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Current Business Trends: Strong Growth

  • Brian Long

Posted on May 04, 2010

GRAND RAPIDS, Mich. — The greater Grand Rapids economy is experiencing strong 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 in the last two weeks of April. The new orders index, which tracks business improvement, shot up to a 16-year high of +51, building on last month's +20. "For the first time in the 21-year history of the survey, not a single firm reported business conditions to be weaker than the previous month," said Long.

In other measures, the production index rose to +44, up from +30. The purchasing index climbed to +39 from +17.  The employment rose to +22 from +17. 

Long noted that area economy has returned to the output and employment levels of 2005.  "However, we can say that strong growth has resumed, and we are on our way back to the pre-recession production levels of a few years ago. Major exceptions to all of this good news are the commercial and residential construction markets, which will take many more years for a full recovery," he said. 

Long said the automotive sector is leading the way in the recovery, with almost all respondents reporting business as very positive, followed by the industrial distributors who are helping firms meet newfound demand. Although the office equipment industry is still a laggard in the recovery, Long said there is evidence that the worst is over and that business conditions are beginning to recover. 

Some changes to the employment situation in Michigan are likely permanent, though.

"A large percentage of the unskilled jobs that we have lost in Michigan over the past 10 years are gone forever," Long said. "Most of the jobs that are now available require some kind of skill and some kind of experience."

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

Call Brian J. Bowe at (616) 331-2221 or e-mail to arrange interviews with Long. NOTE TO RADIO: downloadable audio bites are available at

  • Long says automotive industry has turned the corner and those companies that survived are busy (audio).
  • Long says the manner in which employers are hiring has changed. Temp agencies are being used and those who are unemployed should not rely on newspaper ads (audio).
  • Long says while numbers were stronger in April than they were in 1994, Michigan is losing unskilled  jobs and so is the rest of the world (audio).
  • Long says the wet blanket on the economy is commercial and residential construction as homes are still going into foreclosure (audio).

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