In Perspective

By Andrew Paparozzi
In September 16, 2011

Economic forecasts continue to be ratcheted downward. The latest consensus from Blue Chip Economic Indicators has the forecast for inflation-adjusted GDP in 2011 sliding to 1.8%. This compares to a forecast in July of 2.5% growth, and as recently as February the outlook was for a gain of 3.2%. Thus, in the span of seven months, the outlook has essentially been cut in half. The consensus for 2012 isn’t looking much better, now standing at 2.2%—down from 3.0% in July. There is little question that the steep adjustment in the forecast reflects the official downward revision to GDP data. But it’s also reflecting what is obviously a sputtering of the U.S. economy, and much of the same can be said for the global economy.

There is no getting around the fact that the latest data depict an economy with no or very little momentum and, unfortunately, dim prospects of a shot in the arm any time soon. Higher gas and food prices, along with dismal job and housing markets have stalled consumer spending. Weak data along with wild gyrations in the financial markets are fueling anticipation of another recession or worse. The chance of slipping back into recession has been creeping up, with several surveys now putting it at one in three. While conditions don’t appear very encouraging, let’s put things in perspective:

  •     GDP, while weak, is still expected to grow.
  •     Job creation, while anemic, is still expected to be to the plus side.

No doubt the financial developments are unnerving and downright scary. And the rampant political haggling and posturing in Washington is enough to make cynics of us all, doing very little to instill even a sliver of confidence.

Along with the economy, our industry has lost the momentum it had coming into 2011. As discussed in our latest report from the State of the Industry Series, NAPL Printing Business Conditions: August 2011, commercial printing industry sales (all sources) fell 0.9% in the second quarter, and confidence has slipped. In July, just 24.7% of the NAPL Printing Business Panel expected business to improve during the six months ahead—down from 36.1% in April and 39.6% in January. Based on recent economic data, confidence has likely slipped further. However, as developments play out, keep this in mind: While our individual votes certainly do count, acting as individuals we cannot make significant changes to the macro environment. Thus, why spend countless hours worrying about something we don’t have control over. Why not concentrate on what we do have control over—our business decisions. Going forward, it is those decisions that are going to make the difference between achieving a certain level of success or being left behind. Stay focused and keep everyone focused on preparing for recovery by asking the right questions such as:

  •     What are we doing better today than we did six months ago?
  •     What will we be doing better in six months than we are today?
  •     How are we becoming more valuable to clients? What really makes us valuable to them?
  •     If we are doing well, why? Is our success likely to be sustainable, or is it due to  temporary factors?

Andrew Paparozzi        Joseph Vincenzino

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.

Leave A Comment