The National Association of Manufacturers released its Manufacturers’ Outlook Survey for the fourth quarter of 2021, showing manufacturers remain mostly optimistic in their economic outlook (86.8%, down from 87.5% in Q3) but are significantly concerned with issues like inflation, hiring and potential tax increases targeting manufacturers.
“Manufacturers are working overtime to fill more than 1 million open jobs, including through our nationwide Creators Wanted workforce campaign,” said NAM President and CEO Jay Timmons. “On top of that, we’re grappling with a supply chain crisis. Despite the challenges confronting us, manufacturers remain bullish on the future. But if Congress passes legislation with taxes that hit manufacturers harder than other industries, our entire recovery will be thrown off course. If new taxes land on our shoulders, it will undo all the progress we’ve made since the 2017 tax reform law.”
Key survey highlights:
Top issues:
- Increased raw material costs (87.1%), the number-one issue for the fourth straight quarter
- Supply chain challenges (84.5%)
- Attracting and retaining a quality workforce (82.7%)
Additionally:
- 87.8% of respondents said an increased tax burden on income from manufacturing activities would make it more difficult to expand their workforce, invest in new equipment or expand their facilities
- 85.2% said they have open positions they cannot fill.
- 73.6% of respondents said supply chain bottlenecks negatively impacted their company’s outlook for production, hiring and overall business activity.
“Manufacturers have kept our promise to hire more workers, raise wages and benefits and invest in our communities,” Timmons said. “Our question to Congress—the message of this survey—is, do we want to weaken our recovery by undermining manufacturers’ competitiveness? Raising taxes on manufacturers will not help us build back better. It will tear down what we’ve achieved.”
Read the full Q4 2021 Manufacturers’ Outlook Survey results here.
Background on manufacturing growth following the enactment of 2017 tax reform, according to NAM:
- In 2018, manufacturers added 263,000 new jobs. That was the best year for job creation in manufacturing in 21 years.
- In 2018, manufacturing wages increased 3% and continued going up—by 2.8% in 2019 and 3% in 2020. Those were the fastest rates of annual growth since 2003.
- Manufacturing capital spending grew 4.5% and 5.7% in 2018 and 2019, respectively.
- Overall, manufacturing production grew 2.7% in 2018, with December 2018 being the best month for manufacturing output since May 2008.