U.S. industrial manufacturers’ optimism about domestic outlook rises
Optimism regarding the direction of the domestic economy rose among U.S. industrial manufacturers during the first quarter of 2014, according to the Q1 2014 Manufacturing Barometer, released by PwC US. The positive sentiment about the prospects of U.S. commerce in the next 12 months reached the highest level since the fourth quarter of 2005. Conversely, optimism regarding the prospects of the world economy lessened during the first quarter as U.S. industrial manufacturers remained cautious on the global stage.
Optimism around the prospects of the U.S. economy during the next 12 months rose among U.S. industrial manufacturers to 71 percent in the first quarter of 2014, from 68 percent in the previous quarter and 55 percent in first-quarter 2013. Concurrent with the improved sentiment, uncertainty about the domestic outlook has continued to abate among industrial manufacturers, dropping to 27 percent in the first quarter, representing the lowest level since the first quarter of 2012.
Overall sentiment about the world's economic prospects among U.S. industrial manufacturers that market abroad weakened somewhat during Q1 2014, with optimism declining to 41 percent from 47 percent in 4Q 2013. However, global sentiment is ahead of the 36 percent level of optimism recorded in the first quarter of 2013.
Regarding actual company growth expectations, 82 percent of survey respondents expect positive revenue growth for their own companies in the next 12 months, with 15 percent forecasting double-digit gains and only 5 percent anticipating decreased revenues. The projected average revenue growth rate for own-company revenue over the next 12 months remained consistent at 5.3 percent, compared to 5.4 percent in 4Q 2013, but well above the 4.3 percent recorded in the first quarter of 2013.
PwC's Manufacturing Barometer is a quarterly survey based on interviews with 61 senior executives of large, multinational U.S. industrial manufacturing companies about their current business performance, the state of the economy, and their expectations for growth over the next 12 months. To view the complete Manufacturing Barometer report, visit www.pwc.com/manufacturing-barometer.