Poll: Manufacturers detail recession survival strategies, report better conditions
Opportunities for manufacturers abound as economy improves suggests a poll by sponsors of the Fabtech International & AWS Welding Show, including Metalform, in Chicago. Sponsors are American Welding Society (AWS), Fabricators & Manufacturers Association Int'l (FMA), Society of Manufacturing Engineers (SME), and Precision Metalforming Association (PMA).
To survive what many view as the worst economic downturn since the Great Depression, 69 percent of manufacturers indicated they reduced their workforce, followed by delaying capital expenditures (66 percent), negotiating with suppliers for better deals (48 percent) and cutting promotional activities (37 percent.) The survey asked 1,046 past or prospective registrants of Fabtech International & AWS Welding Show, including Metalform. The poll was conducted in late July.
However, with signs that the economy is currently improving, those surveyed plan to reverse downsizing -- nearly one-third of those surveyed said they expect to add to their workforce in the next 12 months . Manufacturers reported an increase in demand in product as the leading factor that would prompt an increase to the workforce (78 percent) followed by the opportunity to upgrade workforce (7 percent) and the need for new skill sets (6 percent).
"As manufacturers look for signs of improvement in their business, it's vital that they prepare for the economic recovery," said Mark Hoper, Fabtech show manager. "History shows that it's the period immediately following a recession that offers the most opportunity for businesses," he says.
More than half (53 percent) of the manufacturing executives polled indicated they have seen or experienced signs that signal the start of an economic recovery . Among positive signals reported were an increase in new sales inquiries (27 percent, followed by an increase in orders (23 percent), reduced layoffs (18 percent), and the need to replenish inventory levels (14 percent).
Also, more than one quarter surveyed, 27 percent, agree with economists' , the survey said.
"These findings are in line with what we are hearing from other industry sectors, as well as economists' assessments that the economy is gradually improving," said Hoper, advising manufacturers to take advantage of this pending recovery period. In Chicago, Nov. 15-18, the Fabtech International & AWS Welding Show, including Metalform, is timed to provide manufacturers with the latest tools, technologies and processes to improve business in uncertain economic times, say organizers, who expect 35,000 attendees and 1,000 exhibitors at Chicago's McCormick Place. Sponsors are American Welding Society (AWS), Fabricators & Manufacturers Association Int'l (FMA), Society of Manufacturing Engineers (SME), and Precision Metalforming Association (PMA).
Free educational sessions focusing on the economy include:
- A keynote panel discussion led by Jeff Knauf, president of Medalist Laserfab, Inc., titled, "Best Practices for Thriving in Tough Times," on business strategies for surviving and thriving during an uncertain economy. Topics include workforce development, diversifying product lines and operations, obtaining financing/credit, and current tax incentives.
- A Solutions Showcase session on "Maintaining Sales Focus in a Down Economy" that offers strategies to better prepare businesses for the economic turnaround including creating a recession-proof sales strategy, growing current accounts and gaining new customers in tough times.
- A Solutions Showcase session titled, "Smart Strategies for Preserving Stakeholder Relationships," that highlights the importance of frequent, quality communications with stakeholders.
In separate news, several other industrial economic indicators improved in July and August.
- NEMA reported that its Electroindustry Business Confidence Index (EBCI) for current North American conditions jumped nearly 12 points to 53.3 in August, an indication that the business environment facing electrical equipment manufacturers improved during the month, according to the association of electrical and medical imaging equipment manufacturers. Meanwhile, the NEMA North American future conditions EBCI also climbed in August, rising 1.7 points to 68.3, the organization reported. This marked the highest reading for the future conditions index since August 2005 and implies that a significant proportion of industry executives expect at least some degree of improvement in the business situation within the next six months, NEMA explained.
- The Conference Board Employment Trends Index (ETI) remained unchanged in July, after being flat for three months running, the board said on Aug. 10, suggesting an end to layoffs. In July, The Conference Board Employment Trends Index (ETI) remained at the same level as the revised figures for May and June. The index stands at 88.3 and is down 20.1% from a year ago.
"The Employment Trends Index has been flat in the last three months," said Gad Levanon, senior economist at The Conference Board. "This suggests that we are getting closer to the point when employers are no longer cutting their workforce. However, since we are expecting a weak economic recovery, and given the record number of involuntary part-time workers - many of whom are likely to move to full-time positions before new employees are hired - we do not expect significant job growth over the next year."
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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