Current Business Trends: Slow Growth
Posted on February 05, 2014
The greater Grand Rapids industrial economy experienced sustainable slow growth, according to the results of a monthly survey compiled by Brian G. Long, director of Supply Management Research in the Seidman College of Business at Grand Valley State University.
The survey results are based on data collected during the last two weeks of January. See full report here.
The survey’s index of business improvement, called new orders, gained strength by rising to +14, from +5. However, the production index eased modestly to +7 from +10. The employment index returned to double digits at +12, up from +9.
Long said returning to a double-digit employment index is significant. “Even though it’s not strong double digits, it means there is some growth left in the industrial sector for the employment market,” said Long. “Smaller companies are lagging with new employment because owners are still worried about the future with talk of raising the minimum wage and Obamacare.”
Long said the furniture industry remains on a very steady, but improving trend line, and auto parts firms turned in a mixed performance for January. He said January is usually a slow month for capital equipment firms, but several local respondents reported very positive sales. “Overall, we have numerous local factories at full capacity, and we still have firms looking for qualified people to fill positions,” 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.” An expanded version of this report and details of the methodology used to compile it are available at www.gvsu.edu/scblogistics.
For more information, contact Brian Long at (269) 323-2359.
* Long said January was a very positive month (audio).
* Long said a double-digit employment index is significant (audio).
* Long said smaller businesses are lagging when it comes to new hires (audio).
* Long said it will be several years before a complete economic rebound (audio).