U.S. Growth at Slowest Since 2016, Complicating Trump’s Pitch

Services are driving growth, while manufacturing lags.

Although wage growth and business investment have slacked off, consumers’ confidence in the economy has been unshaken. Optimism about the ease of finding a job helped fuel the rise in its most recent monthly measure of confidence, the Conference Board, a business research group, reported this week.

Consumer spending accounts for two-thirds of economic activity, and enthusiasm drives growth.

The growth, though, is not spread evenly. “The manufacturing and service sectors are telling two slightly different stories,” said Emily Weis, macro strategist at State Street Corporation, a large financial institution based in Boston.

While spending on services has remained strong, manufacturing in the United States has yet to revive, despite signs that it has stabilized abroad.

December was the fifth month in a row that the sector had declined. One large company, 3M, which makes Post-it notes and a wide range of other consumer and office products, announced this week that it was laying off 1,500 people globally.

“Manufacturing has generally underwhelmed in the U.S.,” Ms. Weis said.

The Commerce Department will revise the fourth-quarter results twice, as more data comes in.

Article source: https://www.nytimes.com/2020/01/30/business/economy/gdp-numbers.html?emc=rss&partner=rss