American manufacturers have significant concerns around recession, inflation, hiring, and China competition legislation according to a new survey.
The National Association of Manufacturers' Q2 2022 Manufacturers’ Outlook Survey also identified a number of policy areas that would mitigate some of those concerns.
"Through multiple crises, manufacturers have proven remarkably resilient, but there’s no mistaking there are darker clouds on the horizon," said NAM president and CEO Jay Timmons.
"Actions here at home can help ease these pressures, including first and foremost harnessing every energy resource available to us domestically and quickly—and refraining from imposing new taxes on manufacturers or families.
"It also means acting on manufacturers’ solutions to our supply chain challenges and passing the China competition bill—or Bipartisan Innovation Act.
"Though it won’t solve every issue, this will give us many of the tools needed to ramp up domestic manufacturing and strengthen our supply chains."
The survey found that 59% of manufacturing leaders believed inflationary pressures make a recession more likely in the next 12 months.
Higher raw material costs topped the list of primary business challenges in the second quarter, cited by 90% of respondents.
Three-quarters of manufacturers felt inflationary pressures were worse today than six months ago, with 54% saying higher prices made it harder to compete and remain profitable.
The top sources of inflation were increased raw material prices (97%), freight and transportation costs (84%), wages and salaries (80%) and energy costs (56%), with 49% also citing a shortage of available workers.
When asked about what aspects of the China competition legislation were most important for supporting manufacturing activity, 71% of respondents cited addressing port congestion and competition issues in ocean shipping.
Despite ongoing economic headwinds, manufacturers remain largely optimistic, with 83% maintaining a positive outlook for their company.