Rural Economic Conference: Opening Remarks

MARTIN LAVELLE: Welcome. We appreciate everybody making it and coming. My name is Martin Lavelle. I'm a principal business economist with the Federal Reserve Bank of Chicago. But I'm based in Detroit. And we welcome you to Des Moines and day one of the Rural Futures Series, "The Lay of the Land-- Labor, Zoning, and Housing in Rural Communities."

The work I do in our Detroit branch of the Chicago Fed is I do a lot of Beige Book work, so on the real side, talking with contacts on from business, state, and local government, nonprofits to see if what's happening in all the different statistical data that we're able to look at matches up with what we're hearing on the ground with real conditions. So this conference will be a great example of that, as well as diving into some of the issues we're going to talk about and then also on the pre-FOMC side, helping to brief President Goolsbee with what he should know about what's going on in our district before going to DC for the FOMC meetings.

I will be your emcee, which seems kind of weird saying that for a Fed conference, but that's the role I'm going to play, keeping us on time and telling you hopefully the right directions, the right places to be, how things are going to go. So if you have any questions, please find me or Dustin or David or one of the other Chicago Fed staff that are here.

So a lot of thank yous and putting this together. On the Fed side, David Oppedahl, Dustin Ingram, Gar Kelly, Rick Mattoon, Susan Longworth back in Chicago that helped putting the event together, Lauren and Peter and then helping us out with-- you've already met Ye Lin and Max and Maria in the front. So thank you to them for all their help and day of and days before meetings and putting the program together and vetting and all the things that needed to get done to put this together. So we could give them a nice hand.

[APPLAUSE]

But probably most importantly, we want to thank the rural steering committee that we have at the Chicago Fed that we formed right after the conference we did in Grand Rapids two years ago. We gave the committee a pretty big responsibility in that we come at this humbly. We come at this as not the experts in trying to understand and how we should think about these issues in greater depth. And so the committee gets together with us every quarter and helped us in a big way to pick the topic that is the overarching theme of the conference and helping to give us ideas on who to bring in and what they should talk about.

So I'd like you all to stand up and be recognized when I call your name. So Marie Berry.  

[APPLAUSE]

Neil Sheridan.

[APPLAUSE]

Lisa Leady.

[APPLAUSE]

Carrie Navratil.
 
[APPLAUSE]

Ray Lai.

[APPLAUSE]

Susan Bradbury.

[APPLAUSE]

And Molly Hammond. Molly, did you make it in yet? OK, maybe Molly's not here yet, but we give Molly a nice hand, too.

[APPLAUSE]

As well as Julie Burrell and Pat Corey, who could not be with us in person. But they were a big part in putting this together, too. So one more hand for the group.

[APPLAUSE]

So now it is my honor to introduce Leslie McGranahan, who's going to give the opening remarks for the conference. She's our Senior Vice President and Director of Regional Research and Engagement of the Chicago Fed. And we thank her for her support that she's given our committee and this conference and doing it for the second time. So here's Leslie.

[APPLAUSE]

LESLIE MCGRANAHAN: Hi. Good afternoon, everyone, and thank you. And thank you, Martin. So on behalf of the Chicago Fed, I wanted to welcome you to our Rural Future Series on "The Lay of the Land-- Labor, Zoning and Housing in Rural Communities." As Martin mentioned, this conference is the culmination of a series of conversations we had following the conference we held jointly with the WE Upjohn Institute for Employment Research in 2022, in Grand Rapids, Michigan. It actually was a conference that was supposed to happen in 2020, in May, and then in 2021, and eventually we were able to hold it in person in 2022 in Grand Rapids.

One goal of that conference, which was titled "Creating Conversations on the Challenges and Opportunities Facing Rural Economic Development," was to develop relationships between researchers and practitioners and ourselves around rural economic needs and achievements. And following that conference, as Martin mentioned, we created this rural steering committee, which would regularly update us on issues central to rural communities and also play a role in generating ideas for future research and programming that we could bring additional attention and ideas to rural communities.

Today and tomorrow's conference is a result of the dedicated work of the steering committee, as well as the Fed participants who really were like elucidating the subjects where we should dig deeper. So I wanted to take a moment myself to thank the steering committee for their engagement and their help in enhancing our understanding of the challenges and opportunities in rural communities and especially the rural communities in the Chicago Fed's district and also want to just thank my Chicago Fed colleagues for their role in continuing that work.
 
So often our conversations with rural stakeholders have come back to the question of the best way to measure a rural community's progress. One of the most cited statistics or measures involves populations. Sometimes the answer is population growth. If you aren't growing, you're failing or falling. Some answers have been around the word stability, maintaining population, which is maintaining the people, the community's most important asset. And other times the answer involves shrinking smartly, allowing the community to stay viable, providing a healthy of quality of life for residents.

But any of these answers requires a community's ability to maintain and attract a strong labor force that allows it to support its residents and provide services and also a chance to take advantage of opportunities that can stimulate and attract local economic activity. And so one of the things we've consistently heard and even as the unemployment rate has been rising nationwide, is that local employers just don't have enough labor to fill open positions. It's kind of like as we go out in the community and Martin's work and others like around the Beige Book, and Susan Longworth does a lot of that as well and David and Dustin, as we talk to people, we're constantly hearing this refrain of we can't find enough people.

And we've heard this particularly and consistently in our rural areas. And this is also reflected in the low unemployment rates in many places. So I looked at a little bit at the data. And then in August of 2024, so the most recent employment data, 95% of Iowa's counties had an unemployment rates below the National unemployment rate, with the median county at 2.8%.
So this seems to suggest that the labor force is not keeping up with employer demands. So how should a community go about attracting and retaining a strong labor force? That's one of the topics that this conference will focus on. We'll look at the people side, how highlighting the resources, such as schools and a welcoming climate that bring a population in. We'll also hear about best practices that communities are employing, some of which are placemaking and looking to enhance amenities, including access to health care, transportation and child care.

Our second topic involves housing. So attracting and retaining people requires that those people have a place to live. And so possessing affordable housing is vital. This may require a housing stock that is more diverse than what's currently available in many communities. So how can a community offer the appropriate housing supply to potential residents? So we'll hear about how communities and home builders are confronting that.
Tomorrow we'll see with our own eyes a community that has had to make some big decisions after its major employer left, leaving the community, Newton, with the need to forge a new identity, and also like increasing creative zoning and land use practices have become part of the conversation, both when it comes to housing and when it comes to attracting new employers when they're looking at site selection processes. But to look at zoning and land use, we want to understand the evolution of land practices. So we'll hear from perspectives from a historian, a lawyer, and a practitioner on the subject of zoning.

And lastly, as we attract employment opportunities, we need to incorporate what's best for the community itself and its residents, so how can potential employers and investors and decision makers balance the needs of investors and community members so that attracting new businesses enhances the community's ability to thrive. So that's kind of our closing session.
 
While we don't expect all of the issues and topics we discuss to apply to all of your communities, we hope that a few things resonate with you that you can bring back home and say, let's try this because it's working somewhere else and can work for us as well, and also share with everyone else what's working in your part of the country.

So just want to finish up with two things. One, thanks for joining us. Please continue to share your perspectives with us. At the Chicago Fed, we're really fortunate to cover such a diverse part of the nation's economy, and we're really grateful to those who partner with us to help us better support, understand, and serve it. And secondly, I wanted to mention an opportunity to engage with us further in a more official capacity with the Chicago Fed.

Every three years, we recruit new members for our advisory council on small business, community, economic development, agricultural and labor, and we're doing that right now. So we go through this recruiting process once every three years. And so that's happening right now. It's a set of leaders who meet with senior leadership at the Chicago Fed twice a year to share what's going on in their communities or industries.

And these discussions inform Fed leadership to enhance their contribution to national monetary policy. So that application is currently live on our website. I see Marie, who's a current member of the advisory council, and she can say wonderful things about what a great experience it is. Or reach out to us to find more about this application process. So I just wanted to put in that pitch. And thanks, everyone, and looking forward to a really terrific couple days. So thank you, Martin.

[APPLAUSE]