CLEVELAND — Metalforming companies reported a drop in shipping levels in May, leading to predictions of a dip in economic activity heading into the summer months, according to the May 2023 Precision Metalforming Association Business Conditions Report.
Prepared monthly, the report provides an economic indicator for the next three months of manufacturing, sampling 107 metalforming companies in the United States and Canada.
PMA’s May report shows that 35% of metalforming companies anticipate a decrease in general economic activity in the next three months, compared to 30% in April; 54% expect no change — compared to 55% in April — and only 11% predict an increase in activity, down from 15% last month.
Metalformers also forecast a decline in incoming orders, with 21% of survey respondents expecting an increase in incoming orders during the next three months compared to 28% in April, 45% anticipating no change compared to 44% last month, and 34% predicting a decrease in orders, up from 28% in April.
Metalforming companies also reported a drop in shipping levels. Only 15% of respondents reported an increase in current average daily shipping levels in May — compared to 33% in April — 49% reported no change compared to 46% last month, and 36% reported a decrease, up from 21% in April.
“PMA members are facing headwinds with more companies reporting drops in shipping levels and a decline in incoming orders,” said PMA President David Klotz. “While one month doesn’t make a trend, rising costs, supply-chain challenges and ongoing difficulty in finding workers all contribute to uncertainty. Leaders in Washington, D.C. could help by ensuring that the country does not default on its debt. Congress also should reinstate the full deduction of R&D expensing and avoid policies that drive up prices and create shortages of important inputs including raw materials.”
Lead times dropped this month, with only 11% of metalforming companies reporting an increase in lead times in May, compared to 17% in April. Seven percent of companies had a portion of their workforce on short time or layoff, the same percentage reported in March and April, while 40% of companies are currently expanding their workforce, compared to 47% last month.