ARLINGTON, Va. -- The housing collapse is still hurting related industries, creating rough times in the U.S. manufacturing sector in 2008. However, the sector should rebound in 2009, according to the Manufacturers Alliance/MAPI.
Housing starts fell 26 percent in the fourth quarter of 2007, and are expected to drop another 33 percent in 2008, bottoming out in the second quarter as the U.S. remains “in the midst of the most severe housing downturn anyone could have imagined,” says Daniel J. Meckstroth, Chief Economist of the Manufacturers Alliance/MAPI. Long-term, a 32 percent increase in housing is expected for 2009.
Inflation adjusted exports should expand by 8.1 percent in 2008 and by 9.9 percent in 2009, offsetting some of the negative effects of the housing crisis.
Manufacturing production is expected to increase 0.5 percent in 2008 before rebounding to 3.4 percent in 2009.
“Any recession is bad news for manufacturing; however, the structure of the current downturn is concentrated in finance, real estate, and construction and not on manufacturing intensive demand such as business equipment and exports,” Meckstroth said. “Furthermore, the reduction in consumer spending may well hurt foreign imports more than domestically produced items.”
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