Posted May 22, 2017

Manufacturers expect growth for remainder of 2017

Economic growth is expected to continue in the U.S. throughout the remainder of 2017, say the nation's purchasing and supply executives in their Spring 2017 Semiannual Economic Forecast.

Sixty-four percent of respondents from the panel of manufacturing supply management executives predict their revenues will be 8.5 percent greater in 2017 compared to 2016, 12 percent expect a 9.6 percent decline, and 24 percent foresee no change in revenue. This yields an overall average forecast of 4.4 percent revenue growth among manufacturers for 2017.

This current prediction is 0.2 percentage point below the December 2016 forecast of 4.6 percent revenue growth for 2017, but is 3.5 percentage points above the actual revenue growth reported for all of 2016. With operating capacity at 82.5 percent, an expected capital expenditure increase of 5.2 percent, an increase of 2.5 percent for prices paid for raw materials, and employment expected to increase by 1.3 percent by the end of 2017 compared to the end of 2016, manufacturing is positioned to grow revenues while managing costs through the remainder of the year.

"With 17 of the 18 industries within the manufacturing sector predicting revenue growth in 2017, when compared to 2016, U.S. manufacturing continues to move in a positive direction," said Bradley J. Holcomb, chair of the ISM Manufacturing Business Survey Committee.

The 17 industries reporting expectations of growth in revenue for 2017 — listed in order — are: Electrical Equipment, Appliances & Components; Textile Mills; Computer & Electronic Products; Furniture & Related Products; Apparel, Leather & Allied Products; Primary Metals; Paper Products; Fabricated Metal Products; Miscellaneous Manufacturing; Food, Beverage & Tobacco Products; Petroleum & Coal Products; Plastics & Rubber Products; Machinery; Chemical Products; Wood Products; Nonmetallic Mineral Products; and Printing & Related Support Activities.

Purchasing and supply managers report that their companies are currently operating on average at 82.5 percent of normal capacity, representing a small increase from the 81.9 percent reported in December 2016, as well as slightly larger increase from the 81.7 percent reported in April 2016.