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US manufacturers optimistic

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US manufacturers optimistic

PwC survey shows growing concerns about qualified workers, however.

Optimism regarding the direction of the domestic economy rose among U.S. industrial manufacturers during the first quarter of 2014, according to the PwC US Q1 2014 Manufacturing Barometer. 

The positive sentiment about the prospects of U.S. commerce in the next 12 months reached the highest level since the fourth quarter of 2005.  Conversely, optimism regarding the prospects of the world economy lessened during the first quarter as U.S. industrial manufacturers remained cautious on the global stage. 

"The majority of U.S. industrial manufacturers surveyed plan to add employees to their workforce over the next 12 months."

Optimism around the prospects of the U.S. economy during the next 12 months rose among U.S. industrial manufacturers to 71% in the first quarter of 2014, from 68% in the previous quarter and 55% in the first quarter of 2013. Concurrent with the improved sentiment, uncertainty around the domestic outlook has continued to abate among industrial manufacturers, dropping to 27% in the first quarter, representing the lowest level since the first quarter of 2012.

"The level of optimism among industrial manufacturers concerning the direction of the domestic economy continued to rise, with company revenue growth expectations remaining at healthy levels," said Bobby Bono, PwC's U.S. industrial manufacturing leader. 

"This improved sentiment bodes well for the year ahead, as management teams continue to indicate consistent near-term spending plans, including hiring more workers, supporting new product development and investing in IT and R&D.  At the same time, sentiment regarding the outlook for worldwide commerce softened in the early months of 2014, while the level of uncertainty remained elevated. As a result, companies are continuing to focus primarily on investing in core products and services in an effort to expand market share, while taking a cautious approach to longer-term capital investment and overseas expansion."

Overall sentiment about the world's economic prospects among U.S. industrial manufacturers that market abroad weakened somewhat during the first quarter of 2014, with optimism declining to 41% from 47% in the fourth quarter of 2013.  However, global sentiment is ahead of the 36% level of optimism recorded in the first quarter of 2013.

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