You don't need a crystal ball to know that the economy is still struggling to recover. We're no longer backsliding, but we're also not moving forward as quickly as we would like. Unemployment remains high and GDP growth is nearly stagnant, according to Jeremy Leonard, economic consultant for the Manufacturers Alliance/MAPI. Leonard was featured in this month's Economic Update podcast, which you can watch or download now at www.mdm.com/economic-update.
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The key restraint to recovery remains uncertainty, here in the U.S. and abroad – particularly in the Middle East and Europe. Confidence is essential for recovery, because continued investment is essential for recovery. And uncertainty about taxes, health care, gas prices and Europe's economic health have kept confidence from really building.
However, there are a few bright spots in the latest round of economic news. Business investment continues to be steady … and evenly divided between structures and equipment. "Businesses are sitting on large amounts of cash," Leonard says. "And they seem to be gaining the confidence necessary to boost capital spending."
Residential investment, while still relatively flat, has not declined in three quarters, meaning "it may have at least hit bottom," Leonard says.
Hear more from Jeremy Leonard in the November MDM-Manufacturers Alliance/MAPI economic update.
Leonard is also featured in the 2012 Economic Outlook webcast from MDM and sponsored by NetSuite. Register for free for the annual event.
