BANNOCKBURN, IL – Current conditions for the electronics supply chain remain challenging, with 86% of electronics manufacturers experiencing rising material costs, while 76% indicate labor costs are increasing, says IPC's August report measuring global sentiment of the electronics supply chain.

Supporting data from IPC’s August Economic Report indicate a slowing economy, with an ongoing debate among experts about the possibility of a recession.

According to Shawn DuBravac, chief economist, IPC: “Industrial production rose at a healthy 6.2 percent annualized rate in the second quarter, strongly suggesting that the economy is not in a recession. At least not yet.”

Other forces exerting pressure on the economy are the weakening of demands for new orders and increasing energy and food prices. At the same time, this is helping ease supply chain disruptions and inflationary pressures brought on by fiscal and monetary stimulus, strong demand for goods, and short supply.

“On net, the global economic picture looks worse than it did a month ago, despite some positive developments,” added DuBravac. “We have subsequently lowered our projections for economic growth in the regions we cover.”

Additional survey results from the global sentiment report indicate:

• • Supply chain constraints continue to ease, with most companies seeing an expansion in available inventories for the first time in five months
• • The labor picture is less bad, but companies expect to continue to have difficulty finding skilled labor
• • Demand remains strong, but profit margins still hurting from high costs.

IPC surveyed hundreds of companies from around the world, including a wide range of company sizes representing the full electronics manufacturing value chain.

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