Forecast: Investment to Drive Growth in 2014, 2015 - Modern Distribution Management

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Forecast: Investment to Drive Growth in 2014, 2015

MAPI chief economist outlined the outlook for the U.S. in recent webcast.

Investment-driven manufacturing will be a key driver of economic growth for the rest of 2014 and into 2015, according to Daniel Meckstroth, MAPI chief economist. Meckstroth presented the economic outlook for the U.S. in a recent webcast.

This investment-driven growth is the result of three factors: historically low interest rates, accelerating growth in the economy and pent-up demand finally being realized, Meckstroth says. These three items will be responsible for increased investment in 2014 and 2015 and will be among the major drivers of growth in the years ahead.

According to the forecast, the U.S. economy is six months away from a full recovery.

Other highlights from the forecast include:

Consumers are at their lowest debt obligation levels since 1980. This, combined with the fact that job growth is outpacing the economy's growth, is driving a moderate consumer spending growth.

Manufacturing job growth is also increasing, but at a slower rate than the rest of the economy. While manufacturing makes up 12 percent of the U.S.'s total economy, it only accounts for 4 percent of job growth.

Residential construction growth is accelerating in 2014 and is expected to "explode" in 2015. Housing, along with related industries, will see a growth in the next two years, as will industrial machinery. Transportation is also expected to see growth, led by the strength of the aerospace market.

Industrial production manufacturing levels have almost returned to their 2007 levels, with an expected growth of 3.2 percent in 2014 and 4 percent in 2015.

Exports are expected to have a neutral effect on the economy this year, but will act as a net drag on the economy in 2015. Imports are expected to be a drag on the economy this year and will be a major drag in 2015. Government spending will be a net positive to the economy in the next two years.

Get more data from the report here.

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