Dive Brief:
- 56% of respondents in the National Association of Manufacturers (NAM) second-quarter survey cited trade tensions, including tariff threats against China and Mexico, as a top concern for their business.
- Despite the concern, 80% of respondents said they had a positive outlook for their business, although that figure is down from almost 90% in March. The tariff spat with Mexico unfolded while this survey was being conducted, NAM said.
- More than 80% also said the passage of the United States, Mexico and Canada Agreement (USMCA) was important to their company. "Manufacturers in America sell more to Canada and Mexico, our country’s largest two trading partners, than our next 11 trading partners combined," the survey said.
Dive Insight:
The survey noted it "is no secret that manufacturers rely on trade to grow their businesses." Protectionist measures, such as tariffs or other trade barriers, can impede growth and reduce confidence in the manufacturing sector.
Trade issues were also prominent in the Institute for Supply Management's last monthly survey.
"Respondents expressed concern with the escalation in the U.S.-China trade standoff, but overall sentiment remained predominantly positive," ISM Chair Timothy R. Fiore said in a statement.
Other challenges the 689 respondents to the NAM survey noted were the cost of raw materials and the ability to attract and retain workers. Hiring and retention challenges have led to more than 78% of respondents saying a reformed immigration system could address the workforce shortage, the survey notes.
Notwithstanding these issues, NAM said the manufacturing sector is still expanding, "albeit more slowly, and business leaders in the sector continue to be mostly upbeat," a summary of the survey reads.
