GVSU economist: Local economy is flat

The West Michigan economy experienced slow, shallow growth in October, according to a Grand Valley State University economist.

Brian G. Long, director of Supply Management Research in the Seidman College of Business, surveyed local business leaders and his findings are based on data collected during the last two weeks of October. 

The survey's index of business improvement (new orders) retreated to +1, down from +23 last month. In a similar move, the production index eased to +4, from +24. The index of purchases returned to a negative reading of -3, down from +15. The employment index remained positive at +7, but fell slightly from +9. 

"It's not surprising to see that most groups flattened," said Long. "Several of the auto parts suppliers raised concern over the recent softening in auto sales, and noted that new quotation requests were down considerably. The office furniture industry continues to show evidence of topping out, although business conditions still remain positive." 

Long said Ottawa County’s unemployment rate of 2.7 percent continues to be the lowest in the state, while Allegan and Kent counties tied for second place at 2.9 percent. 

"The unemployment picture for West Michigan continues to improve, but the changes are now very small," said Long. "Wages are starting to show significant improvement for the first time in more than seven years. Michigan still has about 80,000 jobs that cannot be filled because of a shortage of qualified workers. Unfortunately, the education system is currently doing little to close this gap." 

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) 323-2359.