manufacturing forecast

The manufacturing industry, along with the overall economy, has been off to a great start in 2018. As precision spring manufacturers, we have been watching with great interest the numbers associated with production, jobs, spending, etc.

Here’s a quick update on the economic happenings and numbers for 2018 so far.

Gross Domestic Product (GDP)

Real GDP rose in the 4th quarter of 2017 by 2.9% after an increase in Q3 of 3.2%. Economists are expecting even larger number in Q1 of 2018. Some are predicting GDP growth to be higher than 3.0%, and other economists are estimating growth to be at 5.4%.

Prices and Profits

Prices of goods and services increased by 2.5% in Q4 after an increase of 1.7% in Q3. Corporate profits decreased by 0.1% in Q4 after increasing by 4.3% in Q3.

Labor Rates

National unemployment remained at 4.1% for the fifth consecutive month in February. This is the lowest rate the U.S. has seen in more than 18 years.

The manufacturing industry added 31,000 jobs in February. Over the past year, manufacturing has added  a total of 224,000 jobs. The breakdown within the industry was as follows:

  • Transportation equipment (+8,000 jobs)
  • Fabricated metal products (+6,000 jobs)
  • Machinery (+6,000 jobs)
  • Primary metals (+4,000 jobs)

Business Confidence

Overall, businesses are doing well and looking to invest more money in 2018. Some experts are expecting that business investments will increase by 4.5% in 2018, which should spur more growth in jobs and the economy.

Challenges Lie Ahead

Despite the good news with the economy, there are always concerns for businesses. According to the ASQ 2018 Manufacturing Survey, 41% of manufacturers said that finding skilled labor remains their top challenge. This is an increase over the 30% of OEMs who expressed this concern in 2017. OEMs are looking to agencies and local colleges to recruit talent and are also enhancing their benefits packages to make employment with their companies more appealing to top talent.

 

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