In remarks at the 2026 Investing in Rural America Conference, Federal Reserve Board Governor Lisa Cook said inflation has remained above the Federal Reserve’s 2 percent target for more than five years and reiterated that she voted for the 25 basis point rate increase at the September Federal Open Market Committee meeting. She emphasized returning inflation to target while preserving labor market strength and assessed rural economic conditions as broadly aligned with national trends, but with weaker labor force participation, slower recent job creation and distinct cost pressures. Rural unemployment is close to the national rate, but the employment-to-population ratio among workers ages 25 to 54 is several percentage points lower, and job growth has shifted toward urban areas over roughly the past four years. Rural households also faced a sharper rise in living costs during the early pandemic recovery. Transportation accounts for about one-quarter of their expenses, while home values in nonmetropolitan counties, smaller metropolitan areas and low-density suburbs rose 36 percent from March 2020 to March 2023, compared with 21 percent in the densest urban counties. Rural housing inflation has since moved back toward pre-pandemic patterns, but housing remains a major source of inflation. Cook also highlighted the role of 4.3 million rural small businesses, which employ 7.4 million people and account for more than 96 percent of rural establishments. Thirty percent are less than three years old, underscoring the importance of new firms to rural employment growth alongside Federal Reserve research and investment initiatives aimed at improving credit and capital access.

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