US & Global Economic Impact Analysis and Forecasts

Freedonia analysts and economists are sharing their insights on how major events are impacting different parts of the US and global economies.

US Housing Market Predicted to Remain Strong in 2022

The US housing market has seen impressive levels of growth over the past two years. Even as the COVID-19 pandemic affected the US economy, Americans remained highly interested in buying homes – as indicated by the high levels of home sales and the record-low levels of available homes for sale. After a year and a half of above average activity, many in the industry wonder if this pace is sustainable. A series of recent articles indicates it can.

According to one report, single-family housing starts will remain over one million units in 2022 and 2023. While growth in this key segment will be modest over the next two years, this level of new home building is still more than 25% over that of 2019. Multifamily housing starts are forecast to advance more rapidly – over 6% in 2022. In both the single- and multifamily housing segments, builders will continue to capitalize on strong demand for new housing and years of underbuilding, which has thousands of potential homeowners looking for residences in vain.

Housing prices will also remain high over the next year or so, due to:

  • the shortage of available units
  • rising costs for key raw materials, particularly lumber and plastic products, such as siding and windows and doors
  • a shortage of labor across construction and the skilled trades

Home builders remain optimistic about the market amid these conditions. Nearly all builders report that they will build more homes in 2022, even in the face of rising prices and shortages of key materials. To offset this, home builders are increasingly using software to better manage projects and minimize downtimes, as well as specifying prefabricated components to reduce delays at the construction site.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, particularly in the Construction and Building Products. Freedonia Custom Research is also available for questions requiring tailored market intelligence.


Plan for National Network of EV Stations Shows Increasing Role of Electric Vehicles

The US government recently announced a $5 billion spending plan to construct a national network of charging stations for electric vehicles (EVs). The plan, which will call for the building of these stations mainly along the nation’s interstate highway network, is expected to create an infrastructure of charging stations that will allow people with electric vehicles to more easily cross the US.

Details of the plan include:

  • Stations will be erected no more than 50 miles apart – making it easier for drivers to plan when and where they can recharge.
  • Stations must be located no more than one mile from a highway, ensuring that drivers can easily find these stations.
  • Each station will have at least four fast-charging ports, which will allow for multiple drivers to quickly charge their vehicles – akin to visiting a gas station.

This plan reflects the increasing popularity and sales of EVs. While Tesla is the company that currently leads in the production of EVs, numerous manufacturers are working to get more of these vehicles – both passenger cars and larger trucks – on the road, as evidenced by the high number of orders for Ford’s electric pickup trucks. These EVs will be fighting for spots at this new network of charging stations.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, particularly titles such as Global Batteries and Global Hybrid & Electric Vehicles. Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Automotive & Transport      Consumer Goods      Energy & Petroleum    

High Diesel Prices To Further Strain US Consumers

For all the talk of the supply chain issues that have riled the US economy since the beginning of the COVID-19 pandemic, there is another factor that’s contributing to the high prices that are confronting consumers at nearly every retail outlet: the cost of diesel fuel is at a record high.

This surge in pricing – caused by high crude oil prices and decreasing domestic production of diesel fuel – is set to cause further angst across many segments of the economy:

  • Truckers of every stripe – from those driving tractor trailers across America’s highways to the smaller trucks filling grocery shelves – will have to pay more for fuel, and will in turn charge more for their services.
  • Diesel fuel also powers the locomotives that carry cargo on the rails and the container ships that sail the high seas – and again, railroad companies and shippers will pass these costs on to consumers.
  • The construction industry relies on diesel fuel in myriad ways – from the generators that power equipment during a home remodel to the bulldozers, loaders, and other vehicles used in infrastructure projects. Construction professionals will have to figure these increased costs into the bids they submit.

Sadly, there does not appear to be serious price relief on the horizon. Winter is expected to continue for at least another month in the US, and any serious storm can affect refinery outputs, thus making it difficult for US producers to increase domestic supplies. Even more seriously, global uncertainties – of war in the Ukraine, for instance – have pushed petroleum prices to nearly $100 a barrel, and efforts to increase production (and lower prices) have remained modest.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research. Freedonia Custom Research is also available for questions requiring tailored market intelligence.