Manufacturing’s growth could more than triple services in '08

Industrial Distribution staff -- Industrial Distribution, 12/12/2007 6:01:00 AM

Revenue in the nation's manufacturing economy is expected to grow at three times the rate of the service sector in 2008, according to the latest survey conducted by the Institute for Supply Management.

The survey of about 400 purchasing and supply management executives showed a 6.8 percent revenue increase was expected in manufacturing next year compared to a 2 percent rise in overall service revenue.

That compares with reported growth rates of 2.4 percent in manufacturing and 1.3 percent in service businesses for this year.

The ISM survey found 62 percent of the manufacturers expect revenue to be higher in 2008. Fifty-four percent of executives surveyed in the service sector saw an increase for ‘08.

Overall expectations were lowered by concerns over energy prices, commodity prices, the weak dollar and housing.

''It appears the further away they are from housing the better off they are on the manufacturing side,'' said Norbert Ore, chairman of the ISM manufacturing business survey committee.

Ore said there was no indication in the ISM survey that the economy was headed toward a recession.

''There's nothing in the forecast that would lend itself to that,'' he said.