REGIONAL REPORT
75.1 % of manufacturers say it would be helpful , allowing their company to hire more workers , expand business and / or increase wages and benefits .
5 . The top challenges facing manufacturers include attracting and retaining a quality workforce ( 74.4 %); weaker domestic economy ( 55.7 %); rising health care / insurance costs ( 53.1 %); unfavourable business climate ( 52.1 %); increased raw material costs ( 50.8 %) and supply-chain challenges ( 44.9 %).
Metalforming manufacturers continue to persevere despite rising costs , supply-chain disruptions and the ongoing challenge to find workers
Metalforming business conditions
Metalforming companies anticipate little change in business conditions during the next three months , according to the June 2023 Precision Metalforming Association ( PMA ) Business Conditions Report . Prepared monthly , the report provides an economic indicator for the next three months of manufacturing , sampling 96 metalforming companies in the United States and Canada .
PMA ’ s June report shows that 58 % of metalforming companies expect no change in general economic activity in the next three months ( compared to 54 % in May ), 32 % predict a decrease in activity ( down from 35 % in May ) and only 10 % forecast an increase in activity ( compared to 11 % in May ).
There also was little change in metalformers ’ anticipation of incoming orders , with 20 % of survey respondents expecting an increase in orders during the next three months ( compared to 21 % in May ), 44 % predicting no change ( compared to 45 %) and 36 % forecasting a decrease in orders ( up from 34 % in May ).
However , current average daily shipping levels rebounded in June . Twenty-seven per cent of responding companies reported an increase in shipping levels ( up from 15 % in May ), 52 % reported no change ( compared to 49 %) and 21 % reported a decrease ( down from 36 % in May ).
“ Metalforming manufacturers continue to persevere despite rising costs , supply-chain disruptions and the ongoing challenge to find
U . S . steel worker ( Shutterstock . com ).
Image : Luke Stackpoole ( Unsplash ).
Chicago skyline ( image : Pedro Lastra , Unsplash ).
workers ,” said PMA President , David Klotz . “ Our members are fighting for business every day against global competitors . PMA continues to urge Congress to support domestic manufacturing through funding workforce development programmes , instituting trade policies that take into consideration consuming industries and addressing important tax policies such as reinstating R & D expensing . In a recent survey of manufacturers that included our members , 27 % reported that they will reduce their R & D activities if Congress does not fix this .”
Lead times remained steady in June , with only 10 % of metalforming companies reporting an increase in lead times ( compared to 11 % in May ). Ten per cent of companies had a portion of their workforce on short time or layoff in June ( up from 7 % in May ), while 46 % of companies are currently expanding their workforce ( compared to 40 % in May ).
Labour , monetary and fiscal policy
According to the International Monetary Fund ’ s Article IV Consultation ( results confirmed in June 2023 ), prime age labour force participation has risen above its pre-pandemic peak , the unemployment rate for women and African Americans has fallen to historical lows , and real wages have been rising faster than inflation since mid-2022 . Nonetheless , the significant reduction during 2021 in the share of the population living in poverty has largely been unwound , as pandemic benefits have expired and real wage growth for low-income workers has moderated .
“ The strength of demand and in labour market outcomes has contributed to a persistent inflation problem . While goods inflation has moderated and shelter price growth is expected to slow in coming months , nominal wage increases are feeding into non-shelter services prices . Core and headline PCE inflation remain materially above the two-per-cent target of the Federal Reserve ,” said the IMF .
“ Fiscal policy is expected to be procyclical in 2023 on a general government basis , following a significant fiscal contraction in 2022 due to the unwinding of major pandemic-related fiscal measures and higher tax receipts . While the U . S . retains some fiscal space , public debt is well above pre-pandemic levels and is expected to continue to increase over the next decade , as ageing-related expenditures on healthcare and social security feed into the debt dynamics ,” it added .
Monetary policy has been assertively tightened . Going forward , bringing inflation down remains a priority . Efforts to tackle longerterm issues ( including bringing down public debt , addressing supplyside constraints and decarbonising the economy while avoiding
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