Long-Range Projections Summary
The quarterly U.S. forecast of November 2012 was used as the basis for this long run projection. As shown in the Table below, that forecast showed real GDP growth averaging 2.5% over the period 2012-2015. Employment was expected to rise at a 1.5% rate, while consumer inflation averaged 1.5%. That forecast reflected the lingering effects of the 2008-2009 recession. Over the period 2016 to 2033, real GDP growth is above the near-term performance. It is basically equivalent to that projected in August 2011, as is our projection of employment growth. The long-run growth in both output and employment are in line with our assumptions about long-run potential. Inflation is low in both the near-term and the long-run.
|Total Establish. Employment|
The Indiana long run projection uses our November 2012 short run control forecast as its basis. The resulting long-run projections for employment are very close to our August 2012 projection.
For the projection of the industry gross state product variables (GSP), we used the GSP historical data released in June 2012 which covers the period 1997 to 2010. Productivity is defined as the ratio of GSP to total employment in an industry. Projections of productivity together with projected sectoral employment levels are used to calculate GSP. Our productivity estimates for the state arevery similar to those in August. When combined with employment growth the result is that GSP growth in this projection that iscomparableto that in our previous projection.
The average growth rate of total Gross State Product over 2012-2033 is projected to be 2.8% per year. Over the same period total Indiana employment is projected to grow at a 0.9% rate, with employment in manufacturing rising at a 0.3% rate, and in non-manufacturing growing at a 1.0% rate.