Local Market Monitor, a National REIA preferred vendor, recently released their National Economic Outlook for January, 2020 where they share their thoughts on developments taking place in the U.S. economy.
National Economic Outlook – January 2020
By Ingo Winzer
Retail sales for 2019 were up 3.6 percent from 2018. With inflation running around 2 percent, that means a real increase of 1.6 percent or so. Car sales were good and on-line sales were terrific (up 13 percent) but when you subtract out inflation, every other sector did poorly – furniture stores, food stores, hardware and lumber stores, drug stores, electronics, sporting goods.
It’s difficult to see this scenario changing in 2020, not just because of Amazon but because consumers are already up to their ears in debt – where will they get the money?
Total jobs in December were up 1.4 percent from the previous year, pretty much in line with the performance of recent months. I don’t see a better picture in 2020, it’s much easier to see slower growth. While a recession in 2020 is unlikely, the low growth of the economy means it can quickly slide if shocks of one kind or another (trade wars, real wars, political wars) make consumers cautious.
Jobs were up 2.5 percent in healthcare, 2.3 percent at restaurants, 1.9 percent in business services, 1.4 percent in finance, 0.7 percent in government, and virtually flat in retail and manufacturing.
Temporary jobs, a category that can include secretaries and clerks as well as doctors and engineers, and that served as a leading indicator before the 2008 recession (but also fell in 2016) is now in negative territory.
Please click here for an expanded look at this month’s National Economic Outlook
About the Author: Ingo Winzer is President of Local Market Monitor, and has analyzed real estate markets for more than 20 years. His views on real estate markets are often quoted in the national press and in 2005, he warned that many housing markets were dangerously over-priced. Previously, Ingo was a founder and Executive Vice President of First Research, an industry research company that was acquired by Dun and Bradstreet in March 2007. He is a graduate of MIT and holds an MBA in Finance from Boston University. He resides in Cambridge, Massachusetts.