A monthly economic report by a Grand Valley State University researcher suggests that the West Michigan economy is continuing to slow in part due to the recent United Auto Workers strike and the Federal Reserve’s rising interest rates.
Brian Long, director of supply management at GVSU’s Seidman College of Business, said his survey shows growing pessimism among local manufacturers and businesses.
Several of the key indicators in Long’s report continued their downward trend in October. New orders, employment and lead times all slumped last month.
“It's not too much of a surprise that our October numbers show a little bit of softening in the West Michigan economy,” Long said. “Some additional softness can be attributed to the UAW strike that affected some of our local firms. But the strike is now over, and the West Michigan economy is slowing, but that's what the Fed wanted the economy to do to tame inflation.”
In his report, Long said he doesn’t forecast an imminent recession, but noted that surveyed businesses are preparing more for an economic slowdown than a collapse. Many are feeling the pinch of the Fed’s higher interest rates, they said.
“For October, our local unemployment index posted the first significantly negative reading we've had since the pandemic,” Long said. “Although some of the softness may relate to the UAW strike, which is of course now over, there is nonetheless plenty of evidence that the West Michigan economy is in fact slowing.”
Here’s a look at the key index results from October’s survey of West Michigan businesses:
- New orders index (business improvement): -13 vs. -9 in September
- Production index (output): -4 vs. -5 in September
- Employment index: -10 vs. 0 in September
- Lead times index: -17 vs. -13 in September
More information about the survey and an archive of past surveys are available on the Seidman College of Business website .