Manufacturers took an optimistic outlook into 2019, according to a new report by National Manufacturing Outlook and Insights.
The global survey, now in its third year, gives manufacturers strategic insights into the economic climate so they can address challenges and take advantage of opportunities. Overall, the 2019 survey revealed cautious optimism among manufacturers for their business, the industry, and the economy overall.
Asked to rate their optimism about the economy from 1 to 100, manufacturing leaders pegged their regional economy at 70.75 (up from 69.3 in 2018), the national economy at 68.97 (down from 69.3), and the world economy at 55.75 (down from 59.4).
Among the manufacturers surveyed, 81 percent expect revenue to grow in 2019, although just 48 percent expect a rise in international sales. Among priorities for sales growth: 50 percent expect organic growth in domestic markets as their main opportunity; 22 percent expect a new product or service to boost their sales; and 13 percent say that a strategic alliance or joint venture will be the boost they need.
The bottom line remained the top priority for manufacturers, with 54 percent indicating that improved profitability is their top goal for the year. To get there, 31 percent plan to increase marketing and advertising budgets, and another 31 percent plan to invest in technology (particularly cybersecurity improvements).
Addressing the workforce shortage was the top 2019 priority for 43 percent of manufacturers. In fact, 62 percent expect to hire more people this year, and 59 percent expect to raise wages to stay competitive.
Industry-wide, more than 60 percent of manufacturers expect their sector to expand in 2019, which is more than double the results of the 2017 survey. But those expansions will come with hurdles: labor costs (noted by 77 percent of respondents), raw materials (63 percent), technology (54 percent), and taxes (22 percent) stand as the biggest barriers, respondents said.
The median annual revenue from respondents was in the $10 to $50 million range.
More than 350 manufacturing leaders participated in the LEA 2019 Manufacturing Outlook and Insights Survey, with contribution from the Manufacturing CPAs. The survey involved 357 participants and was carried out in October 2018. Manufacturers in the U.S. made up the bulk of respondents, followed by Belgium, Canada, France, and Germany.
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