Survey: Manufacturers more optimistic
The fourth quarter PricewaterhouseCoopers LLP Manufacturing Barometer reports cautious optimism about the U.S. and global economies among U.S.-based industrial manufacturers.
Nearly half (47 percent) of survey respondents are optimistic about the U.S. economy's prospects, whereas only 5 percent were optimistic a year ago. Similarly, 41 percent of panelists who sell internationally are optimistic about the prospects for the world economy, compared to only 4 percent a year ago.
Indicating a continued hint of optimism, 35 percent of panelists believed the U.S. economy grew in Q4 2009, up 22 points from the prior quarter. Only 15 percent believed it declined (down 8 points from the previous quarter), while the prevailing opinion (50 percent) was that the U.S. economy remained unchanged. In regards to the world economy, the most typical view was that it remained unchanged (46 percent) for the second straight quarter. However, 34 percent viewed the world economy as growing, a 5 point increase, while 20 percent believed it was declining.
Thirty-eight percent of industrial manufacturers that sell abroad reported an increase in international sales, up 16 points over last quarter. The number reporting a decrease in international sales fell to 22 percent from 39 percent in the prior quarter and is down significantly from the 60 percent reported in the first quarter of 2009.
Industrial manufacturers’ average revenue growth for calendar year 2009 ended with a double-digit loss (minus 11 percent), with only 20 percent reporting positive growth. However, in sharp contrast, the majority (57 percent) forecast positive revenue growth for their own companies in 2010 – with 19 percent forecasting double-digit growth, and 38 percent forecasting single-digit growth. Only 13 percent forecast negative growth.
Looking ahead, 47 percent of respondents are optimistic about the 12-month outlook for the U.S. economy, similar to the prior quarter. Only 10 percent remain pessimistic, and 43 percent are uncertain. This level of cautious optimism is in sharp contrast to a year ago, when 70 percent were pessimistic. Similarly, 41 percent of those surveyed who market abroad are optimistic about prospects for the world economy, 50 percent are uncertain and only 9 percent are pessimistic. A year ago, only 4 percent of the international segment was optimistic about the global economy, while 69 percent were pessimistic.
“We are beginning to see cautious optimism about the economy in the industrial manufacturing sector,” said Barry Misthal, U.S. industrial manufacturing leader for PricewaterhouseCoopers. “There is a sense that the worst is over, but recovery will be slow. These manufacturing executives are still facing a significant challenge to their growth targets from a lack of demand. The industry needs improved momentum in the overall business climate and a reduction in regulatory and legislative pressures."
INDUSTRIAL SUPPLY MAGAZINE
The May/June issue of Industrial Supply magazine features an in-depth cover story about GHX Industrial. Plus, we're featuring articles by contributing writers Dr. Bharani Nagarathnam and Frank Hurtte, as well as interviews with numerous product and distribution industry experts.
