Sentiment among manufacturers, according to a new survey, shows a decline in optimism for a second consecutive quarter. The latest National Association of Manufacturers (NAM)/IndustryWeek Survey of Manufacturers is a signal that the compounding effects of Washington’s inaction and the slowing global economy means uncertainty for the future of business across the country.

• 78.7% of manufacturers surveyed cited that the uncertainty related to the political climate, such as the looming fiscal abyss and pending budget cuts, was the top challenge for their businesses.
• 69.4% of manufacturers identified rising healthcare and insurance costs as their second-most important challenge.
• 62.4% identified the unfavorable business climate, resulting from taxes and regulations, as another primary concern.
• The percentage of respondents who were “somewhat negative” nearly doubled from 15.8% in the second quarter to 29.6% in the third quarter.

“Manufacturers are sending a clear message that Washington’s action or inaction can have a serious effect on our economy,” said NAM Chief Economist Chad Moutray. “The Congressional Budget Office has already warned that falling into the fiscal abyss will mean a recession next year, and manufacturers are not optimistic that Washington will be able to set us back on track in time. Unless Washington takes bold action to address the economic and political uncertainty and puts in place a pro-growth business climate, we can expect to see more dismal economic growth and pessimism from manufacturers.”

The NAM/IndustryWeek Survey of Manufacturers was conducted among 514 manufacturers in a variety of industries and of various sizes.

Previously reported on Equipment Finance Advisor - July 2, 2012: “Manufacturing Optimism Declines Due to Increased Uncertainty”