A new report on Southwest Michigan’s economy finds growth slowed in December. The director of Grand Valley State University’s Supply Chain Management Program Brian Long finds economic indicators were down in the region, compared to November.
In his monthly report for the National Association of Purchasing Managers Long says fear over the fiscal cliff hurt the economy during December. He says that led to psychological concerns about the state of the economy. Long says if people believe the government is dysfunctional it creates more hurdles to economic growth. Long’s projection for 2013 is for what he calls “a leveling off.” Long says “I guess that’s a polite way of saying that the best we can hope for is very slow growth.” He says much depends on what happens on the national and world stage. He says that includes negotiations in Washington and among European nations. Long says if Congress could reach agreement on reducing the deficit it could lead to positive economic growth in the latter part of the year. Long says Kalamazoo and West Michigan have been less affected by the recession than the state and the nation. The unemployment rate has dropped recently. Long says he expects that trend to continue. While there is always uncertainty about the economy, Long says several factors make that uncertainty greater than normal right now. He says businesses don’t have an optimistic tone about expanding and hiring.
Long says that uncertainty is another hurdle in the way of a strong economy. He says Congress reaching agreement on some sort of a budget deal would help, even if it wasn’t perfect. Long says the markets responded well to the deal reached last week even though it delayed big decisions on many important issues. But Long says the rhetoric from both sides makes it hard to believe that such a deal is possible.