MetroIntelligence Economic Update by P. DUFFY
Early read on economy for January shows a steep slide in growth
Adjusted for seasonal factors, the IHS Markit Flash US Composite PMI Output Index posted 50.8 in January, down notably from 57.0 in December. The resulting upturn in activity was only marginal, and the slowest since July 2020. This marked slowdown in growth at the start of 2022 was due to softer demand conditions, worsening supply chain disruptions and labor shortages linked to the Omicron wave.
December Leading Economic Index rises another 0.8 percent
The Conference Board Leading Economic Index® (LEI)for the U.S. increased by 0.8 percent in December to 120.8 (2016 = 100), following a 0.7 percent increase in November and a 0.7 percent increase in October. For the first quarter, headwinds from the Omicron variant, labor shortages, and inflationary pressures—as well as the Federal Reserve’s expected interest rate hikes—may moderate economic growth. The Conference Board forecasts GDP growth for Q1 2022 to slow to a relatively healthy 2.2 percent (annualized). Still, for all of 2022, we forecast the US economy will expand by a robust 3.5 percent—well above the pre-pandemic trend growth.
U.S. population growth in 2021 slows to lowest level since 1900
According to the U.S. Census Bureau, the of the United States increased by 393,000 to an estimated 332 million from the previous year. In 2021, the estimated population growth rate of 0.12 percent was the lowest since the Bureau began collecting this data beginning in 1900. Per Census estimates, slower population growth in 2021 was a result of decreasing fertility, net international migration, combined with increasing mortality which was intensified by the COVID-19 pandemic.