US purchasing and supply executives expect economic growth to continue through the remainder of the year, according to a semiannual survey. The growth will continue in both the manufacturing and non-manufacturing sectors.
According to the Semiannual Economic Forecast, 66 per cent of respondents in a panel of manufacturing executives forecast 2012 revenues to be 9.5 per cent higher than 2011, while 15 per cent expect a 12.1 per cent decline. Nineteen per cent expect no change.
“With 16 out of 18 industries within the manufacturing sector predicting growth in 2012 over 2011, manufacturing continues to demonstrate its strength and resilience in the midst of global economic uncertainty and volatility,” said Bradley J. Holcomb, chair of the ISM Manufacturing Business Survey Committee in a statement. “The positive forecast for revenue growth and modest price increases will drive a continuation of the recovery in the manufacturing sector.”
The manufacturers said their companies are operating at 81.6 per cent of normal capacity, up from 79.2 per cent in December 2011, but a decrease from the 83.2 per cent level reported a year ago.
Production capacity for 2012 is expected to increase an average of 5.2 per cent this year. Forty-seven per cent of the respondents forecasted an average capacity increase of 14.1 per cent, while 8 per cent expected decreases averaging 19.1 per cent. Forty five per cent expected no change.
The respondents also expected to see an average 6.2 per cent increase in capital expenditures in 2012, up from the last survey in December 2011 where respondents forecasted an increase of 1.9 per cent. Forty two per cent expected to increase capital expenditures by 23.4 per cent, while 45 per cent said they would spend the same as 2011.
About 45 per cent expected employment levels to rise by 5.6 per cent, while 41 per cent said employment levels would remain unchanged for the year. The study said the positive signs reflected "moderate" growth for manufacturing.