The president and CEO of the Federal Reserve Bank of New York assured the audience at Whitman on Friday that the economy has improved since the Great Recession, but said there is still more work that needs to be done.

William Dudley, a highly ranked economist, discussed his views on the economy and monetary policy in the Martin J. Whitman School of Management’s Lender Auditorium.

The speech drew such a large audience that it raised concerns about capacity. Before the speech began, Tom Barkley, an assistant professor of finance at Syracuse University, requested audience members to go to an overflow room with live-streaming.

During Dudley’s speech, he said a more rapid pace of growth is needed to help the economy overcome its slump, especially in the labor market.

“Job loss rates have fallen – like if we look at the level of initial unemployment claims, they’ve come down a lot – hiring rates have not picked up proportionally, so hiring rates remain at quite depressed levels,” he said. “So when we put it all together, what you see is a labor market that has improved somewhat, but still can’t be regarded as healthy.”

He said Syracuse’s and Upstate New York’s economies are recovering at a somewhat slower rate than the national economy. He said this is reflected by historical economic trends and the area not being as severely affected by the recession as others.

But Dudley said that both Syracuse’s recession and recovery lags behind the rest of the region, as the city lost 13,000 jobs during the downturn and has gained less than half of the jobs back. While sectors such as education, healthcare and hospitality have added jobs to the local economy, he said job losses in the manufacturing industry are weighing against these gains.

“Even though the upstate economy is not growing very fast, there is a lot more optimism about the future compared to the last time I came up here,” Dudley said.

Dudley highlighted increasing long-term interest rates, the uncertainty of the sequestration’s contraction effects and the global economic outlook as risks to an optimistic outlook on the economy.

He then briefly addressed the job market for graduates at the end of his speech.

“There is no doubt  in my mind that the Great Recession and the sluggish recovery have made it more difficult for people to find jobs coming out of school,” Dudley said.

After his speech, Dudley took questions both from a list of student-submitted questions and from the audience.

Some students who attended the event said they liked the lecture, but disagreed with what Dudley had to say on some specifics in the economy, such as keeping inflation rates as close to two percent as possible.

“I just thought they could always stimulate the economy by increasing the inflation rates,” said Mohammed Albunyan, a senior finance and economics major. “But they always keep it very limited.”

Tameem Ammourah, a junior finance and supply chain management major, agreed, adding that increasing interest rates and inflation would only make unemployment rise temporarily.

“What he’s doing is when you decrease interest rates, you pump demand into the economy,” he said. “You motivate people to go out and spend more money. But, until now, people are just wondering why he didn’t raise interest rates.”

Published on September 28, 2013 at 1:43 pm

Contact Ellen: ekmeyers@syr.edu | @ellenkmeyers