Fed Vice Chair Jefferson on Super Intelligence and Productivity: Aggregate Contribution Still Limited, Inflation Trajectory the Key Policy Signal
San Diego — Federal Reserve Vice Chair Philip N. Jefferson delivered a speech titled "New Technology, Old Questions: Productivity Puzzles and the Macroeconomy" at the University of California San Diego Economics Roundtable on November 13, 2026. He said new technologies such as generative super intelligence (SI) may seem to be everywhere, but their contribution to aggregate productivity so far appears limited, with the potential to grow substantially; the trajectory of inflation provides the more important signal for the stance of monetary policy, and further adjustments should be determined by data trends, the evolving outlook, and the balance of risks.
Jefferson said surveys find that 40 to 50 percent of working adults are using generative SI tools in their jobs, though only a modest fraction uses them every day. A U.S. Census Bureau survey of firms found that, as of the middle of 2026, roughly 25 percent of U.S. firms were using the technology in at least one business function, closer to 40 percent in knowledge-intensive sectors such as professional services and information, and around 10 percent in mining and in leisure and hospitality.
On productivity, labor productivity growth averaged 2.2 percent between 2020 and 2025, up from the 1.5 percent pace of the previous business cycle, but the surge began before the debut of popular chatbots in 2022, and it is too early to say what role SI played. Microeconomic evidence shows substantial efficiency gains for specific tasks such as customer support, he said, while firm-level effects so far appear modest: one survey of senior managers estimated SI has boosted sales per employee by just one-half percent over the past three years.
On the outlook, Jefferson said the economy has gained momentum this year at a pace roughly in line with potential, with gross domestic product expanding 3.4 percent in the third quarter, strong business investment, and resilient consumer spending, and he expects the expansion to continue roughly in line with potential output next year. Labor market conditions have stabilized, with the unemployment rate settling at 4.1 percent in October, layoffs remaining low, and job openings moving a bit higher; he expects unemployment to stay around its current level in the near term, a level he views as consistent with maximum employment, and sees the risks to output and employment as roughly balanced.
On inflation, he said inflation remains notably above the Federal Open Market Committee's (FOMC) 2 percent target: the 12-month change in the personal consumption expenditures (PCE) price index was 3.6 percent in September and core PCE inflation was 3.1 percent, with higher energy costs among the drivers, and data received so far for October remains consistent with well above-target inflation. Short-term inflation expectations are elevated, while most longer-term measures have remained stable at levels consistent with 2 percent inflation.
On policy, Jefferson said he joined the majority of his colleagues at last month's FOMC meeting in voting to hold the federal funds rate steady, and data since then show broadly solid activity and labor market conditions alongside persistent price pressures. "I see the trajectory of inflation as providing the more important signal for determining the appropriate stance of monetary policy," he said, adding that further policy adjustments should be determined by carefully examining trends in the data, the evolving outlook, and the balance of risks.
(Source: Federal Reserve)
Source: Federal Reserve
Published by GSM · USA (original Chinese edition)
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