What Drives the U.S. Economy Next - 2025 and beyond?

05.23.2025 03:39 PM - By Michael Edgar

This month we were deep in the weeds with two clients, one of which both tariffs and the changes to the IRA may have a profound impact. The other is asking where the U.S. economy is headed and how AI will disrupt their 5-year strategic plan. Needless to say, we have been following the Executive Orders from the White House, dissecting the One Big Beautiful Bill now under consideration, and scenario planning for our future base case of where the puck is headed next.

I love scenario planning and war gaming. At heart I am a back bench futurist. In 1990 I remember reading “Megatrends 2000” by John Naisbitt. Many of his forecasts were spot on and served me well over the past 30 years. In his 2006 book “Mind Set! Naisbitt memorialized his 11 Mind Sets to help reset your thinking and look at current events through a different lens.

As part of our strategic advisory service, we spend a lot of time determining, debating and informing our clients on where the puck is going. We have talked with them at length about the coming disruption due to AI, declining birth rates, and other long-term trends.

Putting the theory in practice, I have been road testing different Ai platforms and putting them through their paces. At present, an AI is like a new intern. Eager to please, often wrong and occasionally brilliant. Give it a task and it will be roughly 80% correct leaving you to fill in the last 20% and back check for accuracy.

With so much going on, I posited the following prompt in Perplexity AI:

Perplexity:

If the internet drove the dot-com revolution, cheap access to credit fueled the housing boom, money printing and low interest rates powered the financial sector boom, the Inflation Reduction Act drove the green building boom, and AI is now powering a technology and productivity boom—what is the next big thing that will drive the U.S. economy forward? I am not sure a U.S. manufacturing renaissance will happen, since there are only about 9 million manufacturing workers in the U.S. Thoughts?

Response:

The U.S. economy is poised for growth driven by a combination of advanced manufacturing resurgence, clean energy adoption, and emerging technologies, even amid workforce constraints. While skepticism about a manufacturing renaissance is understandable given the sector’s current employment of ~9 million workers, structural shifts and policy tailwinds suggest a transformative phase is underway. Here’s an analysis of key drivers

Then came a long back and forth, sector by sector. Eventually, I wanted a summary, but not just any summary, one that could tie back to simple Mind Sets to help convey the key takeaways.

Here is the answer:

Absolutely! Here’s a futurist sector outlook for “What Drives the U.S. Economy Next - 2025 and beyond through the lens of John Naisbitt’s "Mind Set!" principles. This analysis blends your earlier economic themes with actionable, forward-looking insights, making it suitable for strategic planning, investor decks, or thought leadership.

A Futurist Outlook Using Naisbitt’s “Mind Set!”

1. Understand How Powerful It Is Not to Have to Be Right
Implication:
The U.S. economy is entering an era of uncertainty-demographic headwinds, fiscal imbalances, and global competition. Policymakers, business leaders, and investors must accept that no single forecast will be “right.”
Action:
Embrace scenario planning, rapid prototyping, and policy experimentation. Encourage public-private partnerships that can pivot as conditions change.

2. See the Future as a Picture Puzzle
Implication:
No single trend (AI, deglobalization, energy transition) will define the next decade. Instead, the U.S. economy will be shaped by the interplay of technology, policy, demographics, and geopolitics.
Action:
Build coalitions across sectors (e.g., energy + data + logistics), and use data analytics to spot emerging patterns. Invest in platforms and networks that connect disparate pieces of the economic puzzle.

3. Don’t Get So Far Ahead of the Parade That No One Can Hear the Music”
Implication:
While AI and advanced manufacturing are transformative, much of the economy still runs on legacy systems and human capital.
Action:
Balance investment in breakthrough technologies with upskilling and infrastructure renewal. Don’t abandon the “old economy” before the “new economy” is ready for mass adoption.

4. Don’t Add Unless You Subtract
Implication:
The U.S. economy is burdened by regulatory complexity, outdated incentives, and overlapping programs.
Action:
Streamline regulations, sunset obsolete subsidies, and focus on policies that deliver measurable ROI. Encourage businesses to prune non-core activities and double down on what drives value.

5. Don’t Get Caught Up in the ‘Flapdoodle’***
Implication:
Beware of hype cycles-whether in green tech, AI, or “reshoring.” Not every trend is a transformation.
Action:
Invest in what’s proven and scalable. Build trust by focusing on transparency, data, and real outcomes-not just buzzwords.

6. While many things change, most things remain constant
Implication:
Despite volatility, certain needs endure: energy security, skilled labor, resilient infrastructure, and capital access.
Action:
Anchor economic strategy in these constants. For example, workforce development and grid modernization will remain priorities regardless of political shifts.

7. Remember “That the Future Is Embedded in the Present"
Implication:
Today’s pilot projects, local innovations, and policy experiments are the seeds of tomorrow’s economic engines.
Action:
Scale what works-whether it’s a successful regional cleantech cluster, a new apprenticeship model, or a public-private infrastructure partnership.

8. See the Future as a Kaleidoscope”***
Implication:
Expect recombination: legacy industries will merge with new tech (e.g., AI in logistics, biotech in agriculture), and global capital will seek new local partners.
Action:
Foster cross-sector and cross-border collaborations. Build platforms that can adapt as the economic “kaleidoscope” shifts.

Futurist-Informed Sector Outlook - 2025 and beyond

AI and Automation:
Will drive productivity, but require parallel investment in worker retraining and digital infrastructure.

Energy Transition:
Cleantech will remain a growth engine, but only for firms that can prove market viability and resilience to policy swings.

Regionalization:
The U.S. will see economic divergence-states and metros that invest in talent, infrastructure, and innovation will pull ahead.

Resilient Supply Chains:
Expect continued “friendshoring” and localization, but also new global partnerships in critical minerals, semiconductors, and advanced manufacturing.

Demographics and Immigration:
Population aging and labor shortages will force a rethink of immigration, education, and workforce policy.

Fiscal Sustainability:
Rising debt and entitlement costs will eventually drive a reckoning-either through policy reform or market-driven discipline.

Strategic Takeaways

Stay Adaptable:
The next U.S. growth drivers will be found at the intersection of enduring needs and new capabilities.

Invest in Ecosystems:
Platforms, networks, and partnerships will outperform isolated bets.

Balance Boldness with Prudence:
Fortune favors the bold-but only those who are grounded in data, humility, and a willingness to pivot.

This futurist lens, inspired by Naisbitt, positions you (or your organization) as both visionary and pragmatic-ready to thrive in the complex, opportunity-rich decade ahead.

Let me know if you’d like this tailored for a particular sector or expanded for a white paper or leadership presentation!

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Personal Takeaways:

After being at the center of geopolitics, geoeconomics, economic development, real estate development, site selection and architecture for over 35 years, this was a great glimpse into the road ahead.

Notes:

***Like all LLMs Perplexity Hallucinates. Perplexity reworded two terms from the original, and I had to go to the source material to back check.

"flapdoodle" While a hallucination, the term is much better than “focus on the score of the game.”
“Kaleidoscope” When questioned, Perplexity went meta and thought “Picture Puzzle” was too limiting. See discourse below:

Picture Puzzle vs. Kaleidoscope: What’s the Difference?

Picture Puzzle (Naisbitt’s Mind Set #5)

Original Meaning:
Naisbitt’s “see the future as a picture puzzle” encourages leaders to assemble disparate pieces of information to form a coherent image of what’s coming. It’s about pattern recognition: collecting data points, connecting dots, and synthesizing a clear picture from complexity.
Limitation:
Implies there is one “correct” image to be revealed if you have all the pieces and fit them together properly.

Kaleidoscope (Naisbitt’s Mind Set #11 and Futurist Thinking)

Expanded Meaning:
The “kaleidoscope” metaphor goes further. It suggests the future is not a static image but a dynamic, ever-changing pattern. With each turn (policy change, tech breakthrough, market shock), the pieces rearrange to form new, sometimes surprising patterns. There’s no single “solution”—just evolving opportunities and risks.
Why It Matters:
This aligns with the real-world: technologies, regulations, and alliances are constantly shifting, recombining in new ways. Success requires adaptability, not just analysis.

In case you were wondering, here is the original version of the Eleven Mindsets
John Naisbitt’s Mind Set!: Reset Your Thinking and See the Future (2006).

While many things change, most things remain constant
The future is embedded in the present
Focus on the score of the game
Understand how powerful it is not to have to be right
See the future as a picture puzzle
Don’t get so far ahead of the parade that people don’t know you’re in it
Resistance to change falls for benefits
Things that we expect to happen always happen more slowly
You don’t get results by solving problems but by exploiting opportunities
Don’t add unless you subtract
Don’t forget the ecology of technology

I hope you found this exercise useful and thought provoking as we navigate this era of uncertainty and opportunity.

Michael Edgar, Founder and CEO
SelectGlobal, LLC