For many, the U.S. economy is hitting the mark: unemployment is at its lowest level since before the Great Recession, inflation is stable, and the economic expansion that began in 2009 is poised to become the second-longest period of economic growth in our nation’s history.
Here in Atlanta, our regional economy is booming. Thousands of new jobs, tens of thousands of new residents, and a diverse range of businesses are moving in. In the context of the Fed’s congressional mandate of maximum sustained employment and stable prices, I feel good about the state of the overall economy.
But I also believe it is important to consider how macroeconomic outcomes are distributed across communities and demographic groups. And here, we can’t ignore that many families and communities continue to struggle. Urban, rural, black, white, brown — across our region, economic distress spans both geography and race. As a Federal Reserve Bank president, I see symptoms of economic distress as signals for unrealized economic potential.
Dramatic imbalances in how people and communities benefit from growth may limit our aggregate economic potential. For example, if a group of entrepreneurs lacks access to capital, then overall economic growth may be constrained. Similarly, if a sizable segment of our workforce lacks the skills necessary to contribute productively to the economy, then gross domestic product, or GDP, may fall short of its potential.
In a country as large and diverse as the United States, it’s inevitable that economic growth will be uneven. The question is, what do we as local and regional leaders do about it?
Since I moved to Atlanta last year, I’ve seen attempts to confront economic distress head on. Bottom-up initiatives in communities like Thomasville Heights, Grove Park, and historic English Avenue-Vine City are examples. These community revitalization efforts are tackling both place- and people-based economic distress by raising funds, channeling investment, and delivering programs and infrastructure for improved education, affordable housing, preventive health care, and small business development. They represent important efforts to address our economy’s deepest challenges.
Neighborhood-based initiatives like these are critical to unlocking economic growth potential. And they rely on grants from government sources and foundations. Atlanta has a rich ecosystem of funders who support community-driven solutions like these. But it will take more than local funding.
Work by my team suggests that initiatives like these in Atlanta (and in the Southeast generally) are underfunded by national foundations. Our bank’s Following the Money research finds that Atlanta attracts only about $15 per capita in national grant dollars per year. This compares to $22 in New York City, $25 in Denver, $30 in Boston, and $50 in San Francisco in support of similar community-driven programs.
In Atlanta and throughout the Southeast, we need as many resources as we can muster to confront these challenges.
To attract more national funding, we need to do two things. First, we need to ask for it. Public officials, local funders, and business leaders should continue their long history of engaging with national philanthropic leaders and press for greater support of our city and region. We need to challenge national foundations to support local initiatives, like those mentioned above and others, with programmatic funds.
In this context, I am excited about a new opportunity for Atlanta to tap into philanthropic resources. Two major philanthropies that have collaborated with the Fed — the Rockefeller Foundation and the Chan Zuckerberg Initiative— recently announced the Communities Thrive Challenge, which is a $10 million funding opportunity to find, strengthen, and grow community-driven approaches across America. We need to make sure our community-led initiatives compete for this funding.
Second, we need to make it easier for philanthropic dollars to land. This means clarifying our shared local and regional priorities. This also means supporting local efforts to collaborate and share resources across community-led initiatives to elevate a region-wide pipeline of philanthropic opportunities. Finally, it means strengthening the partnership between public agency leaders and local funders to build the capacity of our local community-led initiatives so they can absorb philanthropic investments from national foundations.
Success in these areas holds the promise of improving outcomes for the many families and communities in our region that are not reaching their potential. I encourage everyone to come together to advance this important goal.
Raphael Bostic is president and CEO, Federal Reserve Bank of Atlanta.