Strong Consumer Demand Driven by Job Gains
November 30, 2015 | MAPI FoundationEstimated reading time: 1 minute
Strong consumer demand driven by job growth should lead to increased manufacturing production through 2017, according to a new forecast.
The MAPI Foundation, the research affiliate of the Manufacturers Alliance for Productivity and Innovation, released its quarterly economic forecast, predicting that inflation-adjusted gross domestic product will expand 2.9% in 2016 and 2.7% in 2017, both on par with the August 2015 report. GDP growth for 2018 is anticipated to be 2.5%. All estimates are above the anticipated 2.4% GDP growth for the U.S. economy in 2015.
During the next few years, manufacturing production is also expected to outpace the forecast of 1.8% growth in 2015. Output is anticipated to advance by 2.6% in 2016 (down from 3.4% in the August report) and 3.0% in 2017, a slight decrease from 3.1% in last quarter's analysis. The foundation predicts 2.8% growth in 2018.
The November 2015 reports offers a five-year horizon in which GDP is expected to average just under 2.6% growth from 2016 to 2020 and manufacturing production to average 2.6% growth during that time frame.
"There are strong deflationary pressures that are spreading, such as lower global energy prices, China's economic restructuring, and a forecast for slow price recovery in commodities," said MAPI Foundation Chief Economist Daniel J. Meckstroth, Ph.D. "Also, we are not anticipating negative shocks such as the harsh winter and California port strikes to repeat themselves in 2016. Strong domestic demand buffers the United States from the rest of the world, where global manufacturing continues to slow.
"We expect a modest acceleration in manufacturing growth over the next two years before it decelerates," he added. "Consistently strong job growth is driving the economy. New workers mean more income, which translates into more spending."
Still, Meckstroth sees some challenges.
Suggested Items
I-Connect007 Editor’s Choice: Five Must-Reads for the Week
04/19/2024 | Marcy LaRont, PCB007 MagazineFor my must-read picks of the week, I’m highlighting Parker Capers, a young professional seeking employment, solid counsel from Dan Beaulieu on what your post-show plan should look like, more information and insight on “chiplets” and the need for secure data transfer standards from columnist Preeya Kuray, as well as Matt Stevenson’s design for reality wisdom. It’s a reminder to download one of our newest books (there are several) you don't want to miss if you are an assembler.
Absolute EMS Champions Collaboration Between Humans and Robots in Modern Manufacturing
04/19/2024 | Absolute EMS, Inc.Absolute EMS, Inc., an award-winning EMS provider of turnkey contract manufacturing services, offers a perfect factory environment that seamlessly blends robotic automation with human expertise.
ZESTRON Welcomes Whitlock Associates as New Addition to their Existing Rep Team in Florida
04/19/2024 | ZESTRONZESTRON, the leading global provider of high-precision cleaning products, services, and training solutions in the electronics manufacturing and semiconductor industries, is thrilled to announce the addition of Whitlock Associates to its esteemed network of sales representatives.
SEMI Applauds U.S. Chips Act Award for Samsung Electronics Facilities to Strengthen Domestic Semiconductor Supply Chain
04/17/2024 | SEMISEMI, the industry association serving the global electronics design and manufacturing supply chain, applauded the United States Department of Commerce’s announcement of a Preliminary Memorandum of Terms for an award under the CHIPS and Science Act to support the expansion of Samsung Electronics’ presence in Texas and the company’s development and production of leading-edge chips.
Ark Electronics Expands Global Manufacturing Factory Network in North America and Europe
04/17/2024 | PRNewswireElectronic Manufacturing Company Ark Electronics recently announced the expansion of its Global Factory Network with the addition of Electronics Manufacturing Service (EMS) capabilities in Mexico and Europe.