The Economic Outlook and Its Impact on the Industry

Two of the nation’s most influential economic thinkers, Paul Krugman and Lawrence H. Summers, will face-off in person at this year’s NIC Fall Conference during a lively main stage debate. Both have strong, often differing opinions about the economy and the path forward. The discussion will be moderated by Angela Mago, president Key Commercial Bank & KeyBank Real Estate Capital.

Krugman is a Nobel Prize winning economist and professor emeritus of Princeton University’s Woodrow Wilson School. Summers is the former Secretary of the U.S. Treasury and president of Harvard University, and served in many U.S. executive branch administrations.

To provide context for the upcoming discussion, NICs chief economist, Beth Mace, recaps the big issues driving the economy, and topics likely to be addressed at the upcoming Fall Conference session.

Growth Outlook

As of the second quarter, real GDP in the U.S. had surpassed its pre-pandemic level, rising at a fast 6.5% annualized clip. That said, growth is likely to be much slower in the coming months as the vast pandemic-related fiscal stimulus starts to wane, pent-up demand begins to fade, and as the COVID-19 Delta variant takes its toll. It will be interesting to hear the broad views Krugman and Summers will have on the shape of the post-pandemic recovery.

Inflation

Since the recovery from the pandemic has begun, inflation has increased due to supply chain disruptions and reopening effects. The policy question has become whether this inflation growth is transitory or will become more permanently embedded in consumer and business expectations.

Labor Pains: Short or Longer Term?

Increasingly, we hear from employers of all industries, and importantly, seniors housing and nursing care are among these industries, that finding workers is a limiting factor to business expansion. Certainly, one part of the discussion on labor shortages is around what is causing so many low wage workers to stay out of the labor force now.

Interest Rates

Federal Reserve Chairman Jerome Powell recently said that interest rate hikes are not on the Fed’s radar immediately. But the markets may not agree with the pace and timing of expected interest rates increases. As the economy starts to improve, what should we expect to see with interest rates?

Send Us Your Questions

For more on the 2021 NIC Fall Conference opening session with Krugman and Summers, look for an interview with Paul Krugman in the September edition of the NIC Insider newsletter, coming September 9. As session moderator Angela Mago prepares for the discussion, she wants to know what topics industry stakeholders want to hear about. Send your questions now to submityourquestions@nic.org.

Learn more about the 2021 NIC Fall Conference and register here.