With 80 companies responding, the PMPA Business Trends Index for May 2019 came in at 140, making it our 6th highest month ever recorded. While sales outlook dropped to a negative reading for the first time since October 2016, our Sentiment indicator for Profitability rose, while Lead time remained level. Forward looking sentiment for Employment declined from 97% positive to just 87% positive.
Network Security – Our Shops are the Target!
According to MITECH, a new survey shows 77 percent of organizations in transport and automotive markets have been hit with IoT-focused cyberattacks during the past twelve months. Of those that experienced a cyberattack, 91 percent had an impact on the organization, including operational downtime and compromised customer data and/or brand or reputational damage. Perhaps most alarming, many organizations are not properly prepared for future threats, with only 6 percent indicating that they have what they need to combat cyberattacks.
NFIB Posts Its Best Reading Since Last October
The National Federation of Independent Business reported that the Small Business Optimism Index rose to the best reading since October, up from 103.5 in April to 105.0 in May. It was the fourth consecutive monthly increase in sentiment, and despite softening from August’s all-time high (108.8), small businesses remain upbeat overall.
Manufacturing Optimism (Take #2)
Last week, the MetLife & U.S. Chamber of Commerce Small Business Index Q2 report showed strong optimism among small business owners across the nation.
According to the Q2 report:
- 59% of small businesses viewed the U.S. economy as “in good health,” up six points from last quarter.
- 27% of small business owners plan to increase investment in their company over the next year.
- 69% of manufacturers feel positive about the national economy, up 16 points from last quarter.
“This quarter’s report is further evidence that small businesses are flourishing.
Manufacturing Optimism Dips:
Manufacturers were feeling cautious in the second quarter, according to the NAM’s quarterly Manufacturers’ Outlook Survey. It’s no wonder—the survey was in the field during the uncertainty about tariffs on Mexico and the Section 232 auto tariffs.
The Key Number: 79.8 percent of manufacturers rated their outlook as positive, a drop from 89.5 percent in the first quarter of 2019. As you may recall, 2018 was the best year on record for the NAM’s quarterly surveys.
Here are some other findings of interest:
- 68.8 percent of respondents rated the inability to find high-quality workers as their top concern.
- 56 percent reported uncertainty due to the USMCA, the elusive U.S.-China trade deal, the threat of Section 232 auto tariffs and the tariffs on Mexico (since resolved).
- Plus, nearly half are concerned about the rising prices of raw materials.
NAM Chief Economist Chad Moutray said:
“All things equal, I would expect these numbers to improve if we get the U.S.–Mexico–Canada Agreement across the finish line, strengthen our trading relationships by removing the threat of 232 auto tariffs and get a trade deal with China done.”
Navigating the 4th Industrial Revolution
While manufacturers recognize the potential value of advanced technologies and digital innovation – particularly robotics, the Industrial Internet of Things (IIoT), cloud computing, advanced analytics, 3D printing, and virtual and augmented reality – they are still deliberating how and where to invest and balancing the hype with their own level of preparedness. Meanwhile, they’re also well aware of the significant changes 4IR will bring to a new manufacturing workforce.