NAED Economic Outlook: Expect a Moderate Increase in Sales Growth

By Erika TenEyck, Director of Business Intelligence Programs & Insights

The same issues seen in the first quarter of 2023 will continue into the second quarter. As such, it is expected that the economy will remain flat given the current factors of essentially stable unemployment, higher interest rates, inflation, and slower GDP growth. The availability of products/supplies continues to be a primary concern for businesses.

NAED’s Expected Sales Growth Index for Q1 remained flat at 3.5. Like the previous quarter, the typical respondent expects sales to growth between 4% and 10% over the next twelve months.

Of those expecting growth in capital spend over the next 12 months, 21% believe that there will be significant increases (more than 10%) while 49% expect it to remain flat over the next 12 months with moderate increases (between 3% and -3%).

Derived from a quarterly survey—State of Your Industry—that NAED has been conducting for over a year, NAED’s Expected Sales Growth Index gauges leaders’ sales revenue expectations for the next 12 months. The survey also asks about capital spend, technology investment, sales backlog, inventory backlog, and much more, including current concerns and new this year is “number of units sold”.

Results of the latest survey indicate that momentum comes with some concerns as the availability of products and supplies remained at the forefront of concerns. Finding qualified employees and wage inflation round out their top 3 concerns. Interestingly, more respondents are also concerned about employee performance quality than previous quarters at 28%.

Building and construction data saw all regions growing on both a quarter-over-quarter and year-over-year basis according to NAED’s Construction Index for Q1, particularly in the South. This exclusive index helps to predict which Metropolitan Statistical Areas (MSAs) are poised for growth.

NAED’s full Economic and Industry Sector Outlook, which includes NAED’s exclusive Construction Index, is scheduled to be released on Friday, April 28th, 2023, and is free to all distributor members courtesy of Schneider Electric and Hubbell, Inc.

For more information on how to download or purchase NAED’s Economic and Industry Sector Outlook click here or contact NAED’s Member Engagement Team.