PMA releases December 2008 Business Conditions Report.
Press Release Summary:
According to December 2008 report, companies expect business conditions to improve slightly, yet remain difficult, during the next 3 months. Out of 157 metalforming companies in U.S. and Canada, 6% forecast an improvement, 31% predict no change, and 63% report activity will decline. Shipping levels, according to 79% of participants, are below that of 3 months ago and the number of companies with a portion of their workforce on short time or layoff increased to 54%.
Original Press Release:
Business Conditions Report: December 2008
CLEVELAND, OH - December 16, 2008 - According to the December 2008 Precision Metalforming Association (PMA) Business Conditions Report, metalforming companies expect business conditions to improve slightly, yet remain difficult during the next three months. Conducted monthly, the report is an economic indicator for manufacturing, sampling 157 metalforming companies in the United States and Canada.
When asked what the trend in general economic activity will be during the next three months, metalformers anticipate a slight improvement. Six percent of participants forecast an improvement in business (up from three percent in November), 31% predict activity will remain unchanged (up from 27% last month) and 63% reported that activity will decline (down from 70% in November).
Metalforming companies also expect incoming orders to continue to improve slightly during the next three months. Fifty-nine percent of companies anticipate a decrease in orders (down from 67% in November), 30% expect no change (up from 24% the previous month) and 11% forecast an increase in orders (compared to nine percent in November).
Current average daily shipping levels dropped substantially in December. Seventy-nine percent of participants report that shipping levels are below levels of three months ago (up from 59% in November), 17% report no change (compared to 31% last month) and only four percent report that shipping levels are above levels of three months ago (down from 10% in November).
The number of metalforming companies with a portion of their workforce on short time or layoff continued to increase to 54% in December - up from 42% in November and at a substantially higher rate than December 2007, when only 18% of companies reported workers on short time or layoff.
"Business conditions for many metalforming companies are extraordinarily challenging," said William E. Gaskin, PMA president. "Suppliers to the automotive industry have been hit especially hard by production declines due to poor car sales in the fourth quarter, and the outlook for the first quarter of 2009 is only marginally improved. Suppliers to other industries may be somewhat better off; however, production levels in all segments of manufacturing are falling, resulting in the sharp decline in current shipments. The increase in layoffs and reduced work hours from 42 to 54 percent of our member companies is significant and probably conservative in that many companies have reported extended holiday closures to reduce costs and balance production to demand," Gaskin continued.
The monthly Business Conditions Report has been conducted by PMA since 1979. Full report results are available at pma.org/about/stats/BCreport. PMA is the full-service trade association representing the $91-billion metalforming industry of North America - the industry that creates precision metal products using stamping, fabricating and other value-added processes. Its nearly 1200 member companies include metal stampers, fabricators, spinners, slide formers and roll formers as well as suppliers of equipment, materials and services to the industry. Members are located in 30 countries, with the majority found in North America - in 41 states of the United States as well as Canada and Mexico.
