Economic growth is expected to continue in the U.S. throughout the remainder of 2017, say the nation's purchasing and supply executives in their Spring 2017 Semiannual Economic Forecast. Expectations for the remainder of 2017 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 on May 22, 2017 by Bradley J. Holcomb, CPSM, CPSD, chair of the ISM Manufacturing Business Survey Committee; and by Anthony S. Nieves, CPSM, C.P.M., A.P.P., CFPM, chair of the ISM Non-Manufacturing Business Survey Committee.

Manufacturing Summary

Sixty-four percent of respondents from the panel of manufacturing supply management executives predict their revenues will be 8.5 percent greater in 2017 compared to 2016, 12 percent expect a 9.6 percent decline, and 24 percent foresee no change in revenue. This yields an overall average forecast of 4.4 percent revenue growth among manufacturers for 2017. This current prediction is 0.2 percentage point below the December 2016 forecast of 4.6 percent revenue growth for 2017, but is 3.5 percentage points above the actual revenue growth reported for all of 2016. With operating capacity at 82.5 percent, an expected capital expenditure increase of 5.2 percent, an increase of 2.5 percent for prices paid for raw materials, and employment expected to increase by 1.3 percent by the end of 2017 compared to the end of 2016, manufacturing is positioned to grow revenues while managing costs through the remainder of the year. "With 17 of the 18 industries within the manufacturing sector predicting revenue growth in 2017, when compared to 2016, U.S. manufacturing continues to move in a positive direction," said Holcomb.

The 17 industries reporting expectations of growth in revenue for 2017 — listed in order — are: Electrical Equipment, Appliances & Components; Textile Mills; Computer & Electronic Products; Furniture & Related Products; Apparel, Leather & Allied Products; Primary Metals; Paper Products; Fabricated Metal Products; Miscellaneous Manufacturing; Food, Beverage & Tobacco Products; Petroleum & Coal Products; Plastics & Rubber Products; Machinery; Chemical Products; Wood Products; Nonmetallic Mineral Products; and Printing & Related Support Activities.

Non-Manufacturing Summary

Fifty percent of non-manufacturing purchasing and supply executives expect their 2017 revenues to be greater by 10.6 percent as compared to 2016. Respondents currently expect a 4.1 percent net increase in overall revenues, which is the same as the 4.1 percent increase that was forecasted in December 2016. "Non-manufacturing will continue to grow for the balance of 2017. Non-manufacturing companies continue to operate very efficiently as reflected by the high percentage of capacity utilization. Supply managers have indicated that overall prices are projected to increase 1.5 percent over the year. Overall employment is projected to grow 2.2 percent. Fourteen out of 18 industries are forecasting increased revenues, which is more than the 13 industries that forecasted increased revenues last year. The non-manufacturing sector will continue economic growth throughout the year," Nieves said.

The 14 non-manufacturing industries expecting increases in revenue in 2017 — listed in order — are: Information; Wholesale Trade; Construction; Retail Trade; Finance & Insurance; Arts, Entertainment & Recreation; Health Care & Social Assistance; Professional, Scientific & Technical Services; Mining; Utilities; Accommodation & Food Services; Agriculture, Forestry, Fishing & Hunting; Educational Services; and Transportation & Warehousing.

For additional details, read the full ISM release here.