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Jan. 2, 2025 |  By: Chrystal Blair - Public News Service

Professor forecasts 2025 economic trends amid presidential transition

economy

By Chrystal Blair - Public News Service

As President-elect Donald Trump prepares to take office, economists are focusing on how his promised policies could shape 2025.

In 2024, Missouri faced economic challenges, including declining revenue and slow population growth. The economy dominated the election, with voters nationwide prioritizing gas and food prices. Moving forward, economists highlight tariffs, the stock market, electric vehicles, agriculture and education as key issues.

Jason Miller, professor of supply chain management at Michigan State University, predicted Trump's tariffs will affect 2025, although positive signs remain.

"Retailers have entered the holidays with inventory sort of in line with demand conditions," Miller pointed out. "November sales for motor vehicles were phenomenally strong for light trucks and SUVs; it was, on a seasonably adjusted basis, the third-highest month of all time."

Miller believes importers will stockpile Chinese goods to avoid tariffs. Past tariffs failed to create jobs and instead drove up costs, raising prices for consumers.

He also projected a major supply-chain issue by Jan. 15, involving the International Longshoremen's Association, as East Coast and Gulf port contracts expire, raising the threat of port strikes. However, he sees potential for a rebound in the manufacturing sector, an industry facing challenges recently.

"Now that the Fed is cutting interest rates, that is a nice tailwind for the type of goods needed for capital investments," Miller explained. "For things like machinery, as well as goods for residential construction, so bricks and lumber and shingles."

Miller added they are also monitoring potential extreme weather events in early 2025, such as the polar vortex back in 2018, which could impact the economy.