Business and civic leaders from across the region recently gathered for The Chamber of Commerce for Greater Philadelphia’s annual State of the Economy event, where Anna Paulson, President and CEO of the Federal Reserve Bank of Philadelphia, offered a wide-ranging assessment of national and regional economic conditions — and what they could mean for jobs, inflation, and opportunity in the year ahead.

The event, held at the Kimmel Center for the Performing Arts and presented by title sponsor Firstrust Bank, emphasized the private sector’s role in supporting informed dialogue around economic policy, workforce development, and long-term regional growth. Firstrust’s sponsorship helped bring together leaders and changemakers for a candid conversation about the challenges and opportunities facing Greater Philadelphia for more than 15 years.

“If I pick a theme for inflation for 2026, it would be ‘cautious optimism,’” said Paulson.

She framed 2026 as a year that could reward patience, particularly as inflation shows signs of cooling while the labor market sends more mixed signals. Paulson pointed to recent inflation readings that remain above the Federal Reserve’s two percent target but argued that the components beneath the headline data show progress.

She described a path where tariff-related price increases appear concentrated in goods, while services and housing-related inflation continue to move in a more favorable direction — a combination that could support inflation trending closer to target over time.

“Higher tariffs on imports are showing up in goods’ prices,” said Paulson. “Based on my reading of the evidence and conversations with businesses, I expect that we’ve already seen a lot of the price adjustments.”

Paulson also highlighted the growing tension between strong topline growth and a labor market that has clearly slowed compared to the prior year.

“Currently, we’re seeing divergent signals on growth in the labor market,” she said, suggesting that uncertainty, including shifting trade policy and the evolving impact of artificial intelligence, is influencing hiring and investment decisions.

Following her address, panelists expanded the discussion with sector-by-sector detail, reinforcing the theme that the outlook is improving, but uneven. The panel included:

• Kevin Coleman, Vice President, Investor Relations & Treasurer, AMETEK
• Kevin Labick, Senior Vice President, Digital, EPAM Systems
• Christopher Molineaux, President & CEO, Life Sciences Pennsylvania
• Bret Perkins, Senior Vice President of External & Government Affairs, Comcast Corporation
• Elinor Haider, Senior Director, The Pew Charitable Trusts

The panel’s themes mapped closely to a key point raised repeatedly throughout the program: Greater Philadelphia’s long-term success depends on growing more “opportunity jobs” — and doing so requires a sharper focus on industries that bring income into the region.

That argument is central to a major Brookings Institution assessment of southeastern Pennsylvania’s economy, which found that the region’s underperformance in tradeable industries — sectors that sell goods and services beyond the region — is eroding pathways to economic mobility. Brookings reported that, in 2023, only about half of the region’s jobs qualified as “opportunity jobs,” a lower share than in most of the nation’s 50 largest metropolitan areas.

Brookings also concluded that if southeastern Pennsylvania’s tradeable industries had matched national performance from 2013 to 2023, the region would have generated more than 104,000 additional jobs. And roughly 70 percent of those would likely have been “opportunity jobs” — the kind of roles that can support families and create upward mobility.

The assessment points to several priorities that are critical for the region’s success:

• Competing in tradeable sectors that can scale, not only to add jobs but to lift wage growth regionwide
• Targeting “opportunity industries” with the capacity to create quality jobs and career pathways, rather than measuring success by job counts alone
• Coordinating across the five-county region so economic development, workforce systems, and innovation assets move in the same direction at the same time

Brookings’ market assessment identified three tradeable clusters that stand out for their growth potential and capacity to generate opportunity jobs: enterprise digital solutions, materials machining and electronic components, and biomedical commercialization.

Panelists often returned to those same ideas, stressing that cluster growth can create multiplier effects beyond any single industry. They noted that job growth and mobility will hinge on how quickly the region can align employers, education, and training systems around real demand — and remove barriers that keep residents from participating.

In life sciences, that means building clearer on-ramps into manufacturing and lab roles while demystifying career pathways. In industrial technology, it means raising the pipeline of technicians and engineers equipped for automation-heavy environments. In digital services, it means preparing students and early-career workers for AI-enabled workflows that are already changing how teams operate.

With Firstrust Bank’s sponsorship and the chamber’s convening power, the event positioned 2026 as a year when the region’s economic trajectory may be shaped by whether leaders can collaborate on the practical work of competitiveness: focusing on tradeable growth, expanding opportunity jobs, and building workforce systems that match the economy that is emerging.