US GDP to Rise on Gains in Personal, Investment, & Government Spending

Cleveland OH, April 15, 2024 — US nominal gross domestic product (GDP) is forecast to increase 4.1% annually through 2028, according to Macroeconomy: United States, a report recently released by Freedonia Focus Reports. Real (inflation-adjusted) GDP is projected to rise 1.7% yearly from 2023 to 2028. Increases in personal consumption expenditures (PCE), which are the largest component of GDP, are expected to account for over two-thirds of GDP gains. Gains in fixed investment spending to build plants and homes and increasing government expenditures will create positive knock-on effects in the rest of the economy by creating jobs, which will boost household disposable income and support further gains in spending. For 2024, high interest rates are expected to persist, as inflationary pressures continue, due to factors such as oil supply constraints and the expectation of adverse weather from a strong El Niño. The unemployment rate is expected to grow to 4.3% in 2024, up from 3.7% the previous year and peak at 4.5% in 2025 and 2026.

US nominal retail sales are forecast to see annual gains of 3.6% through 2028. Rising disposable personal income will support advances. In real terms, retail sales are forecast to grow 2.2% per year to 2028. In 2024, retail sales are projected to advance 3.1%, representing an improvement from 2.1% in 2023, but remaining relatively subdued. The strong surge in retail sales in 2021 and 2022, partially driven by inflation, satiated consumer demand, limiting growth in 2023 and 2024. However, the rate of growth in the 2025-2028 period is forecast to exceed the rate of gains in the 2023-2024 period as consumer spending trends normalize.

These and other key insights are featured in Macroeconomy: United States. This report forecasts annually to 2028 US GDP in nominal and real US dollars. Nominal and real GDP are segmented by component in terms of:

• services PCE

• nondurable goods PCE

• durable goods PCE

• nonresidential fixed investment

• residential fixed investment

• state and local government spending

• federal government spending

• change in private inventories

• net exports

This report also forecasts annually to 2028 US retail sales in nominal US dollars. Retail sales are segmented by business type as follows:

• nondurable goods
  • eating and drinking places
  • food and beverage stores
  • general merchandise stores
  • gasoline service stations
  • healthcare and drug stores
  • apparel and accessory stores
  • other nondurable goods retailers
• durable goods
  • vehicle dealers
  • general hardware
  • furniture and furnishings stores
  • electronics and appliances stores
  • other durable goods retailers

To illustrate historical trends, GDP, retail sales, disposable personal income, interest rates, labor force size, and the various segments are provided in annual series from 2013 to 2023.

GDP is the broadest measure of macroeconomic activity and is defined as the sum of PCE, investment, government spending, and net exports. The Freedonia Group’s Consensus Forecasts for GDP and other major macroeconomic indicators draw on the projections of 10 to 30 sources.

More information about the report is available at:

https://www.freedoniagroup.com/freedonia-focus/macroeconomy-united-states-ff95051.htm

About Freedonia Focus Reports

Each month, The Freedonia Group – a division of MarketResearch.com – publishes over 20 new or updated Freedonia Focus Reports, providing fresh, unbiased analysis on a wide variety of markets and industries. Published in 20-30 pages, Focus Report coverage ranges from raw materials to finished manufactured goods and related services such as freight and construction. Additional Services reports can be purchased at Freedonia Focus Reports or MarketResearch.com.

Analysis is intended to guide the busy reader through pertinent topics in rapid succession, including:

• total historical market size and industry output

• segmentation by products and markets

• identification of market drivers, constraints, and key indicators

• segment-by-segment outlook in five-year forecasts

• a survey of the supply base

• suggested resources for further study