This behavior threatens future prosperity on a most fundamental level, including the outlook for increases in labor productivity and hence wages. Between 2010 and 2016, real spending on new equipment and premises as well as technology grew at only 3.6% a year. This last cycle saw the recessionary cutbacks but not the capital spending surge in the recovery. Past recoveries often saw rates of capital spending exceed depreciation by as much as 50%. A return to timid capital spending would cast a dark shadow over future economic prospects.

Source: Forbes March 13, 2019 19:52 UTC