It could finally be the year that ordinary Americans feel like the economy is working for them.
The forecast for the U.S. economy in 2015 is positively rosy, and it could finally spur bigger wage gains for more workers.
“It will be a better year—it will certainly feel better,” said Ethan Harris, head of North America Economics at Bank of America Merrill Lynch’s research division. “In 2015, for the first time, we’ll see a modest pickup in wages. As the labor market tightens, workers will be getting a little bit of negotiating power.”
“The underlying fundamentals of the economy are quite solid,” said Gus Faucher, senior economist at PNC Financial Services. “Consumer balance sheets are in good shape, business balance sheets are in the good shape, and the government’s balance sheet is in better shape.”
Justin Wolfers, a professor at the University of Michigan, agrees that the economy is faring well and expects it will continue to do so in the coming months. He warns, however, against getting too sanguine about how the economy will shake out through 2015. “It will continue to be good unless it won’t,” he said, adding: “The biggest risk is the one we haven’t thought of.”
“My working assumption is that Washington does no harm, doesn’t do anything silly like shut the government down or threaten to breach the debt ceiling,” said Zandi.
Even if such fights surface again, the markets will be less inclined to take them as seriously, Harris added. “People have gotten used to the threats and no longer worry as much. We’ve been through it.”
