Economic growth is expected to continue in the United States throughout the remainder of 2014, say the nation's purchasing and supply executives in their Spring 2014 Semiannual Economic Forecast. Expectations for the remainder of 2014 continue to be positive in both the manufacturing and non-manufacturing sectors.

These projections are part of the forecast issued by the Business Survey Committee of the Institute for Supply Management® (ISM®). The forecast was presented today by Bradley J. Holcomb, CPSM, CPSD, chair of the ISM Manufacturing Business Survey Committee; and by Anthony S. Nieves, CPSM, C.P.M., CFPM, chair of the ISM Non-Manufacturing Business Survey Committee.

Manufacturing Summary

Sixty-eight percent of respondents from the panel of manufacturing supply management executives predict their revenues will be 9.1 percent greater in 2014 compared to 2013, nine percent expect a 9.6 percent decline, and 23 percent foresee no change. This yields an overall average expectation of 5.3 percent revenue growth among manufacturers in 2014, which is a notable increase of 0.9 percentage point from December 2013 when the panel predicted a 4.4 percent increase in 2014 revenues. With operating capacity at 82.3 percent, an expected capital expenditure increase of 10.3 percent, prices paid expected to increase a modest 0.2 percentage point from now through the end of 2014, and employment expected to grow 1.5 percent for the balance of 2014, manufacturers are positioned to grow revenues while containing costs through the remainder of the year. "With all 18 industries within the manufacturing sector predicting growth in 2014 when compared to 2013, U.S. manufacturing continues to demonstrate its broad-based strength, efficiency and leadership in the world economy," said Holcomb.

The 18 industries reporting expectations of growth in revenue for 2014 — listed in order — are: Textile Mills; Printing & Related Support Activities; Furniture & Related Products; Food, Beverage & Tobacco Products; Fabricated Metal Products; Transportation Equipment; Plastics & Rubber Products; Paper Products; Miscellaneous Manufacturing; Nonmetallic Mineral Products; Chemical Products; Computer & Electronic Products; Primary Metals; Petroleum & Coal Products; Electrical Equipment, Appliances & Components; Wood Products; Machinery; and Apparel, Leather & Allied Products.

Non-Manufacturing Summary

Fifty-one percent of non-manufacturing purchasing and supply executives expect their 2014 revenues to be greater by 6.7 percent than in 2013. Overall, respondents currently expect a 2.7 percent net increase in overall revenues, which is less than the 3.6 percent increase that was forecast in December 2013. "Non-manufacturing will continue to grow for the balance of 2014. Non-manufacturing companies continue to operate very efficiently as reflected by the high percentage of capacity utilization. Despite the volatility in energy and fuel costs, supply managers have indicated that overall costs have not been substantially impacted. The relatively flat rate of growth for overall employment is a potential impediment; however, with 17 out of 18 industries forecasting increased revenues, the non-manufacturing sector will continue on the path of steady economic growth," Nieves said.

The 17 non-manufacturing industries expecting increases in revenue in 2014 — listed in order — are:  Agriculture, Forestry, Fishing & Hunting; Transportation & Warehousing; Construction; Mining; Wholesale Trade; Retail Trade; Arts, Entertainment & Recreation; Utilities; Public Administration; Finance & Insurance; Accommodation & Food Services; Professional, Scientific & Technical Services; Management of Companies & Support Services; Information; Real Estate, Rental & Leasing; Educational Services; and Other Services.

To read the full Spring 2014 Semiannual Economic Forecast, click here.