The U.S. Economy: Perception vs. Reality
Fear sells, and when it comes to the U.S. economy, we are buying a lot of it. Fortunately, many of these fears are unfounded—a point made by Alan Beaulieu, CEO of ITR Economics, when he spoke at the MFG Meeting 2016.
In this segment of MFG Advocate, Beaulieu reassures us about economic facts and dispels a few bits of fiction.
Myth #1: China is overtaking us.
According to a Gallup poll, 53 percent of Americans think China is larger economically than the United States. In fact, the American economy is 70 percent larger than China. Additionally, China’s “one child” policy has put the country in a position of population decline that it is not going to overcome for many generations.
Myth #2: Fewer manufacturing jobs mean that U.S. manufacturing is weak.
While it’s true that we do not have the same number of manufacturing workers that we did in past decades, manufacturing’s value to the economy is expressed in many other important ways. It is a leading industry in data generation as well as spending for R&D. Foreign enterprises are investing in U.S. manufacturing plants because they want to make their goods near the consumer. Also, manufacturing’s “multiplier effect”— or its income gained vs. its costs—is also top among all industries.
Beaulieu predicts that because commodity prices are beginning to rise, much of the fear around the general economy should ease as we move through the year. With that stability comes a sense of healing, which means CFO’s, CEO’s and CMO’s begin to think more positively about the future, saying “yes” instead of “no” or “wait.”
For the long-term future, Beaulieu authored a book, with his brother Brian, titled Prosperity in The Age of Decline: How to Lead Your Business and Preserve Wealth Through the Coming Business Cycles, which outlines a clear plan about how to manage businesses, personal wealth and assets through any economic storm. Maybe if this interview doesn’t ease your nerves, the book can help!
Planning is already underway for The MFG Meeting next year, March 22-25, 2017, at the Omni Amelia Island Plantation Resort, Amelia Island, Florida. Stay up to date with the latest at theMFGMeeting.com (#MFGmtg).