White House Projects Increased Economic Growth in 2014 & 2015
Administration’s optimism could be good news for builders and banks
It’s been almost five years since the recession ended, and the economy hasn’t been growing as fast as many would like. However, the White House has recently released a new economic forecast that projects faster economic growth for 2014 & 2015.
This forecast, which is based on the administration’s planned efforts to refocus its agenda on jobs and growth, could give builders and lenders the confidence and opportunities they need to grow their business in the next few years. Those contractors and banks that are able to streamline their management & administration processes using tools such as ECL Software’s Fund Control suite or Construction Management Information System may be better poised to take advantage of this projected growth.
Whereas the economy grew by 1.7 percent last year, now the administration expects nearly double this rate of growth. Officials have predicted 3.1 percent growth in 2014 and 3.4 percent growth in 2015. These projections are more optimistic than those released by other forecasters. The “Blue Chip” forecasters projected 2.9 percent growth for 2014 and the non-partisan Congressional Budget Office projected 2.7 percent.
The White House also released a new prediction for the unemployment rate, which they expect to hit an average of 6.9 percent in 2014. This is a bit more pessimistic than the view of the other forecasters, who predicted 6.6 or 6.8 percent. However, many economists question how accurate the unemployment rate really is, as many individuals who are out of work eventually stop looking for new jobs and are no longer counted as unemployed. A projection for the overall labor force participation rate in 2014 and 2015 would perhaps be more useful.
Making the Prediction a Reality
The White House has recently re-emphasized its commitment to creating jobs and growth, perhaps in response to recent slips in presidential approval ratings. Though national trends such as a declining budget deficit, an improving housing market, and ramped up domestic energy production should help fuel stronger growth, the White House plans to help things along with its own efforts. For example, the White House wants Congress to increase the minimum wage to $10.10 an hour to put more money in consumers’ pockets. Also, the president recently proposed an additional $56 billion for the 2015 fiscal year budget, which includes spending on education, training and defense projects. The White House is relying on the passage of these measures to fuel their higher projected economic growth rates.