Assurance Services, Consulting Services, Tax Services, Technology Services • Published 3/04/2019 2019 LEA National Manufacturing Outlook Survey

The Leading Edge Alliance (LEA) produced their 3^rd Annual National Manufacturing Outlook Survey to gain insight into the current manufacturing industry conditions. As a Gulf South firm, P&N understands the significance of manufacturing to the regional and national economies.

Over 350 manufacturing executives participated in the survey, which includes respondents who produce industrial/machining; transportation/automotive; construction; food and beverage; and other products.

“Across the board, manufacturers are optimistic about the regional economy, sector growth, and increasing revenue expectations in 2019,” the report states. “Looking ahead, manufacturers expect raw materials, labor costs, lack of available talent and competition to be significant hurdles in 2019. The tariffs implemented by President Trump provide productivity issues; however, an increase in spending on Big Data and business intelligence are delivering innovative technology for minimizing productivity concerns.”

Survey Highlights

Highlights from the 2019 National Manufacturing Outlook Survey include: 

• Growth: 81% of manufacturers expect their revenue to increase in 2019, and 61% expect their overall sector to expand in 2019.
• Economy: Optimism for the regional, national and global economies has increased by more than 12 percentage points over the last two years. 
• Priorities: Manufacturers’ top three priorities are growing sales, improving profitability and addressing the workforce shortage.
• Challenges: Most manufacturers (52%) cited labor/talent as their greatest barrier to growth, followed by competition (34%) and profitability (25%).

The survey identified three key growth strategies manufacturers will use to keep their companies on a growth track: 

• Technology: Manufacturers plan to leverage technology as key to solving productivity concerns; 76% said that they will investigate/prioritize cybersecurity in 2019, and 43% said they will prioritize Big Data/ERP/IoT.
• M&A: More manufacturers are considering a merger/sale or acquisition in 2019; 21% expect to acquire another business in 2019 and 16% are in the pre-planning stage of a merger or acquisition.
• Talent: Faced with a growing labor shortage, manufacturers have turned to a range of tools to improve hiring and retention with 62% increasing compensation, 39% implementing retention strategies and 35% using internal training programs.

How We Help

P&N has experience helping clients with several of the success strategies identified in the LEA survey, including:

• Cost efficiencies
• Mergers and acquisitions
• Human resources strategy and hiring trends
• Technology

We are committed to continuous learning within the manufacturing industry to better serve our clients. If you have any questions about the strategies discussed in the survey, please contact us.