The short-term economic outlook is positive, but political risk factors threaten to destabilize economic growth, said Eric Starks, chairman and CEO of FTR, during the economic outlook presentation at the Truckload Carriers Association’s 79th Annual Convention in Nashville, Tenn.
The Institute for Supply Management (ISM) Manufacturing Index has been in a period of expansion for the last year and is likely to continue to grow.
“Manufacturing is the bread and butter of transportation,” said Starks. “If we look at ISM Index, right now this information tells us manufacturing is growing and in the near-term is likely to continue to grow.” Starks also cited the Federal Reserve’s Industrial Production Index for Manufacturing showing similar positive momentum after two years of stagnation.
In the broader economy, payroll employment and the overall job market are improving, adding 238,000 jobs in January and 235,000 in February after three straight months below 165,000 to end 2016.
“In a 2-percent growth economy, job growth in the 200,000-plus range suggests the economy can continue to be self-sustaining,” said Starks, adding that wages are also increasing. “The numbers are telling us we are near full employment. What we’d like to start seeing in the next 12 months is wage inflation.”