Policies, investments continue to fuel optimism

With the near-term plateauing of interest rates and a more sanguine outlook from the Federal Reserve on the rest of 2019, the outlook for the U.S. economy continues to be robust.

Government policies and capital investment plans by corporations are driving GDP higher. Job growth remains strong, even though we are at “full employment” due to seasoned workers reentering the workforce. We expect GDP to grow by about 3 percent in 2019 and 2020.

But now for the “however”: Our outlook depends on major progress in a trade deal with China, and the lack of any major conflicts in the typical hotspots of the world.

For construction materials, it will be another good year for nonbuilding as pent-up demand coincides with higher tax receipts at all levels of government. We still believe residential and nonresidential will be flat to slightly down, as shifting shopping habits hurt shopping mall investments and high home prices retard home buying.

Regionally, states bordering the west side of the Mississippi River will be flat to down, while the Mountain and Pacific Coast states will do well. States along the eastern seaboard will not do well with the exception of South Carolina, which we expect to do much better in 2019 and 2020.

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Dr. David Chereb has many years of experience forecasting construction materials, and his web-based forecasting models have captured every major turning point in materials demand for more than 15 years. Chereb received his Ph.D. in economics from the University of Southern California.