Economic Recovery Continues in 2010: Institute for Supply Management
Non-manufacturing supply management executives report their level of capital expenditures in 2009 compared to 2008 declined 4.2 percent. This compares to the 1.4 percent increase reported for 2008 one year ago, and is significantly less than the 13.5 percent decrease pedicted by respondents in April 2009. Fifteen percent of respondents report increases averaging 60 percent. An additional 52 percent report decreases averaging 24.9 percent. Thirty-three percent indicate they spent the same on capital expenditures in 2009 as in 2008. The three industries experiencing increases in capital expenditures in 2009 are: Retail Trade; Mining; and Professional, Scientific & Technical Services.
PREDICTED CAPITAL EXPENDITURES — 2010 vs. 2009
Purchasing and supply executives expect capital expenditures to decrease 4 percent in 2010. The 43 percent of respondents who predict increased capital expenditures in 2010 indicate an average increase of 32.5 percent, while the 24 percent who said their capital spending would be reduced predict an average decrease of 74.1 percent; 33 percent said they expect to spend the same in 2010 as in 2009. The 10 industries predicting increases in capital expenditures for 2010 — in order of percentage increase — are: Paper Products; Transportation Equipment; Wood Products; Plastics & Rubber Products; Textile Mills; Electrical Equipment, Appliances & Components; Machinery; Apparel, Leather & Allied Products; Miscellaneous Manufacturing(a); and Fabricated Metal Products.
Non-manufacturing purchasing and supply executives are expecting a decrease of 6.7 percent in capital expenditures from what they are reporting for 2009 (a decrease of 4.2 percent). The 31 percent of respondents expecting to spend more predict an average increase of 13.7 percent. An additional 28 percent anticipate a decrease averaging 39.7 percent. Forty-one percent expect to spend the same on capital expenditures in 2010 as in 2009. The six industries expecting increases in capital expenditures in 2010 — in order of percentage increase — are: Professional, Scientific & Technical Services; Mining; Agriculture, Forestry, Fishing & Hunting; Transportation & Warehousing; Public Administration; and Finance & Insurance.