By Kyle Cheng
The overall U.S. economic outlook remains positive as the country continues to bounce back from 2020. However, challenges remain on the horizon: supply-chain constraints, inflationary pressure, a tight labor market and a potential COVID-19 resurgence.
Supply-chain disruptions continue to affect many sectors of the economy. For the auto industry, the chip shortage is disrupting production, reducing inventory levels and driving up prices. Nearly every car manufacturer reported higher average transaction prices in June compared to 2020. While economists expect inflationary pressures like this to be short-term, it is weighing on consumer minds.
Employment in the sectors hardest hit by the pandemic continues to improve, especially leisure and travel. Average hourly earnings are also up, suggesting employers are having to offer higher wages to attract workers. COVID-19 cases have also risen in recent weeks. If outbreaks emerge more broadly, economic activity may slow down.
Want to learn more about the economic factors shaping our industry? Download the new July Industry Indicators report today at www.sema.org/research.