NAM Manufacturers’ Outlook Survey: Third Quarter 2016
Manufacturing sentiment appears to have stabilized after several quarters of declining assessments about the economic outlook, and the latest data appear to mostly back that assertion up, but with some caveats. Indeed, economic challenges continue in the sector, among them being concerns over rising health care costs (Figure 4) and dampening perceived growth rates over the next 12 months (Figure 3) despite some progress in this release. Large manufacturers (i.e., those with 500 or more employees) were more upbeat about their company’s outlook this quarter, but small (i.e., those with fewer than 50 employees) and medium-sized manufacturers (i.e., those with between 50 and 499 employees) experienced declines in their outlook in this survey. This was especially the case for the smallest of firms, with just 48.7 percent positive in their outlook in this survey, down from
56.1 percent last time. Overall, one could characterize manufacturers’ current economic outlook as cautiously encouraging, but still less-than-desired and highly varied by firm size and export sales growth expectations.
Also in this report, we drilled down further into the issue of regulatory challenges that manufacturers face, focusing particularly on the burdens of small and medium-sized manufacturers. Along those lines, 88.8 percent of those completing the current survey either somewhat or strongly disagreed with the notion that the federal government carefully considers the point of view of small business owners when it imposes new regulations (Figure 9).