"A recovery is clearly under way"

MAPI report shows manufacturing is bouncing back faster than expected

03/18/2010


 

A recovery in the U.S. domestic manufacturing sector is under way that is stronger than the recovery in the general economy, largely due to industry taking the brunt of the decline in the downturn, according to the Manufacturers Alliance/MAPI U.S. Industrial Outlook: Industrial Recovery Gaining More Solid Footing, a quarterly report that analyzes 27 major industries.
"A recovery is clearly under way. Monthly data for manufacturing production indicate that the recession, which started in January 2008, ended in June 2009," said Daniel J. Meckstroth, Ph.D., chief economist for the Manufacturers Alliance/MAPI and author of the analysis. "The worst of the inventory destocking is ending; inventories do not have to be built to increase production as output growth can result from less liquidation. The inventory swing has had a positive effect on production and was evident in the fourth quarter (2009)."
Manufacturing industrial production, measured on a quarter-to-quarter basis, grew at nearly a 6% annual rate in the fourth quarter of 2009 following healthy 8% growth in the third quarter.
Production in non-high-tech manufacturing expanded at a 5% annual rate in the fourth quarter. According to MAPI's quarterly economic forecast, non-high-tech manufacturing production is expected to increase 3% in 2010 and grow by 5% in 2011. High-tech industrial production rose at an 8% annual rate in the fourth quarter. MAPI predicts it will post impressive 15% growth in 2010 and 18% growth in 2011.
There was a significant upward trend in the 2009 fourth quarter figures for the various components of the manufacturing economy. Twelve of the 27 industries tracked in the report had inflation-adjusted new orders or production above the level of one year ago, seven more than reported in the third quarter of 2009, and one industry remained flat. Steel production grew by 49% while basic chemicals advanced by 16%.
The largest drop came in construction machinery production which declined 27% while mining, oil field and gas field machinery experienced a 26% decline.
Meckstroth reports that 12 industries are in the accelerating growth (recovery) phase of the business cycle; no industry is in the decelerating growth (expansion) phase; two industries, private nonresidential construction and mining, oil field and gas field machinery, appear to be in the accelerating decline (either early recession or mid-recession) phase; and 13 are in the decelerating decline (late recession or very mild recession) phase of the cycle.
The report also offers economic forecasts for 24 of the 27 industries. The manufacturing sector should show improvement in 2010, with MAPI forecasting 17 of 24 industries to show gains, led by steel production with expected 35% growth and housing starts with 34% growth. The recovery should continue in 2011 with growth likely in 22 of 24 industries, including nine industries which are predicted to grow at double-digit rates, led by housing starts at 70%, albeit from current historically low levels, and engines, turbines and power transmission equipment at 28%.

 



No comments
The Top Plant program honors outstanding manufacturing facilities in North America. View the 2015 Top Plant.
The Product of the Year program recognizes products newly released in the manufacturing industries.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
2016 Product of the Year; Diagnose bearing failures; Asset performance management; Testing dust collector performance measures
Safety for 18 years, warehouse maintenance tips, Ethernet and the IIoT, GAMS 2016 recap
2016 Engineering Leaders Under 40; Future vision: Where is manufacturing headed?; Electrical distribution, redefined
SCADA at the junction, Managing risk through maintenance, Moving at the speed of data
Safety at every angle, Big Data's impact on operations, bridging the skills gap
The digital oilfield: Utilizing Big Data can yield big savings; Virtualization a real solution; Tracking SIS performance
Applying network redundancy; Overcoming loop tuning challenges; PID control and networks
Driving motor efficiency; Preventing arc flash in mission critical facilities; Integrating alternative power and existing electrical systems
Package boilers; Natural gas infrared heating; Thermal treasure; Standby generation; Natural gas supports green efforts

Annual Salary Survey

Before the calendar turned, 2016 already had the makings of a pivotal year for manufacturing, and for the world.

There were the big events for the year, including the United States as Partner Country at Hannover Messe in April and the 2016 International Manufacturing Technology Show in Chicago in September. There's also the matter of the U.S. presidential elections in November, which promise to shape policy in manufacturing for years to come.

But the year started with global economic turmoil, as a slowdown in Chinese manufacturing triggered a worldwide stock hiccup that sent values plummeting. The continued plunge in world oil prices has resulted in a slowdown in exploration and, by extension, the manufacture of exploration equipment.

Read more: 2015 Salary Survey

Maintenance and reliability tips and best practices from the maintenance and reliability coaches at Allied Reliability Group.
The One Voice for Manufacturing blog reports on federal public policy issues impacting the manufacturing sector. One Voice is a joint effort by the National Tooling and Machining...
The Society for Maintenance and Reliability Professionals an organization devoted...
Join this ongoing discussion of machine guarding topics, including solutions assessments, regulatory compliance, gap analysis...
IMS Research, recently acquired by IHS Inc., is a leading independent supplier of market research and consultancy to the global electronics industry.
Maintenance is not optional in manufacturing. It’s a profit center, driving productivity and uptime while reducing overall repair costs.
The Lachance on CMMS blog is about current maintenance topics. Blogger Paul Lachance is president and chief technology officer for Smartware Group.
This article collection contains several articles on the vital role of plant safety and offers advice on best practices.
This article collection contains several articles on the Industrial Internet of Things (IIoT) and how it is transforming manufacturing.
This article collection contains several articles on strategic maintenance and understanding all the parts of your plant.
click me