Metal forming companies anticipate little change in business conditions in next three months

According to the July 2010 Precision Metalforming Association (PMA) Business Conditions Report, metal forming companies anticipate little change in business conditions during the next three months. Conducted monthly, the report is an economic indicator for manufacturing, sampling 119 metal forming companies in the United States and Canada.

The July report shows that 23 percent of participants expect an improvement in economic activity during the next three months (down from 24 percent in June), 61 percent predict that activity will remain unchanged (up from 59 percent last month) and 16 percent report that activity will decline (down from 17 percent in June).

Metal forming companies also anticipate virtually no change in incoming orders for the next three months. Twenty-nine percent of participants forecast an increase in orders (down from 30 percent in June), 51 percent expect no change (compared to 47 percent the previous month) and 20 percent predict a decrease in orders (down from 23 percent in June).

However, average daily shipping levels dipped in July. Only 34 percent of participants report that average daily shipping levels are above levels of three months ago (down from 48 percent in June), 54 percent report no change (up from 43 percent in June) and 12 percent report that shipping levels are below levels of three months ago (up from nine percent in June).

The percentage of metal forming companies with a portion of their workforce on short time or layoff remained unchanged from June to July, with 27 percent of companies reporting workers on short time or layoff.

"Metal forming companies, particularly suppliers to automotive, medical equipment, energy and electronics markets, continue to report very positive business conditions," said William E. Gaskin, PMA president. "It appears that there will be some softening in the 3rd quarter for many automotive suppliers due to reduced June sales. Many companies continue to be very cautious about the future due to the constant barrage of media coverage about the possibility of a double-dip recession. From numbers reported by PMA members, it certainly appears that the recovery will continue at a slow, but steady pace."