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Home > Coronavirus > RSM US Manufacturing Outlook Index remains positive, but within a range

RSM US Manufacturing Outlook Index remains positive, but within a range

Jan. 4, 2021 by Joseph Brusuelas

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Optimism in the American manufacturing community is poised to continue in the new year, though with some caution attached. It is clear that the risks around the pandemic are rising and we may observe volatility in manufacturing indices until the bottlenecks around vaccine distribution are solved.

The proprietary RSM US Manufacturing Outlook Index has been positive for the five months since August, but not significantly so. It may be some time before we observe robust readings in manufacturing sentiment.

In past economic downturns, manufacturing sentiment receded as the recession continued, something that could be expected. In this recession, manufacturing sentiment plunged when the coronavirus shut the economy down, but then revived even as infections and deaths accelerated and job layoffs continued.

The moderation of confidence is most likely the result of both manufacturing sales and durable goods orders remaining lower than historical standards. Given the importance of manufacturing to overall economic activity, that speaks to the need for a stimulus program to accelerate growth of the manufacturing sector.

The RSM index of manufacturing sentiment is based on surveys conducted by the regional Federal Reserve banks.

For more information on how the coronavirus is affecting midsize businesses, please visit the RSM Coronavirus Resource Center.

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Filed Under: Coronavirus, Economics, Industrials Tagged With: coronavirus, Covid-19, Joseph Brusuelas, RSM US Manufacturing Outlook Index

About Joseph Brusuelas

@JoeBrusuelas

Joe Brusuelas, “chief economist to the middle market,” is the preeminent voice championing issues and policies facing midsize companies in the United States and around the world. An award-winning economist, Brusuelas has more than 20 years’ experience analyzing U.S. monetary policy, labor markets, fiscal policy, international finance, economic indicators and the condition of the U.S. consumer.

A member of the Wall Street Journal’s forecasting panel, Brusuelas regularly briefs members of Congress and other senior officials regarding the impacts of federal policy on the middle market and the factors by which middle market executives make business decisions. He also frequently offers his insights on the U.S., Canadian and global economies in the financial media. In 2020, he was named one of the 100 most influential economists by Richtopia.

Before joining RSM in 2014, Brusuelas spent four years as a senior economist at Bloomberg L.P. and the Bloomberg Briefs newsletter group, where he co-founded the award-winning Bloomberg Economic Brief. Earlier in his career, he was a director at Moody's Analytics covering the U.S. and global economies for the Dismal Scientist website. He also served as chief economist at Merk Investments L.L.C. and chief U.S. economist at IDEAglobal.

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