Economic pundits and industry watchers are forecasting an economic boom similar to what the nation experienced in its heyday, in the 1950s and 1960s. Two key economic sectors are driving growth, along with a changing consumer mindset among a key demographic.
There has been a lot of talk about the United States becoming energy independent by 2020. Growth in cheap natural gas seems to make that sentiment a distinct possibility. Some critics suggest that we will not keep the energy for ourselves, but instead sell it off for a hefty profit. Whatever the ultimate outcome, there is no argument that the energy sector – particularly natural gas – has taken off.
Natural gas projects are underway across America, despite harsh opposition from environmentalists and citizens who are living in the pathway of proposed pipelines. The states themselves do not seem to mind if pipelines cross through National Forests or family farms, because of the economic promise of such projects. Some estimates predict at least another one million energy jobs being created by 2017, with even more by 2020.
Not only are there pipeline projects in the works, there are also equipment and materials manufacturing opportunities that have emerged in support of the natural gas industry as a whole.
American businesses are “reshoring” the operations they shipped off to China and other nations during previous years. One reason is that cost of offshore wages has ballooned over the past decade or so. For example a worker in China who was earning $0.72 per hour in 2000, saw their rates increase astronomically to an average of $8.62 per hour in 2010.
Some manufacturers also cite the unseen cost of the disconnect between development engineers and production workers who are twelve time zones away. It is difficult at best to innovate, test, and implement new designs and processes with that degree of physical separation.
The U.S. is currently responsible for 20 percent of the world’s manufacturing activity, and that is only expected to increase in the years to come. Regions that have been hard hit by layoffs in other sectors have become the new factory boom towns, just like the communities that are popping up along proposed natural gas pipeline routes.
For years, economists have noted that the spending habits of the millennials are not what the U.S. traditionally expects from the young and upwardly mobile. It seems, however, as this generation matures, its populace is ready to settle down, get married, and begin families of their own.
Recent data shows that up to 85 percent of millennials are interested in buying a home, with almost half hoping to do so in the next two years. Home purchases automatically require additional spending on furniture, appliances, yard tools, and other typical consumer goods.
Depending on the location of their new home, the millennials may also need a new car (or two) to make the commute to work and transport the kids around town. All in all, the millennials’ growing maturity bodes well for the economy.