The central theme of MAPI’s forecast for the next five years is that we believe the U.S. economy is in the midst of a transition period from sluggish growth to a longer period of moderate growth. For a smooth transition, politicians must (1) compromise and not go over the fiscal cliff, (2) raise the debt ceiling early next year, and (3) agree on a plan for meaningful long-term federal deficit reduction.
Over the next five years, we forecast that employment will grow at an average 1.7 percent annual rate and inflation-adjusted consumer after-tax income will increase 2.7 percent a year. The five-year growth rate for GDP is 2.7 percent a year, a subpar expansion following a deep recession.
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