Last week First Research updated growth forecasts in 500+ industry profiles to reflect the latest data from INFORUM, the Interindustry Forecasting Project at the University of Maryland. INFORUM provides both macroeconomic and industry-level forecasts. Its latest outlook provides context for First Research’s 2015-19 revenue-growth forecasts.
INFORUM’s economists project US GDP will grow 2.3% in 2015 and 3.0% in 2016, driven largely by consumer and business sector expansion. Export growth (dampened by economic weakness in Europe and Japan) and government spending will make only small contributions through 2017.
Factors including a falling unemployment rate and pent-up demand will drive household consumption growth. INFORUM expects inflation-adjusted consumer spending to expand 2.9% in 2015 and 2.5% in 2016 and 2017.
Consistent with the last several outlooks, construction and construction-related markets feature heavily on the list of growth sectors. INFORUM expects US housing investments to rise 9% in 2015.
Falling oil prices have driven down drilling and other oil field development activity, contributing to contraction in nonresidential construction in 2015. However, commercial and health care buildings will help drive growth in 2016 and 2017.
The health care sector should also grow as more of the newly insured begin using their benefits. This will be a boon to the drug manufacturing industries. Other health-related industries on the rise include nursing homes, biotechnology research and product manufacturing, outpatient surgical centers, and kidney dialysis centers.
Despite the recent dip in prices, oil and gas production continues to buoy the US economy. The oil and gas exploration and production, fuel oil and LP gas dealer, and oil and gas well drilling industries are all expected to see double-digit growth over the next several years.
At the other end of the spectrum, a shrinking customer base has curbed tobacco industry growth, and government spending cuts could challenge search and navigation equipment demand. And while INFORUM believes rising exports could ultimately boost US coal production, environmental regulations are among several issues currently threatening that industry.
INFORUM warns that its projections could be thrown off by a number of factors, both positive (wage hikes, greater corporate investment, infrastructure investment increases) and negative (deflation, political paralysis, international crises), which is why it provides regular updates. Count on First Research to do the same.
Interested in getting deeper insight into the trends, challenges and opportunities facing your prospects and clients? First Research’s profiles provide a wealth of industry intelligence, including projected compound annual growth rates for more than 500 industries.
Josh Lower is an industry editor for First Research/Hoover’s.