While the April manufacturing index from the Institute for Supply Management is still two weeks away, three other industry barometers show significant decline in both sales and confidence in the near-term future.
The April 2020 Precision Metalforming Association (PMA) Business Conditions Report recorded its sharpest decline in data since the survey began in 1979. The survey of 101 metalforming companies in the United States and Canada found that 40% of companies had workers on a shortened schedule or on layoffs, up from 14% in March. The short-term outlook was equally grim, with 87% of respondents expecting an economic decline in the next six months.
“PMA’s April Business Conditions report underscores that, like most sectors of the economy, manufacturing is facing unprecedented challenges caused by the COVID-19 pandemic,” said PMA President David Klotz. “Our members are rising to the challenge to help the country fight the virus.”
The February data from the U.S. Cutting Tool Institute (USCTI) and the Association For Manufacturing Technology (AMT) show consumption was down 4.2% from January 2020 and 8.5% from February 2019.
And USTCI president Bret Tayne said that data doesn’t reflect current realities of the COVID-19 pandemic, “The most recently released February cutting tool statistics reflect the modest slowing we began to see in the latter part of 2019,” Tayne said. “But these numbers precede the effects of the COVID-19 fallout. I suspect we have all experienced a much steeper drop over the past several weeks. Buckle your seat belts!”
The Equipment Leasing and Finance Foundation’s April confidence index for the equipment finance industry plummeted by more than half, dropping to just 22.3% in April after slipping to 46.0% in March. Still, Michael DiCecco, executive vice president of Huntington Asset Finance, tried to find a ray of hope. “While production is likely to soften in the short term, in many ways we have a great opportunity to affirm our value to our existing clients and demonstrate our value to new ones,” DiCecco said. “It’s an important time to stay close to our clients.”
Other survey respondents were less optimistic. While 27.6% of the respondents believe that U.S. will improve in the next six months, 65.5% are of the opinion the economy will decline during that same period.