Manufacturing Is on the Rise Across 15 Sectors
The Institute for Supply Management’s (ISM’s) New Orders Subindex rose slightly—from 56.9 in May to 58.9 in June. The increase was subtle on a month-over-month basis, but of more significance, it was the highest reading since December.
July 7 2014 by Lynn Russo Whylly
Of the 18 manufacturing industries the ISM tracks, 15 reported growth in June, including Furniture & Related Products, Nonmetallic Mineral Products, Fabricated Metal, Computer & Electronic Products and Transportation Equipment.
In addition, in the 2014 McGladrey Manufacturing and Distribution Monitor, data show that small and mid-sized manufacturers are optimistic about near-term growth, and a majority of survey respondents plan to add a “significant number of jobs” as the market improves.
The report notes the following positive findings:
- 69 percent reported growth in domestic sales over the past year.
- 88 percent expect their numbers to go up in the coming year, with an average projected increase of 8 percent.
- 67 percent expect to hire more employees over the next year, with an average expected increase of 6 percent.
McGladrey also is seeing a significant drop in the number of companies expecting to cut employees for the first time in several years. “This suggests that the influence of the economic downturn may truly be waning,” Karen Kurek, national industrial products practice leader for McGladrey said in a public statement.
In May, New York state Comptroller Thomas DiNapoli reported that manufacturing jobs in Brooklyn were growing at twice the rate of the rest of the New York City area. His report, according to Crain’s, showed significant increases in both food and apparel manufacturing.
On a more somber note, McGladrey also uncovered several concerns among manufacturers, specifically with regard to regulatory and tax issues.
- 66 percent expect growth to be limited or significantly limited by government regulation over the next year
- 69 percent expect implementation of the Affordable Care Act (ACA) to be an impediment
- 80 percent of respondents don’t believe their data is at risk
- 43 percent believe their companies are not high priorities for data thieves
- 50 percent or more do not intend to increase physically, as in facilities/warehouses, fleets/vehicles, or R&D, due primarily to an expiration of business tax incentives
Is your manufacturing business growing? Tell us what’s driving the growth in the comment section below.