Fed’s Watchdog Says Board Can Do More to Diversify Workforce

(Bloomberg) -- The Federal Reserve Board of Governors’ inspector general said the US central bank can take additional steps to bolster its hiring practices after seeing a drop-off in the diversity of late-stage applicants. 

In a report posted to the Office of Inspector General’s website Monday and dated Sept. 25, the watchdog made seven recommendations to strengthen hiring practices at the Board of Governors. The IG found that from 2018 to 2022, the pool of applicants for jobs at the Board became less diverse during the last two stages of the hiring cycle.

“The Board’s mission is to promote a strong economy for the American people by fostering the stability, integrity and efficiency of the nation’s monetary, financial and payment systems,” the IG said in its report. “Attracting, developing and retaining a diverse workforce with varied experiences and perspectives will help the Board to successfully meet its mission.”

The IG said the Board should anonymize resumes, provide training for hiring managers, develop guidance with baseline expectations for the entire hiring process and collect applicant demographic data, among other recommendations.

The Fed’s board has come under criticism in the past few years for a lack of diversity, particularly in its top ranks. It’s one of the biggest employers of doctorate-level economists, yet just a quarter of them are non-White. 

In response to the IG’s report, the Fed’s division of management said it “concurs or generally concurs” with the recommendations and has outlined actions it’ll take to address them. 

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