US manufacturing has demonstrated continuedstrength in 2022, building on the momentum it gained emerging from the pandemic, and surpassing expectations from the prior two years.’ Policy initiatives such as the Creating Helpful Incentivesto Produce Semiconductors for America Act(CHIPS Act) and Inflation Reduction Act(IRA) have the potential to help sustain recovery in the manufacturing industry. Looking ahead to 2023, Deloitte projections based on Oxford Economics’ Global Economic Model anticipate 2.5% growth in GDP in manufacturing.
While overall demand and production capacity have hit recent highs, there are indications that the near-term outlook may not be as bright. The industry is currently experiencing concerns related to inflation and economic uncertainty. In addition, manufacturers continue to grapple with talent challenges that may limit the industry’s growth momentum.Even though employment levels now stand higher than in 2008，³ the industry remainssignificantly short of skilled workers.4 Moreover，supply chain issues, including sourcing bottlenecks,global logistics backlogs,cost pressures,and cyberattacks,will likely remain critical challenges in 2023. As highlighted in the recent National Association of Manufacturers(NAM)survey,thesedisrupters have affected manufacturers’ optimism and business confidence,pulling the second-quarter Manufacturing Outlook Index to 55, down by 4.2 points since first-quarter 2022.5
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