Minnesota’s small- and medium-sized manufacturers are incredibly optimistic about the prospects of their companies over the coming year according to the ninth annual State of Manufacturing survey.
These findings, coupled with shrinking concerns about the global economy, suggest 2017 will be a year of growth for the state’s manufacturing industry.
Minnesota’s manufacturing executives nearly unanimously—94%—report they are confident about the financial future of their companies, which is the highest recorded mark in the survey’s history and the fourth consecutive year that confidence has climbed.
Fifty-seven percent said they are very confident, up 14% in just one year, and a staggering 30-point improvement over the first survey in 2008.
For the first time in the survey’s history, more manufacturers predict economic expansion in the coming year over a flat economy. This year, 58% of manufacturers forecast expansion, with only 32% choosing a “flat” year.
A record 55% of manufacturers expect to see increases in gross revenue this year, 11 points higher than the responses to the same question last year. Thirty-five percent of manufacturers expect revenues to increase by more than 10% in 2017 and 27% expect a double-digit increase in profitability, also record numbers.
Health care costs remain the top concern for manufacturers (59%), as it has for all nine years of the survey. “Government policies and regulations” was a distant second concern (32%), having fallen by nearly 30 points since 2011.
The percentage of manufacturers who are having a difficult time finding “qualified workers” has more than doubled since 2011. The issue is even more pronounced in Greater Minnesota, with 75% of manufacturers reporting that it is difficult to attract and retain qualified workers compared to 62% of metro area manufacturers.
“At the time the survey was taken in March, it was clear that Minnesota’s manufacturers are optimistic about the economy and their companies’ growth potential,” said Bob Kill, Enterprise Minnesota CEO. “Manufacturers preside over a job-creating engine that feeds the economic vitality of so many communities across the state.”