The greater Grand Rapids industrial economy is experiencing modest,
yet slightly improved 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 September. The survey’s index of business improvement,
called new orders, rose to +25 from +13. In a similar move, the
production index edged up to +25 from +17. The index of purchases
backtracked to +14 from +21. The employment index almost remained
unchanged but bumped up to +27 from +26.
“Locally, automotive parts producers are generally reporting
business conditions to be improving, no doubt in response to the 10
percent improvement in auto sales for this month,” said Long. “The
capital equipment firms are also doing better than they have for the
past two years.”
Long said the office furniture firms are still holding steady,
but the recent decline in business confidence is starting to erode the
prospect for future performance. He said for the fifth month in a row,
industrial distributors came in fairly positive.
“A recent survey of economists shows most believe there is a one
in three chance of sliding into another recession, or a double dip of
the 2007-2009 recession,” said Long. “By the statistics in our current
report, the odds are probably higher than that. However, the big
problem is not with the United States but the rest of the world. It
appears many places may already be in a recession. If we do slide into
another recession, it will be the fault of the European debt crisis.”
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.
DOWNLOADABLE AUDIO
* Long says lower gas prices are helping the local economy (audio).
* Long says if we see a double-dip recession, it will not be the fault of the U.S. (audio).
* Long says we would hardly feel a double-dip recession (audio).
* Long says a double-dip recession would be shallow (audio).
