ISM forecast: Spending, revenues both expected to keep climbing

Manufacturing sector to keep building on three-year winning streak, report finds.

05/11/2012


Institute of Supply Management logo. Courtesy: ISMManufacturing's strong rebound from the depths of the 2008 recession is expected to continue throughout the rest of 2012, according to the semiannual Institute for Supply Management’s Economic Forecast. Expectations for the remainder of 2012 continue to be positive in both the manufacturing and non-manufacturing sectors.

These projections are part of the forecast issued by the Business Survey Committee of the ISM. The forecast was presented today by Bradley J. Holcomb, CPSM, CPSD chair of the Manufacturing Business Survey Committee and by Anthony S. Nieves, C.P.M., CFPM, chairs of the ISM Non-Manufacturing Business Survey Committee.

Two-thirds of the ISM Manufacturing Business Survey Committee respondents a 9.5% increase in revenues for the rest of 2012, while 15% expect a double-digit decline and 19% forecast no change. The aggregate 4.5% increase, while 1 percentage point lower than December’s forecast, is still line with ISM’s monthly manufacturing report, which has shown growth in the manufacturing sector for almost three straight years.

“With 16 out of 18 industries within the manufacturing sector predicting growth in 2012 over 2011, manufacturing continues to demonstrate its strength and resilience in the midst of global economic uncertainty and volatility. Capacity utilization is at historically typical levels and manufacturers are continuing to invest in their businesses. The positive forecast for revenue growth and modest price increases will drive a continuation of the recovery in the manufacturing sector,” said Holcomb.

Purchasing and supply managers report that their companies are currently operating at 81.6% of normal capacity, representing an increase from the 79.2% reported in December 2011, and a decrease from the 83.2% reported in April 2011.

Production capacity in manufacturing is expected to increase 5.2% in 2012. This increase is slightly less than the 5.6% increase predicted in December 2011 for 2012, but greater than the 4.6% increase reported in December for 2011.

Survey respondents expect a 6.2% increase in capital expenditures in 2012. This is considerably greater than the December 2011 forecast when members predicted an increase of only 1.9% for 2012. Currently, 42% of respondents predict increased capital expenditures in 2012, with an average increase of 23.4%, while the 13% who said their capital spending would decrease expect an average decrease of 25.8%, and 45% say they will spend the same in 2012 as they did in 2011.

- Edited by Chris Vavra, Plant Engineering, www.plantengineering.com 



No comments
The Top Plant program honors outstanding manufacturing facilities in North America. View the 2013 Top Plant.
The Product of the Year program recognizes products newly released in the manufacturing industries.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
The true cost of lubrication: Three keys to consider when evaluating oils; Plant Engineering Lubrication Guide; 11 ways to protect bearing assets; Is lubrication part of your KPIs?
Contract maintenance: 5 ways to keep things humming while keeping an eye on costs; Pneumatic systems; Energy monitoring; The sixth 'S' is safety
Transport your data: Supply chain information critical to operational excellence; High-voltage faults; Portable cooling; Safety automation isn't automatic
Case Study Database

Case Study Database

Get more exposure for your case study by uploading it to the Plant Engineering case study database, where end-users can identify relevant solutions and explore what the experts are doing to effectively implement a variety of technology and productivity related projects.

These case studies provide examples of how knowledgeable solution providers have used technology, processes and people to create effective and successful implementations in real-world situations. Case studies can be completed by filling out a simple online form where you can outline the project title, abstract, and full story in 1500 words or less; upload photos, videos and a logo.

Click here to visit the Case Study Database and upload your case study.

Maintaining low data center PUE; Using eco mode in UPS systems; Commissioning electrical and power systems; Exploring dc power distribution alternatives
Synchronizing industrial Ethernet networks; Selecting protocol conversion gateways; Integrating HMIs with PLCs and PACs
Why manufacturers need to see energy in a different light: Current approaches to energy management yield quick savings, but leave plant managers searching for ways of improving on those early gains.

Annual Salary Survey

Participate in the 2013 Salary Survey

In a year when manufacturing continued to lead the economic rebound, it makes sense that plant manager bonuses rebounded. Plant Engineering’s annual Salary Survey shows both wages and bonuses rose in 2012 after a retreat the year before.

Average salary across all job titles for plant floor management rose 3.5% to $95,446, and bonus compensation jumped to $15,162, a 4.2% increase from the 2010 level and double the 2011 total, which showed a sharp drop in bonus.

2012 Salary Survey Analysis

2012 Salary Survey Results

Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Society for Maintenance and Reliability Professionals an organization devoted...
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.