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Cushman & Wakefield Research for the Americas
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C&W Special Report Examines the State of Manufacturing in North America
Following Steady Decline, Sector’s Recent Momentum and Outlook Encouraging
NEW YORK, Aug. 26, 2015 – Manufacturing remains a driving force of innovation, jobs
and prosperity in North America, according to a special report released today by
commercial real estate services firm Cushman & Wakefield. The study, “Manufacturing
in North America,” examines the status of manufacturing in the region, and explores the
opportunities and risks that are likely to shape the sector’s future – and inform important
real estate decisions.
“While the manufacturing sector in North America may not play as large a role in the
regional economy as it once did, the outlook is encouraging,” noted John Morris, leader
of Cushman & Wakefield’s Industrial Services Group. “On the heels of a steady decline
that seemed a permanent trend, the positive story revealed in our report is one that
some would have doubted was possible just a few short years ago. Competitive
disadvantages of the past that hurt the North American region have been muted and in
some cases have flipped over to the positive side.”
In fact, critical factors including labor costs, proximity to customers, time to market,
currency volatility, and transportation concerns are now bigger assets for this region. In
particular, though, for those manufacturers who want to access the coveted U.S.
consumer market, North American locations are enticingly close, and no longer
disproportionately expensive. When these and other variables are fully weighed,
reshoring can make good business sense.
The report outlines reasons for optimism as well as continued challenges for growth for
U.S., Canadian and Mexican manufacturing. It also provides a market-by-market shortterm outlook, including:

U.S: Slow but Steady – Despite being walloped by a first-quarter drop in
energy-related investment and a severe winter, the U.S. manufacturing sector
stabilized in mid-2015 and is on track to record steady growth into 2016.
Manufacturing is expected to grow by about 2.5 percent in 2015, which is in line
with real GDP growth expectations.
-more
Cushman & Wakefield Research/Manufacturing in North America/page 2

Canada: Non-Energy Exports Lead the Way – Despite a rough start to 2015,
the outlook for the Canadian economy looking ahead is much brighter, with
average growth expected to head back toward 2.0 percent for this year and
average 2.2 percent in 2016. Manufacturing and export-related industries will get
a lift from economic activity in the U.S. and the lower Canadian dollar.

Mexico: Solid Growth For 2015 – Mexican real GDP growth should range
between 2.5 and 3.0 percent, and accelerate to 3.5 percent in 2016 on the back
of increased U.S. demand. While weak domestic demand and planned cuts to
government spending may temper overall growth, manufacturing output is
projected to increase 4.0 to 4.5 percent through to 2016.
“Manufacturers face a barrage of challenges as they navigate a changing world,” Morris
noted. “Still, North America offers many advantages over other global regions. The
future of manufacturing here will depend on how well industries and governments work
together to address the competitive challenges needed to ‘seize the moment’ and take
full advantage of the trends that favor North American production.”
Through the balance of this year and into 2016, Cushman & Wakefield expects the
recent momentum of North American manufacturing recovery to continue at a modest
but steady rate. “The industry will benefit from anticipated gains in employment in the
U.S. and further upticks in consumer spending – a net benefit to both Canada and
Mexico,” Morris noted. “At the same time, the sector will also face uncertainty, and
undoubtedly headwinds, from declining Asian demand and continued sluggishness in
Europe. Long term, however, the manufacturing industry here stands in a better position
to compete globally for investment and jobs than it has in decades.”
The full Cushman & Wakefield report is available at:
http://www.cushmanwakefield.us/en/research-and-insight/2015/manufacturing-in-northamerica/
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