M&T Bank President Robert Wilmers on Serving America’s Credit Needs

For far too many Americans, the economy recovery is something about which they read — a phenomenon affecting other people in other places. It is against such a backdrop that one must weigh the unintended consequences of financial regulation, which burden the institutions that power the core of our local economies in America.

To an extent, the financial crisis may seem like a faded memory. On an annualized basis, U.S. real GDP growth has topped the 3% long-term average in four of the past six quarters — the strongest period of sustained growth since 2006. U.S. private sector employers created 2.5 million jobs in 2014 — the strongest year-over-year increase since 1999. The low interest rate environment established by the Federal Reserve, along with the efforts of ordinary people trying to minimize their financial risk, have reduced household debt service burdens to generational lows.

But while metropolitan areas are doing much better, rural areas continue to struggle. Over the past decade, U.S. employment growth has varied widely between larger urban areas and rural communities.

U.S. metropolitan areas experienced a 12% increase in private sector employment from 2003-2013 while non-metropolitan areas recorded just a 5.4% gain.

Collectively, U.S. metropolitan areas experienced a 12% increase in private sector employment from 2003-2013 while non-metropolitan areas recorded just a 5.4% gain.

More worrisome is the impact of the current, uneven recovery on the economy’s future. Tomorrow’s generation faces a number of headwinds that will forestall their ability to contribute to the next wave of economic growth. Aggregate student loan debt stands at more than $1.1 trillion, trailing only mortgage debt as the largest form of consumer indebtedness. One consequence of this rising student debt burden is deferment of home ownership — the percentage of 18-to-34 year olds who own homes has continued to decline and stands at 13% compared to over 17% before the crisis.

Contrary to their portrayals in popular media as a group of swashbuckling entrepreneurs, millennials have actually become less inclined to launch new businesses — the percentage of business owners in that demographic has not been this low since the early nineties. Since 2007, the average net worth of those under 30 has fallen by almost half.

Since 2007, the average net worth of those under 30 has fallen by almost half.

Young people who are now entering the workforce with limited professional, financial and entrepreneurial opportunities may unfortunately be losing the most vital and economically productive years of their lives. It follows, then, that the total rate of business creation from 2012 to 2013 continued the downward trend that started in 2011. These are not the signs of the kind of America for which we strive and aspire — one in which opportunity, prosperity and growth are broadly shared.

Read more at American Banker