The “back-to-work euphoria” of January has faded and economic indicators edged back into negative territory in West Michigan during February, according to the latest survey from Grand Valley State University’s Seidman College of Business.
The Current Business Trends survey of West Michigan manufacturers released March 8 found key indexes sliding as new orders and production soured after an unexpectedly rosy outlook in January.
“Overall we had expected business conditions to soften in 2023 and this month’s report is a confirmation of that trend,” said Brian Long, director of supply chain management research at Seidman. “We expect interest rate-sensitive industries to retreat, but are still expecting that the pent-up demand for automotive will keep the West Michigan economy positive.”
Based on responses from the survey, Long said he also expects a positive outlook from aerospace firms, while the prospects for the office furniture business “remain far less certain.”
“However, even if the markets for office furniture remain soft, a major collapse like we’ve seen in other downturns is unlikely,” Long concluded.
Both the short- and long-term business outlook indexes slid back into negative territory after showing a more upbeat outlook in January.
Broader indicators are showing the world economy proving resilient despite the war in Ukraine, Long said.
"The world economy is not as grim as you might imagine,” he said. “The JP Morgan international survey of purchasing agents indicates that we are absolutely at break-even now. Some countries are down, but enough countries are up right now that the average is at a break-even point.”
GVSU’s Current Business Trends survey indexes are tracked based on whether survey respondents report “up,” “same,” “down” or “N/A” to questions about business conditions.
Here’s a look at some key indexes:
- Sales (new orders): -17 in February vs. +18 in January
- Production: -7 in February vs. +21 in January
- Employment: +17 in February vs. +18 in January
Lead times also improved in the survey, which Long noted was a strong indicator that supply chains are continuing to loosen up, despite continued shortages and high prices for specific commodities.
View the complete March 2023 report and an archive of previous reports at the Seidman College of Business’ Publications and Research website.