Survey Ranks Manufacturers’ Economic Worries

Prime Advantage, a buying consortium for midsized industrial manufacturers, released its second Group Outlook Survey revealing members’ most pressing economic concerns for the second half of 2008. Similar to the first survey, which was issued in January, raw material and energy costs top the list. However, members are now even more apprehensive. Compared with 43 percent in the first survey, 93 percent cite raw material costs as a top concern. Energy costs are close behind at 67 percent, compared with 17.5 percent in the first survey.

Unlike the first Group Outlook Survey, inflation is now the third-highest concern, with 39 percent in agreement (up 31 points from January). Logistics and supply chain costs are fourth at 38 percent, a 21.6-point increase from the first survey. Healthcare, foreign competition, overhead and labor were among other cost pressure concerns cited by respondents.

However, some cautious optimism remains—the survey showed confidence for employment opportunities in the second half of 2008. While only 17 percent expect job cuts within the next six months, another 17 percent expect job growth and 66 percent expected to keep their current employee base at the same level.

Data was collected from 72 senior-level representatives of industrial manufacturing companies, including business owners, vice presidents of procurement and purchasing directors.

For more information from Prime Advantage, visit www.primeadvantage.com.