Service providers in the U.S. forecast sales growth will almost double next year to 10 percent, according to a survey by the Institute for Supply Management that also showed manufacturers project increased revenue.
The service industries’ forecast compares with a 5.1 percent sales gain they reported for 2014, the Tempe, Arizona-based group said in its semiannnual business outlook survey today. Purchasing managers at factories anticipate sales will grow 5.6 percent in 2015, up from 3.6 percent for 2014.
A strengthening labor market and the plunge in gasoline prices is giving Americans the ability to keep spending, providing support to manufacturing and service industries. The improvement in demand also bodes well for employment and investment in equipment.
Service providers predicted a 1.7 percent increase in staffing levels in 2015, up from a 1.3 percent gain posted since April. Manufacturers projected a 1.5 percent increase next year, up from a 1.2 percent gain since April.
Purchasing managers in manufacturing plan on increasing capital spending by 3.7 percent in 2015, down from a 14.7 percent gain this year. Service industries plan to increase capital investment by 3.8 percent, versus a 3.3 percent gain this year.
“Our forecast calls for a continuation of growth in 2015, building on the momentum reported in 2014,” Bradley Holcomb, chairman of the group’s factory committee, said in a statement.
Purchasing managers at service industries “are optimistic about continued growth in the first half of 2015 compared to the second half of 2014,” Anthony Nieves, chairman of ISM’s non-manufacturing survey committee, said in the statement.
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