The manufacturing industry is expected to see expansion this year.
According to SME:
Manufacturing’s economic expansion is forecast by the Institute for Supply Management to continue into 2022, the organization said today.
ISM surveyed executives across 18 industries. Respondents expect gains in revenue and capital expenditures.
Those surveyed “are optimistic about overall business prospects for the first half of 2022, with business continuing to expand through the second half, though at slightly lower rates,” Timothy R. Fiore, chair of ISM’s Manufacturing Business Survey Committee, said in a statement.
Tempe, Ariz.-based ISM produces a monthly manufacturing index, known as the PMI. The economic forecast is based on a survey of the same executives used to compile the PMI.
The manufacturing purchasing and supply executives surveyed by ISM expect an average 6.5 percent gain in revenue in 2022. ISM said 15 of 18 industries forecast revenue increases in 2022. The industries anticipating revenue boosts include machinery, fabricated metal products, transportation equipment, and miscellaneous manufacturing.
The respondents also expect capital expenditures to increase by 7.7 percent in 2022. ISM also forecast that capacity utilization – how much plant capacity is being used – will rise to 88.7 percent next year, up from 88.3 percent in May 2021.
ISM’s manufacturing index has indicated that industry was running at strong rates during most of 2021.
An index level above 50 percent indicates economic expansion in manufacturing. The PMI has averaged 60.8 percent for the 12 months ending in November. During that period, it reached a peak of 64.7 percent in March.
ISM said manufacturers also forecast that employment will rise by 1 percent next year. The group said 14 of 18 industries expect to boost employment.