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Metal formers expect slight decline in business conditions

Metal forming companies expect a slight decline in business conditions during the next three months, according to the Sept. 1, 2006 Precision Metalforming Association (PMA) Business Conditions Report. Conducted monthly, the report is an economic indicator for manufacturing, sampling 153 metal forming companies in the U.S. and Canada.

When asked what they expect the trend in general economic activity to be over the next three months, 27 percent of participants reported that economic activity will decrease (up from 20 percent in August), 49 percent believe conditions will remain the same (down from 58 percent the previous month) and 24 percent anticipate economic activity will improve (compared to 22 percent in August).

Metal forming companies also expect incoming orders to dip during the next three months. Twenty-eight percent of respondents predict an increase in orders (down from 33 percent in August), 29 percent anticipate a decrease (up from 23 percent last month) and 43 percent forecast no change (compared to 44 percent in August).

Current average daily shipping levels, however, improved in September. Twenty-nine percent of companies reported that shipping levels are above levels of three months ago (compared to just 18 percent the previous month), 45 percent reported no change (down from 53 percent in August) and 26 percent reported that September shipping levels are below levels of three months ago (compared to 29 percent in August).

The number of metal forming companies with a portion of their workforce on short time or layoff increased to 13 percent in September, compared to 12 percent in August. While the September 2006 data represents the highest level this year, it is consistent with September 2005 data, at which time metal formers reported 14 percent of their workforce on short time or layoff.