The MHEDA Journal - First Quarter, 2015 - (Page 67)

INDUSTRY MAPI FORECAST MAPI Economic Forecast: Investment Spending Will Drive Growth BY THE MAPI FOUNDATION. REPRINTED WITH PERMISSION FROM MAPI M anufacturing production continues to outpace overall economic growth and will be led more by investment than by consumer-driven advances over the next 18 months, according to a new report. The Manufacturers Alliance for Productivity and Innovation (MAPI) Quarterly Economic Forecast predicts that inflation-adjusted gross domestic product will expand 2.5% in 2014 and 3.2% in 2015. The former is a decrease from 2.8% and the latter equal to the 3.2% from MAPI's March 2014 report. Manufacturing production is expected to fare better, with anticipated growth of 3.2% in 2014 and 4.0% in 2015, consistent with the previous report. "While consumer-driven manufacturing will grow at a consistently moderate rate, the industries driven by investment will grow at a higher rate," predicted MAPI Chief Economist Daniel J. Meckstroth, Ph.D. "Energy infrastructure and manufacturing machinery will see increases as firms replace and expand equipment. Aerospace will also experience a big ramp-up in production. In addition, there will be growth in the construction supply chain - HVAC, wood, paint, appliances, and furniture - as we anticipate both residential and nonresidential increases. The acceleration driver will be investment." Production in non-high-tech manufacturing industries is expected to increase 2.9% in 2014 and 3.7% in 2015. High-tech manufacturing production, which accounts for approximately 5% of all manufacturing, is anticipated to grow 6.6% in 2014 and 10.0% in 2015. The forecast for inflation-adjusted investment in equipment is for growth of 5.2% in 2014 and 10.3% in 2015. Capital equipment spending in hightech sectors will also rise. Inflationadjusted expenditures for information processing equipment are anticipated to increase 2.7% in 2014 and a strong 14.6% in 2015. MAPI expects industrial equipment expenditures to advance 8.1% in 2014 and 10.8% in 2015. The outlook for "We anticipate 1.03 million housing starts in 2014 and 1.40 million starts in 2015," Meckstroth said. "Manufacturing production will finally approach its 2008-2009 pre-recession peak by the end of 2014." spending on transportation equipment is for growth of 5.6% in 2014 and 3.9% in 2015. Spending on nonresidential structures is anticipated to improve by 4.2% in 2014 and by 5.1% in 2015. Residential fixed investment is forecast to increase by 4.1% this year and a robust 19.9% in 2015. "We anticipate 1.03 million housing starts in 2014 and 1.40 million starts in 2015," Meckstroth said. "Manufacturing production will finally approach its 2008-2009 prerecession peak by the end of 2014." Inflation-adjusted exports are anticipated to increase 3.0% in 2014 and 5.1% in 2015. Imports are expected to grow 2.1% in 2014 and 6.8% in 2015. MAPI forecasts overall unemployment to average 6.4% in 2014 and drop to 5.9% in 2015. The outlook is for an increase of 158,000 manufacturing jobs in 2014, a decline from the anticipated 356,000 jobs in the March forecast, but increasing to 212,000 jobs in 2015, an increase from 197,000 jobs in the previous report. The refiners' acquisition cost per barrel of imported crude oil is expected to average $95.90 in 2014 and $93.60 in 2015. MAPI, founded in 1933, contributes to the competitiveness of U.S. manufacturing by providing economic research, professional development, and an independent, expert source of manufacturing information. The MHEDA Journal | First Quar ter 2 015 67

Table of Contents for the Digital Edition of The MHEDA Journal - First Quarter, 2015

MHEDA’s 2015 Board of Directors and Mboa
Lift Atlanta, Inc
Sara Mcmurray, Flow-Rite Controls
Distributor Forecast
Confident Supplier/associate Members Ready for Continued Growth in 2015
MHI Predicts 8-9% Growth for 2015
CEMA Expects Growth
Continued Stability in the Market
Investment Spending Will Drive Growth
What in the World Is Going On?
Quality Lift Trucks Undergoes a Major Succession and Transition Plan

The MHEDA Journal - First Quarter, 2015

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