GVSU economist: Local economy plateauing at a slower growth rate
Posted on July 09, 2019
"Although the pace of the West Michigan economy is slowing, there is no evidence that we are about to fall off a cliff," said Brian G. Long, director of Supply Management Research in Grand Valley State University's Seidman College of Business.
Long said currently there are no factors to indicate an economic downturn in 2019 or 2020.
Long surveyed local business leaders and his findings below are based on data collected during the last two weeks of June. See the full report here.
The survey's index of business improvement (new orders) rose to +10, up from +3. The production index remained steady at +11, while the index of purchases rebounded sharply to +12 from -2, indicating that the outlook for the next few months may be improving. The employment index dropped to +5 from +15.
Long said the ongoing trade war with China continues to weigh on the U.S. economy, primarily impacting farm exports to China and the rising cost of goods coming from China. "Fortunately, in a brief meeting at the recent G20 summit, presidents Trump and Xi agreed to at least resume talks," said Long. "Unfortunately, this implies that a full trade agreement may still be a long way off."
Long said a continued decline in auto sales has been orderly and modest. He said West Michigan counties continue to have the lowest unemployment rates in the state with numbers below the state and national average.
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."
For more information, contact Brian Long at (269) 870-0428.