Inflation Is Getting Worse for Manufacturers
Solid earnings updates from 3M, Rockwell and Stanley Black & Decker came with a worrying asterisk.
It’s not a five-alarm inflation fire, there’s definitely a lot more smoke.
Photographer: Ty Wright/BloombergSupply-chain pressures and rising costs are threatening to take a real bite out of the industrial recovery.
Results from 3M Co., Rockwell Automation Inc. and Stanley Black & Decker Inc. on Tuesday point to a robust manufacturing revival, with all three companies boosting their outlooks in some form to reflect a stronger-than-expected snapback from the doldrums of the pandemic. But those brightened views also came with worrying asterisks on inflation and shortages. These aren’t new trends: The economy is being asked to grow at multiples of its normal rate as businesses attempt to make up for the Covid slowdown. But these complications also aren’t going away, and it’s not getting any easier for manufacturers to deal with them. Quite the opposite, in fact. While industrial companies are all boosting prices, costs are rising so quickly and so sharply that they’re struggling to keep up.