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 www.gvsu.edu/scblogistics.
DOWNLOADABLE AUDIO:
* 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).
