U.S. manufacturing executives are slightly more optimistic about the U.S. economy than previously reported, according to the first quarter edition of the PricewaterhouseCoopers LLP Manufacturing Barometer released April 29.
Of those polled, 16% of executives expressed optimism about the U.S. economy over the next 12 months, up 11 points from the previous quarter. More than half the respondents (55%) remain pessimistic about the U.S. economy, which is an improvement from the 70% who were pessimistic last quarter.
Anxieties over international prospects remain high amidst the global recession, as 98 percent of manufacturers marketing abroad agree that the global economy declined in Q1. International sales turned increasingly negative in the first quarter, with more than half (60%) of respondents reporting decreased international sales from Q4 2008. The expected contribution of international sales to total revenues over the next 12 months remained at 36%, which is on-pace with last year's findings of 35%. But, overall revenues will be lower.
"The wide-scale fears of declining international sales, as we reported in previous Manufacturing Barometers, were finally realized during the first quarter of 2009," said Barry Misthal, partner and industrial manufacturing sector leader at PricewaterhouseCoopers. "Manufacturing executives are hoping to ride out 2009 with a focus on making their companies leaner and more efficient, while aligning inventories to match lower demand levels. Taking these kinds of cautionary measures should position manufacturers for a more auspicious start to 2010."
Looking beyond 2009, senior executives are preparing for a possible turnaround in early 2010. This is reflected in the average revenue growth projections of respondent companies for the next 12 months, which were reported at minus 0.7% in Q1 versus the minus 2.4% revenue growth projections reported in Q4 2008.