Background on the Federal Reserve and its Workforce
The Federal Reserve (Fed) of the United States, an independent government agency, is responsible for conducting the nation’s monetary policy to promote maximum employment, stable prices, and moderate long-term interest rates. It consists of 12 regional Federal Reserve Banks, a board of governors in Washington D.C., and employs around 24,000 people across the system.
Who is Jerome Powell?
Jerome Powell has been the Chair of the Federal Reserve since February 2018. Appointed by President Donald Trump, Powell previously served as a partner at law firm Shaw Pittman and as an undersecretary of the Treasury for Domestic Finance during the George W. Bush administration.
Planned Workforce Reduction
According to sources familiar with the matter, as reported by Bloomberg, the Federal Reserve intends to reduce its workforce by approximately 10% over the coming years. This reduction will primarily occur through non-renewal of open positions and a deferred exit program.
“I have instructed the leadership of the Federal Reserve, here at the Board and throughout the system, to find incremental ways to consolidate functions where appropriate, modernize certain business practices, and ensure that we have the right size and capability to fulfill our statutory mission,” explained Chair Jerome Powell in an internal document.
“In the coming years, our staffing levels will decrease by about 10% relative to today,” Powell summarized.
Currently, the Fed employs around 3,000 people in Washington and approximately 21,000 across the system’s twelve regional banks.
Impact on Employees
The planned reduction will affect employees who could potentially retire by December 31, 2027, regardless of their location within the Fed system – whether in Washington or attached to one of the twelve regional banks.
Key Questions and Answers
- Q: Why is the Federal Reserve planning to reduce its workforce?
A: The Fed aims to modernize business practices, consolidate functions where appropriate, and ensure the right size and capability to fulfill its statutory mission.
- Q: How will the reduction be implemented?
A: The reduction will primarily occur through non-renewal of open positions and a deferred exit program.
- Q: How many employees will be affected by this reduction?
A: The Fed plans to reduce its workforce by approximately 10% over the next few years, affecting around 3,000 employees in Washington and approximately 21,000 across the system.
- Q: Which employees will be impacted?
A: Employees who could potentially retire by December 31, 2027, will be affected, regardless of their location within the Fed system.
