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.


Is Your Carryout or Delivery Habit Filling Your Junk Drawer? Some People Suggest to #skipthestuff

Many Americans already had a habit of ordering carryout or delivery meals from their favorite restaurants. In the COVID-19 pandemic era, more people ordered carryout as a replacement for their former visits to dine-in restaurants. As of the October-November 2021 edition of the Freedonia Group National Online Consumer Survey, 35% of respondents reported that they had increased their pattern of ordering carryout from a restaurant because of the pandemic and had not returned to pre-pandemic levels. Approximately one-quarter said they were increasingly ordering restaurant meals for home delivery either from a 3rd party app or from the restaurant directly because of the pandemic and had not returned to pre-pandemic habits.

The result of that increased carryout, delivery, and drive-thru ordering was more napkins, straws, plastic utensils, chop sticks, and condiments filling up our junk drawers. With more people ordering carryout or delivery to eat at home rather than on-the-go or at their office, more of us are eating carryout with our own utensils and often on our own plates. While many of us were already used to getting more napkins than we needed with each order, now the utensils, straws, and condiments also stacked up.

One movement looks to deal with that accumulation of carryout paraphernalia… #skipthestuff. This social media movement and the local ordinances that go along with it encourage people to ask restaurants to leave the utensils, napkins, straws, and condiments out of their bags, or to at least ask for only what they need. They also encourage restaurants to see this as an opt-in situation; to ask customers if they want them before automatically tossing them in the bag.

Since most of these items are destined for landfills, more consumers see this as an easy way to use less disposable paper and plastic. Many restaurants – some of which had already limited the inclusion of these items as a cost reduction measure – increasingly make “no utensils”, “no napkins”, and “no condiments” an option on their internet ordering platforms.

Freedonia analysts remain on top of changing consumer habits, supply levels, local regulations, sustainability pushes, cost reduction needs, and other reasons for shifting trends in this area.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research, particularly our collection of packaging reports, including Foodservice Single-Use Products and Global Foodservice Single-Use Products. Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Consumer Goods      Packaging    

Strong Growth in Kitchen Cabinets Demand in 2021: Will It Continue?

A recent press release from the Kitchen Cabinets Manufacturers Association (KCMA) reported strong gains in cabinet sales in 2021, with a gain of 14.6% from 2020. This is not surprising, given:

  • high levels of housing starts, particularly of single-family units with the largest kitchens (and thus have more cabinets)
  • strong homeowner interest in home improvement projects, such as kitchen remodeling – when homeowners often replace older cabinets with newer ones

These bursts of activity are demonstrated by the growth seen in the various kitchen cabinet types. Stock kitchen cabinets sales rose over 16% in 2021, bolstered by the increase in housing starts – home builders are more likely to buy these basic cabinets to more quickly install them, thus making a residence more ready sale.

Custom cabinets – those individually designed and crafted for installation in a home – saw the most rapid advances in 2021, growing 19.5% in that year. These advances were driven by the large number of homeowners who invested in kitchen remodeling projects during the COVID-19 pandemic. Consumers who had significant savings because of the pandemic – due to stimulus outlays and a lack of entertainment options – often put these funds in their homes. One way in which to do so was to upgrade their kitchens, installing custom cabinets with such features as pet beds, spice racks, and pull-out shelves.

Will these elevated kitchen cabinet sales continue in 2022?  Early indicators say “yes”. Home builders are continuing to erect houses as fast as they can as demand remains unquenched. Similarly, many remodelers expected continuing strong demand for their services – including kitchen renovations – as homeowners continue to invest in their residences. As of the December 2021 edition of The Freedonia Group National Online Consumer Survey, 30% of respondents reported that they were still doing more DIY home improvement and 13% were still hiring contractors for additional home improvement projects at an elevated rate than prior to the pandemic.  

For more information and discussion of opportunities, see The Freedonia Group’s study of the US cabinets industry, Cabinets, as well as the Freedonia Group’s extensive collection of off-the-shelf research, particularly our series of studies in the Construction and Building Products catalog. Freedonia Custom Research is also available for questions requiring tailored market intelligence.