Manufacturing has experienced strong periods of growth through 2015, but unfortunately, the most recent months haven’t been included among them. New orders, job openings, and hiring have all fallen recently and defied earlier positive trends.
Parts of the sector have also been hurt by unfair material importing practices, jobs lost to international hubs, lack of qualified applicants compared to increasing retirees, and other ongoing factors that could easily dim the most resilient optimism.
There are growing concerns on what this means for the overall economy, causing some to project that the sector’s meager growth and recent decline could drag down service and retail sectors that are doing fairly well.
Despite lackluster headlines from media outlets, a new survey points to a resilient optimism and potential for a U.S. manufacturing rebound in 2016.
Employment Expectations And Company Growth
The December 2015 Semiannual Economic Forecast was recently released by the Institute for Supply Management. The survey did reveal a 0.2 decrease in manufacturing employment since this past April, but it also predicated a comparable increase expected for early 2016.
The survey of purchasing and supply management executives showed that half of respondents expected their employment levels to stay the same next year, while 18 percent expected that level to decrease.
Almost one third of those surveyed however, projected that employment levels at their companies would grow. The forecast also indicated that labor and benefit costs would rise by just under 2 percent, with the most substantial increases happening in printing, furniture, plastics, and textile industries.
A More Prosperous Year?
The December 2015 Semiannual Economic Forecast revealed that 85 percent of manufacturing executives believed that 2016 would be a more prosperous year than 2015 and that nearly two-thirds of the respondents expected an increase in revenue in the coming year.
According to the survey, low fuel prices and raw material costs are expected to continue benefiting manufacturers in 2016.
Manufacturing On The Campaign Trail
Looking ahead even further, manufacturing jobs in the U.S. may start to become a bigger topic on the 2016 presidential campaign trail. Hillary Clinton has recently announced additions to her job growth agenda with a manufacturing tax incentive plan that focuses on towns that have been hit hard by loss of factory jobs.
As other candidates will follow suit, perhaps 2016 will be a big year to focus on manufacturing growth. Whether actual growth will follow, it seems we’ll have to wait and see, but tell us what you think.
Do you expect 2016 to be a better year for U.S. manufacturing?