ISM Forecast Expects Further Recovery in Second Half of 2002
May 13, 2002
According to the 63rd Semiannual Forecast from the Institute of Supply Management (ISM), San Francisco, Calif., economic growth is expected to continue in the second half of 2002. Purchasing and supply executives expect their 2002 revenues to grow from 2001 as they now anticipate 2.8% growth in revenues. In the manufacturing sector, purchasers report operating at 79.3% of their normal capacity, up from 77.5% reported in December 2001. They now predict that capital expenditures will decrease 8.7% in 2002 compared to the December 2001 prediction of 14.4% decrease. Purchasers also forecast that they will continue to reduce their organization's purchased inventory to sales ratio, while expecting manufacturing employment to decline an additional 0.5%. They also forecast an average 2% increase in overall labor and benefits costs for 2002.