Crawling Out of the Abyss

By Andrew Paparozzi
In December 9, 2009

The economic outlook, which appeared quite dire earlier in the year, continues to slowly improve. The November 2009 Blue Chip Economic Indicators consensus now expects GDP adjusted for inflation to increase by 2.7% in 2010, after dropping 2.4% in 2009. Although not exactly a return to boom times, it’s definitely better than what was being envisioned as recently as April—the low point in the outlook. At that time the Blue Chip consensus was looking for a growth rate of just 1.8% in 2010, following an expected decline of 2.6% this year. But as seen in the chart below, the outlook has since improved steadily. And while the difference in percentage terms doesn’t appear to be all that much, it does represent over $115 billion of additional national income—not exactly pocket change.

Blue Chip Trend x

Does the forecast of 2.7% growth for next year represent a return to an economy operating on all cylinders? No, it doesn’t—not by a long shot. This is readily apparent upon viewing the consensus forecast for unemployment for 2010. As also seen in the chart, the jobless rate is expected to still be hovering near 10.0% for all of next year—a far cry from what we’ve become accustomed to.

The economy is mending, but a full recovery will be a slow process. Banking on a stronger economy to solve most business problems and move toward a path to sustainable success is, at best, a misguided option. This is especially true in an industry such as print, where structural changes continue to redefine all aspects of the business and success hinges on much more than the level of economic activity.

Andrew Paparozzi

Epicomm's Andrew Paparozzi, Vice President/Chief Economist, is well-known for his accurate and thoughtful discussions on the economy and US commercial printing industry. A foremost author and speaker on economic business trends in the printing industry, Paparozzi heads Epicomm's Printing Economic Research Center.

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