According to Leading Edge Alliance National Manufacturing Outlook Survey
We are excited to release the results from the 2017 Leading Edge Alliance (LEA Global) National Manufacturing Outlook Survey.
With more than 250 participants, this survey report contains the expectations and opinions of manufacturing executives in more than 20 states across the country producing a wide variety of products including industrial/machining, transportation/automotive, construction, food and beverage, and other products.
Results from the survey include:
- 74% of small manufacturers and 69% of large manufacturers expect revenue to grow in 2017.
- Manufacturers are more optimistic about their local/regional economies than the national or global economies.
- The top priority for manufacturers in 2017 is “cutting operations costs.” However, high-growth manufacturing respondents are more focused on “research and development,” with 12% of high-growth respondents reinvesting more than 10% of annual revenue.
- Labor continues to be a challenge for manufacturers with 67% of respondents expect labor costs to “increase” and an additional 7% expect labor costs to “increase significantly” in 2017.
- Appropriate cost allocation and accurate and timely data will become required capabilities for successful businesses in the industry.
- More manufacturers will be considering both sales and mergers in 2017, as well as strategic acquisitions.
U.S. manufacturing industry headwinds are significant and include both internal issues (such as high inventory-to-sales ratios), the cost of technology, labor shortages, and external issues like the price of raw materials and strength of the dollar.
Strategic manufacturers should have ongoing conversations with all of their advisors, including their accounting and tax provider, as to how to overcome these challenges and achieve their business goals.