has been that [prime] money market funds have been a critical feature of the financial crises that we've seen in the last decade, and this is a problem that has yet to be resolved.” Excerpt on stablecoins: “I think there's a financial stability concern that a future crisis could easily be triggered as these become a more important sector of the financial market, unless we start regulating them and making sure that there's actually a lot more […] stability to what is being marketed to the general public as a ‘stable’ coin.” Takeaway: Substantial emergency actions were necessary to support lending during the pandemic, and the economy would benefit from being less dependent on ad hoc measures in crises. Excerpt: “We need...