In recent months and even years, optimism was a word that was rarely heard in manufacturing. Now, however, small but steady gains are making small and midsized manufacturers approach the future with some hopefulness, a recent survey found.
“We poll our members twice a year, at the beginning and the midpoint of the year, to ask about their expectations about revenues, hiring plans, and capital expenditures,” said Mike McDonald, vice president of member recruitment for Prime Advantage, a buying consortium for midsized-manufacturers, in an interview. “The trend is that it has constantly been getting better in those areas.”
Recently, the company announced the findings of its 12th semi-annual Group Outlook Survey, and the results were promising:
- Ninety-seven percent of respondents reported they expect revenues to be better than or equal to the first half of 2013.
- Forty-two percent anticipate revenue growth will be higher in the second half of 2013 than in the first half 2013.
- The level of capital expenditures is expected to increase at one out of three companies in the second half of 2013.
- Forty-seven percent of companies expect to hire in the next six months and less than percent are planning layoffs.
Of course, manufacturers are not without concerns, pointing to the cost of raw materials as the biggest worry going forward. “There's been a shift in what they are worried about from a cost standpoint,” said McDonald. “Raw materials are always up there on the list because that's where you spend money.” In addition, manufacturers are focusing on manufacturing processes and the cost of baseline materials for components (such as oil and gas) as other areas that bear watching.
Other pressures are created by the current political scene. In fact, 62 percent felt that fiscal policy uncertainties were negatively impacting their business and the overall impact. Most (52 percent) thought that negative impact would continue over the next year. In addition, survey respondents identified the top barriers to business growth over the next 12 months: legislative and regulatory pressures (47 percent); oil and energy pricing (39 percent); and lack of qualified workers (32 percent).
We've asked Mr. McDonald to come and share more about the current manufacturing landscape. We'll be gathering in the EBN Chat Area on October 10 at 1:30 p.m. ET (10:30 a.m. PT). We'll be talking about all the hottest manufacturing topics, from conflict minerals and sourcing concerns to the current talent pool, and how they will impact OEMs. Bring your thoughts and questions and join us there!