Manufacturers in the U.S. are more optimistic about demand and capital spending this year than at the end of 2013, according to a survey by the Institute for Supply Management.
Purchasing managers at factories project sales will grow 5.3 percent in 2014, up from the end of last year when they forecast a 4.4 percent gain, the Tempe, Arizona-based group’s figures showed today. Service industries estimate a 2.7 percent net increase in revenue compared with a December projection for a 3.6 percent gain.
“U.S. manufacturing continues to demonstrate its broad-based strength, efficiency and leadership in the world economy,” Bradley Holcomb, chairman of the group’s factory committee, said in a statement.
Manufacturers estimate their spending on new equipment and plants will increase 10.3 percent this year, according to the April survey. The December forecast called for an 8 percent pickup. Service industries plan to boost capital outlays by 10.8 percent, up from an end-of-2013 projection of 4.6 percent.
The outlook for employment was little changed compared with the December survey. Service providers predicted a 1.4 percent increase in staffing levels by the end of 2014, today’s report showed. Manufacturers projected a 1.5 percent rise.
“Non-manufacturing will continue to grow,” Anthony Nieves, chairman of ISM’s non-manufacturing survey committee, said in a statement. “The relatively flat rate of growth for overall employment is a potential impediment.”