Please do not leave this page until complete. This can take a few moments.
Jeffrey C. Fuhrer, executive vice president and senior policy advisor at the Federal Reserve Bank of Boston, on Tuesday predicted 2.5% U.S. economic growth in 2018 and gave a quick readout of what the new tax-reform package means for households and businesses.
“For the last three quarters, we’ve actually had quite robust growth, averaging around 3%” he said in opening Mainebiz’s Five on the Future event in Portland. “It turned out the year as a whole was actually pretty good.”
In the coming year, he said growth is expected to be “in the 2.5% range, maybe a little stronger, maybe a little weaker.”
And while the projected growth will be consumer-led, investment is also doing better, according to Fuhrer’s presentation. He also said he’s optimistic of productivity growth picking up.
Turning his attention to the recently passed tax reform, he noted that while most households will receive a net tax cut, the biggest cuts will go to the highest-income households. Those lower rates revert back to current rates in 2025 to reduce the impact of deficits.
For corporations, the reform means a lower tax rate of 21%, down from 35%; repatriated earnings will be taxed at a lower rate; and more rapid expensing of capital and structures.
Interestingly, Fuhrer said that while companies have been sitting on a lot of cash or cash-like assets for some time, they’ve by and large used the money to buy back shares or pay dividends.
With greater after-tax profits generated by the reform, Fuhrer said, the hope is that employers will return more to workers, and noted that some have already said they will give bonuses and raise wages.
“We hope we’ll see more of that,” he said.
Following his talk, Fuhrer moderated a panel discussion with Kathie Leonard, president and CEO of Auburn Manufacturing; Michael O’Hanlon, vice president of government and industry relations at Wayfair; Drew Sigfridson, SIOR, managing director of brokerage Services at CBRE | The Boulos Co.; and Matt McGrath, president of Systems Engineering.
The Giving Guide helps nonprofits have the opportunity to showcase and differentiate their organizations so that businesses better understand how they can contribute to a nonprofit’s mission and work.
Learn MoreWork for ME is a workforce development tool to help Maine’s employers target Maine’s emerging workforce. Work for ME highlights each industry, its impact on Maine’s economy, the jobs available to entry-level workers, the training and education needed to get a career started.
Learn MoreFew people are adequately prepared for all the tasks involved in planning and providing care for aging family members. SeniorSmart provides an essential road map for navigating the process. This resource guide explores the myriad of care options and offers essential information on topics ranging from self-care to legal and financial preparedness.
Learn moreThe Giving Guide helps nonprofits have the opportunity to showcase and differentiate their organizations so that businesses better understand how they can contribute to a nonprofit’s mission and work.
Work for ME is a workforce development tool to help Maine’s employers target Maine’s emerging workforce. Work for ME highlights each industry, its impact on Maine’s economy, the jobs available to entry-level workers, the training and education needed to get a career started.
Few people are adequately prepared for all the tasks involved in planning and providing care for aging family members. SeniorSmart provides an essential road map for navigating the process. This resource guide explores the myriad of care options and offers essential information on topics ranging from self-care to legal and financial preparedness.
In order to use this feature, we need some information from you. You can also login or register for a free account.
By clicking submit you are agreeing to our cookie usage and Privacy Policy
Already have an account? Login
Already have an account? Login
Want to create an account? Register
In order to use this feature, we need some information from you. You can also login or register for a free account.
By clicking submit you are agreeing to our cookie usage and Privacy Policy
Already have an account? Login
Already have an account? Login
Want to create an account? Register
This website uses cookies to ensure you get the best experience on our website. Our privacy policy
To ensure the best experience on our website, articles cannot be read without allowing cookies. Please allow cookies to continue reading. Our privacy policy
Comments