The Manufacturers Alliance for Productivity and Innovation (MAPI) Foundation has released its fourth quarter forecast for 2017. The Moderate Manufacturing Outlook Amidst an Improving Global Picture report indicates that durable and continuing global economic recovery is propelling a modest rebound in U.S. manufacturing growth after years of virtual stagnation. Looking at both optimistic and pessimistic scenarios, MAPI projects a range for U.S. manufacturing growth through 2021 of between 1.2 and 1.8 percent.
“The current leadership transition at the Federal Reserve is creating uncertainty for domestic and global economies,” noted Cliff Waldman, chief economist for the MAPI Foundation, in a press release. “The nomination of Jay Powell to succeed Janet Yellen as the Fed Chair creates an unknown factor for monetary policy.”
Other uncertainties include:
- Growing protectionist policies in North American could affect manufacturing globally.
- Tensions with North Korea and Iran could dampen global capital expenditures.
Signs of growth include:
- Despite hurricanes Harvey and Irma, the U.S. economy continues to grow in recent months. U.S. GDP growth is up, along with a significant acceleration in business equipment spending since the beginning of 2017.
- Despite potential political instabilities, Eurozone GDP growth has continued to improve.
- The Japanese economy has been steadily rebounding since the beginning of the year, with solid manufacturing output.
Additionally, MAPI’s final forecast of the year, A Strong Turn in Aerospace and Moderate Growth in Capital Goods and Chemicals Propels U.S. Manufacturing, focuses on the manufacturing outlook featuring both improvements and ongoing challenges for the U.S. manufacturing industry. The aerospace, machinery, computers and chemicals subsectors are catalyzing forward momentum for manufacturing growth.