Tax Bill Boosts Manufacturers’ Confidence, but Challenges Persist
A few months after the landmark tax bill’s passage, manufacturers’ optimism has jumped—even as challenges persist across the sector.
- The NAM’s Q3 2025 Manufacturers’ Outlook Survey found a 10-percentage-point increase in confidence, with 65.0% of respondents reporting a positive outlook for their companies, up from 55.4% in Q2.
Still concerned: Respondents reported the same top business concerns as in Q2—and at growing levels:
- Trade uncertainty: 78.2% (up from 77.0%)
- Rising raw material costs: 68.1% (up from 66.1%)
- Increasing health care costs: 65.1% (up from 60.0%)
Timmons says: “These results confirm what we’ve seen in the economic data—that the sector is still enormously challenged as manufacturing output took four months to recover from this spring’s dip, and optimism still falls below the survey’s historical average of 74%,” said NAM President and CEO Jay Timmons.
- “To supercharge the increase in optimism we’re starting to see, manufacturers need certainty across a full manufacturing strategy spanning sensible trade policy, permitting reform to unleash American energy dominance, modernized regulations and workforce investments,” Timmons said.
- “Put another way, so long as this uncertainty persists, manufacturers will not be able to tap fully into the strength of President Trump’s monumental and historic tax provisions, championed by our allies in the White House and Congress.”
The economic data: “The third quarter optimism level aligns with August’s production data released by the Federal Reserve, which showed that manufacturing output was 100.3% of its 2017 average, barely above March’s level of 100.2%, taking four months to recover from April’s drop,” said NAM Chief Economist Victoria Bloom.
- “At the same time, manufacturers are projecting moderate growth over the next 12 months with production expected to rise 2.5% (up from 1.4% in Q2) and capital investments 1.0% (up from 0.3%),” Bloom said.
- “Costs are still expected to climb, but at a slightly slower pace than Q2, with raw material and input costs projected to increase 5.4% (down from 5.8%) and product prices up 3.7% (down from 4.3%).”
- “These findings reflect both the resilience of the sector and the real challenges still weighing on growth.”
Read more: Further information on the survey is available here.