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Economic Forecasts for 2017: How They Compare

2017 economy.jpgLooking forward to the coming year, many economists seem confident that the U.S. economy is on fairly stable footing. Current projections for 2017 are generally positive, with sources citing GDP growth at between
2.1 percent and
3.1 percent.

While both numbers are within the desired range for healthy growth, some sources report that the growth rate of 4 percent intended by the pending Trump administration could result in “the irrational exuberance that creates booms and busts.” It is unclear at this time what steps the coming administration will take to encourage the higher growth rate or how effective they will be over time.

Currently, however, the numbers are showing a healthy balance in the 2017 economic projections:

  • The unemployment rate is below 5 percent and is expected to remain there
  • The inflation rate is expected to be 1.9 percent in 2017 and 2.0 percent in 2018, up from the 1.5 percent in 2016. These numbers may have been affected by low oil prices and both are below the Fed’s 2.0 percent target inflation rate.
  • Housing and non-residential construction have both shown increases and 2017 economic projections show those numbers continuing to slowly grow
  • Bureau of Labor Statistics (BLS) figures from 2012 estimated a roughly 5.6 million job increase in healthcare and a 3.8 million job increase in professional and business services. Overall, job increases are expected in 88 percent of all occupations.

Not all the projections are positive, however. All sources agree that the oil industry is expected to be a sore spot in the future, though not necessarily in 2017. Crude oil is expected to stay around $50/barrel in the first 6 months of 2017, but will likely increase to over $70/barrel by 2020. These expected increases in oil prices will ultimately impact every part of the American economy, from transportation and food production to household wages and consumer spending.

With any luck, new technological developments, including cleaner energy sources, will become lucrative and result in new jobs and great changes for the overall structure of the market, offsetting the future impact of oil prices and crude oil scarcity. The chances of that occurring with in the next four years, however, are unlikely.

Of course, not all sources agree on future projections and their ultimate outcome for the state of the economy. The 2017 economic projections are generally accepted as favorable for the time being, but Forbes reported a general settling of the market, while the balance anticipates another recession in about 3 years. Unfortunately, market trends often show highs and lows ending with crashes, some larger than others, after the cycle has run its course, so the latter source seems to have historical precedent on their side, unfortunately.

Regardless of long-term projections, which are decidedly unpredictable, since so many factors can influence the economy over time, the short-term 2017 economic projections are actually very positive. All sources agree that 2017 is a good time for playing smart in the market, watching trends and not panicking over fluctuations.

A new administration and changing priorities can sway the market in many ways over the course of a year, but overall projections show that consumers are mostly positive and businesses have largely bounced back from 2008-2009 lows. As long as patterns hold as they are, 2017 should be a good year for businesses and consumers.

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Ashley.jpgAbout the Author – Ashley Choate is a native of Jacksonville, FL where she lives with her son, dog, and three cats. She graduated Magna Cum Laude from Jacksonville University with a BA in English and holds an MAED in Adult Education and Training. She lives for reading and writing, learning and teaching, and figuring out the day-to-day traumas and joys of mommyhood. .

 Top Photo Courtesy of Automotive Social @ Flickr CC.