West Michigan economy continues strengthening in April
The West Michigan economic recovery continued its expansion into April. While the economy is entering record territory, there are signs of headwinds approaching.
Record high statistics were collected in the April Supply Management Research survey.
“Locally here, of course, we’ve seen automotive, one of our major cyclical industries come back to pretty much full speed.”
Brian G. Long is director of Supply Management Research in the Seidman College of Business at Grand Valley State University. He explains in 2021, low interest rates and federal stimulus dollars are fueling an estimated annual U.S. economic growth rate of seven to nine percent. That would be fastest growth rate in six decades. Still, west Michigan’s entertainment and hospitality sectors hit hardest by the pandemic are dealing with above average unemployment.
Long warns there are headwinds approaching. There remain supply chain disruptions, a shortage of truck drivers and there’s a customs inspection logjam at the country’s ports. Add it up, and product shortages are increasing.
“Shortages create rising prices, and unfortunately for the 32-year history of our Grand Rapids survey we’re at an all-time high as far as the prices that are being charged to our local industrial companies.”
That’s limiting profitability and there are signs consumer prices are beginning to go up.
Long explains the fear of rising prices could trigger the Federal Reserve raising interest rates.