Brian Long is a local business forecaster. (Courtesy, GVSU)
Local manufacturers are seeing the West Michigan economy flatten as sales across some industries have slowed and market demand has stabilized, according to a monthly survey conducted by Brian G. Long, director of Supply Management Research at Grand Valley’s Seidman College of Business.
Long said his August report shows several key indicators from July have flattened after fluctuating from the previous few months.
“Our most important index in our survey of purchasing managers is new orders,” Long said. “When new orders are coming in strong to just about any firm, they start buying more materials, more equipment, more industrial services and eventually of course, hiring more people, but the impact on the financial and employment statistics may not show up for weeks or even months.
“So right now, with most of our recent orders indexes turning in flat or stable, we have to declare that the West Michigan economy is stable, neither expanding or contracting.”
While the strong demand for cars and light trucks is helping the automotive industry prosper, suppliers in the office furniture sector are seeing their segment soften, Long said.
“Statistically, this month’s survey of purchasing managers in West Michigan is about as flat as it can possibly be,” Long said. “However, it is our automotive parts producers that are holding us up. Other industries like office furniture are softening, but again, I say softening and not collapsing like we would expect in a recession.”
Here is a look at the key index results from July’s survey of West Michigan manufacturers:
New orders index (business improvement): 0 versus +9 in June
Brian Long is a local business forecaster. Credit: GVSU
There are no signs of an impending recession, but the local economy will continue to slow in 2020, 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 November.
The survey’s index of business improvement (new orders) came in at -10, up significantly from -21 in October. The production index is negative, but recovered to -9 from -34. The index of purchases recuperated to -18 from -21, and the employment index came in at -9 from -14.
Looking to 2020, Long said there is no evidence of the overall economy sliding into a recession, but there’s plenty of evidence to indicate a slowing for the industrial economy.
“Part of it has to do with the ongoing trade war with China and the soft business conditions around the world,” Long said.
All three local cyclical industries — office furniture, aerospace and automotive — have more than topped out, Long said, while some segments of the West Michigan agricultural industry, namely corn, soybeans and cherries, have had a marginal year.
Local employment numbers continue to set records. “Ottawa County posted the lowest unemployment rate of 2.3 percent,” Long said. “Of the major cities in Michigan, the Grand Rapids report of 3.3 percent unemployment is the envy of most other major cities in the state.”
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.”
According to GVSU Economist Brian Long, the GM-related layoffs accounted for most of the drop in the West Michigan employment index for October. (Photo by WKTV)
The West Michigan industrial economy continues to see marginal growth despite effects from the GM strike, 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 October.
The survey’s index of business improvement (new orders) dropped significantly to -21 from +6. The production index fared worse, plunging to -34, from +6. The index of purchases dropped to -21 from -6 and the employment index fell to -14 from +8.
Long said GM-related layoffs accounted for most of the drop in the West Michigan employment index for October; he said he expects the local economy will return to steady slow growth in November.
“Of the 83 counties in Michigan, Ottawa County still posted the lowest unemployment rate at 2.7 percent. At 2.8 percent, Kent and Allegan counties tied for third place.” Long said. “It is good to see many firms are still looking for people at all levels.”
Long said it looks as though China and the U.S. may have come to an agreement and, if so, there could be a modest bounce in the economy if an agreement is signed. “We’ve been here before, only to have China pull the rug out from under us at the last minute,” Long said.
He added current signs still point toward a stagnation rather than a recession for the world economy.
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.”
UAW Local 167 have been on strike for about a month. (Photo credit: WKTV)
By Joanne Bailey-Boorsma joanne@wktv.org
Despite his own business wows with an electric bill at around $20,000, Mitten Pizza owner Jamie Zichterman did not blink an eye when it came to donating pizzas to the UAW Local 167.
“I think it was just the right thing to do,” Zichterman said. “Regardless of what type of issues we were facing, it was just something that we needed to.”
About 46,000 GM employees went on strike Sept. 15 which included 650 employees from Wyoming’s GM Holdings Components LCC, a subsidiary company of GM that makes auto parts.
The Mitten Pizza is located in Middleville with the nearest GM facility being the Wyoming plant. Because of the distance, the strike will have minimal impact on his business, Zicterman said, adding that he has seen an uptick in business that he credits to the amount of publicity he has had over his surprise electric bill of about $20,000 from Great Lakes Energy. Zichterman is currently trying to settle the bill with friends establishing a GoFundMe page to help pay it.
“What was surprising was to see the people coming in with UAW shirts buying pizzas and donating like crazy to the cause,” Zichterman said. “It shows if you do the right thing, good things will happen.”
Marilyn Free, manager of Marge’s Donut Den, said the Wyoming donut shop has not been impacted much by the strike either.
“Other than people stopping to pick up donuts for those striking, no we have not seen anything,” Free said, adding that people have been purchasing three to four dozen donuts at a time along with coffee to go.
Brian Long is a local business forecaster. (Photo credit: GVSU)
Brian Long, director of Supply Management Research at Grand Valley State University’s Seidman College of Business, said in his monthly economics report, he is not surprised that there has not been much impact felt from the strike at this point since most of the local firms and businesses have diversified their customer bases.
“None of the firms in our survey is exclusively GM which was not the case from 20 years ago,” Long said. “Two of the firms I talked to indicated that they are actually stockpiling for GM. They figure that when GM does come out of this strike there is going to be a huge build up demand and they are going to need the parts that they are producing. However if this drags on for too long we may see some marginal layoffs.”
Long said regardless of the strike, the whole auto industry has been slowing down for 2019 with it being down about 1.6 percent on sales.
The Wyoming GM Components Holdings LLC has been building precision machined automotive components for almost 70 years. The plant makes such parts as lifters and the axle for full-size trucks. WKTV did contact a couple of local suppliers with one indicating that despite the warning on the GM Parts webpage about a delay in getting parts, they were able to continue fulfilling orders.
Todd Bartrand, owner of Wyoming’s Bob and Dave’s Garage, which like many similar independent garages purchase parts from suppliers and not directly from GM, indicated his business has not been impacted by the strike, yet.
“So far, so good,” Bartrand said. “I guess if it does not get resolved soon we might feel it, but for right now, we have not noticed anything.”
Congressmen Bill Huizenga (R) in a recent interview with Fox Business said he has reached out to a number of suppliers that supply GM.
“Our suppliers are kind of mixed. Some of them are really afraid as they have slowed down and had to lay people off voluntarily that they may not be able to keep doing that voluntarily and they would have to do layoffs,” Huizenga said, adding that there is some concern that these employees would seek employment in other industries.
The strike is now four weeks old. UAW officials have stated that issues have been temporary employees becoming full-time GM workers, wages, pensions, and job security.
A GM spokesperson said “We continue to negotiate and exchange proposals, and it remains our goal to reach an agreement that builds a stronger future for our employees and our company.” For more information, visit the company’s website, buildingastrongerfuture.gm.com.
After last month’s dip, the pace of the West Michigan industrial economy returned to a very modest growth rate, 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) recovered to +3, up from -13. The production index bounced up to +9, from -15. The index of purchases flipped back to +2 from -6 and the employment index edged to +1 from -1.
Long called the trade war with China a two-edged sword. “The news media has highlighted the impact on farmers, which has resulted in falling prices for corn, soybeans, pork and other agricultural exports,” he said. “Many West Michigan industrial firms have come to rely on a wide range of industrial commodities subject to new tariffs that are driving up prices.”
Long said initially, many Chinese exporters were willing to accept lower prices in orders to retain the business relationship. “Both buyers and sellers believed the governments of both countries would soon reach an agreement, but that was 18 months ago, and now the rhetoric has turned pessimistic,” he said.
The world economy continues to slow, and the U.S. will eventually be drawn into the slowdown, Long said.
“The world political situation is a mess. The impending U.K. ‘hard’ Brexit could destabilize both the British and the European economies. Italy, France and Germany are dealing with populist uprisings. And, the U.S. is starting to focus on a major election that is still 14 months away, ignoring other problems,” he said.
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.”
The West Michigan economy is slowing with evidence of a flat growth pattern, 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 May.
The survey’s index of business improvement (new orders) flattened to +3, down from +13. The production index held steady at +11, while the index of purchases dropped sharply to -2 from +16. The employment index rose to +15 from +4.
“The sharp drop in our index of purchases indicates many firms are putting expansion plans on hold and beginning to sandbag operations in the event that the economy continues to flatten,” said Long.
He said the local economic slowdown is related to the trade war with China and the possibility of tariffs on Mexican imports.
“The economic impact and direction of the ongoing multi-national tariff wars virtually defies prediction,” said Long. “What we do know is that the tariffs are starting to raise prices for a wide variety of commodities and pinch profitably for an increasing number of firms. Business planners hate uncertainty, and not knowing what new commodities might be impacted and what the resulting delivered prices might be causes future hiring or expansion plans to be put on hold.”
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.”
The West Michigan economy is chugging along like it has been for the past 10 years, but evidence is mounting that the pace may be slowing, 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 April.
The survey’s index of business improvement (new orders) remained positive but backtracked to +13 from +17. The production index rose to +11 from +5, and the index of purchases also increased to +16 from +4. The employment index slid from +15 to a 27-month low of +4.
“Although one month can never be construed as a trend, it was disappointing to see our local employment index take such a deep slide,” said Long. “Unemployment is always an economic laggard, resulting in most of our West Michigan counties continuing to post very good unemployment numbers.”
Long said although there are some significant signs that growth is slowing, there is still no sign that the economy is about to slide into a recession.
“We know the world economy is slowing and that will ultimately have at least some impact on our domestic economy,” said Long. “Various industries are starting to grow ‘bubbles’ which we hope will not all break at once.”
The ongoing trade dispute with China could generate a significant slowdown or even a recession if the war drags on, Long said. Most major capital projects are planned and executed over a long-term cycle, such as five years. He said these projects tend to have long and productive supply chains which stimulate growth. He also said some of the benefits of the 2017 tax legislation could be felt for years to come, making the U.S. the cheapest place in the world to do business.
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.”
West Michigan’s recovery from the Great Recession began 10 years ago this month and it continues at the same slow pace since 2009, 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 March.
The survey’s index of business improvement (new orders) remained virtually unchanged at +17, up from +16. The production index retreated to +5 from +16. The index of purchases waned to +4 from +16, and the employment index declined slightly to +15 from +17.
Business confidence rebounded in February after posting near-record lows in January, Long said, but March saw that optimism fade.
“Short-term confidence for March slipped for a number of reasons — no resolution to the Chinese trade war, Brexit, the softening world economy and retreating monthly auto sales,” said Long.
The long-term business outlook (perception for the next three-to-five years), remained steady at +28, up marginally from February’s +27.
Long added that auto sales are continuing to fall as predicted, but West Michigan auto parts producers are not feeling pinched. “Just as it has been for many months, the decline in auto sales has been very orderly, so far,” he said.
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.”
While 2019 got off to a slow start in January, February’s report for the West Michigan economy shows a return to a pattern of slow growth that has been reported for nearly 10 years, according to 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 February.
The survey’s index of business improvement (new orders) bounced back to +16 from -4. In a similar move, the production index rose to +16 from +4. The index of purchases also bounced to +16 from +3, and the employment index rose to +17 from +14.
Long said several business leaders continue to voice concerns over the still unresolved tariff war with China, and others are cautious about the potential decline in auto sales.
“Although several of our local auto parts producers remain modestly pessimistic about the prospects for 2019, we have yet to see any significant weakening in our local firms,” said Long. “Overall, the mood remains watchfully optimistic.”
Long said business confidence rebounded in February, after posting some near-record lows in January.
He said despite the weakness in last month’s survey, the employment index continues to remain double-digit positive.
“Employers are still complaining that they cannot find enough qualified workers,” he said.
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.”
The West Michigan economy flattened in January, signaling a slow start to 2019, 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 January.
The survey’s index of business improvement (new orders) edged down to -4. The production index, which had been as high as +33 in November, softened to +4. The index of purchases flattened to +3, and the employment index came in at +14.
“The overall business outlook is much more cautious than it was just a few months ago,” said Long. “Several survey participants continue to voice concern over the price impact of the still unresolved tariff war with China. Others are cautious about the potential decline in auto sales. In contrast, firms associated with the office furniture industry remain watchfully optimistic.”
Long said the national economy turned out stronger than expected to start 2019.
“It is possible that the 2017 tax cuts may have a little more room to run than we expected,” he said. “However, the softening of the world economy will pull us in the opposite direction. The economy still has plenty of momentum to carry through the first two quarters of 2019 and quite likely beyond.”
Long said more than 58 percent of the Wall Street Journal’s panel of 60 economists expect the next recession to start in 2020, and 2019 could turn out to be just another year of slow growth.
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 the West Michigan industrial economy, September was strong, October was stronger and November was the best month of the year, 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 November.
Brian Long, photo from gvsu.edu
The survey’s index of business improvement (new orders) edged higher to +38, from +36. The production index edged up to +33, from +30. The index of purchases rose to +36, from +32, and the employment index came in at +25, up slightly from +24.
Long said November’s bad news from the automotive sector came from General Motors; the company plans to close three plants associated with small car production and lay off 14,000 workers, presumably to get ahead of the predicted slump in auto sales for 2019.
“Although auto sales continue to soften, our West Michigan auto parts suppliers continue to report positive business conditions and remain cautiously optimistic about the first half of 2019,” he said.
The 2017 tax incentives may have run their course for at least some of the capital equipment firms, Long said, and business conditions remain strong for most industrial distributors.
He added that the office furniture industry is profitable at the current level, but the expansion for this phase of the business cycle for office furniture is apparently over. “The ‘sugar high’ for office furniture sales brought on by the 2017 tax reform package has now run its course,” said Long.
Looking forward, Long said unless trade talks with China break down, there is no apparent problem in the short term that will upset the economy for the first half of 2019.
Other report highlights:
* Some firms are seeing falling prices for some key commodities. However, the tariffs are still being used as an excuse to raise prices.
* Year-over-year unemployment rates are still running about a full percentage point below a year ago.
* Hiring and retaining new workers continues to be a big problem for some firms, but with the current hesitancy in the economy, this problem may be receding.
* The European economy continues to slow. Not collapse, just slow. The Italian fiscal budget problem is not yet resolved, and could cause trouble for the other eurozone countries.
* Mike Dunlap survey of the office furniture firms clearly depicts an industry that is topping out.
* Our two largest trading partners are Canada and Mexico. The Mexican PMI dipped to 49.7 in November, down from 50.7. However, the Canadian PMI upticked to 54.9 in November from September’s 53.9.
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.”
The economic pace for West Michigan was strong in September, but October was even stronger, 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 October.
The survey’s index of business improvement (new orders) rose confidently to +36, from +28. The production index edged up to +30, from +29. The index of purchases rose to +29, from +21, and the employment index came in at +24, down from +29.
Long said auto sales numbers continue to surprise many economists. “After all the talk about auto sales softening, the October sales report from Automotive News posted a minor gain of 0.4 percent,” Long said. “The seasonally adjusted sales rate (SAAR) rose to 17.59 million vehicles from 17.44 in September.”
Long said year-over-year unemployment rates continue to fall; Kent County is at 2.6 percent, Ottawa County is at 2.5 percent and Kalamazoo County is at 3.0 percent.
The current economy is about as good as it gets, Long said. “Hiring and retaining new workers continues to be a big problem for some firms, so we can’t expect much more expansion.”
Long said there has been an interesting twist on the tariffs. “Because of some Chinese firms experiencing declining business, they have been willing to cut prices enough to cover the cost of the tariffs,” he said.
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.”
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.
Tariffs have been threatened for many months, and now that they are actually being imposed, the West Michigan economy is beginning to feel the pinch, 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 July.
After 18 months of solid growth, the survey’s index of business improvement (new orders) is down sharply from June at -3, down from +33. The production index eased to +23 from a robust +39. The index of purchases tapered to +13 from +27, and the employment index eased to +21 from +30.
“Although our last report was quite strong, growth has slowed in almost every sector of the West Michigan economy,” said Long. “Business planners hate uncertainty, and many firms appear to be putting expansion plans on hold until they can see a clearer picture of where the trade war is taking us and exactly how much it will cost.”
Long said auto sales are continuing to soften, especially for local auto parts suppliers. He said local firms producing capital equipment are still benefitting from the recently passed tax advantages for new capital investments, but rising costs are a major concern. Many local industrial distributors reported flat business conditions for July, some of which may be seasonal.
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.”
The local economy continues to maintain solid growth, while some area business leaders express concern about an impending tariff war, 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 June.
The survey’s index of business improvement (new orders) came in at +33, up from +30. The production index rose to +39 from +37. The index of purchases also increased to +27 from +19, and the employment index remains strong at +30.
“Many local manufacturers are worried that this tariff war is going to come down in the form of higher prices and lack of availability of some of the key commodities, like steel and aluminum, that are needed by local businesses,” said Long. “The office furniture industry, which uses a lot of steel, and the aerospace industry, which uses aluminum, could be especially impacted by the new tariffs.”
Long said local farmers who sell produce like blueberries and cherries worldwide are also worried about tariff wars. He also said local business owners feel positive about the future.
“Unemployment is down to 2.9 percent in Kent County and 2.7 percent Ottawa County, which is the county with the lowest unemployment in all of Michigan’s 83 counties,” he said.
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.”
The stronger-than-usual performance of the West Michigan economy has continued into the opening of the second quarter of 2018, 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 April.
The survey’s index of business improvement (new orders) retreated to +28 from +34. The production index edged lower to +28 from +31. The index of purchases eased to +34 from +37, and the employment index rose to +23 from +19.
“Most capital equipment manufacturers continue to be positive, but there are some exceptions,” said Long. “Local automotive parts producers are still modestly expanding despite the slight downtick for the industry as a whole.”
Long said the office furniture industry is holding steady, but signs indicate the peak for the current business cycle has been reached. He said most industrial distributors reported a good month, much as they have since the beginning of the year.
The latest numbers reported by the Department of Technology, Management and Budget pegged Michigan’s seasonally adjusted unemployment rate for March at 4.7 percent. Long said from March 2017 to March 2018, payroll jobs in Michigan increased by 61,000 or 1.4 percent. The estimated unemployment rates range between 3.2 percent for Ottawa County to 4.2 percent in Barry County, all well below the state average.
The national U-6 unemployment rate, which includes various discouraged and marginally attached workers, has now fallen to a 17-year low of 7.8 percent.
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.”
The West Michigan economy looks strong for the new year, according to a Grand Valley State University expert.
“We are heading into 2018 with a full head of steam,” said Brian G. Long, director of Supply Management Research in the Seidman College of Business. “I don’t see anything on the horizon that will trip us up.”
Long surveyed local business leaders and his findings below are based on data collected during the last two weeks of November.
The survey’s index of business improvement (new orders) rose to +20 from +11. The production index backtracked slightly to +17 from +20. The index of purchases eased to +18 from +22, and the employment stayed positive at +13, down slightly from +14.
Long said the November performance for most groups was mixed.
“Despite the modest softening in auto sales, the local auto parts producers remain surprisingly strong, even though they continue to voice concern about possible slower auto sales as we head into 2018,” he said. “It is currently the slow season for office furniture sales, and the industry still appears to be topping out at the present level.”
Long said some of the smaller office furniture firms are still expanding, and for most industrial distributors, November was one of their better months. “A plateau seems to be forming for the capital equipment industry, but recent proposed changes in the tax law could result in improved conditions in 2018,” he said.
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.
The West Michigan economy continues to show positive growth, and the national industrial economy remains very strong, according to a Grand Valley State University expert.
“This is probably as good as it’s going to get,” said Brian G. Long, director of Supply Management Research in the Seidman College of Business. “If we continue this way to 2019, it will be the longest post-war recovery in history without sliding into another recession.”
Long surveyed local business leaders and his findings below are based on data collected during the last two weeks of October.
The survey’s index of business improvement (new orders) remained positive at +11, but declined from +21 in September. The production index posted a modest gain, rising from +17 to +20. The index of purchases rose to +21 from +14, and the employment index remained positive at +14, down from +17.
Long said most of the auto parts suppliers are still maintaining their present status, with a similar mood noted among the office furniture firms. He said October was generally a good month for industrial distributors.
The local index of employment remained double-digit positive, while the official unemployment rate nationally has fallen to 4.1 percent. “That’s only a breath away from the 20-year low of 3.8 percent,” said Long.
The national industrial economy also remains very strong, according to Long.
“U.S. manufacturing stepped up a gear at the start of the fourth quarter, boding well for higher factory production to support robust economic growth in the closing months of 2017,” he said. “Production volumes jumped higher and growth in factory jobs picked up to one of the strongest levels since the global financial crisis, underscoring the improvement in optimism about future trading among manufacturers.”
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.”
Brian Long is a local business forecaster. Credit: GVSU
After a summer lull, the West Michigan economy resumed the positive growth pattern the area has seen for the past eight years, according to a Grand Valley State University expert.
Brian G. Long, director of Supply Management Research in the Seidman College of Business, surveyed local business leaders and his findings below are based on data collected during the last two weeks of August. See the full report here.
The survey’s index of business improvement (new orders) came in at +19, well above last month’s +8. The production index increased to +20 from +6. The index of purchases moved higher to +24 from +12, and the employment index remained positive at +21, up from +20.
Long said most auto parts suppliers continue to express concern about slower sales figures that have been reported every month since the beginning of the year, but, so far, none of the firms in the local survey are talking about major sales declines.
He added that some capital equipment firms are reporting weaker sales due to the slowdown in the auto parts industry.
Long said that the office furniture industry continues to show signs of topping out at the present level, but no significant setbacks have been reported.
“Most firms realize that we are now over eight years into the recovery from the Great Recession, but none of the respondents feel that a major decline is coming any time soon,” he said. “Having successfully recovered from one of the sharpest dips in recent history, many of our local firms have wisely resisted the temptation to over expand.”
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.
After six months of disappointing car sales, the impact on local auto parts suppliers is finally being felt by the West Michigan economy, a Grand Valley State University expert said.
Brian G. Long, director of Supply Management Research in the Seidman College of Business, said: “It’s not a collapse, just a modest tapering of the growth rate. Growth is still growth.”
Long surveyed local business leaders and his findings below are based on data collected during the last two weeks of July.
The survey’s index of business improvement (new orders) came in at +8, considerably below last month’s +31. The production index eased to +6 from +26. The index of purchases tapered to +12 from +22, and the employment index is still very positive, falling slightly to +20 from +23.
Long said business conditions for the auto parts suppliers have turned mixed, based on the specific car or truck lines companies are supporting. Some have been forced to cut production because of slow vehicle sales.
“For the sixth straight month, auto sales for July are lower,” said Long. “The 6.9 percent drop is the largest so far this year, although most of the decline came from a 15 percent drop in the sale of sedans (regular cars) verses a 1.9 percent drop in light trucks and SUVs.”
With the production of 2017 models now finished, Long said analysts are still worried about the bloated dealer inventories which are much higher than they were before the Great Recession. Compounding the problem is the large number of vehicles coming off lease.
Long said the office furniture industry is still stable while the capital equipment market remains mixed, and the slowdown in the auto parts industry has resulted in the cancellation of further expansion by some firms. He said many segments of the West Michigan tourist industry are poised to have a record year, and the agricultural industry will have a good year as well.
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.
The West Michigan economy is still growing, a Grand Valley State University economist said.
Brian G. Long, director of Supply Management Research in the Seidman College of Business, surveyed local business leaders and his findings below are based on data collected during the last two weeks of June.
The survey’s index of business improvement (new orders) came in at +31, a modest improvement over last month’s +27. The production index edged up to +26 from +19. The index of purchases remained virtually unchanged at +22, while the employment index jumped to +23 from +13.
Long said slower auto sales have resulted in most auto parts suppliers showing signs of plateauing, but no major firms have reported a significant drop in sales. He said some firms have seen an uptick in quoting activity.
Long also said the office furniture industry continues to show signs of topping out, but no decline appears to be on the horizon. “Because of the apparent topping out for some of our local industries, the capital equipment market remains mixed, and the bias is still to the down side,” he said. “For the industrial distributors, the summer maintenance schedules have given some firms a slight boost.”
The West Michigan employment picture continues to be a bright spot for the local economy, Long said. Ottawa County has the lowest unemployment rate in the state at 2.6 percent, and Kent County tied for third lowest at 2.8 percent. The current Michigan unemployment rate stands at 4.2 percent.
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.”
Brian G. Long, Ph.D, C.P.M., serves as Director of Supply Management research for the Seidman College of Business at Grand Valley State University. Dr. Long earned a B.S. and M.B.A. from Central Michigan University, and a Ph.D. in Marketing from Michigan State University. He is also a Certified Purchasing Manager.
For over 28 years, Dr. 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.
