By PYMNTS | November 9, 2025

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A leading Federal Reserve official warns that problems of poorer Americans could threaten economic growth.

In an interview Saturday (Nov. 8) with the Financial Times (FT), New York Fed President John Williams says data and conversations with community leaders spotlighted the affordability crisis facing many poorer households.

“There is quite a bit of evidence … that lower and moderate-income households are facing some constraints from an affordability point of view,” Williams told the FT. “From the cost of living, the housing costs and basically many families living month to month.”

At the same time, wealthier Americans were enjoying the benefits of a stock market “booming near all-time highs.”

With the U.S. labor market cooling, Williams pointed to what he called the “disaggregated” behavior of American households as a possible factor in determining whether or not he thinks the Fed should reduce borrowing costs next month.

The FT noted that although U.S. growth has been sturdier than many economists had forecast and inflation remained above the Fed’s 2% target, the struggles facing more vulnerable households because of the high cost of living could send the economy off course.

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“Something could happen that cuts into confidence, or consumer spending growth that we’re seeing at the aggregate level may not be as robust, if you will, as it would be otherwise, given that a lot of folks are really, again, living month to month,” said Williams, who also serves as vice-chair of the Federal Open Market Committee.

Fed officials, the report added, have begun to focus more on how a jobs market which Williams described as lacking “a lot of strength and momentum” could impact the economic fortunes of everyday Americans.

As covered here last week, the latest corporate earnings season has illustrated some of the pressures facing lower-income Americans.

For example, Chipotle’s recent earnings call included comments from CEO Scott Boatwright, who touched on reduced visits from lower-income diners, echoing comments from other quick-service and casual dining brands.

“Those remarks align with PYMNTS Intelligence data showing that these lower-income households, which make up the core of the Labor Economy, face persistent financial fragility,” PYMNTS wrote. “According to the Wage to Wallet Index for October 2025, roughly 60 million U.S. workers earning $25 an hour or less, generally under $50,000 a year, account for 36.5% of all employment but only 15.1% of total consumer spending, or about $1.7 trillion annually.”