A harsh 2009 may give way to a moderate rebound in 2010, according to the Manufacturers Alliance/MAPI U.S. Industrial Outlook: Accelerating Decline, a quarterly report that analyzes 27 major industries. On an annual basis, MAPI forecasts manufacturing production to fall 9% in 2009 and grow 3% in 2010.
"Fortunately, we see an eventual end to the current recession, perhaps by late 2009," said Daniel J. Meckstroth, Ph.D., Chief Economist for the Manufacturers Alliance/MAPI. "A second round of federal fiscal stimulus, this time of major proportions; growing pent-up demand as spending is postponed; lower commodity prices, particularly oil; lower mortgage and borrowing rates resulting from Federal Reserve monetary stimulus; and declining imports will all contribute to a rebound in industrial production activity in late 2009," said Daniel J. Meckstroth, Ph.D., Chief Economist for the Manufacturers Alliance/MAPI.
Manufacturing industrial production, measured on a quarter-to-quarter basis, declined at a 16% annual rate in fourth quarter 2008 after falling at a 9% annual rate in the third quarter.
Non-high-tech manufacturing production declined at a steep 15% annual rate in the fourth quarter of 2008. Non-high-tech manufacturing production is expected to decline 8% this year and rebound a modest 2% in 2010. High-tech industrial production fell at a 29% annual rate in the fourth quarter of 2008. MAPI predicts it will decline 10% in 2009 and post 6% growth in 2010.
Steel production declined 41%, material handling equipment dropped by 25%, and industrial machinery and domestic electronic computer equipment production each decreased by 23%.
Domestic electronic computer equipment will decline 16% in 2009 and 13% in 2010, while electrical equipment will decline 10% in 2009 and 1% in 2010.
