By Dottie Barnes
After a minor scare from July’s reading of -3 for new orders, the West Michigan economy has returned to a normal pattern of slow growth, said Brian G. Long, director of Supply Management Research in Grand Valley State University’s Seidman College of Business.
Long surveyed local business leaders and his findings below are based on data collected during the last two weeks of August.
The survey’s index of business improvement (new orders) came in at +21, up significantly from -3. The production index tapered to +16 from +23. The index of purchases edged higher to +15 from +13, and the employment index came in unchanged from last month at +21.
“After last month’s lackluster report, slow growth has returned to most sectors in the West Michigan economy,” said Long. “At least some of the fears of the trade war have been moderated, and the automotive sector appears to be exempt from some of the tariffs.”
Long said auto sales continue to soften in the traditional sedan sector, but the light truck/SUV segments are doing well. He said the office furniture business continues to benefit from the new tax structure, so the outlook for most firms remains positive. The local firms producing capital equipment are also back on track after last month’s hesitation, Long said, and business conditions for industrial distributors remain seasonally flat.
The Institute for Supply Management survey is a monthly survey of business conditions that includes 45 purchasing managers in the greater Grand Rapids area and 25 in Kalamazoo. The respondents are from the region’s major industrial manufacturers, distributors and industrial service organizations. It is patterned after a nationwide survey conducted by the Institute for Supply Management. Each month, the respondents are asked to rate eight factors as “same,” “up” or “down.”
For over 28 years, Dr. Brian Long has edited a survey of local purchasing managers for both the Kalamazoo and Grand Rapids areas, which has proved to be a major indicator of current and future business conditions. This survey appears in many local newspapers and national business publications, including the Grand Rapids Press, MiBiz, and the Grand Rapids Business Journal. The survey is also a component of the Federal Reserve’s bimonthly survey of business conditions.
