June 2014
Featured in this insight: Financial services, Manufacturing, engineering & industrial
Survey shows industrial sector confident of growth over the next year: A growing sense of optimism is emerging in the industrial sector as nine out of 10 executives of small and mid-size manufacturing and distribution companies expect to see solid growth over the next 12 months, according to the 2014 McGladrey Manufacturing and Distribution Monitor.
The survey, featuring responses from of over 900 company executives, also reveals the intention of two-thirds (67%) to make additions to their workforce over the next year – defying the trend of recent years where companies had to lay off employees.
Over the past year, the industrial sector has already enjoyed renewed buoyancy, with 69% reporting an increase in sales. The industry’s positive sale figures are set to continue over the next 12 months too, with almost nine in ten (88%) expecting to see yet further growth, with an average projected increase of 8%.
Whilst the findings paint a positive picture for the industry, there is a feeling that there are barriers in place which are inhibiting yet further growth. Two thirds (66%) believe that regulatory issues are likely to hinder their progress and feel that this is a bigger challenge to them than the competition they will face from rival companies in the market (63%). The regulation that most concerns executives is the Affordable Care Act (ACA), with 69% forecasting that this will act to limit their profits over the course of the next year.
Six in ten (60%) also cited taxation as being a potential obstruction to growth – more specifically, federal business taxes (61%), state business taxes (60%) and federal income taxes (50%) were deemed as being major impediments to growth. However, in spite of these headwinds, 67% expect to see profits rise over the next year, and almost one quarter (24%) expect increases of over 10%.
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