The manufacturing sector has begun to turn a corner in recent months, trending in the right direction both in the United States and globally after struggling for much of the past two years. In addition, there is a sense that many of the pro-growth policies that businesses have long sought, including tax reform, a major infrastructure package and regulatory relief, among others, might finally come to fruition, albeit perhaps slower than some might prefer. As a result, manufacturing leaders have shown increased optimism since the election. In March, the Manufacturers’ Outlook Survey from the National Association of Manufacturers (NAM) rose to an all-time high in the survey’s 20-year history, with 93.3 percent of respondents positive about their own company’s outlook.

Three months later, manufacturers remain very upbeat. In the latest report, 89.5 percent were either somewhat or very positive about their own company’s outlook (Figure 1). This pullback in confidence mirrors easing in other sentiment surveys, even as they continue to present an encouraging assessment of overall conditions. In this case, the percentage who are positive in their outlook has averaged 91.4 percent over the first and second quarters of 2017, the highest consecutive two-quarter average in the survey’s history.