May’s survey of purchasing managers shows the West Michigan economy continuing to slow at a measured pace as key indices continued a month-to-month yo-yo pattern signaling uncertainty – and reason for optimism.
The Current Business Trends Report, authored by Brian Long, director of supply management research for the Seidman College of Business at Grand Valley State University, included upticks in areas like sales, output, employment and purchases in May after flat or lower results in April.
“Since we instituted this survey many years ago we've seen our numbers bounce around, and this month our bounce was to the upside,” Long said. “Our index of new orders came in much stronger than expected. But of course, one month does not make a trend. So when we add up June at the end of the month, the numbers we get may be a little bit less robust.”
Office furniture makers continue to report soft market conditions – though no major layoff announcements have been made. Meanwhile, automotive parts suppliers remain steady with backlogs and upside potential thanks to “reshoring” – or bringing manufacturing of certain parts that had been made overseas back to U.S.-based suppliers.
“This is where I think West Michigan is well positioned to pick up some additional business.” Long said. “The problem is, of course, reshoring in the industrial market takes time to identify and qualify new sources so it won't happen overnight.”
Here’s a look at the key index results from May’s survey of West Michigan manufacturers:
- New orders index (business improvement): +19 versus +0 in April
- Production index (output): +13 versus +5 in April
- Employment index: +13 versus +3 in April
- Lead times index: +2 versus +3 in April
More information about the survey and an archive of past surveys are available on Seidman’s website.
