The Federal Open Market Committee on Thursday voted unanimously to lower interest rates by a quarter of a percentage point, effective Nov. 8. 

The move brings down the federal funds rate — the interest rate banks charge each other for borrowing money — to a targeted range of 4.5% to 4.75% from its current level of 4.75% to 5%.

Lower interest rates going forward was one of SIA’s base assumptions when it forecast staffing industry revenue would rise 5% in 2025 after falling 10% this year in its US Staffing Industry Forecast: September 2024 Update report. 

One potential effect of higher interest rates on staffing is higher caution among client firms.

The committee is “strongly committed” to supporting maximum employment and returning inflation to its 2% objective, according to the announcement released by the Federal Reserve’s Board of Governors, and recent indicators suggest that economic activity has continued to expand at a solid pace.

“Since earlier in the year, labor market conditions have generally eased, and the unemployment rate has moved up but remains low,” the announcement stated. “Inflation has made progress toward the Committee’s 2% objective but remains somewhat elevated.”

The goal is to achieve maximum employment and inflation at the rate of 2% over the longer run.

“The Committee judges that the risks to achieving its employment and inflation goals are roughly in balance,” it said. “The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.”