Fed survey looks at economic challenges for low, moderate-income communities

Poor economic conditions are hampering community improvements efforts in low- to moderate-income communities, according to a new survey spearheaded by the Federal Reserve.

The survey, called “Community Perspectives Survey: Insights from the Field,” polled 937 representatives of organizations serving low- to moderate-income communities. The survey, conducted in April by the Federal Reserve and four national partners, said housing and personal finance difficulties presented the biggest challenges in serving these communities. Respondents gave slightly more positive ratings on employment and education.

“Respondents were relatively optimistic about the future, except as it related to housing, personal finance and human services. Continued challenges in these areas suggest that overall conditions for economic mobility in low- to moderate-income (LMI) communities will likely remain poor over the next year,” said report co-author Nishesh Chalise, senior manager of community development at the Federal Reserve Bank of St. Louis.

It examined several different areas, including:

• Housing: Conditions for housing, particularly rental housing, were rated the worst among the areas addressed in the survey, and very few respondents expected any positive changes in housing conditions over the coming year.
• Personal finance: LMI populations respondents or service providers reported poor financial stability, which they did not expect to improve mostly due to income not keeping up with the cost of living.
• Small business: Despite identifying high interest rates as a challenge, small business respondents were generally optimistic about prospects for the coming year due to availability of grants and technical assistance in addition to some softening in the labor market.
• Health: Most survey respondents rated health conditions and access to health care as poor, with insurance coverage and mental health needs as the main challenges.
• Education: Respondents saw a strong uptake of skill and credential programs for adults, and they expected conditions for adult education to continue to improve. On the other hand, conditions for pre-K through 12th grade education were considered poor, and respondents had mixed expectations for the year ahead largely due to continued challenges in teacher hiring and retention and student absences.
• Human services and emergency assistance: Half of respondents noted conditions were poor, with a large fraction expecting conditions to worsen over the next year. Negative factors associated with housing and mental health care were mentioned as overwhelming service providers.
• Internet and technology: While over one-third of respondents said internet access was poor, most indicated that it has been improving, and they expected it to continue improving over the next year. Nevertheless, the discontinuation of the federal Affordable Connectivity Program is expected to contribute substantially to the loss of internet access for LMI populations.

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