Challenging Conditions Ahead for Electronics Manufacturers per IPC’s Electronics Supply Chain Report

Per IPC’s September Global Sentiment of the Electronics Supply Chain Report 81 percent of electronics manufacturers are currently experiencing rising material costs while 74 percent indicate labor costs are on the rise. At the same time, ease of recruitment, profit margins and inventory available from suppliers are presenting declining.

Among other data, survey results show:

• Demand, while still positive, is showing some signs of a slowdown
• Lead-times are improving but much of the electronics supply chain expects lead-times to decline in the coming months and the recovery appears to be unevenly distributed
• Inventory available from suppliers is expected to increase more among firms operating in APAC or globally than those in North America
• Over the next six months, manufacturers expect to see continued increase in both material and labor costs, although to a lesser extent than what they are currently experiencing, especially as it relates to material costs.
• On a positive note, manufacturers are anticipating a decline in backlogs over the next six months.

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