#666 – US Manufacturers are Really Optimistic

We end the year with some more good news for manufacturing! Below are excerpts from the latest National Association of Manufacturers’ Outlook Survey for Fourth Quarter 2017.

US Manufacturers Are Really Optimistic

In the latest Manufacturers’ Outlook Survey from the National Association of Manufacturers (NAM), manufacturers’ optimism has risen to unprecedented heights, driven by their belief that the progress the White House and Congress have made on enacting bold, comprehensive tax reform shows that leaders in Washington are finally embracing policies to help manufacturers in the United States successfully compete in the global marketplace. With 94.6 percent of respondents saying they are positive about their own company’s outlook, this quarter’s optimism level is the highest in the survey’s 20-year history. Optimism has been at historically high levels throughout the year, averaging 91.8 percent in the four quarters of 2017, up from a 64.3 percent average in 2016.

Both sales and capital spending are anticipated to increase over the next 12 months at the fastest rates since mid-2011, and employment continues to trend strongly upward.

• Respondents predict sales growth of 5.2 percent over the next year, up from 4.5 percent in the previous release.
• More than 56 percent say their sales will rise by at least 5.0 percent over the next 12 months.
• Capital investments are anticipated to grow 3.4 percent over the next 12 months, up from 2.7 percent in September, reflecting business leaders’ increased confidence in the future.
• Just more than 38 percent of respondents predict capital expenditures will rise by at least 5 percent, with 21.3 percent predicting an increase of more than 10 percent.
• Full-time employment is expected to rise 2.6 percent over the next year, up from 2.2 percent in the previous survey. This is just shy of the 2.7 percent pace recorded in June, which was the fastest rate in the survey’s history.
• Nearly 62 percent of manufacturers anticipate an increase in employment over the next year, with 22.8 percent predicting a jump of at least 5 percent.

The inability to attract and retain a quality workforce is the top business challenge, cited by 72.9 percent of respondents. This continues to be one of the most cited issues for manufacturers, especially as the labor market has tightened significantly.

Full report

We would like to extend our very best wishes to our loyal readers for a joyous and safe holiday season.