An executive from the Federal Reserve System's Atlanta District said the economy in the Southeastern United States is starting to pick up, despite a lag in the energy sector because of low oil prices.
Federal Reserve Regional Executive, New Orleans branch, Adrienne Slack was guest speaker at Tuesday's East Mississippi Business Development Corporation's Business Before Hours event at the Mississippi State University/Meridian's Riley Center.
Slack was joined at the head table by banking executives from all of Meridian's area banks. During her presentation, Slack showed slides representing how the U.S. economy has rebounded from a financial crisis in the Great Recession of 2009.
"The gross domestic product (GDP) or the growth of the American economy has been chugging along since the financial crisis, at a pretty steady clip in that 2-2.5 to 3 percent growth rate," Slack said. "What we are also looking at is the health of the labor market. We have made a tremendous amount of progress with regards to the U.S. labor market with unemployment sitting at 5.3 percent. We still feel there is some slack left in the labor market, but our policy is accommodative in nature to ensure that we are providing support."
In her position as a regional executive in New Orleans for the Federal Reserve's Sixth District in Atlanta, Slack is one of five regional executives who report to Atlanta Federal Reserve Bank President & CEO Dennis Lockhart. The other regional heads are in Birmingham, Jacksonville, Miami and Nashville. Lockhart is a voting member on the Federal Open Market Committee, the chief monetary policy body that reports to the Federal Reserve Board of Governors and Chairman Janet Yellen.
Slack said the Southeastern U.S. economy is performing nearly on par with the rest of the nation, with the exception in two areas, energy and tourism.
"Generally, the Southeastern U.S. is performing in a healthy manner with the exception of the energy industry that has been impacted by the downturn in oil," Slack said. "Tourism is in another place and I would point to it as being strong. Occupancy rates are up and so are the number of tourists. In medical, we are seeing a lot of activity in the southeast U.S., but we look very much like the rest of the country there."
Slack said inflation is another data her branch looks at closely.
"The pricing-pressure businesses are not experiencing those in a way today that necessarily has us at 2 percent inflation," Slack said. "But again we are watching the data to ensure that it is continuing to tell us."
Part of Slack's trip is to gather information from banking executives and business leaders on how things are within certain areas – like East Mississippi.
"The general position of business leaders in the Gulf South over the last 30 days is very positive," Slack said. "Even when I speak with people in the energy industry, they are still making adjustments for the short and medium term, their long term outlook is not necessarily diminished. Businesses outside energy, like tourism, is very strong. Manufacturing is experiencing demand. There continues to be a tightening in the labor force and I'm also hearing some signs of wage pressure, particularly in those areas of impacted by tourism and manufacturing."
Wayne Henson, chief executive officer for the East Mississippi Electric Power Association and an EMBDC vice president, found Slack's assessments informative.
"It was very interesting that she is so knowledgeable about our region," Henson said. "It's very good to hear that the Federal Reserve appears to see some very positive signs. We still have pockets in the southeast that are not performing well. Like all of us, we'd love to know what the federal interest rates will do, but I guess we will all have to wait on that."
Citizen's National Bank Chief Executive Officer and President Archie R. McDonnell met with Slack afterwards along with other officials – including EMBDC CEO & President Bill Hannah – for a roundtable discussion.
"We had a good dialogue with her and her associate about how the economy of East Mississippi is doing and how it compares to other areas," McDonnell said. "I found it very informative and I felt she thought the same thing and will be able to take that information back to New Orleans and Atlanta."
Slack said that was another of her purposes for coming to Meridian.
"I wanted to provide an economic overview of the Federal Reserve and how that fits into what we're looking in determining monetary policy for the United States," Slack said. "We are a dual mandated organization and what that means is we are responsible for a stable financial system and full employment."