Optimism about the prospects for the U.S. and world economy over the next 12 months hit all-time lows among U.S. industrial manufacturers, according to the findings of the Q3 2011 Manufacturing Barometer released by PwC US. While only five percent of U.S. industrial manufacturers are optimistic about the prospects of the U.S. economy over the next 12 months, the lowest since the fourth quarter of 2008, a vast majority are uncertain, rather than outright pessimistic. Despite those uncertainties, U.S. industrial manufacturers over the next 12 months expect positive own-company growth, are planning major new investments of capital, and are forecasting international sales to more heavily contribute to their bottom lines.
While the projected average growth rate for own-company revenue over the next 12 months fell to five percent from 6.5% in the second quarter, 75% of panelists expect their companies to grow over the next 12 months. Of those expecting growth, 22% forecast double-digit growth and 53% single-digit growth, while 20% forecast zero growth and only five percent expect negative growth.
Looking ahead, only five percent of respondents expressed optimism about the 12-month outlook for the U.S. economy, down 43 points from the second quarter. The vast majority, 77%, were uncertain while 18% were pessimistic. Prospects for the world economy over the next 12 months echoed similar trends for the U.S. economic outlook, with only seven percent of U.S.-based industrial manufacturers who market abroad being optimistic about the prospects for the world economy over the next 12 months, down 31 points from the prior quarter. The majority, 72%, are uncertain and 21% are pessimistic.
In the third quarter of 2011, 80% of surveyed U.S. industrial manufacturers saw no change in the U.S. economy from the second quarter, while 13% believed it was declining. Only seven percent believed the U.S. economy was growing, down 50 points from the prior quarter. Similarly, the majority of respondents (56%) that market abroad viewed the world economy as unchanged in the third quarter when compared to the second quarter. Only seven percent of the panelists noted the world economy was growing, down 34 points from the prior quarter while 37% believed it was declining.
Learn more about the Q3 2011 Manufacturing Barometer released by PwC US.