Winners and losers in a recession

At the restaurant, I knew something was up.

The family ate out at a middle-class dining establishment next to a big shopping mall on Thanksgiving weekend the day after Black Friday. Only, the place was only half full. More than that, service was horrible. Two waitresses scurried around helping everyone; the kitchen seemed backed up. Yes, it looked like the place had downsized.

This was something, I thought. Deciding not to get a plasma TV is one thing, but not eating out? That"s something else entirely. For my family, going out for a reasonably priced (OK, cheap) dinner is one of the last nonessential things we plan to cut from our budget, should the need arise. Friends, family, and prepared (even cheap) food served to everyone: You just can"t get better than that.

But when times are tough, food at home, transportation, and shelter win out. Sitting at the restaurant table, I began to wonder just how bad things have gotten. How many of us lived beyond our means? How many lived with high credit card balances? If it"s enough to keep people home most of the time, we"re in for a rough ride.

The news Monday didn"t cheer me up either, when the Institute for Supply Management™ told us that U.S. manufacturing has hit its lowest point in 26 years, and that the sector continued to shed jobs for the fourth straight month. Today the government finally got around to telling us that we"ve been in a recession since December 2007, and stocks plunged with the news. (Economists are really good at predicting past events.)

In October at the FABTECH® Intl. & AWS Welding Show, as I reported in this blog, attendees told me times were not great, but not bad either. Some said they were even expanding. What a difference two months make. On Monday I began to think many of them might tell me a different story.

But then I stumbled upon EVS Metal Inc., a precision metal fabricator with headquarters in Riverdale, N.J., and additional facilities in Texas and New Hampshirefor a total of 120,000 square feet of manufacturing space. From the looks of it, 2008 has been a banner year for the company. In August it purchased the Holden Co. in Keene, N.H., a company that specialized in heavy, complex weldments. The place came with a wet-paint booth, and EVS has since added powder coating equipment and a 4-kW laser cutting system.

Joseph Amico, EVS vice president, had this to say in a press release: Holden"s location will allow EVS to better service New England, while its capabilities in larger and heavier fabrication will complement the New Jersey facility"s smaller precision chassis and assembly strengths, allowing us to provide a total solution to more of our customers" metal requirements.

EVS serves customers like Siemens, Eaton, 3M, Qualcomm, Pepsi, and Applied Materials. In fact, the industries the company serves make up a cross section of much of the industrialized economy: aerospace, automation, electronics, energy, food and beverage, military, telecom, transportation, even gaming.

In 2006 EVS acquired assets of Preferred Inc., a precision metal fabricator in Austin, Texas. This came after several acquisitions on the heels of the last downturn, in 2003. In July of that year EVS acquired Austin"s Quickturn Precision Sheet Metal, and the company helped shut down Grentek Inc., another metal fabricator in Austinand, oh yes, obtained Grentek"s customer base.

This shows that, while every downturn is a struggle, there are winners and losers. And after each recession, winners can emerge stronger than ever.