January 5, 2026

Hi, everyone. This is Taylor St. Germain with ITR Economics. Thanks for joining me on this episode of TrendsTalk. And I wanted to thank everyone for tuning into TrendsTalk in 2025. I know we’re kicking off a new year, so I wanted to just look back at some of the trends in 2025 and highlight how things will be changing as we look at 2026.

2025, as all of our business owners know, was not an easy year. We were dealing with record levels of uncertainty. We had manufacturing in a downturn for the first half of the year. We had CapEx declining for the first half of the year. It was a really challenging start to the year. And of course, tariffs did not make things easier. But as we looked at the second half of the year, we started to see a lot of these economic benchmarks and leading indicators pointing in the right direction. And when I say the right direction, I mean pointing towards growth in 2026. And as we ended 2025, we saw industrial production and manufacturing, both those year-over-year growth rates turn positive. We saw business investment, business to business spending turn positive. So there’s some great momentum carrying us into 2026.

However, 2026 will not come without its own set of challenges. Yes, we expect GDP to expand in 26. We expect accelerating growth in industrial demand. There’s good news, but we’re likely to face some higher costs. We’re likely to face higher inflation. And that will be one of the primary challenges as we move through 2026. As President Trump announced, we’re also getting a new Fed chair in 2026. So there’s a lot of excitement in the world of economics. But I wanted to just take a step back and say, we expect the global economy to grow in 2026. And I’m talking about real growth, not inflated growth, talking about volume growth.

We expect the US to continue to accelerate into 2026 from an industrial standpoint, which will be very exciting. I expect more demand to come your way. I expect more business to come your way. Again, my primary concern is can we be profitable in the face of higher labor costs, in the face of higher electricity costs, costs from tariffs being passed along? The question for me for 2026 is not, will our sales and revenue grow, it’s will your profits grow? It’s a very different conversation because of some of the higher cost environment that’s out in front of us. But that’s what we’re here for. We’re going to keep you updated with all these current events throughout the year, how tariffs are evolving, how the Fed is changing their course, if they change their course, and what the leading indicators are telling us about the future.

We always want you to be thinking a business cycle ahead. And when we think about the trajectory that we’re on, not just in 2026, but in the second half of the decade, it’s one that’s characterized by growth. But we need to take advantage of 2026 and the second half of this decade with all this growth to put us in a position to where we’re thriving during the 2030s. In 2026, ITR is going to come with a lot more information about the 2030s, how to best prepare your business, what markets you want to be involved in. Our job is we only have four years left to prepare for the 2030s. And so one of our focuses in 2026 is going to be how do you diversify your business? How do you buy other businesses? How do you best prepare yourself for what’s coming down the line?

The thing that I’m paying most attention to in 2026 is the consumer. Two-thirds of our economy is the consumer. I’m very interested in the housing market, which we expect to improve in 2026. Do we continue to see consumer incomes in retail sales grow? That’s our expectation, but I’m laser focused on that part of the economy in 2026 because it’s such a big driving factor. Uncertainty is fading as we ended 2025 and moved into 2026, but we’re still going to be here to walk you through the leading indicators and what they’re showing us. Head over to our Trends Report if you haven’t at this point, because we have a lot of leading indicators that should have you very positive as we move into 2026.

There’s one market that I was concerned with through most of 2025, and it was commercial construction. We saw a lot of weakness in commercial construction in 2025, particularly in that retail, office segment. Those areas were down. We saw overall commercial construction enter a recession in 2025. But most of our construction forecasts are for a positive ’26, especially as we move into the second half of the year. So for those CRE folks that have been listening to me and I’ve been a little bit of a doom and gloom over the second half of ’25, I can tell you we’ve got a lot better news coming for you in 2026.

Folks, there’s a lot to be excited about this year. There’s still things to have a little bit of anxiety about, but that’s what we at ITR are here for. We’ve got a lot of great webinars, conversations coming up, and I’ll continue to keep you informed here on TrendsTalk. So let’s find ways to deal with these higher costs. Let’s enjoy this growth. Let’s grow profitably in 2026. That’s really our goal. That’s our goal for you all. That’s our goal as a company as well. And we’ll be here to handle these disruptions with AI and geopolitics as we progress throughout the year. Thanks again for trusting me in 2025. Thanks again for trusting ITR. We’ve got a lot of great information coming your way in 2026.

As always, I am always taking any suggestions that you have. Message me on LinkedIn, message ITR on LinkedIn, any topics you want me to improve on, to discuss. We’re always looking to make TrendsTalk more applicable to all of you. So we always appreciate the feedback and thanks again for a great year. Looking forward to TrendsTalks this year in 2026. Thanks for joining me today. And I hope you all had a great holiday season and a good start to 2026. Thanks so much. Take care for now.