U.S. Economic and Industrial Outlooks Kent Model Forecasts

By Simunek, Vladimir J. | The Journal of Business Forecasting Methods & Systems, Winter 1993 | Go to article overview

U.S. Economic and Industrial Outlooks Kent Model Forecasts


Simunek, Vladimir J., The Journal of Business Forecasting Methods & Systems


In 1993, the economy is expected to continue expanding at moderate pace, which will accelerate in 1994 and afterward. Measured by GDP in constant 1987 dollars, the rate of growth is expected to be 2.1% this year. In 1993, it will accelerate to 2.8%, and in 1994, 3.3%. The employment outlook is also optimistic. Data are not as rosy as that for the real output, however. Forecast calls for the unemployment rate to continue declining in small margins throughout the next and the following years. Compared to the rate of slightly above 7% at the end of this year, it will decline to 5.5% in the second half of 1994. Forecast data calls for inflation to behave within tolerable levels of 3-4% in the next and the following years. Some acceleration in the pace of price increases is expected to start in the second half of 1994. Short-term interest rates are predicted to keep increasing throughout both forecast years. Long-term rates will also follow the upward trend, Increases in long-term rates and yields are expected to proceed in smaller margins than those of short-term rates.

REAL GROWTH

Data for the rest of this year and the forecasts of 1993-1994 point to four major factors expected to shape the growth of the economy: consumer spending, residential construction, business capital outlays, and exports,

In 1993 and 1994, consumers are expected to be the major force speeding up the pace of recovery. Consumer spending is expected to grow by 5.8% this year. In 1993, consumer spending will increase by 6.5%, and in 1994, by 7.4%. Factor responsible for such healthy gains are expected to be: increases in personal disposable income due to rising number of employed persons, gains in average wage rates, rising returns on Securities and increases in farm income. Forecast data for this year calls for substantial increases in spending on durables, mainly motor vehicles and parts, home building materials and household durables. Compared to the expected 7% increase in outlays on durables this year over the last year, consumers are expected to increase their outlays by 9% in the coming year and additional 9% in 1994. Consumers will also spend significantly more on services, notably the health care, travel, fast food, and transportation. Forecast data of retail sales calls for record Christmas sales this and next year. In 1993, the fastest growing items are expected to be motor vehicles and parts, hardware, household appliances and furnishings, home electronics, and other consumer durables. Data also indicate strength in sales of textile mill products, products in specialty stores, and petroleum and coal products especially gasoline and other oil-related products, and chemicals for household and personal use. The other two major factors contributing to the expansion of the economy during 1993-1994 are expected to be private housing, and business investment in machinery and equipment. While private residential construction will be a dominant factor in 1993, it will slow down somewhat in 1994. Business capital outlays are expected to rise though gradually next year. But they will gain momentum in 1994. The U.S. exports, the other factor contributing to the growth of the economy, are expected to remain weak next year due to current recession or modest growth of overseas economies. Exports are expected to regain strength in 1994 when the majority of countries will be out of main troubles and their economies start expanding.

EMPLOYMENT

Forecast data point to continuing improvements in the employment situation in coming months and throughout the next and the following years. Data indicate significant improvements in private housing construction, paper and products, instruments, and chemicals and products. Some segments are expected to experience continuing problems, notably nonresidential construction, apartment housing, airline transportation, and defense and defense-related segments of the economy especially segments of mining, construction, machinery, and instruments. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

U.S. Economic and Industrial Outlooks Kent Model Forecasts
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.