PwC: U.S. Industrial Manufacturers Remain Positive
Published October 25, 2012
Categories: Industry News
Despite continued uncertainty about the prospects of both the U.S. and global economies, the majority of U.S. industrial manufacturers remain positive regarding the overall revenue outlook for the next 12 months, according to PwC’s Q3/12 Manufacturing Barometer.
Eighty-two percent of respondents forecast revenue growth at their own companies for the next 12 months, and only 9% expect negative results, with many of the respondents planning to hire additional employees, as well as invest in new products and research and development. However, the projected average growth rate for own-company revenue over the next 12 months dropped to 4.6% from 5.6% in the second quarter, and below last year’s 5% estimate.
“While the majority of U.S. industrial manufacturers continue to forecast revenue growth at their companies over the next 12 months, overall sentiment among those surveyed remains cautious toward the direction of both the U.S. and global economies,” said Bobby Bono, U.S. industrial manufacturing leader for PwC. “Margins remained flat during the third quarter and inventories rose, while concerns rose regarding a lack of demand as a barrier to growth. There was also a notable pullback in capital and operational spending plans for overseas expansion. These factors may point to the continued uncertain global climate and a more guarded approach being taken by industrial manufacturers.”
Optimism regarding the 12-month outlook for the U.S. economy dropped to 37% in the third quarter of 2012, down 15 points from 52% in the second quarter, but remained well above the record low levels during the same quarter of 2011.
Despite the cautious outlook, more U.S. industrial manufacturing panelists are planning net new hiring over the next 12 months, at 47%, up five points from the previous quarter. With regard to spending, 49% of respondents plan major capital investments over the next 12 months, slightly below last quarter and a year ago (55%).
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