Long-Range Projections Summary
February 2012
National
The quarterly U.S. forecast of November 2011 was used as the basis for this long run projection. As shown in the Table below, that forecast showed real GDP growth averaging2.5% over the period 2011-2014. Employment was expected to rise at a 1.5% rate, while consumer inflation averaged 2.2%. That forecast reflected the lingering effects of the 2008-2009 recession. Over the period 2015 to 2032, 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.
| Variable | ||
| Real GDP | ||
| Total Establish. Employment | ||
| Consumption Deflator | ||
Indiana
The Indiana long run projection uses our November 2011 short run control forecast as its basis. The resulting long-run projections for employment are slightly less optimistic than our August 2011 projection.
For the projection of the industry gross state product variables (GSP), we used the GSP historical data released in June 2011 which covers the period 1997 to 2009. 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 are above those in February. Even when combined with slower employment growth the result is that GSP growth in this projection is a higher than in our previous projection.
The average growth rate of total Gross State Product over 2015-2032 is projected to be 3.1% per year. Over the same period total Indiana employment is projected to grow at a 1.0% rate, with employment in manufacturing declining, and in non-manufacturing growing at a 1.2% rate.
