Majority of US Job Shops in Manufacturing Survey Optimistic – Why?

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A few days ago, our sister site Spend Matters brought an interesting manufacturing survey to MetalMiner’s attention., the organization that comes out with the MFGWatch Manufacturing Supply Survey of North American buyers and suppliers (which MetalMiner has covered before), recently surveyed some 250 US job shops to parse out an overall economic outlook from their perspectives.

The first survey we mentioned (of which the latest results were published in February 2012), found that

“Overall manufacturing business conditions improve[d] for product manufacturers (buyers) and job shops/contract manufacturers (suppliers) with both reporting increased sales; job shops/contract manufacturers report growths in capacity and customer inquiries; reshoring still not a noticeable trend for product manufacturers but intentions to reshore increased; more education needed on exporting before manufacturers will become willing to explore international markets; increase in concerns about availability of qualified labor.”

In the most recent survey, many of the manufacturers’ responses seemed to coalesce around a few themes. According to comments forwarded to us made by Mitch Free,’s founder and CEO, many job shops “continue to struggle to find skilled workers, and are “frustrated that the government isn’t doing more to help small business.” They also find credit still very hard to get, and “finding the customers who are reshoring manufacturing work so they can get contracts from them is a challenge.”

The three takeaways from the survey that stuck out to us:

  • While a big concentration of respondents told that they’re running at between 70 and 80 percent capacity, the trend is “in the right direction,” Free said, and “job shops are reporting running at a higher capacity than previously.”
  • Free said in an email that seeing 40 percent of the job shops reporting that they have benefited from work being re-shored is a great sign, and will continue to grow. “Very encouraging,” Free said.
  • However, 63.3 percent of surveyed job shops do not sell outside of America — while this “is not surprising” to Free, “it is a sad statement,” he noted. “Small businesses have to learn how to sell outside of the U.S. Being 100% dependent on the U.S. Economy going forward is a losing strategy.”

Overall, respondents seemed optimistic about their business moving forward. Whether this holds true across all metal/machining and fabrication shops remains to be seen.

Rob Olney, the CEO of ETM Manufacturing in Littleton, Mass. — a supplier of several New England-based OEMs — may have some different opinions. On his blog, he wrote a post on March 28 titled ““If the economy is recovering, how come I feel so lousy?” Olney noted that his team had reported that all of their suppliers are slow:

“This is unusual given that it’s the end of the month/quarter, so I called around…Even Jaime, who had a great year last year, said that product hadn’t been moving out of his warehouse for months.  Some product that we shipped them almost 2 years ago was still on his shelf.  So what is all this talk we’re hearing about a recovering economy?”

Check back in next week to read a MetalMiner interview with Olney to see his manufacturing outlook for the next quarter.

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