One issue that dampens the mood for manufacturers is the cost of regulation.
A recent study by the National Association of Manufacturers found 297,696 specific regulations impact manufacturing, and the cost of regulatory compliance for small manufacturers is $35,000 per employee per year.
Manufacturers turn the beat around
The manufacturing sector is bullish on the future. From local economic forecasts to national surveys, the outlook for 2017 is resoundingly upbeat. Consider:
The PricewaterhouseCoopers annual outlook survey of industrial manufacturers found 78% believed the U.S. economy had begun to show sharp growth in the fourth quarter of 2016. In the fourth quarter, there was a doubling of the view that the U.S. economy had begun to grow — from 38% two quarters ago to 78%, a significant increase of 40 points. Optimism about the U.S. economy’s prospects over the next 12 months rose as well, increasing from 35% two quarters ago to 57%, a notable 22-point increase. More than 48% had hiring plans, and 60% planned major investments.
Local surveys heavily laden with regional manufacturers found similar results. The Fox Cities Regional Partnership economic outlook survey showed more than 70% expected to increase sales in 2017, while more than 60% also expected an increase in profits. More than 70% rated the regional economy as excellent or good, while more than 50% planned to hire new workers, and almost 70% planned a major expansion or investment.