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GVSU expert describes local economy 'like a train wreck in slow motion'
Posted on April 07, 2020
In the 40-year history of a GVSU economic survey, the economic situation in West Michigan has seldom looked this grim, said Brian G. Long, director of Supply Management Research in the Seidman College of Business.
"Although negative, much of our data collected in the third and fourth weeks of March do not begin to reflect the impact of recent events," said Long.
Long surveyed local business leaders and his findings below are based on data collected during the last two weeks of March. Find full report here.
The survey's index of business improvement (new orders) slipped to -21 from +7. The production index dropped to -16 from +2. The index of purchases plunged to -30 from +9, and the employment index plummeted to -25 from +9.
Long said the Detroit automakers made good on their promise to report only 2020 quarterly sales, which reflect the aggregate of positive sales months of January and February and the negative month of March. "Even then, sales were off considerably," he said.
Long said at this early stage, assessing the economic impact of the COVID-19 pandemic is almost impossible, but said "we are now in a historical collapse."
"If, by some miracle, we were to have a viable vaccine in the next few months that could be widely distributed, the economy would quickly begin to recover," said Long. "However, some marginal businesses have already been forced to close, and there will surely be more to follow. Unfortunately, this crisis is still just beginning."
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.