Survey: Worst of Recession Behind MN Manufacturers
The worst of the recession may be over for Minnesota manufacturers, a just-released survey suggests.
The survey, a research project sponsored by Enterprise Minnesota and its partners, found that fewer than one in 10-or 9 percent of-manufacturing executives anticipate a continued recession in 2011; 40 percent, meanwhile, foresee economic expansion.
The number of executives who predict that the recession will continue this year has declined 47 percent since a survey conducted two years ago. Additionally, 32 percent more executives are predicting growth as compared to the previous survey.
The survey points to good news about manufacturers' financial status as well: 51 percent of executives indicated that they expect their annual gross revenues to increase in 2011, up from 44 percent in 2010 and 23 percent two years ago. Similarly, 39 percent of survey respondents said that they expect their firm's profitability to increase in 2011-representing a 17 percent increase from two years ago.
“The value of manufacturing to a healthy economy cannot be stated strongly enough,” Enterprise Minnesota President and CEO Bob Kill said in a statement. “We saw manufacturing lead the way in job growth last year, and the optimism for this year should be a positive sign for the year ahead.”
Despite the rosy outlook, Minnesota manufacturers do face some challenges. Almost half-47 percent-said that they believe the state isn't moving in the right direction when it comes to competitiveness as a business location.
Additionally, for the third consecutive year, the top concern among those polled is the cost of health care coverage. The percent of manufacturing executives that rate it as a concern has increased steadily-from 64 percent in 2009 to 68 percent in 2010 to 71 percent this year. Concern about health care is particularly pronounced for small business owners who are uncertain about how they will be affected by the federal health care reform plan, according to the survey findings.
Rounding out the list of top worries among the state's manufacturers are government policies and regulations (which concern 61 percent of respondents), the impact of President Obama's health care reform plan (which worries 58 percent of those polled), and taxes (a concern for 56 percent of respondents).
The survey was based on phone interviews with 400 manufacturing executives that were conducted over a two-week period in January. The survey was complemented by 17 focus groups that met throughout Minnesota.
Enterprise Minnesota is a Minnesota State Legislature-chartered organization that aims to help Minnesota manufacturers to grow profitably. Earlier this month, the organization announced that it launched a new program that will help 25 Minnesota-based manufacturers develop and implement strategies to grow.