Companies whose overall revenues are falling include makers of industrial machinery and some consumer goods. One consumer products manufacturer indicates that major retailers are reducing inventories significantly even though their sales are not declining. Contacts producing aircraft components, biotech products, information products, and business services report strong growth in these markets. Respondents selling to the semiconductor industry note a recent weakening in sales, particularly for items used in cell phones, personal computers, and printers, but their overall revenues remain ahead of year-earlier levels. Utility and transportation costs are up from a year ago, in some cases considerably.
Contacts also report paying more for petroleum-based inputs, chemicals, and metals.
Selling prices remain mostly flat or rising at a low single-digit rate. Many respondents indicate that they cannot raise prices for fear of losing business. Most manufacturers report little net change in U.S. employment, although one-quarter of the sample plan deep cuts. Some contacts indicate that the number of vacancies has fallen for salaried technical personnel. Based on current trends, most contacts expect this year's wage and salary increases to be on par with last year's, although some expect a slight moderation.