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Current business trends very good but moderating

Posted on August 03, 2010

The greater Grand Rapids industrial economy remains strong but continues to moderate, 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 in the last two weeks of July. The survey’s index of business improvement, called new orders, remained almost unchanged at +31, down from +32. In a similar move, the production index eased to +27 from +30. The index of purchases retreated to +23 from +34. After setting a six-year record, the employment index moderated to +33, down from +36. 

Long said automotive parts suppliers reported that all of the assembly plants did not close for the traditional model changeover, however, some of the September-October production schedules are not as robust as those of a couple of months ago. Long also said there is still evidence that conditions are slowly improving for the office equipment and furniture industry.

Long said with 43 percent of firms reporting adding staff, the employment rate in the greater Grand Rapids area remains high.“Many firms are hiring, but some of them are being very quiet about it to avoid a long line at the door,” said Long. “The catch is that almost all of the new hires require some kind of skill, such as computer analysis, CNC operation, electronics repair, or medical skills.

“A bigger problem with unemployment relates to the inability or unwillingness of firms to expand. Unlike most recoveries in the past, many firms that are at full capacity are not expanding and seem to be content to stay at their current size.”
The Institute for Supply Management, greater Grand Rapids 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 purchasing managers from the region's major industrial manufacturers, distributors, and industrial service organizations. It is patterned after a nationwide survey conduced 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


* Brian Long says local growth was expected to level off (audio).

* Long says hiring is strong in the greater Grand Rapids area (audio).

* Long says the numbers for July are better than the national average (audio).

* Long believes there is a 30 percent chance of a double-dip recession for the area (audio).

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