In older days I paid a lot more attention to the economy, much of the work I did then was driven by it, and my client's perception of it. Even today it seems that a lot of ProAdvisors experience changes in their day-to-day and year-to-year business volume based upon what the economy is really doing.
As manufacturing is improving, many manufacturing clients may begin to look for ways to improve their manufacturing and inventory controls, thus they ProAdvisors with an emphasis in inventory may experience an up-tick in their services. As retail improves, ProAdvisors supporting Ponit-of-sale systems may experience similar requests for service.
But as the economy slacks off, clients are looking for 'more services' for 'fewer dollars', and may in fact limit their use of ProAdvisor services all together. So staying abreast of at least the basics of what is going on with the economy is important to ProAdvisors, and thus we think, our readers as well.
Calling upon my 'old school days', I have tried to review a slew of articles and summarize some of the current economic news in brief. Accordingly, take this information 'with a grain of salt.'
While there are some politicians who will tell you that our US economy has turned the corner and is in the midst of a robust growth, the 4th Quarter of 2014 was a bit of a stumble, resulting in little more than a 2% annualized GDP for all of 2014. Retail sales, manufacturing and inflation were all disappointing according to reports recently released. In addition weekly jobless claims also rose back above 300,000.
While many economic forecasters remain hopeful that the new year will continue to see an improving economy, this recent slowdown is concerning to many others. Some economists think the significantly lower gasoline prices will provide sufficient fuel savings that consumers will boost their spending. Forecasters predict that the average GDP could reach 3% by the end of 2015, but others are tempering that expectation by saying 2.8% is more realistic.
Gasoline savings may indeed fuel some additional consumer spending, but those lower oil prices could also give rise to significantly higher unemployment as the energy sector has already begun to announce layoffs in light of reduced consumer demand for oil. As far as any growth in the manufacturing sector is concerned, a recent report indicates that manufacturing has still not recovered to levels of 2007.
While jobs continue to be created within the labor market, the most recent job data also indicates that there has been an accompanying decline in the actual hourly earnings of workers. So while there are more people working, they are working for less pay. The release of seasonal workers is considered as the primary cause of the up-turn in jobless claims.
Not much more than a nutshell here in terms of this discussion, but hopefully even a nutshell is better than "nuttin honey."