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Posted on December 10, 2009 - 00:15 by admin

Textiles and apparel are among the 13 US manufacturing industries expecting improved revenues in 2010.

Economic growth in the US will resume in 2010, said US purchasing and supply management executives in their December 2009 Semiannual Economic Forecast.

The manufacturing sector positive about prospects in 2010 with revenues expected to increase in 13 of 18 industries, while the non-manufacturing sector appears slightly less positive about the year ahead with eight of 18 industries expecting higher revenues. Business investment, a major driver in the US economy, will decline as both sectors expect a combined 5.4% average decline in capital spending, said the report.

These projections are part of the forecast issued by the Business Survey Committee of the Institute for Supply Management (ISM).

In manufacturing, 60% of survey respondents expect revenues to be greater in 2010 than in 2009. The panel of purchasing and supply executives expects a 5.7% net increase in overall revenues for 2010, compared with a 10.7% decrease reported for 2009.

The 13 manufacturing industries expecting improvement over 2009 are: transportation equipment; nonmetallic mineral products; printing and related support activities; computer and electronic products; paper products; electrical equipment, appliances and components; apparel, leather and allied products; food, beverage and tobacco products; chemical products; machinery; miscellaneous manufacturing; textile mills; and fabricated metal products.

Norbert J. Ore, chair of the ISM Manufacturing Business Survey Committee said: “Manufacturing purchasing and supply executives reflect more of their typical optimism about their organisations’ prospects as they consider the first half of 2010 and they are even more positive about the second half. “While 2009 has been a challenging year overall, we are in a growth trend as we approach the end of the year. Respondents expect cost pressures to be low to moderate based on their price forecast. Manufacturing growth is now in its fourth consecutive month as measured by and reported in the monthly Manufacturing ISM Report On Business.”

In the manufacturing sector, respondents report operating at 70.1% of their normal capacity, up from 67% reported in April 2009. Purchasing and supply executives predict that capital expenditures will decrease by 4% in 2010, compared with a 7.8% decrease reported for 2009. Survey respondents also forecast that they will reduce inventories in an effort to improve their purchased inventory-to-sales ratio in 2010. Manufacturers have an expectation that employment in the sector will increase by 1.5%, while labour and benefits costs are expected to increase an average of 1.4% in 2010. Manufacturing purchasers are predicting strength in exports and imports in 2010. They also expect the US Dollar to weaken on average against the currencies of major trading partners, according to the survey.

The panel also predicts the prices they pay will increase 0.2% during the first four months of 2010 and an additional 2.4% during the remainder of 2010. Respondents’ major concerns are a weak economy; credit crisis; taxes; interest rates and high energy costs.

Survey respondents expect to realise supply chain improvements through supplier consolidation; new or improved enterprise technology and system utilisation; improved inventory/asset management; lean manufacturing and cost reduction.

Source: Inteletex