Prepared monthly, the PMA business conditions report provides an economic indicator for manufacturing, sampling 101 metal forming companies in the United States and Canada.
After two months of showing increased optimism, PMA’s May report shows that only 41 percent of metal forming companies forecast an improvement in economic activity in the next three months (compared to 56 percent in April), 49 percent predict no change (compared to 37 percent in April) and 10 percent anticipate a decline in activity (up from 7 percent in April).
The May report indicates that lead times continue to increase. When asked about lead times compared to the previous three months, 71 percent of respondents said that they have increased, up from 64 percent in April. Increases have continued each month since September 2020, when only 16 percent reported increased lead times.
“The May report reflects what I have been hearing from members during my visits to their facilities across the country: There are substantial challenges in finding steel and other raw materials needed to meet growing demand,” says PMA President David Klotz. “Our members continue to report high prices and increased lead times for steel, aluminum, copper, brass, and other metals.
“PMA calls on the Biden administration to terminate the Section 232 steel and aluminum tariffs, which no longer are needed and are one of the main causes for the supply problems experienced by our members. In addition, members also report that the semiconductor shortage that has resulted in the idling of some auto plants are beginning to negatively impact orders.”
Current average daily shipping levels decreased in May, with 60 percent reporting an increase (down from 72 percent in April), 30 percent reporting no change (compared to 23 percent in April) and 10 percent reporting a decrease (up from 5 percent in April).
The survey also revealed an expectation that incoming orders will decline somewhat in the next three months, with 42 percent forecasting an increase in orders (down from 58 percent in April), 44 percent predicting no change (compared to 33 percent in April) and 14 percent anticipating a decrease in orders (compared to 9 percent in April).
Four percent of responding metal forming companies had a portion of their workforce on short time or layoff in May, an increase from only 1 percent in April.
A trade association, PMA represents nearly 850 member companies in the $137-billion metal forming industry of North America. The members include companies that use stamping, fabricating, spinning, slide forming and roll forming technologies, and other processes to create precision metal products. The members also include suppliers of equipment, materials, and services to the industry.
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