Survey: U.S. Manufacturers' Capital Spending Outlook Stabilizes

---

Researched by Industrial Info Resources (Sugar Land, Texas)--The latest quarterly membership survey by The National Association of Manufacturers (NAM) indicates more than 34% of the respondents anticipate capital spending to increase over the next year, down just two percentage points from the previous survey. Industrial Info is tracking more than 1,700 active Industrial Manufacturing projects worth nearly $248 billion.

However, the average expected increase in capital investments over the next 12 months was 0.8%, according to the third-quarter survey results, up 0.2 percentage points from the second-quarter survey.

In addition to the 34% of the third-quarter survey respondents who expect an increase in capital spending, more than 46% of the respondents expect spending to stay the same over the next year (compared with 40% of the respondents from the second-quarter survey) and nearly 20% expect capital spending to decrease over the next year (compared with 24% in the second-quarter survey).

"In addition, one's capital investment plans tended to increase with size," according to the latest survey report. "Smaller entities [those with fewer than 50 employees] expected capital spending to decline by 0.3% in the next year; whereas, medium-sized [those with between 50 and 499 employees] and large manufacturers [those with 500 or more employees] predicted capital investment growth of 0.8% and 1.5%, respectively."

When asked about their capital spending expectations for all of 2016, more than a fourth of the respondents indicated they expect to increase spending in comparison with 2015, and an almost identical percentage expected to decrease investments. In addition, 39.1% said they made no changes to their capital spending for this year versus last year, and 7.5% indicated they have no plans at all.

Those who expected capital spending to increase this year cited the need to replace other capital goods, new products and innovation in their processes and the need to increase overall capacity utilization, as well as increased demand for their products.

Overall, "Manufacturing sentiment appears to have stabilized after several quarters of declining assessments about the economic outlook, and the latest data appear to back that assertion up, but with some caveats," according to the survey report. "Indeed, economic challenges continue in the sector, among them being concerns over rising health costs ...and dampening perceiver growth rates over the next 12 months..."

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.