MAPI: U.S. Manufacturing Poised for Steady Growth



U.S. manufacturing is poised for steady growth through 2016, according to the MAPI Foundation’s U.S. Industrial Outlook, a quarterly report that analyzes 27 major industries.

Manufacturing industrial production increased at a 4% annual rate in the first half of 2014 (and 5% in the three months ending July 2014) while inflation-adjusted GDP grew at a 0.9% rate.

The MAPI Foundation forecasts manufacturing production growth of 3.4% in 2014, 4.0% in 2015, and 3.6% in 2016. The 2014 forecast is an increase from 3.2% and the 2015 forecast is consistent with the June 2014 report. Manufacturing will continue to grow faster than the overall economy.

“The proximate cause for faster industrial growth is that demand has shifted toward manufactured goods,” wrote MAPI Foundation chief economist Daniel J. Meckstroth, Ph.D. “Durable goods, equipment, and construction have long lives and therefore are temporarily postponable, especially during economic downturns and times of uncertainty.” He noted that the rebound in big-ticket consumer spending is supported by employment gains, households’ low debt burdens, and rising consumer wealth.

Meckstroth sees several growth themes creating an incentive for business investment, including energy infrastructure, residential and nonresidential construction, transportation equipment, and medical supplies and equipment.

The MAPI Foundation is the research affiliate of the Manufacturers Alliance for Productivity and Innovation.

To view the full MAPI press release, click here.


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