This website uses cookies primarily for visitor analytics. Certain pages will ask you to fill in contact details to receive additional information. On these pages you have the option of having the site log your details for future visits. Indicating you want the site to remember your details will place a cookie on your device. To view our full cookie policy, please click here. You can also view it at any time by going to our Contact Us page.

Global manufacturing output growth reaches 3.9% for 2022

04 October 2022

New research from Interact Analysis points to a slow year for global manufacturing output, with growth of 3.9 percent expected in 2022 as a result of an unprecedented wide range of pressures on the economy, including inflation and the war in Ukraine.

Credit: Interact Analysis
Credit: Interact Analysis

Europe will be particularly slow, with a growth projection for manufacturing of 3.7 percent which is seven percent less than 2021’s 11.4 percent figure.

The manufacturing machinery forecast is far less optimistic than the previous quarter, with eight of the top 10 sectors experiencing a downward revision of their forecast for 2022. 

Semiconductor and electronics machinery bucked the trend, and it is forecast for 6.2 percent growth in the year. However, such growth is likely to be unsustainable in the context of the boom-bust market for semiconductors, and so a major downturn is projected for 2023. Japan is the largest single supplier of semiconductor and electronics machinery, accounting for 30 percent of the total market, with China at 23 percent, the US at 10 percent, and The Netherlands at seven percent. 

Another machinery sector with a decent projected performance for 2022 is machine tools. Machine tools are a small niche of the wider machinery market, but it plays an essential role in several of the largest manufacturing sectors such as automotive and metals. Following a very strong 2021, machine tools are projected for five percent growth this year, and solid continued growth is projected out until 2026.

From a regional perspective, the two most obvious negative occurrences are a revision down of performance for Italy and the UK in this quarter compared to last quarter.

Most UK manufacturing sectors are struggling – particularly automotive, where registration of new cars was down 15 percent in April due to parts shortages, according to the Society of Motor Manufacturers and Traders. 

Credit: Interact Analysis
Credit: Interact Analysis

Overall, in 2022, the UK is expected to show a two percent growth in manufacturing output. Meanwhile, Italy will hit three percent growth for 2022 and, despite its poor performance this quarter, is expected to keep growing until 2026. Italian textiles have had a particularly strong second quarter with 10.2 percent growth overall, and 25 percent growth in textile machinery.

Tim Dawson, Senior Research Director at Interact Analysis, says: “World events are playing an outsized role in terms of their impact on manufacturing. In particular, inflation has caused severe problems by increasing input costs for energy, raw materials and components. 

“In the US, a strong dollar is damaging the competitiveness of manufacturing exporters. Meanwhile, China is far less badly impacted by inflation, with a rate of just under three percent (compared to nine percent in the US). 

“The topic of reshoring or near-shoring of manufacturing is much discussed in the global business press. One clear present-day move in this direction is the US’s CHIPS Act which is investing $52bn in US semiconductor manufacturing. 

“The Chinese response is not yet clear, but the CHIPS Act is likely to prove effective in its primary goal of reducing US dependence on China since of the top 10 semiconductor companies, six are US and none are Chinese. The likely result is a significant shift of semiconductor manufacturing to the US in the mid to long-term.”


Print this page | E-mail this page