Manufacturers: Fiscal Cliff Takes Toll on Economy
Manufacturers Renew Call for Growth Strategy from Washington
National Association of Manufacturers (NAM) Chief Economist Chad Moutray issued this statement on the report that the 2012 fourth-quarter GDP decreased by 0.1 percent:
“Today’s GDP numbers are not a surprise to manufacturers. Late last year the NAM released its Fiscal Shock study, which found that the fiscal cliff would reduce real GDP by 0.6 percent in 2012 from what it would have been without the fiscal cliff debate. We saw manufacturers pulling back on spending and hiring at the end of last year as they worried about slowing sales and fiscal uncertainties. This was confirmed in the latest NAM/IndustryWeek Survey of Manufacturers, which found their overall optimism declined significantly throughout the year.
Even with the fiscal cliff partially averted, many concerns remain. There are no budget solutions over sequestration, which could cost a million jobs by 2014. At the same time, headwinds overseas have taken a toll on manufacturing exports. While there has been some recent optimism in the markets, the key driver for manufacturers will be when confidence rises and sales consistently pick up.
The reality of this news comes as all Americans are seeing less in their paychecks, and businesses continue to face uncertainty as policymakers kick the can down the road on our debt. It is frustrating to manufacturers--who continue to call for pro-growth policies such as tax and entitlement reform to address the true drivers of our spending problems--that policymakers can’t seem to put forth a growth plan.”