NAM: Q3 Survey Shows Mixed Results In Challenging Economy The National Association of Manufacturers (NAM) released its Manufacturers’ Outlook Survey for the third quarter of 2022, which shows mixed results around a challenging economic environment, inflation, supply chains and the workforce. The NAM conducted the survey August 16–30. “Three out of four manufacturers still have a positive outlook for their businesses, but optimism has certainly declined. The majority of respondents are expecting a recession this year or next, and it’s clear the challenging environment is taking its toll. Manufacturers have shown incredible resilience through multiple crises, but the chal- lenges of inflation, supply chain strains and the workforce shortage are taking a toll,” said NAM President and CEO Jay Timmons.
Key Findings 78.3 percent of manufacturing leaders listed supply chain disruptions as a primary business challenge with only 10.8 percent believing improvement will occur by the end of the year. Attracting and retaining a quality work- force (76.1 percent), increased raw material costs (76.1 per- cent) and transportation and logistics costs (65.9 percent) were not far behind supply chain challenges as the big- gest problems faced by manufacturers. More than three-quarters of manufacturers felt that rising material costs were a top business challenge (tied with workforce challenges and slightly below supply chain worries), and 40.4 percent said that inflationary pressures were worse today than six months ago. In addition, 53.7 percent noting that higher prices were making it harder to compete and remain profitable. The top sources of inflation were increased raw mate- rial prices (95.2 percent), freight and transportation costs
(85.4 percent), wages and salaries (81.7 per- cent), energy costs (54.4 percent) and health care and other benefits costs (49 percent), with 21 percent also citing the war in Ukraine and global instability. When asked about what aspects of the CHIPS and Science Act were most important for supporting manufacturing activity, 69.6 percent of respondents cited strengthening U.S. leadership in energy innovation and competitiveness. “This is a clear indication that we need urgent action to beat back the macroeco- nomic problems that are causing headwinds and preventing manufacturers in the U.S. from their full potential,” Timmons said. “Our ‘Competing to Win’ agenda gives policy- makers the roadmap for solutions manufac- turers need now to make our industry more globally competitive. Federal policies alone won’t solve everything, which is why we will continue to be part of the solution—innovat- ing ways to deliver for our customers and spearheading efforts like the NAM and The Manufacturing Institute’s Creators Wanted workforce campaign.” Due to the consistent economic head- winds, manufacturers’ confidence has de- clined, with 75.6 percent of respondents having a positive outlook for their company, the lowest since Q4 2020. Conducted by NAM Chief Economist Chad Moutray, the Manufacturers’ Outlook Survey has surveyed the association’s mem- bership of 14,000 manufacturers of all sizes on a quarterly basis for the past 20 years to gain insight into their economic outlook, hir- ing and investment decisions and business concerns. Visit www.nam.org for more.
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September 26, 2022
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