Federal Reserve Banks across the country collect anecdotes from contacts and hone in on concerns for Federal Reserve Beige Book summaries, published eight times each year. Historically, insights about conditions affecting low- and moderate-income communities have come from the perspective of businesses. Several Reserve Banks began including “Community Conditions” and “Community Perspectives” sections in the fall of 2022. These sections provide insight into local changes through direct accounts of nonprofit and community leaders and workforce professionals serving lower-income people. Here are some takeaways from the May 2025 Beige Book, which was prepared at the Federal Reserve Bank of St. Louis and based on information collected on or before May 23, 2025.

Please note that the Beige Book summarizes comments received from contacts outside the Federal Reserve and is not a commentary on the views of Federal Reserve officials.

“Non-profits and other community-based organizations continued to face heightened financial pressures. Increasing distress due to federal government cuts to social programs have extended into healthcare, housing, and the arts and humanities. At the same time, non-profits and other community organizations have also faced higher costs of materials due to tariffs. While local governments have stepped in to provide support and relief payments to subcontracting organizations affected by delayed or cancelled federal funding, gaps remain.”
– New York Fed, Federal Reserve 2^nd District, Community Perspectives

“Community contacts reported that uncertainty surrounding federal funding, inflation, and tariffs caused disruptions in social service and economic development programs serving low- and moderate-income households. One contact observed that funding cuts led some organizations to pause hiring or provision of new services, and others noted a general reduction in essential wraparound services. Another contact mentioned that funding cuts led to monies being pulled from major brownfield remediation projects, leaving site cleanups and the consolidation of police, fire, and 911 services partially complete. Uncertainty over the impacts of inflation and tariffs on building costs led to the stoppage of some housing developments, according to one organization.”
– Cleveland Fed, Federal Reserve 4^th District, Community Conditions

“A broad range of nonprofit and philanthropic contacts said that current and potential federal funding cuts threatened the ability of social service providers to meet community needs or continue operations, as other funding sources are generally insufficient to replace federal dollars. Contacts in the sector reported taking action to shore up their financial positions, including reductions in staff and building reserves.”
– Atlanta Fed, Federal Reserve 6^th District, Community Perspectives

“Community, nonprofit, and other nonbusiness contacts reported a continued decline in economic activity and noted the ongoing negative impact of federal policy uncertainty on activities and planning. State government contacts saw increases in sales tax revenues but declines in payroll withholding. One contact said that while initial unemployment claims had increased in their state, the length of unemployment spells had declined. Small business intermediaries reported that their clients were working to understand the impact of tariffs on their business and pricing models. Leaders of nonprofit and social service organizations noted increased competition for private and philanthropic dollars due to federal funding cuts and fewer federal funding opportunities. Organizations serving low-income communities reported concern about the impact of reduced federal support, in particular on the availability of childcare.”
– Chicago Fed, Federal Reserve 7^th District, Community Conditions

“Most Community Development Financial Institutions (CDFIs) across the Tenth District reported their underwriting standards tightened modestly and that they were seeing more financial stress among clients. Credit scores and conditions of their clients were worsening, and more clients were coming in seeking debt consolidation. Payday and student loans were a rising concern with more borrowers showing derogatory marks on their credit reports. Native CDFIs highlighted concerns regarding CDFI recertification, which one contact estimated could result in a loss of 40 percent of Native CDFIs nationwide. Moreover, Native CDFIs expressed concerns about lending to organizations with revenues associated with government contracts.”
– Kansas City Fed, Federal Reserve 10^th District, Community Conditions

“Demand for social services remained elevated, and several contacts noted an uptick in clients seeking assistance for basic necessities, particularly among low-income workers and immigrant populations. Multiple contacts cited access to public transportation and childcare as significant challenges for workforce participation. A contact in South Texas said many residents are still facing issues from recent flooding, particularly those who did not qualify for federal assistance yet cannot afford to replace ruined cars or fix damage to their homes. New resource constraints, like the pullback in federal funding for food pantries and AmeriCorps, impeded organizations’ ability to meet the increased demand they are observing. Refugee and immigration services noted a severe impact from federal funding cuts. Nonprofits shared that funding instability is a key concern for the foreseeable future.”
– Dallas Fed, Federal Reserve 11^th District, Community Perspectives

“Conditions in the community support and services sector deteriorated as federal funding and charitable donations dropped notably. Demand for community and support services rose somewhat as individuals and households continued to seek housing, health care, and food assistance. Meanwhile, many nonprofit organizations reduced their staff and were less able to meet basic community needs. Availability of affordable housing continued to be a concern for contacts across the District.”
– San Francisco Fed, Federal Reserve 12^th District, Community Conditions

Visit the May Beige Book report for a full national summary and more information about economic conditions from each Reserve Bank, including labor markets, financial services, real estate, and more.