ISM Forecast Economic Growth to Continue in 2008

New York, NY, December 12, 2007--Economic growth in the United States will continue in 2008, say the nation's purchasing and supply management executives in their December 2007 Semiannual Economic Forecast.

Expectations for 2008 are at a higher level for the manufacturing sector than the non-manufacturing sector. The non-manufacturing sector is projecting moderate growth. The manufacturing sector has a higher level of optimism about 2008, with revenues expected to grow more than in the non-manufacturing sector.

These projections are part of the forecast issued by the Business Survey Committee of the Institute for Supply Management.

Expectations for manufacturing in 2008 are high as 62% of survey respondents expect revenues to be greater in 2008 than in 2007. The panel of purchasing and supply executives expects a 6.8% net increase in overall revenues for 2008, compared to an increase of 2.4% reported for 2007.

Respondents expect cost pressures to subside somewhat in the second half of 2008 based on their overall price forecast. Manufacturing growth is now in its 10th consecutive month.

In the manufacturing sector, respondents report operating at 82.9% of their normal capacity, up from 82.8% reported in April 2007. Purchasing and supply executives predict that capital expenditures will increase by a meager 0.7% in 2008, compared to a 18.2% increase reported for 2007.

Manufacturing purchasers are predicting strong growth in both exports and imports. They also expect the U.S. dollar to weaken on average against the currencies of major trading partners.

Respondents believe they are only 51% complete on average in achieving benefits from technology in their supply chain, indicating there is still significant improvement to be gained from the application of technology in manufacturing.