05282016Sat
Last updateFri, 27 May 2016 2pm

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Survey: Manufacturing Execs Investing in Advanced Tech

 A convergence of disruptive factors such as new technologies, increasing competition, and pricing pressures, is forcing manufacturers to increase investment in new products and services as they seek to innovate manufacturing capabilities, according to the 2016 KPMG Global Manufacturing Outlook survey.

In KPMG’s survey of 360 C-level global manufacturing executives, including 80 in the U.S., 39% say over the next two years they will devote a significant amount of R&D towards advanced manufacturing technologies such as robotics. In fact, many indicated they have already made investments in new digital technologies, with 25 % saying they have invested in artificial intelligence and cognitive computing technologies as well as in 3D printing and additive manufacturing technologies. 


Durable Goods Orders Surge 3.4%, But Demand Soft

New orders for manufactured durable goods in April increased $7.7 billion or 3.4% to $235.9 billion, the U.S. Census Bureau announced today. This increase, up three of the last four months, followed a 1.9% March increase. Excluding transportation, new orders increased 0.4%. Excluding defense, new orders increased 3.7%.

“Orders for long-lasting U.S. manufactured goods surged in April on strong demand for transportation equipment and a range of other products, but continued weakness in business spending plans suggested the manufacturing rout was far from over,” Reuters reports.

Markit PMI Shows U.S. Manufacturers Stagnating in May

The U.S. manufacturing sector crept closer to stagnation in May, with the seasonally adjusted Markit Flash U.S. Manufacturing Purchasing Managers’ Index (PMI) registering only slightly above the neutral 50.0 mark at 50.5. This was down from 50.8 in April and signaled only a marginal improvement in overall business conditions that was the weakest since the current upturn started in October 2009.

A renewed fall in production was one key factor weighing on the headline index in May, alongside softer new order growth and further cuts to stocks of inputs. U.S. manufacturers signaled the first reduction in output since September 2009 in May, although the rate of decline was only marginal. A number of monitored firms mentioned that uncertainty around the general economic outlook had caused clients to delay spending decisions, which in turn prompted firms to trim their production schedules. 

Why Innovation is the Key to U.S. Manufacturing Growth

Manufacturing may be facing some headwinds, but it’s undeniably in the midst of a technological renaissance that is transforming the look, systems and processes of the modern factory. Despite the risks — and despite recent history — industrial manufacturing companies cannot afford to ignore these advances. By embracing them now, says PwC in its 2016 Industrial Manufacturing Trends Report, they can improve productivity in their own plants, compete against rivals and maintain an edge with customers who are seeking their own gains from innovation. 

Obama Administration Announces New Overtime Rules

Vice-President Biden announced this week that the administration has updated overtime regulations to better reflect the original intent of the Fair Labor Standards Act. Among other things, this action raises the salary threshold indicating eligibility from $455/week to $913 ($47,476 per year). The final rule will become effective on December 1, 2016.

“The salary threshold is woefully out of date,” said Labor Secretary Tom Perez, who attended the event with Biden.

Some groups have criticized the move however as just another example of red tape and costly regulations that will do more harm than good to the economy. House Speaker Paul Ryan was among the critics, saying, “This regulation hurts the very people it alleges to help.”

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