The Naperville Area Chamber of Commerce held its economic forecast event at Elements in downtown Naperville on Tuesday night. A panel of four economic experts discussed and answered questions to help people prepare for the year ahead. Moderator Terry Savage led the conversation, which mostly centered on the high possibility of a recession in 2023.
Expect A Recession In The Spring
“So our baseline outlook is with higher interest rates, with a downturn in the housing market that we’re already starting to see, we’re going to start to see a slowing in consumer spending growth as these higher interest rates, lower stock prices, lower home values take a toll on consumer spending,” said PNC Chief Economist Gus Faucher. “We do expect a mild recession in 2023.”
Faucher said the recession will likely begin in the spring and last until the end of 2023. He also talked about the advantages workers have had since the pandemic.
“The labor market is very tight and I don’t think it’s going to get much loosened. So in terms of your business, you’re going to need to rethink things or you need to rethink your hiring practices, your pay, the benefits you take off from work, from home. Because I think that we’re in a change situation and that post-pandemic workers have more bargaining power than they did pre-pandemic. And I think that’s going to be a long-lasting impact.”
Inflation Has Hit A Plateau
Inflation was on the mind of many in the audience. Curtis Dubay of the U.S. Chamber of Commerce said he thinks inflation has peaked. But he said other questions remain.
“I don’t think we’re going to get much higher,” said Dubay. “The question is how long is the plateau? How long do we stay around and how long does it take to come down?”
How The Election Changes The Economic Forecast
Caroline L. Harris of Capitol Tax Partners LLP spoke to the audience about how the recent election might impact next year’s economy. She surmised that with a Republican house, there most likely won’t be any tax increase in the next two years. Also, she thinks we’ll continue to see a lot of what we saw during the campaigns two years ago, which was increased business taxes and increased taxes on the wealthy.
Greatest Risk In Financial Planning
Randy Bruns of Model Wealth INC talked to the audience about financial planning. He said the greatest risk in planning is not what most would think.
“So what’s the greatest risk, the greatest risk in financial planning it’s not the stock market, it’s not the bond market, It’s the things we overlook,” said Bruns. “It’s do you have an estate plan? If you have young children and you don’t have an estate plan, who is going to be the guardian of these children if you die? Or is that person also the best person to manage their finances?
The panel concluded with Q&A from the crowd.
Naperville News 17’s Joe Kennedy reports.
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