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US manufacturing survey 200731/01/2007. Source: Bank of America Business Capital.
 While CFOs are optimistic about the prospects for their own companies, they are concerned about economic expansion and growth opportunities for the manufacturing sector in 2007. That’s according to the ninth annual survey of mid-size and large US manufacturing company CFOs commissioned by Bank of America Business Capital. 600 CFOs were asked their opinions of the economy, financing, M&A activity, and their involvement in foreign markets.
Although a majority of CFOs (54%) also believe that the actions taken by the Federal Reserve Board have helped the economy, this is down significantly from 60 percent last year and 72 percent the year before. What’s more, only 26 percent of CFOs surveyed expect the U.S. manufacturing sector to expand in 2007, while 35 percent of those surveyed believe the manufacturing sector will contract next year. This is the first time in the survey’s history that more CFOs believe the manufacturing sector will contract than expand.
Cautious Optimism
Despite the tempered economic outlook and apparent concern for the manufacturing sector, CFOs continue to see growth opportunities for their individual companies. Sixty-eight percent of CFOs anticipate revenue growth next year and 45 percent expect their profit margins to increase.
This continued upbeat expectation could be a function of the generally positive state of manufacturing over the past 12 months. When asked, "How would you rate the current state of the manufacturing sector on a scale of 0 (extremely weak) to 100 (extremely strong)?" the average score was "59," the same as last year’s rating.
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