Manufacturers have remained optimistic about their business prospects over the past six months, according to new report from Sikich. In the Sikich Industry Pulse: Manufacturing and Distribution, nearly 70% of manufacturers rated their optimism of business prospects over the next six months at a seven or higher on a scale of one to 10. This marks only a slight decrease from the previous Industry Pulse survey from September 2021. In that survey, 71% of manufacturers rated their optimism at a seven or higher.
At the same time, manufacturers must overcome supply chain and talent challenges. Only 10% of manufacturers are “very” confident in their ability to obtain the talent required to support their business strategies over the next 12 months. And in the face of global supply chain upheaval, manufacturers have been forced to revisit their supply chain strategies. One-third of survey respondents are sourcing alternative supplies and one-fifth are sourcing alternative products to address supply chain challenges.
“I’m pleased to see manufacturers’ optimism remain strong, even amid the plethora of challenges they are facing,” said Jerry Murphy, partner-in-charge of manufacturing and distribution services at Sikich. “With the pandemic, supply chain disruptions and geopolitical turmoil continuing to cast a shadow over the industry, manufacturers should focus on strengthening key parts of their operations to reduce their vulnerability to these external challenges. For example, consider adopting advanced technology that improves supply chain visibility and responsiveness. And work to improve recruitment and retention by focusing on creating a superior employee experience.”
Cybersecurity challenges persist
The Industry Pulse report found more than half of respondents experienced an information security event in the past year, and 36% experienced two or more different kinds of security events. Nearly three quarters of manufacturers reported catching email phishing scams.
“While manufacturers are well aware of the cybersecurity challenges they face, attackers are becoming more sophisticated in how they target employees with phishing scams,” said Brad Lutgen, partner and head of Sikich’s security and compliance team. “A security awareness program that includes continuous training and education as well as testing through mock phishing attempts is the best way to help employees avoid falling victim to these scams. A good security program takes a layered approach so it’s also important that manufacturers utilize tools – such as robust email filtering, designed to help detect and quarantine email threats within the business – and not solely rely on training alone.”
The report found that nearly 34% of companies experienced unemployment fraud in the past 12 months, and 8% experienced a ransomware incident.
While cybersecurity remains a challenge, the Sikich Industry Pulse findings mark an improvement from the same time last year. In March 2021, a Sikich report found that 81% of manufacturers experienced an email phishing scam, 42% experienced unemployment fraud and 9% experienced a ransomware incident.
Sikich surveys manufacturers and distributors multiple times throughout the year on a range of business topics to create industry benchmark data. For this report, in February and March Sikich surveyed more than 100 executives from manufacturing and distribution companies across sectors including industrial equipment, wholesale and distribution, metal fabrication, food and beverage, apparel, footwear and textiles, and transportation. View the latest Sikich Industry Pulse: Manufacturing and Distribution report here.