As part of the TLMI Converter Meeting, Alan Beaulieu of ITR Economics delivered his much-anticipated Economic Outlook. Beaulieu, who is retiring, joined the TLMI community for the final time on March 10, 2025. In his overview of the economy, he addressed some of the most pressing economical topics in the United States, including tariffs, inflation, interest rates, the housing market, energy, and more.

ITR Economics, which is now owned by Crowe LLP, is an apolitical research and consulting firm, has been built with accuracy in mind. Beaulieu, a fixture at TLMI events, has presented his Economic Outlook 18 times for members throughout the years.

According to Beaulieu, the immediate future should bring positive economic results. “When we look at wholesale trade in the US, it’s going to be accelerating and getting busier,” noted Beaulieu. “This is good news because of all the labels and tags that go on packages throughout the world. That business will go up and will be accelerating through 2025 and 2026. It will be accelerating. 2027 will be up, too, but not as fast as 2026.

“For the rest of the decade, wholesale trade overall demand will be up, and you’ll be busier,” he added. “Your challenge will be maintaining EBITDA. If you’re feeling stressed or in the doldrums with all the changes in Washington, we are going to be busier despite everything going on – in some cases because of everything going on.”

ITR Economics does not anticipate any potential tariffs bringing about a recession, even if they do bring some pain in the immediate future. Currently, Europe serves as the No. 1 trade partner with the United States, followed by Mexico, China, and Canada.

“Tariffs are on a lot of people’s mind,” stated Beaulieu. “Tariffs have a negative impact on some and a positive impact on others; it’s not a blanket statement that it’s all bad. If other nations – or if we – put on retaliatory tariffs, they lead to inflation. When inflation goes up, interest rates go up. If they go up for the rest of the decade, that will lead to a recession – and then a depression – in the 2030s.”

Reciprocal tariffs have the potential to create trade wars. Much of the tariff news will create disruptions and instability, but it’s too early for projections – especially if the tariffs are more threatening in nature.

“This could be a time where the president uses tariffs as a club, and he’s swinging the club to make people do his bidding,” stated Beaulieu. “It’s too early to tell what the impact will be. The worst you will feel is inflation going forward.”

Beaulieu also delved into DOGE (Department of Government Efficiency). Doge has a lifespan, as any orders enacted can be repealed in future years and presidencies.

“I have yet to find someone who thinks the federal government doesn’t need to be reduced in size,” explained Beaulieu. “The bloat and waste does need to be reduced. But what happens in your business if you come in on Monday and start cutting all your jobs and costs at once? It leads to chaos and a loss of motivation and scared people – uncertainty. That’s all destabilizing. It won’t cause a recession, but it will cause a slowing rate of growth.

“DOGE has a lifespan, too,” added Beaulieu. “When DOGE is done, they can do a victory lap and they can say they saved $100 billion a year. It’s not insignificant, but it’s not significant. And in the future a new president could decide to bring those programs back for job creation. Anything positive with DOGE should be put in the temporary column because it’s not going to last.”

Additionally, the reported tariffs imposed on Canada – specifically in regards to lumber and electricity – could have a big impact on the United States. Canada’s threats of cutting off sales of electricity to the US have a significant impact on three states.

“Electricity coming into the US is a big deal, and we do get things from Canada that we cannot produce on our own,” said Beaulieu. “If our housing industry doesn’t have enough lumber, we can’t keep that industry going and we’re off track. There’s no crystal ball to know if the tariffs are real or not, which makes the world uncertain. The stock market is not happy, and the world is afraid of tomorrow because of this discussion. Businesses considering moving operations here need to know if the tariffs are real first. It’s all uncertainty, and uncertainty is the enemy of the economy.”

Four data centers are currently under construction in South Carolina. According to Beaulieu, those data centers will consume 25% of the electricity of all the homes in South Carolina. “Utilities will be asking for rate increases, and you and I will pay for that,” he noted.

In the future, labor will also drive an increase in inflation. “We see labor costs going up 28% by the end of the decade,” remarked Beaulieu. “We simply don’t have enough people to fill the jobs. If we go down the road of deportation, we’ll find it gets even tighter going forward. If we have a massive amount of deportation of undocumented workers, the construction labor force will go down by 13%. That, of course, has an impact on the economy. It’s not a moral discussion, it’s about economic impact. We already have more jobs than we can fill, which will drive up the cost of labor.”

The label and package printing industry should see an increase in M&A activity, as well. M&A activity is anticipated to rise in 2025 and 2026, although it will decrease after that period. “The lackluster period of M&A is over with,” stated Beaulieu. “Sell your business before too long, because values will be up and people will be hot to buy. Sell it before the silver tsunami.”

The United States is currently the second largest exporting country around the world, as well as the second largest manufacturing company. The export of just goods out of the US makes up 10% of GDP in the US. “If we can’t export, that’s a major ding on the economy,” said Bealieu. “But if you’re making labels for the middle class and up, it’s going to be happy days. Real incomes are going up and Americans are born and raised to spend. If they’re spending, you will be there making money.

“You’re going to like the rest of this year, and 2026 and 2027, as well as the rest of the decade,” Beaulieu concluded. “You’ll need to have efficiencies in your business. And it’s not just automation. You have to look at your business and see how you can become more efficient. You’ll have discussions on AI, but there’s one thing that’s forgotten when it comes to efficiency gains: stop wasting time and money on things you don’t need to be doing anymore. The best people to spot that are millennials. Look at your clients and decide which ones you need to fire. You’re wasting a lot of time and money on some customers that are hurting you. Some you’ll be able to save, and some you’ll have to part company. This is a great opportunity – not a time for fear – going forward.”