Although business owners this year are faced with a new challenge with the official launch of the Affordable Care Act in 2014, the overall economy has shown enough momentum in recent months that even adding another layer of worry shouldn’t be enough to slow that progress.
In his opening general session at the 2014 NSCA Business and Leadership Conference in Dallas, Arizona State University research professor of economics Dr. Lee McPheters expects to deliver some relatively uplifting news about the 2014 economic outlook.
“For the last few years, there has been strong movement toward holding as much money as possible, not hiring for the long-term and uncertainty about Obamacare,” says McPheters. “In 2014, I expect all of those things to change. On top of that, I think we’re going to see expanded spending on technology in the next 12 months as things become a little more stable in other areas of the economy and the business.”
“It’s certainly not gloom and doom. I’m not necessarily saying 2014 will be a breakout year, but it should be better than 2013,” he adds.
McPheters sees potential for increased commercial and industrial development. McPheters admits he doesn’t get too deep into the details of a particular industry or company’s prognosis, saying he describes what he sees “from 40,000 feet,” focusing on global trends, U.S. indicators and regional trends. From that perspective, the 2013 GDP was around 2 percent growth in 2013, short of the 3 percent target needed to have a strong effect on unemployment levels and other economic indicators.
“People are looking for a labor market that gets back to ‘normal,'” says McPheters. “I expect the 1.5 million jobs that were lost in the recession to be replaced in 2014. The other question is about how low unemployment will go. I see it consistently under 7 percent.”
The economies of Europe and Asia have shown steady improvement, which is part of the reason McPheters has some sense of optimism for the U.S. economy over the next 12 months. But, as with any prediction, his are far from a sure thing, and business owners must always have a backup plan if things don’t go the way the so-called experts say they will.
“If things go wrong (in Europe or Asia), the U.S. is affected by that too,” says McPheters. “You always have to look out for external shocks.”