Manufacturing Outlook Appears Promising for '94 New Economic Indicators Raise Business and Consumer Confidence
Amy Kaslow, writer of The Christian Science Monitor, The Christian Science Monitor
RON BULLOCK, president of Bison Gear & Engineering Corporation in Downers Grove, Ill., is feeling good about the economy. So good, in fact, he's planning to expand his payroll by some 10 percent this year and invest in some expensive plant equipment.
Economists and analysts who are bullish about economic-growth prospects are looking to businesses like Mr. Bullock's to provide the biggest push.
Manufacturers account for 22 percent of the overall United States gross domestic product. Add to that already-sizable chunk of US output another dimension - the suppliers and services feeding into and off of manufacturers, such as power companies and health-care providers - and the importance of this sector grows even larger. (Experts say manufacturers pay roughly 40 percent of US health-care coverage.)
National Association of Manufacturers members won't be "taking off, but strengthening their position in 1994," president Jerry Jasinowski says. He is watching three trends that are improving firms' balance sheets:
* The growing emphasis on "people empowerment" (giving workers job training, a hand in management, and a financial stake in the firm).
* Increased global marketing and commercialization to push US products into foreign markets.
* Productivity gains through modernization and greater use of technology.
In recent weeks, the federal government has released strong economic data. The Commerce Department's index of leading indicators posted its fourth gain in a row in November and signals increased economic activity six-to-nine months in the future. Consumer confidence climbed, buoyed by better forecasts. And, fueled by low interest rates, home sales jumped to record levels.
This bodes well for manufacturing, as consumers and new homeowners buy more clothing, household items, and durable goods.
Barbara Kasper, owner of Inter-Lakes Bases Inc., in Fraser, Mich., provides supplies to the machine-tool industry, which is projected by the Commerce Department to be the fastest-growing manufacturing industry in 1994. She employs 35 and plans to hire three more people this year.
The 10 fastest-growing manufacturing industries in 1994 are being propelled by domestic demand for cars, housing, computerization, health care, and environmental equipment, says Commerce Undersecretary Jeffrey Garten. …