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NAED: Industry Leaders Expect Sales Revenue, Construction Opportunities to Slow

(NAED) — The electrical industry continues to evolve and with that brings new challenges and opportunities for growth. During the second quarter, labor and supply chain issues continued to impact businesses and consumers.

In this inflationary environment, it is important to remember that sales performance can be somewhat misleading. Although we likely will begin to see improvements towards the latter part of 2022, it is anticipated that supply chain issues, a tight labor market, and inflationary pressures will continue to be present throughout much of the coming year.

NAED’s Expected Sales Growth Index for Q2 fell to 3.64, down from 4.02 reported during the 1st quarter of 2022. Developing economic factors might be playing a role in challenging optimism for the coming year. Fewer respondents are optimistic that sales growth will be as strong as was expected during Q1. Eighty-one percent expected at least moderate growth for the year ahead when asked in Q1, versus just 61% when asked in Q2. However, momentum remains strong throughout the rest of 2022 with a projected industry increase of more than 10%.

Derived from a quarterly survey, State of Your Industry, that NAED has been conducting for 6 months, 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. Results for the latest survey indicate that momentum comes with some unease as they are also occupied with availability of products/supplies, finding qualified employees, and wage inflation.

Building and construction remain relatively steady according to NAED’s Construction Index for Q2 (which helps to predict which Metropolitan Statistical Areas (MSAs) are poised for growth). Areas remained stable but were noticeably going through a period of deceleration early in Q1 comparatively quarter-over-quarter.

NAED’s full Economic and Industry Sector Outlook, which includes NAED’s exclusive Construction Index, is scheduled to be released on Friday, July 29th, 2022, and is free to all distributor members courtesy of Schneider Electric and Hubbell, Inc.

To find out more about the survey, contact NAED’s Business Intelligence Analyst, Erin Prinster. 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.

 

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