APARTMENT ADVOCATE
NATIONAL APARTMENT ASSOCIATION
FOMC Adjusts Policy Rate Over Weak Job Market Concerns
BY GEORGE RATIU
The Federal Reserve’ s ratesetting committee looks to balance its dual mandate, which focuses on maximum employment and inflation running at 2.0 %, amid a changing economic landscape. The Federal Open Market Committee cut the funds rate by 25 basis points at the September meeting, spurred by significant downward revisions to not only the summer jobs numbers, but also those of the 12 months which ended in March of this year.
Employment data highlights rising concerns from business executives over weakening consumer confidence which could lead to a pullback in spending and sliding revenues. Retail sales have been resilient, showing consumers are still weathering rising prices. Despite ongoing consumer momentum, companies are
taking steps to trim costs. The number of open jobs has been deflating since the March 2022 peak when they reached 12.1 million. As of the latest data, there were 7.2 million posted positions.
Mirroring the slumping demand, companies added a mere 22,000 workers to their payrolls in August, a sharp downturn from the monthly average of 150,000 to 200,000 seen during a healthy economy. In addition, a recent Bureau of Labor Statistics data revision showcased that the economy added 911,000 fewer jobs during the March 2024 through March 2025 period, further signaling that employment is on shaky ground.
The Fed has been under months of intense pressure to lower rates. Over the past nine months, the central bank has been closely monitoring not only the jobs data but also the trajectory of price gains. Worryingly for the Federal Open Market Committee( FOMC), after sliding toward the bank’ s desired target of 2.0 %, inflation has rebounded in the past few months as the imposition of tariffs on most trading partners meant that importers have been passing higher costs onto consumers. Both the Consumer Price Index and the Personal Consumption Expenditures Index have been accelerating since April 2025.
For the 12 members of the FOMC, the experience of the late 1970s and early 1980s serves as a cautionary reminder that economic shocks— like this year’ s tariffs— combined with inflationary pressures can force the central bank to take more drastic monetary actions in case of runaway inflation. Informed by the lessons of that time, the committee has taken a steady
42 | TRENDS OCTOBER 2025 www. aamdhq. org