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PMA Releases February Business Conditions Report
February 17, 2014
According to the February 2014 Precision Metalforming Association (PMA) Business Conditions Report, metalforming companies expect a dip in business conditions during the next three months. Conducted monthly, the report is an economic indicator for manufacturing, sampling 115 metalforming companies in the United States and Canada.
The February report shows that 32% of participants predict that economic activity will improve during the next three months (down from 46% in January), 60% anticipate that activity will remain unchanged (compared to 47% last month) and 8% believe that economic activity will decline (up from 7% in January).
Metalforming companies also forecast a modest decline in incoming orders during the next three months, with 50% anticipating an increase in orders (down from 54% in January), 41% expecting no change (the same percentage reported in January) and 9% predicting a decrease in orders (up from 5% in January).
However, current average daily shipping levels improved in February. Forty-six percent of participants report that shipping levels are above levels of three months ago (up from 35% in January), 31% report that shipping levels are the same as three months ago (compared to 45% last month), and 23% report a decrease in shipping levels (compared to 20% in January).
The percentage of metalforming companies with a portion of their workforce on short time or layoff remained steady at 6% in February. The February 2014 figure is significantly better than it was at this time last year when 19% of companies reported workers on short time or layoff.
“Business conditions reported by PMA members are consistent with widely reported caution on the part of manufacturers that consumer demand and confidence is not as strong as expected,” said William E. Gaskin, PMA president. “PMA’s typical member experienced 6% growth in orders and 2% growth in shipments in 2013, but according to data from PMA’s Monthly Orders & Shipments Survey, November and December were substantially below expectations and likely contributed to a somewhat more cautious outlook for Q-1 2014. In a recent meeting of PMA’s Cleveland District, a little more than half of the participants forecasted a flat 2014 vs 2013, one-third predicted modest growth and the balance expected strong increases in orders and shipments. Most agreed that increasing regulatory costs and frustrations over the lack of action in Washington, D.C. on tax rates, immigration and trade agreements threatened to restrict a stronger economic recovery.”