NEWS DESK WHAT’S NEW IN MANUFACTURING n Manufacturing Expansion Forecast for 2017 P
urchasing and supply managers expect manufactur- ing to expand in 2017, including improved gains in revenue, according to the Institute for Supply Man-
agement (Tempe, AZ). That was the conclusion of the group’s semi-annual eco-
nomic forecast in December. A panel of executives forecast a revenue increase of 4.6% for 2017, compared with a 0.9% gain for 2016 over 2015. The panel also forecast that capital expenditures will rise just 0.2% in 2017, according to ISM. That compares with a 7.3% increase in 2016 over 2015. It also forecast an employment increase of 0.6% in 2017 compared with December 2016 levels. Manufacturers are using an average 81.9% of factory
capacity, according to the group. That’s up from 81.7% in April and 81.6% in December 2015. Ten industries are above the average, ISM said, including petroleum and coal products and miscellaneous manufacturing. Manufacturing purchasing and supply executives
“are optimistic about their overall business prospects for the fi rst half of 2017,” Bradley J. Holcomb, chair of the ISM Manufacturing Business Survey Commit- tee, said in a statement. The executives, he said, “are slightly more optimistic about the second half of 2017.” ISM said 67% of manufacturing executives surveyed said they expect increased revenue next year. That included respon- dents in 16 industries, including textiles, fabricated metal prod- ucts, transportation equipment, miscellaneous manufacturing, petroleum and coal products, primary metals and machinery.
helped as new orders, production and employment all reached highs for 2016. The ISM report is based on a survey of purchasing and supply executives. A reading above 50% indicates expan- sion and below 50% contraction. The PMI averaged 51.5% for 2016. The year began with two months of contraction. It ended with nine months of growth.
“We’re certainly glad it fi nished on a strong note and posi- tioned us well for a better year this year,” Holcomb said on a conference call with reporters. In December, 11 of 18 industries reported economic expansion. They included petroleum and coal products, primary metals, miscellaneous manufacturing, machinery and fabricated metal products. Six reported contrac-
Executives “are slightly more optimistic about the second half of 2017.” Separately, on Jan. 3, the institute said its PMI, which
measures economic activity in manufacturing, reached a two-year high in December. The group said the PMI was 54.7% in December. That was an improvement from 53.2% in November and the highest monthly PMI level since December 2014. December also marked the fourth consecutive month of economic growth in manufacturing. The results were
tion, including plastics and rubber products, furniture and transportation equipment. The report’s New Orders Index surged in December to 60.2%
from 53% in November. Twelve industries reported increases in new orders. They included apparel, petroleum and coal prod- ucts, miscellaneous manufacturing, primary metals, machinery, fabricated metal products and transportation equipment. Only four reported a reduction in orders, including furniture.
February 2017 |
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