The ACG Monthly Luncheon in January featured economist Alan Beaulieu of the Institute for Trend Research (ITR). As many of you know, SDR closely follows ITR’s economic forecasting. Alan gave an excellent presentation and here are my takeaways from the event:
- According to ITR, the US economy will skip Phase C & D and move back into Phase A. For those not familiar with ITR’s phases, this means there will be no double dip recession.
- $120 per barrel is a key threshold. If oil surpasses $120 per barrel, it will start to have an impact on the consumer.
- Retail sales are increasing and are 70% of the economy. See warning above.
- The US Dollar will remain steady. There is simply no other currency as stable.
- Inflation will eventually come, starting in 2014.
- Wage inflation will follow commodity inflation. Wage inflation will need to be battled with technology and automation.
- The top 3 states with positive demographic trends are Texas, North Carolina and Arizona. The states with the worst demographic trends are Michigan, New York and Ohio.
- Business is moving out of China because of a changing cost structure.
- The economy will grow through 2013. It looks like there will be a recession in 2014 followed by growth in 2015 to 2017.
Based on ITR’s research and predictions, we see both warning signs and opportunity over the next several years. How do these points affect your business and what actions can you take to ensure you remain competitive?