Prosperity will continue for a vast majority of American manufacturing industries in 1985, with high technology companies and makers of defense-related aerospace equipment leading the way, the Commerce Department predicted yesterday.
But the government's industrial outlook forecast said the rate of growth for 75 percent of the manufacturing industries will taper off from 1984 levels as the strong surge of the economic recovery eases.
"The forecast growth rates, though modest in comparison with 1984, still will exceed historical rates for about 70 percent of the manufacturing industries," according to the report, which included the 1985 outlook for 350 American industries.
The Commerce Department issued its report as the stock market finished a troubled year, with the Dow Jones industrial average down 47.07, 0.7 percent for 1984. Although trading volume set a new record on the New York Stock Exchange, the market was bogged down for most of the year with the exception of a short, spectacular rally in mid-August.
The seven industries with the highest predicted growth for 1985 are all in the high technology sector, which Undersecretary of Commerce Lionel H. Olmer said "appears again and again to be a growth segment and a strong segment of our economy."
The government forecast a 37.4 percent growth in 1985 for semiconductor makers, with a 15 percent annual growth rate predicted through 1989. Other high-growth, high-technology segments include electronic connectors, electronic components, X-ray and electromedical equipment, computers, radio and television communication equipment and lithographic platemaking services.
Olmer noted a reversal of the trend of American high technology manufacturers moving plants offshore to take advantage of low foreign wages.
"Investment seems to be returning to the United States, especially in computers, peripherals and semiconductors, as more of the assembly process is taking place here, and capital investment in this enormously expensive manufacturing equipment is taking place in this country with reduced levels abroad," Olmer said.
Aerospace industries also are prominent among the high-growth fields, "largely due to anticipated government expenditures for national defense," the report said.
Olmer also cited the growth of service industries, which now account for more than two-thirds of the nation's gross national product, as "the place in which new jobs are created." He said these industries, which go beyond a common conception of hamburger stands and dry cleaning stores, include health and medicine, advertising, travel, insurance and entertainment.
The 10 U.S. industries with the greatest employment growth are dominated by services such as data processing, personal supply, securities brokers, radio, TV and music stores, office work and legal services, the Commerce Department report said. The employment growth rates ranged from 41.64 percent for data processing to 21.05 percent for legal services.
Some basic industries that suffered most from the deep recession of 1981-82, especially producers of primary metals such as lead, aluminum, copper, and iron and steel, will show heavy growth rates in 1985. But Olmer said these "turnaround industries" are beginning to share in the recovery later than other industries, and cautioned that the rates are misleading because they are starting from such a low base.
There are, however, "emerging signs of structural readjustment" in some of those industries -- especially steel -- which means they will be better able to compete in the future, Olmer added.
In all, Commerce forecast that 85 percent of the nation's manufacturing industries will register growth in 1985 over 1984 levels.
American auto makers are expected to record heavy sales for a second straight year even if the restraints in Japanese car imports are removed, the report said. It is unclear whether the four years of quotas will end, however, and the White House is unlikely to decide until closer to the March 31 cutoff date whether to ask Japan to continue the restraints.
The Commerce Department analysts based their prediction on a guess that the auto restrictions will either be eliminated or a larger number of Japanese imports will be allowed in the country.
Underscoring changes that are taking place in the shape of the American economy, Olmer said that only three of the top 10 predicted performers for 1985 were on that list in the 1972-1982 period, and only four of the top 20 were on the list in 1984.
"Change is the only constant in our economy," he said. "The United States has an incredible dynamic economy in which no industry is exempt from adjustment."
The report listed five "problem industries," each "with a record of steady decline since 1972 and poor prospects through 1989." They are paperboard boxes, brick and structured clay tile, pressed and molded pulp goods, turbines and turbine generator sets and rubber and plastic footwear.
Plastic containers have replaced boxes, less costly building materials are used instead of bricks and tiles, and Commerce experts questioned whether electric utilities will replace aging turbines.