91% Of Manufacturers Intend To Raise Prices In The Second Half Of 2023, A New Poll Finds

The survey of top executives by Forbes, Xometry And Zogby also shows a preference for Biden’s manufacturing policies among 2024 presidential candidates.

Nine out of 10 manufacturers intend to hike prices in the second half of this year, according to a new poll by Forbes, Xometry and Zogby. The increases will come on top of earlier hikes as nearly 62% said they’d already raised prices this year.

Though the Consumer Price Index rose at 4% in May, its slowest pace in two years, the manufacturing executives’ poll answers could be a sign of more inflation to come as the U.S. economy heads into the second half. Already in 2023, 57% of those polled said they’d boosted prices by at least 5%.

Another key finding: as we head into the U.S. presidential election season, the poll found clear support for President Joe Biden when respondents were asked to compare candidates’ manufacturing policies. Asked whether current federal policy on manufacturing helped their sector, 78% said that it did.

The survey in early June of 150 U.S.-based executives, a joint effort of Forbes and manufacturing company Xometry and powered by veteran polling firm John Zogby Strategies, aimed to gauge how manufacturers have been handling an environment of rising costs, supply-chain disruptions and potential recession. With the presidential election season heating up, we also asked a series of policy questions. This is our fourth poll; for results of the previous ones, see here, here and here.

In a new poll of manufacturing executives, 78% said that current federal policy was helping their sector.

In a series of questions about which presidential candidate would do the best job on issues relevant to manufacturers, the executives favored Biden. Nearly half (46%) said Biden would do the best job at creating an environment for small- and medium-sized manufacturers to flourish versus less than one-third for former President Donald Trump (31%). A similar number (45%) favored Biden’s plans for incentivizing reshoring versus Trump’s (32%); for alleviating inflation (43% Biden to 35% Trump); for establishing trade deals to bolster manufacturing (39% Biden to 35% Trump) and for forming and overseeing a presidential task force on artificial intelligence (49% Biden to 25% Trump).

Both Florida Governor Ron DeSantis on the Republican side and Robert Kennedy Jr. on the Democratic received smaller levels of support on each of those questions. DeSantis polled between 9% and 15% on each, while Kennedy got between 5% and 10%.

Overall, respondents were split between Democrats and Republicans on which party was more likely to bring about a manufacturing renaissance with 41% favoring Democrats and 39% going for Republicans. Thirteen percent said neither party and 7% were unsure.

An increasing number of executives are investing in artificial intelligence, with 61% doing so this quarter versus 51% in the previous poll in April. The majority who are adopting AI (69%) already see a return on their investment. Yet, an even higher number (86%) of executives support federal regulations of the technology. Almost all (95%) said they believed that AI would likely become a top issue for voters, and 83% expressed support for the formation of an AI presidential task force.

“AI is everywhere and will continue to be,” said one executive. “AI systems can analyze vast amounts of data from sensors and equipment to predict maintenance needs and identify potential failures,” said another. “It still cannot be fully trusted,” said a third.

The majority of manufacturing executives are investing in artificial intelligence. An even higher percentage support federal regulations of the technology.

Manufacturers are continuing to bring their factories closer to home with nearly half reporting that they have already reshored some facilities and another third planning to do so. They’re also continuing to invest in robotics with nearly a quarter saying they’re doing so in 2023 and beyond. The vast majority of executives (82%) also continue to stockpile goods in anticipation of further supply chain shocks.

There’s a noticeable uptick in optimism since our previous poll as expectations for a recession have declined. While 63% say a recession is at least somewhat likely this year, that’s down dramatically from 89% in April. More executives now believe that the Federal Reserve should continue to raise interest rates when compared to our previous poll, with 48% now favoring an increase versus 38% in our previous poll.

Nearly three-quarters of executives said that their sales and profits beat last year. Three-quarters said they intended to increase wages for employees this year, and half said they planned to increase hiring.

In a series of questions about which presidential candidate would do the best job on issues relevant to manufacturers, the executives favored Biden.

Yet when asked an open-ended question about the potential for recession, many respondents struck notes of gloom. “Disruptions in international trade, geopolitical tensions or economic instability in major economies can have ripple effects globally,” said one executive. “Banks are failing, loan rates dropping,” said another. “Inflation will set in, and the price of things will go up,” said a third.

The executives polled all work at companies with at least $10 million in sales, and more than half of their firms have revenue of $100 million or more. The margin of error on the poll was plus or minus eight percentage points. Since executives are a tiny segment of the population, a sample size greater than 100 is considered more than representative.