U.S. Manufacturers Optimistic About Domestic Economy, Not Sure About Global Outlook

82 Percent of Industrial Manufacturers Surveyed Predict Revenue Growth in 2013

Sentiment toward the Global Economy Remains Guarded; Uncertainty Prevails

Optimism among U.S. industrial manufacturers regarding the domestic economic outlook rose to 63 percent during the second quarter of 2013, up from 55 percent in the first quarter and representing the highest level since the first quarter of 2012, according to the Q2 2013 Manufacturing Barometer, released July 18 by PwC US. In addition, 72 percent of respondents believed the U.S. economy grew in the second quarter, up 10 points from the prior quarter. At the same time, sentiment pertaining to the world economy remains guarded with only 31 percent expressing optimism and 59 percent voicing continued uncertainty.

The spread between those optimistic about the domestic economy versus those optimistic about the global economy over the next 12 months was 32 percent, representing the second highest quarterly total since these questions were first asked in the third quarter 2003 survey. At the same time, PwC's Global Manufacturing Current Assessment and Outlook indices show a reduction in overall pessimism among manufacturing executives compared to the first quarter, which appears to be driven by more bullishness over total sales, driven by the U.S., offsetting in part increasing bearishness over international sales.

"There remains a persistent dichotomy in viewpoints regarding the outlooks for the U.S. and world economies. Optimism regarding the domestic economy has increased, while worldwide economic sentiment remains restrained, with global uncertainty reaching the highest level in the past 12 months," said Bobby Bono, U.S. industrial manufacturing leader for PwC. 

"The U.S. is starting to show signs of healthy demand trends and improving pricing power, supporting positive overall sentiment in the year ahead,” he said. 

“However, as a result of the mixed global outlook, combined with the moderate domestic recovery and the specter of increased legislative and regulatory pressures, management teams are continuing to carefully manage their costs, while maintaining a focus on growing profitably."

What does this level of optimism mean for hiring? That question will be answered tomorrow.

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