Owing largely to the burst of business activity in the spring and early summer that came in part thanks to rising vaccination rates, annual equipment and software investment is expected to grow 13.2% this year, according to the Q4 update to the 2021 Equipment Leasing & Finance U.S. Economic Outlook from the Equipment Leasing & Finance Foundation. In addition, the outlook projects annual U.S. GDP to grow by 5.3% in 2021. The report, which is focused on the nearly $1 trillion equipment leasing and finance industry, highlights key trends in equipment investment and places them in the context of the broader U.S. economic climate.
“The Q4 update indicates that optimism eased somewhat as the spread of the COVID-19 delta variant began weighing on consumer confidence and economic activity,” Scott Thacker, chair of the ELFF and CEO of Ivory Consulting, said. “The trajectory of the virus this fall and winter, inflation and fiscal policy are the most significant unknowns to consider during the upcoming six months. Fortunately, the overall outlook portrayed in the Q4 update is more optimistic than it was a year ago. Businesses continue to invest despite supply chain issues and labor shortages, which bodes well for the equipment finance industry.”
Q4 Outlook Update Highlights
The Foundation-Keybridge U.S. Equipment & Software Investment Momentum Monitor, which is released in conjunction with updates to the economic outlook, tracks 12 equipment and software investment verticals. In addition, the Momentum Monitor Sector Matrix provides a customized data visualization of current values of each of the 12 verticals based on recent momentum and historical strength. Eight verticals are showing signs of accelerating investment, and the four other verticals are showing signs of peaking. Over the next three to six months, year over year:
The ELFF produces the Equipment Leasing & Finance U.S. Economic Outlook report in partnership with economic and public policy consulting firm Keybridge Research. The Q4 report is the third update to the 2021 outlook and will be followed by the publication of the 2022 Economic Outlook in December.
Like this story? Begin each business day with news you need to know! Register now for FREE Daily E-News Broadcast and start YOUR day informed!