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U.S. Forecasts Slower Industry Growth in ’90 : Economy: Expansion by about 2% is expected. High tech is seen outpacing old core sectors.

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THE WASHINGTON POST

Government analysts on Thursday predicted a slowdown in the overall growth of American industries next year, but said strong sales in the high-technology and medical-equipment sectors would overcome declines in auto production, steel and construction to moderate the impact of continuing weakness in the country’s old-line core industries.

“Overall, we see continued but slower growth for 1990 for the vast majority of industries, both manufacturing and services. . . . Not all industries will be growing, but the overall direction continues upward,” said Commerce Undersecretary J. Michael Farren, who released the Commerce Department’s 1990 Industrial Outlook.

He said the forecasts by department specialists are consistent with the Administration’s expectations of overall economic performance of continued slow growth in the 2% range next year. Some private forecasters, however, are more pessimistic, suggesting that the country faces either stagnation or the possibility of a recession in 1990.

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The forecasts, covering 193 manufacturing industries, found a median growth for next year of 2%, slightly lower than the 2.2% predicted for 1989. The report found that service industries--paced by businesses dealing in the collection, processing and communication of information--will grow more quickly than the manufacturing sectors.

The annual industrial outlook paints a commercial picture of the American economy, pinpointing the winners and losers among business sectors and documenting shifts in manufacturing and consumer tastes.

The 1990 report, for example, noted that poultry slaughtering and processing is expected to be one of the 10 fastest growing industries next year, largely as a result of a shift in the U.S. diet from red meat to chicken.

The analysts predicted the strongest growth for the medical- and dental-equipment industries, which are buoyed both by heavy demand in domestic markets and increased exports. Growth in those industries was projected at 8.8%, compared to 7.7% this year.

Strong growth also was projected for the computer, scientific measuring device and aerospace industries.

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