PMA releases Business Conditions Report for Jan 2009.
Press Release Summary:
According to January 2009 PMA Business Conditions Report, metalforming companies expect slight uptick in business conditions during next 3 months. Fourteen percent of participants predict improvement in business, while 41% expect activity will remain unchanged, and 45% reported that activity will decline. Despite anticipation that business conditions will improve slightly, number of metalforming companies with portion of workforce on short time or layoff spiked to 64% in January.
Original Press Release:
Business Conditions Report: January 2009
CLEVELAND, OH - January 16, 2009 - According to the January 2009 Precision Metalforming Association (PMA) Business Conditions Report, metalforming companies expect a slight uptick in business conditions during the next three months. Conducted monthly, the report is an economic indicator for manufacturing, sampling 163 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 modest improvement. Fourteen percent of participants predict an improvement in business (up from six percent in December), 41% expect that activity will remain unchanged (up from 31% last month) and 45% reported that activity will decline (down from 63% in December).
Metalforming companies also anticipate that incoming orders will improve somewhat during the next three months. Nineteen percent of companies forecast an increase in orders (up from 11% in December), 32% expect no change (compared to 30% the previous month) and 49% predict a decrease in orders (down from 59% in December).
Current average daily shipping levels remained unchanged in January. Seventy-nine percent of participants report that shipping levels are below levels of three months ago, while 17% report no change and only four percent report that shipping levels are above levels of three months ago - the exact percentages reported in December.
Despite anticipation that business conditions will improve slightly during the next three months, the number of metalforming companies with a portion of their workforce on short time or layoff spiked to 64% in January - up from 54% in December and at a substantially higher rate than January 2008, when only 14% of companies reported workers on short time or layoff.
"The metalforming industry relies on orders for components and assemblies by customers in many industries, including automotive, appliance, construction, electronics, defense, agriculture, off-highway and other markets, nearly all of which are suffering significant production cutbacks," said William E. Gaskin, president of Precision Metalforming Association.
"Survey results show that one-third expect orders to be flat and nearly half expect orders to continue to decline. The financial viability of many companies is at risk," Gaskin continued. "PMA supports quick action by the Obama administration and the 111th Congress on a meaningful stimulus plan which should include tax incentives for capital investment, and increasing the availability of loans for manufacturers to boost consumer confidence. President-elect Obama and Congress must recognize the importance of manufacturing jobs to the future of the U.S. economy and quickly address tax, labor, energy, environmental and job training policies needed for a robust manufacturing sector."
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.
