New survey data from the National Tooling and Machining Association (NTMA) shows that U.S. precision manufacturers ended 2025 on solid footing, with steady business conditions, continued capital investment, and cautious optimism for the first half of 2026.

According to NTMA’s semi-annual Business Conditions Report, a strong majority of respondents—69 percent—characterized current business conditions positively. Eight percent rated conditions as excellent, 27 percent as very good, and 34 percent as good. Looking back, nearly three-quarters of respondents also viewed 2025 favorably for their business.

“This survey reflects a manufacturing base that is resilient, capable, and forward-looking,” said Roger Atkins, president of NTMA. “Our members continue to invest, adapt, and compete, which speaks to the strength of the precision manufacturing industry.”

That stability is also evident in financial performance and investment activity. When asked to compare current conditions with the third quarter of 2025, the survey found that profitability and investment remained steady. Seventy-five percent of respondents reported that current profits were either higher or unchanged from Q3 2025, while 81 percent said capital expenditures were up or holding at similar levels.

Some of this momentum may reflect reshoring activity, which is playing a meaningful role for many manufacturers. Nearly a quarter of respondents reported that reshoring work increased over the past six months, and 26 percent expect reshoring activity to rise further in the months ahead, reinforcing the sector’s role in strengthening domestic supply chains.

Looking ahead, respondents expressed growing confidence about the near-term outlook. When asked about business conditions over the next six months, 71 percent expect either a substantial or moderate increase in activity, while another 20 percent anticipate conditions will remain the same. Only a small share of respondents expect a decline, pointing to broad expectations for stability or modest growth through mid-2026.

That outlook is reflected in ongoing equipment investment. In the final six months of 2025, a majority of respondents reported purchasing new machinery, with 40 percent acquiring one to two pieces of equipment and 18 percent purchasing three to five. Looking ahead, 55 percent expect to purchase new equipment in the first half of 2026.

Automation investments also remain measured, but trending toward continued adoption. One in five respondents reported purchasing automation equipment in the last six months of 2025, and nearly the same share expects to make automation purchases in the first six months of 2026, signaling a steady, deliberate approach to advanced manufacturing technologies.

Despite generally stable conditions, workforce challenges remain the industry’s most pressing concern. All respondents identified employee recruitment as a top challenge, with most also citing difficulties related to employee retention and training the future workforce. Manufacturers also pointed to uncertainty driven by tariffs, global conflict, and recurrent government shutdowns as factors affecting long-term planning and investment decisions.

“Manufacturers are continuing to invest in equipment, automation, and reshoring, but workforce availability and external uncertainty remain real constraints,” Atkins added. “Clear, predictable policy is essential for manufacturers to continue strengthening American leadership and competitiveness in advanced manufacturing.”

NTMA’s semi-annual Business Conditions Report is based on a survey of over 180 NTMA member companies. Learn more about NTMA online at NTMA.org.

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This survey reflects a manufacturing base that is resilient, capable, and forward-looking.