News & Insights

Washington, D.C. – As the review of the United States–Mexico–Canada Agreement gets underway, a majority of manufacturers report they utilize either Canada or Mexico for critical parts of their supply chains—at a time when trade uncertainty remains manufacturers’ top business concern, according to the National Association of Manufacturers Q1 2026 Manufacturers’ Outlook Survey. The survey also shows manufacturers’ optimism is rising, with 75.3% reporting a positive outlook for their company, up 5.4 percentage points from the previous quarter.

Among the manufacturers that utilize Canada or Mexico for critical parts of their supply chain, exactly half rely on both countries, according to the latest findings. The majority of U.S. imports from Mexico and Canada are industrial inputs such as machinery, equipment and raw materials while Canada and Mexico also purchase one-third of manufactured good exports—more than the next nine U.S. trading partners combined.

“Manufacturers are ready for liftoff, but the skies need to clear,” said NAM President and CEO Jay Timmons. “This quarter shows a mixed bag of results with real momentum from tax reform, regulatory rebalancing and energy policy. At the same time, the results underscore how essential durable supply chains are to manufacturing success—and how critical Canada and Mexico are to that system, which is why we need to preserve and strengthen the USMCA.”

“For the first time since 2023, manufacturers’ outlook topped the historical average of 74.3%, and manufacturers expect most indices to improve meaningfully over the next 12 months. Sales and production are projected to rise 3.8% and 3.5%, respectively, up from the previous quarter’s forecast of 2.8% and 2.4% growth,” said NAM Chief Economist Victoria Bloom. “However, challenges persist. For example, raw material and other input costs are not anticipated to slow, rising at the same pace as projected in Q4 (4.1%) and ranking as the third-highest business concern at 57.5%.”

Key findings:

• 70.6% of manufacturers cited trade uncertainties as a top business challenge for the fifth consecutive quarter.
• 54.6% secure critical inputs from either Canada or Mexico—82.2% of those manufacturers say they source raw materials or other inputs from either country.
• Of those that utilize Canada or Mexico, 62.7% benefit from a strong customer base across the border.
• For the second consecutive quarter, rising health care/insurance costs (69.8%) remained the second most-cited business challenge for manufacturers.

The NAM releases these results to the public each quarter. Further information on the survey is available here.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.95 trillion to the U.S. economy annually and accounts for 53% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

Watch NAM’s Jay Timmons and SBA Administrator Kelly Loeffler on Fox Business

Washington, D.C. – Today, the National Association of Manufacturers and the U.S. Small Business Administration host the inaugural 2026 Supplier Matchmaking Expo at Charlotte Motor Speedway in North Carolina. There, large manufacturers will connect with smaller suppliers, strengthening their U.S. supply chains and paving the way for more job creation and investment in American industrial dominance.

Ahead of the event, NAM President and CEO Jay Timmons and SBA Administrator Kelly Loeffler joined “Mornings with Maria” on Fox Business to discuss the state of manufacturing.

On Impact of H.R. 1 for Manufacturers

JAY TIMMONS: “I was here … in Charlotte where I got to see the benefits of H.R. 1. We were at Ketchie … the CEO of that company had signs all over her plant showing which machines were able to be purchased because of the tax reforms of 2017 and 2025. You put that together with regulatory modernization and energy development, and then you start putting together small manufacturers who can actually contribute to the supply chain and you’ve just got a supercharged economy. SBA Administrator Kelly Loeffler has been all over the road for the last 57 weeks, I think, pointing out how we need to really strengthen and supercharge the power and the might of small manufacturers here in the United States.”

On 2026 Supplier Matchmaking Expo

KELLY LOEFFLER: “We’re so proud to partner with the National Association of Manufacturers to bring large manufacturers like Ford, Siemens, Boeing, Lockheed and many others together with a half dozen federal agencies and then nearly 900 small businesses. And this is the energy that we see on the ground—that small manufacturers are seeing a ramp-up in orders. You saw that in the ISM, both the services and the manufacturing data, two consecutive months of expansion. What’s exciting about this is that’s a forward-looking metric, as is the small business optimism that we see in this sector. Seventy percent of companies expect revenue growth, half expect to expand. I’ve talked to manufacturers that expect to double, and we’ve seen the demand from large manufacturers that need their subcontractors, companies like Ford that use 5,000 small business manufacturers to help strengthen their supply chain. Those manufacturers need to be in America. Those are American jobs, and that’s why we’re so excited to host this event today in Charlotte.”

On Manufacturing Workforce Needs

TIMMONS: “There are about 400,000 open jobs in manufacturing right now, and what we’re seeing is a need for more highly specialized jobs on the technical side—technicians who can help us develop AI and infuse AI into our workforce. About 50% of small businesses right now use AI in their operations. That number will grow to about 80% by the year 2030. So, think in terms of jobs that we don’t even have an idea of what they look like today. Every generation … the job types in manufacturing change so substantially, and AI, I think, is going to take us in a whole different direction.”

LOEFFLER: “What we see on the ground is strong demand for the skilled workforce, and that’s what we’re working with small businesses on. They have millions of jobs open. This is what our mandate is now … to help create the skilled workforce of the future because those jobs are out there, as Jay said, and we need to make sure that our young people are ready to take those jobs on.”

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.95 trillion to the U.S. economy annually and accounts for 53% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

The Manufacturing Institute, the NAM’s workforce development and education affiliation, announced the 145 recipients of the 2026 STEP Ahead Awards on Monday. They will be honored at the STEP Ahead Awards Gala in April.

• The awards honor outstanding leaders in the industry at all career levels and all positions—from the shop floor to the C-suite—as they build the industry of the future and inspire the next generation of the workers.

Why it matters: With more than 400,000 openings in the sector today—and an expected 3.8 million new employees needed by 2033—the industry requires leaders and role models to show prospective workers all that it can offer.

STEP leaders say: “As chair of the STEP Ahead Awards, I’m honored to recognize distinguished leaders who are strengthening manufacturing excellence by investing in the future talent pipeline. With our industry facing a critical workforce challenge, real innovation will only come from empowering our workforces and nurturing the next generation of leaders through mentorship, sponsorship and serving as strong role models,” Biogen Executive Vice President and Head of Pharmaceutical Operations and Technology Nicole Murphy said.

• “It’s a privilege to serve as vice chair of the STEP Ahead Awards and to highlight those who are reimagining what’s possible in our industry. I’m proud to see the next generation of female and ally leaders shaping the future of manufacturing and technology and inspiring others to see STEM careers as both meaningful and attainable,” AstraZeneca Senior Vice President and Global Head of Pharmaceutical Technology and Development Dafni Bika said.

The MI says: “The STEP Ahead Awards are truly a celebration of the outstanding character and contributions of so many members of the manufacturing workforce. Our industry is so fortunate to have so many inspiring leaders and mentors who are cultivating fulfilling workplace cultures that encourage people to join, stay and grow our workforce,” said MI President Carolyn Lee.

What’s next: The 2026 STEP Ahead Awards Gala will take place April 23, 2026, at The Anthem in Washington, D.C. View the full list of awardees and learn more about the awards gala here.

Washington, D.C. – Vermeer Corporation, an industrial and agricultural equipment producer based in Pella, Iowa, is crediting the pro-growth tax provisions of H.R. 1 with supporting the company’s plan to build an all-new 300,000-square-foot facility in the Des Moines metro that will create more than 300 jobs.

Vermeer said in a company statement, “We’re grateful for the state of Iowa, the pro-business environment, the skilled workforce here and economic policies, like Working Families Tax Cuts, that have helped support Vermeer’s long-term growth.”

Last August, National Association of Manufacturers Executive Vice President Erin Streeter joined Rep. Mariannette Miller-Meeks (R-IA) for a Made in America Manufacturing Tour across Iowa’s 1st District, where they visited Vermeer’s facility in Pella. During the tour, Vermeer President and CEO and NAM Executive Committee member Jason Andringa said H.R. 1 “sets up manufacturers for a generation of continued growth and advancement.”

Streeter praised Rep. Miller-Meeks’ leadership during the tour.

“H.R.1 is a landmark win for manufacturing—delivering pro-growth policies that will strengthen our industry for years to come. Without bold leadership from lawmakers like Rep. Miller-Meeks, manufacturers could have been crippled by the largest tax hike in history—jeopardizing the progress we made after the 2017 Tax Cuts and Jobs Act. Iowa’s 1st Congressional District is the first in the state for manufacturing. We want to thank her for protecting 13,000 jobs and $1.2 billion in wages at more than 800 manufacturing companies in her district alone.”

Background

KEY FACTS: If Congress had failed to preserve tax reform in 2025, the U.S. would have risked:

• 5.9 million lost jobs;
• A $540 billion reduction in employee compensation; and
• A $1.1 trillion shortfall in U.S. GDP.

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.95 trillion to the U.S. economy annually and accounts for 53% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.

U.S. import prices increased 0.2% in January, after a similar rise in December, with higher nonfuel prices more than offsetting lower prices for fuel in January. Over the past year, import prices declined 0.1%. Meanwhile, U.S. export prices rose 0.6% in January, with both higher nonagricultural and agricultural export prices driving the increase. Over the past year, export prices advanced 2.6%.

In January, U.S. import prices for manufacturing rose 0.8% over the year, with most of the industry experiencing price declines. Primary metal manufacturing experienced the most significant over-the-year U.S. import price increase in January, surging 26.1%. On the other hand, the greatest yearly decline in U.S. import prices occurred in beverage and tobacco product manufacturing, which fell 14.1% from January 2025. Meanwhile, U.S. export prices for manufacturing in January advanced 4.0% over the year, with primary metal manufacturing export prices exhibiting the largest rise (43.9%).

Fuel import prices fell 2.2% over the month in January, after declining 1.1% in December. Lower prices for petroleum drove the decrease, moving down 2.7%. Furthermore, prices for fuel imports plummeted 13.4% from January 2025. Meanwhile, natural gas prices jumped 36.4% over the year.

Nonfuel import prices increased 0.5% in January, after moving up 0.2% in December. Higher prices for nonfuel industrial supplies and materials, capital goods, automotive vehicles, consumer goods and foods, feeds and beverages drove the increase. The price index for nonfuel imports grew 1.2% over the past year and has not declined on a year-over-year basis since February 2024.

After no movement in December, agricultural export prices increased 0.2% in January. Over the past 12 months, agricultural export prices advanced 2.2%. Meanwhile, nonagricultural export prices rose 0.7% in January. Higher prices for capital goods, nonagricultural industrial supplies and materials, consumer goods and automotive vehicles led the gain. Over the past year, nonagricultural export prices advanced 2.7%.

The S&P Global Manufacturing PMI was 51.6 in February, down from the January reading of 52.4. New orders rose in February, but at a slower pace than the prior month. At the same time, exports declined for the eighth consecutive month as tariffs continued to drive up costs and hurt demand from Canada. Prices on inputs increased but at a slower rate than in January, while selling price inflation fell to a 14-month low. In sum, the rate of inflation remains elevated from a historical context in February but is lower than recent peaks.

Production rose at the weakest rate since September, and combined with marginal gains in sales, caused stocks of finished goods to remain unchanged following six months of accumulation. Employment gains were weak in February as backlogs of work declined. Meanwhile, vendor performance continued to worsen as a result of low stock availability, transportation delays and adverse weather.

Expectations of new product launches and business expansion plans led firm confidence to rise to its highest level in eight months in February. Despite the gain in optimism, uncertainty over the political environment and the tariff picture continued to be a drag on hiring and investment, and that uncertainty doesn’t seem likely to abate soon.

In February, growth in global manufacturing activity strengthened from January, rising from 50.9 to 51.9, a 44-month high. Output and new orders both expanded as production rose at the fastest pace since December 2021 and growth in new orders hit a four-year high. New export orders increased as international trade volumes improved for the first time since March 2025 but continued to contract in the U.S and eurozone. Meanwhile, lead times continued to slow, lengthening for the 21st consecutive month. Employment grew for the second consecutive month, although gains were minimal.

India, Taiwan, the Philippines and Greece had the highest PMI readings in February. On the other hand, Mexico, Brazil and Russia were some of the larger nations to register declines in activity. The upturn in manufacturing occurred across consumer, intermediate and investment goods in February, with rates of expansion improving for the intermediate and investment goods sectors.

Meanwhile, input price pressures strengthened in February, jumping to a 39-month high, while output prices rose at a slightly slower rate. Forward-looking indicators remained positive, with business optimism hitting a 21-month high and climbing above long-run averages for the first time since March 2024. Notable improvements in Japan, China, the eurozone and the U.S. helped buoy this increased optimism.

Nonfarm payroll employment declined by 92,000 in February, coming in below expectations of a nominal gain. Meanwhile, December and January’s job gains were revised downward by 69,000 to a loss of 17,000 jobs and a gain of 126,000 jobs, respectively. The industries with the most significant job gains in January—health care and construction—both shed jobs in February. The 12-month average stands at just 13,000 job gains per month. At the same time, the unemployment rate inched up 0.1 percentage point from January to 4.4% in February, while the labor force participation rate ticked down 0.1 percentage point to 62.0%.

After edging up in January after 13 consecutive months of declines, manufacturing employment decreased by 12,000 in February. On the other hand, the collective job losses in December and January of 3,000 were revised downward by 5,000 jobs to a decrease of 8,000 jobs. Manufacturing employment is down 98,000 over the year. Durable goods manufacturing employment fell by 4,000 in February, while nondurable goods employment dropped by 8,000. The most significant gain in manufacturing in February occurred in fabricated metal product manufacturing, which added 2,100 jobs over the month. Meanwhile, the most significant loss occurred in plastics and rubber products manufacturing, which shed 4,200 jobs over the month.

The employment-population ratio edged down 0.1 percentage point from January to 59.3% in February and is down 0.6 percentage points from a year ago. On the other hand, employed persons who are part-time workers for economic reasons declined by 477,000 from January to 4.4 million in February and are down from 4.9 million in February 2025. Native-born employment is up 877,000 from January and 128,000 over the year. Meanwhile, foreign-born employment is down 394,000 over the month and 519,000 over the year. At the same time, the native-born unemployment rate is up 0.3 percentage points over the year to 4.7% in February, while the foreign-born unemployment rate stayed the same at 4.7%.

Average hourly earnings for all private nonfarm payroll employees rose 0.4%, or 15 cents, reaching $37.32. Over the past year, earnings have grown 3.8%. The average workweek for all employees stayed the same at 34.3 hours but inched down by 0.1 hour to 40.1 hours for manufacturing employees.

In February, the U.S. manufacturing sector expanded for the second consecutive month but at a slightly slower pace than the prior month, with the ISM Manufacturing® PMI decreasing to 52.4% from 52.6% in January. Demand indicators remained in expansion territory, with the New Orders, New Export Orders and Backlog of Orders Indexes at 55.8%, 50.3% and 56.6%, respectively. Meanwhile, the Customers’ Inventories Index continued to contract into “too low” territory, ticking up 0.1 percentage point to 38.8, which is also a positive sign for future production. Meanwhile, the Production Index expanded at a slower pace in February, decreasing from 55.9% to 53.5%.

The New Orders Index expanded for a second consecutive month in February but at a slower pace, falling 1.3 percentage points from January. Of the six largest manufacturing sectors, four—machinery, transportation equipment, chemical products and computer and electronic products—reported an increase in new orders. In a turnaround from recent months, respondents noted optimism about near-term demand.

The New Export Orders Index expanded for a second consecutive month in February and at a slightly faster pace, 0.1 percentage point higher than January. Nonetheless, respondents remain concerned about trade frictions, with a negative comment for every positive comment. Meanwhile, the Imports Index expanded for the first time since March, up 4.9 percentage points from January to 54.9%, the highest increase since February 2022.

The Employment Index contracted for the 13th consecutive month but at a slower pace than the prior month, up 0.7 percentage points from January to 48.8%. Of the six largest manufacturing sectors, two—transportation equipment and machinery—reported increased employment. Companies focused on holding off on filling open positions to restrict headcounts due to uncertainty around near- to mid-term demand. For every comment on hiring, 1.4 respondents noted reduced headcounts.

The Prices Index surged 11.5 percentage points from January to 70.5%, indicating raw materials prices grew for the 17th straight month in February and at a much faster pace than the prior month. Of the six largest manufacturing sectors, all reported increased prices. The increase continues to be driven by higher steel and aluminum prices impacting the entire supply chain, as well as the tariffs applied to most imported goods. Roughly 45.4% of companies reported paying higher prices, up from 29.0% in January and from 21.0% in January 2025.

Washington, D.C. – Following the decision by Sens. Martin Heinrich (D-NM) and Sheldon Whitehouse (D-RI) to reopen permitting reform negotiations, National Association of Manufacturers President and CEO Jay Timmons released the following statement:

“Permitting reform is one of the key pillars of a comprehensive manufacturing strategy that will help clear the skies for manufacturers. We thank Sens. Whitehouse and Heinrich for reopening negotiations on this critical issue. The stakes couldn’t be higher for manufacturers: America’s permitting system is broken—with projects taking up to 80% longer to move forward than in peer nations. America cannot lead the world in all forms of energy, AI and advanced manufacturing while projects remain stuck in yearslong permitting delays. Coming off the NAM State of Manufacturing Tour, the message has been clear—America needs a faster, more reliable permitting system to build the infrastructure that powers growth and keeps our industry competitive. 2026 must be the year of permitting reform. We want ribbon cuttings, not red tape, so manufacturers can build new shop floors, energy facilities and new infrastructure here in the United States.

“In addition to our champions in the House of Representatives—including Natural Resources Committee Chairman Bruce Westerman (R-AR), Transportation and Infrastructure Committee Chairman Sam Graves (R-MO) and Rep. Jared Golden (D-ME)—we are grateful to Sens.  Whitehouse, Heinrich, Shelley Moore Capito (R-WV) and Mike Lee (R-UT) for their continued efforts to advance bipartisan, comprehensive permitting reform—an essential pillar of a comprehensive manufacturing strategy and an all-of-the-above approach to energy. By modernizing our broken permitting system, Congress can deliver the certainty manufacturers need to build faster, invest with confidence and improve the quality of life for all Americans.”

Background:

In February, the NAM launched “Building to Win,” a six-figure campaign urging Congress to pass robust infrastructure investments and reauthorize critical federal highway programs before they expire on Sept. 30. As part of the launch, the NAM unveiled a new infrastructure policy roadmap, including original analysis on the economic costs of congestion on manufacturers and a set of core infrastructure policy pillars. The NAM also debuted a new ad underscoring the importance of infrastructure investment and permitting reform to manufacturing competitiveness.

Permitting reform has long been a top legislative priority for the NAM. In the final weeks of 2025, the NAM pushed for permitting reform measures that advanced in the House—including the passage of the SPEED ACT. Manufacturers are calling on the Senate to take the helm and build on that momentum by advancing the SPEED Act, a cornerstone of the NAM’s “Manufacturing’s Roadmap to AI and Energy Dominance.”

-NAM-

The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs nearly 13 million men and women, contributes $2.95 trillion to the U.S. economy annually and accounts for 53% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit www.nam.org.