Despite the slow first half of the year, the U.S. economy should return to moderate growth in the second half of 2013 and through 2014, according to the Manufacturers Alliance for Productivity and Innovation (MAPI) Quarterly Economic Forecast.
The forecast predicts inflation-adjusted gross domestic product (GDP) to expand 1.6% in 2013 and 2.8% in 2014.
The report said manufacturing production should fare better than the economy overall. The report anticipates 2.2% growth in 2013 and 3.2% growth in 2014.
The report also looks to 2015, forecasting GDP to rise 3.4% and manufacturing production to rise 4.1%.
"The outlooks for both the U.S. economy and the global economy are falling into place," said MAPI Chief Economist Daniel J. Meckstroth, Ph.D. "First half GDP growth in the U.S. was slow because of a number of factors--an increase in the payroll tax, the early effects of sequestration, and states' austerity--taking a substantial amount out of the growth rate. But the payroll tax effect is diminishing and the sequester effect was not as disruptive as forecast; the government seems to be working around it. Additionally, Europe appears to be coming out of recession."
Meckstroth noted that consumer spending is holding up and business investment is showing moderate growth.
"Housing, despite being a lesser share of the economy, is nonetheless booming, and we're convinced housing starts will be an economic driver," Meckstroth added. "This will have a positive domino effect on the supply chain and products that have been struggling, such as wood and glass and plastics products."
MAPI reported that:
* Non-high-tech industry production is expected to be up 2.1% in 2013 and 3.1% in 2014
* High-tech production, which is less than 5% of all manufacturing, is expected to be up 5.2% in 2013 and 7.6% in 2014.
to Daily News