MAPI Economic Forecast: Investment spending to drive growth

Manufacturing production expected to grow 3.2% in 2014 and 4.0% in 2015.

Latest News

State of Logistics 2016: Pursue mutual benefit
Other Voices: Don’t walk into the “Industry 4.0” tech trap
Is the era of high inventories behind us?
IATA urges air cargo modernization
Q&A: Doug Waggoner, Chief Executive Officer of Echo Global Logistics
More News

Latest Resource

The View from the New “Single Window”
The single window, officially known as the "International Trade Data System," operates via the Customs and Border Protection (CBP) agency's Automated Commercial Environment (ACE) platform, and serves as a single point of contact for all trade filings.
All Resources
By ·

Manufacturing 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 high-tech sectors will also rise. Inflation-adjusted 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 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 pre-recession 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.


Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

All Topics
Latest Whitepaper
The View from the New “Single Window”
The single window, officially known as the "International Trade Data System," operates via the Customs and Border Protection (CBP) agency's Automated Commercial Environment (ACE) platform, and serves as a single point of contact for all trade filings.
Download Today!
From the March 2017 Issue
WMS vendors are stepping up to the plate and developing functionalities and solutions that meet the complex needs of today’s companies. Our top analysts take a peek into these developments and discuss the DC of the future and the software that will support it.
5 Supply Chain Trends Happening Now
2017 Warehouse/DC Equipment Survey: Investment up as service pressures rise
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
2017 Trucking Regulations & Infrastructure Update
In this session our panel brings shippers up to date on the state of transportation regulations. Discussion will revolve around regulatory reform, aspects of the federal highway bill and what the transportation landscape looks like in the early days of the Trump administration.
Register Today!
EDITORS' PICKS
LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...
ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...

2017 Rate Outlook: Will the pieces fall into place?
Trade and transport analysts see a turnaround in last year’s negative market outlook, but as...
Logistics Management’s Top Logistics News Stories 2016
From mergers and acquisitions to regulation changes, Logistics Management has compiled the most...