Several jaws dropped and eyebrows rose in January when BizTimes predicted a robust year of national economic growth for 2015. However, that’s precisely what our data and surveys were pointing to. The headline of the cover story proclaimed, "Ramp it up!"
Well, we’re at the quarter pole, and so far, so good.
A national group of economic forecasters is raising its outlook for the U.S. economy for the next two years.
The March report from the National Association for Business Economics (NABE) forecasts more hiring, a lower unemployment rate, a lower inflation rate and more growth in consumer spending in 2015, compared with the group's forecast in December 2014.
The report also forecasts more investment by businesses in both equipment and intellectual property and modest growth for the U.S. stock market.
"NABE’s March 2015 Outlook Survey panel expects a markedly stronger pace of economic growth in 2015 and 2016 than was recorded last year," says NABE president John Silvia, chief economist of Wells Fargo. "The panelists’ median forecast is for real GDP to increase 3.1 percent on an average annual basis this year followed by a 2.9 percent rise in 2016. This compares to a gain of only 2.4 percent in 2014. Healthier consumer spending, housing investment, and government spending growth are expected to make outsized contributions to the projected acceleration in overall economic activity. Accordingly, recent labor market strength is expected to continue. The panelists’ median forecast is for net new job creation to average approximately 250,000 per month in 2015 and 216,000 per month next year. The unemployment rate is expected to continue its downward trend over the next several quarters, reaching 5 percent by the second half of 2016."
Gross domestic product is expected to grow 3.1 percent in 2015.
The Metropolitan Milwaukee Association of Commerce (MMAC) validated the optimism in its second quarter Business Outlook Survey. Seventy-six percent of MMAC businesses surveyed expect sales increases in the second quarter, 71 percent expect profit gains and 59 percent predict employment growth over year-ago levels.
"Outlook levels remain at high points in the post-recessionary period," said Bret Mayborne, the MMAC’s economic research director. "The current levels of optimism expressed on sales, profit and employment have each matched or exceeded levels posted before the recession. The post-recession period in the Milwaukee area has been one of modest but consistent gains. As a result it has taken a bit of time to get back to pre-recession levels. The second quarter outlook survey results suggest that as far as business confidence is concerned we have largely bridged the gap. The high level of business optimism and the overall upward trend in the local economy perhaps suggest a greater likelihood of accelerated future growth built on a solid foundation."
The momentum of the economic recovery also is being felt in some parts of the local housing market. Realtors and buyers in communities such as Oak Creek, Wauwatosa, the North Shore and eastern Waukesha County are reporting a strong "seller’s market," with multiple bids for houses on the day they are put up for sale.
Steve Jagler is executive editor of BizTimes.
Steve Jagler is executive editor of BizTimes in Milwaukee and is past president of the Milwaukee Press Club. BizTimes provides news and operational insight for the owners and managers of privately held companies throughout southeastern Wisconsin.
Steve has won several journalism awards as a reporter, a columnist and an editor. He is a graduate of the University of Wisconsin-Milwaukee.
When he is not pursuing the news, Steve enjoys spending time with his wife, Kristi, and their two sons, Justin and James. Steve can be reached at email@example.com.