The regional manufacturing sector contracted last year, but manufacturers are optimistic about 2025, according to a new survey conducted by the Federal Reserve Bank of Minneapolis and the Minnesota Department of Employment and Economic Development.

“Just over half of the manufacturers that we surveyed last year told us that their orders were down in the last year … which is a pretty, pretty large portion,” said Joe Mahon, regional outreach director at the Minneapolis Fed.

Profits and employment at the manufacturing firms also tracked downward.

The nearly 500 survey respondents were sampled from several Midwestern states in the Minneapolis Fed’s district, but most are based in Minnesota, where, Mahon said, the bulk of the manufacturing firms in the region are from.

Despite the sector’s contraction last year, respondents expect a strong rebound in 2025. Nearly half said they expect an increase in orders. And about 40 percent of respondents said they expect to raise prices.

Mahon said the survey went out at the end of last year, after the presidential election but before President Donald Trump’s executive orders on tariffs. A few noted strong concerns about tariffs in the comments section but tariffs weren’t a focus of the survey.

“All of these policies are still sort of hypothetical at this point. It’s more …what they know about the economy and what they expect to happen versus the sort of hypothetical threat of a trade war,” said Mahon. “On balance, it’s washing out toward the optimistic side.”

Collected from Minnesota Public Radio News. View original source here.