August 8, 2025
Confidence Levels Cool in Latest NEMA Survey
Despite noise, forward-looking expectations suggest resilient demand ahead
Each month, the National Electrical Manufacturers Association (NEMA) publishes the Electroindustry Business Confidence Index (EBCI). The index is based on surveys of senior managers at NEMA member companies – designed to gauge the business environment of the electroindustry in North America. Member companies include most of the ten largest lighting manufacturers in North America, along with other manufacturers of lighting, electrical and medical imaging products.
Confidence among electrical equipment manufacturers eased in July, according to NEMA. While outlooks for the future remain generally positive, sentiment around current conditions weakened noticeably, with many respondents citing persistent uncertainty tied to market trends, trade policy, and tariffs. Despite some reporting steady business activity, the broader mood reflects cautious optimism as firms navigate a shifting economic landscape.
This most recent ECBI shows how makers of electrical equipment view current and future market conditions. Below are the details:
The Current Conditions component declined in July, falling to 50.0 from 60.0 in June. Sentiment shifted sharply to one of seeing conditions as “unchanged,” a view held by 40 percent of respondents in June that jumped to 80 percent in July. Meanwhile, the percentage of respondents who said conditions were “better” dropped from 40 percent in June to just 10 percent in July. Similarly, those reporting conditions were “worse” also decreased from 20 percent to 10 percent. Comments reflected mixed sentiment, with many respondents citing uncertainty around market conditions, trade policy, and tariffs. However, some noted steady order volumes and reported being busy.
The median value for the magnitude of change in current conditions stayed at 0.0, with the mean decreasing to -0.5. Panelists are asked to report the magnitude of change on a scale ranging from –5 (deteriorated significantly) through 0 (unchanged) to +5 (improved significantly).
The Future Conditions component declined negligibly to 75.0 in July, down from 76.7 in June, and pointing to continued optimism, which remained strong, with 70 percent of panelists expecting conditions to be “better” six months from now. However, 20 percent anticipated conditions will be “worse,” a notable increase from prior periods, while 10 percent believed conditions will remain “unchanged.” Comments reflected a divided outlook, with some panelists expecting tariffs and trade policy to stabilize, while others saw no resolution in sight. Overall, while confidence eased slightly, the outlook for the near future remains positive.
SURVEY RESULTS:
- Values reflect the percentage of respondents expecting "Better" conditions, plus one-half of the percentage of respondents expecting "Unchanged" conditions.
- A score of 50 or higher suggests conditions appropriate to expansion of the electroindustry sector.
- Please note that survey responses were collected from the period of July 14-25, 2025.
EBCI METHODOLOGY:
The EBCI indexes are based on the results of a monthly survey of senior managers at NEMA member companies and are designed to gauge the business environment of the electroindustry in North America (defined here as the United States and Canada).
The survey contains the following questions:
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How would you rate current economic conditions in North America, as they affect your business, compared to the previous month?
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Using the following scale, please describe the magnitude of change in economic conditions in North America this month compared to economic conditions last month? [Scale structured as follows: 5 (improved significantly), 4, 3, 2, 1, 0 (stayed the same), -1, -2, -3, -4, -5 (deteriorated significantly)]
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How do you expect economic conditions in North America, as they affect your business, to have changed six months from now?
Respondents are asked to indicate whether conditions are better, worse, or unchanged. The survey also provides space for respondents to comment on current conditions. These comments are included below the table containing the index levels.
The index value is the percentage of respondents expecting “Better” conditions, plus one-half of the percentage of respondents expecting “Unchanged” conditions, which follows the methodology used by the Institute for Supply Management (ISM; formerly the National Association of Purchasing Management) in the construction of their manufacturing index.
Reprinted by permission of the National Electrical Manufacturers Association (NEMA)
