Month: August 2019

Mixed Signals- Sales & Sentiment Recover, but Moving Averages Show Growth Slowing

Posted on by

“If slowing growth today means Sales 12% above the prior five years’ average sales for July, we’ll take it.”
With 80 companies reporting, the PMPA Business Trends Index for July 2019 recovered up 3 points or 2.3 percent to 132. While this 132 value is the second lowest value for the year, some context is in order. There were only 4 times where the index was higher than 132 prior to 2018. 132 is a 12.4 percent increase above the Average of July for the past five years, and 104 percent of July 2018 sales.
 

There are only 4 occurrences of the BT Index exceeding 132 prior to 2018. The July value of 132 is up 12.4% above the average for the past five Years of July. And 4X the Increase of Industrial Production reported by the FED.

We acknowledge that – the 3-month moving average of this sales index has dipped below the 12-month moving average- indicating that the pace of growth in our industry has slowed. At the same time all our forward looking sentiment indicators are Up. UP.  UP!

Opinions for the next three months compared to today:

  • Net Sales: Our companies’ outlook for the next three months is strongly positive for the next three months.
  • Lead Times: The outlook for Lead Times shows that respondents expect to be busy in the coming three months. Ninety percent of respondents expect lead times to remain the same or increase in the next three months. Positive for Sales.
  • Employment: Sixty percent (60%) of shops reported scheduling overtime in July. Prospects for employment are strongly positive with ninety-seven and a half percent (97.5%) expecting level or increased opportunities for employment.
  • Profitability: Overall sentiment for profitability shows respondents to be optimistic for the next three months, in line with all other sentiment indicator

2019 has been a very strong year for Sales. July’s recovery to 132, while not sufficient to keep the 3-month moving average above the 12-month moving average, is still a remarkable 12.4 percent increase for sales compared to the five year average of monthly sales for July.
Is sales growth slowing? That is what the 3- and 12- month moving averages are telling us. Are we at an enviable level of sales for such a slowdown? I would argue “Yes!” that the current July Sales index of 132 was only exceeded 4 times prior to 2018. Mixed signals appear quite positive to me for the next three months for our precision machining shops.

Most Valuable College Majors- Bankrate

Posted on by

Here in one tidy place you can find a current list of the most Valuable College Majors.
Many of them will lead to a valuable career in our precision machining shops.
The most valuable college majors include naval architecture marine and nuclear engineering and pharmaceutical sciences. We were pleased to see Mechanical Engineering, Transportation Sciences, and miscellaneous Engineering technologies all included in the top spots.

STEM careers add value!
STEM Careers add Value!

The top 10 most valued college majors are:

  1. Naval Architecture And Marine Engineering (Median income: $90,000; Unemployment rate: 1.6 percent, Percent with an advanced degree: 29 percent)
  2. Nuclear Engineering (Median income: $98,100; Unemployment rate: 1.8 percent, Percent with an advanced degree: 56 percent)
  3. Pharmacy Pharmaceutical Sciences And Administration (Median income: $100,000; Unemployment rate: 2.2 percent, Percent with an advanced degree: 58 percent)
  4. Genetics (Median income: $85,000; Unemployment rate: 1.2 percent, Percent with an advanced degree: 76 percent)
  5. Electrical Engineering (Median income: $99,000; Unemployment rate: 2.7 percent, Percent with an advanced degree: 46 percent)
  6. Architectural Engineering (Median income: $74,000; Unemployment rate: 1.5 percent, Percent with an advanced degree: 29 percent)
  7. Aerospace Engineering (Median income: $90,000; Unemployment rate: 2.3 percent, Percent with an advanced degree: 49 percent)
  8. Computer Engineering (Median income: $92,000; Unemployment rate: 2.8 percent, Percent with an advanced degree: 40 percent)
  9. Electrical Engineering Technology (Median income: $76,000; Unemployment rate: 1.8 percent, Percent with an advanced degree: 30 percent)
  10. Materials Science (Median income: $90,000; Unemployment rate: 2 percent, Percent with an advanced degree: 66 percent)
  11. Engineering and Industrial Management (Median Income $72,600; Unemployment rate 1.3%; Percent with an advanced degree: 34%)
  12. General Engineering (Median Income $80,000; Unemployment rate 2.4%; Percent with an advanced degree: 37%)
  13. Applied Mathematics (Median Income $78,200; Unemployment rate 1.8%; Percent with an advanced degree: 49%)
  14. Construction Services  (Median Income $70,000; Unemployment rate 1.9%; Percent with an advanced degree: 11%)
  15. Transportation Sciences and Technologies (Median Income $72,000; Unemployment rate 2.2%; Percent with an advanced degree: 20%)
  16. Mechanical Engineering (Median Income $88,000; Unemployment rate 3.0%; Percent with an advanced degree: 39%)

Cut to #22:
22. Miscellaneous Engineering Technologies (Median Income $70,000; Unemployment rate 2.1%; Percent with an advanced degree: 21%))
Our precision machining shops have career opportunities for those who are STEM minded. 
As the Bankrate study reports:

STEM majors are the most valuable.

 
Bankrate Study: Most Valuable College Majors
 

ITR Economic Report – August 2019

Posted on by

ITR Economic Report – August 2019

 

 

The Institute for Trend Research (ITR) quarterly reports focus on major areas of economic growth and decline in key market segments for the Precision Machined Products Industry. They are provided to PMPA members as part of the association’s overall business intelligence program and are used as a management tool to help PMPA members plan for what lies ahead and which markets they should focus on in a complex manufacturing environment. 

 

VIEW/DOWNLOAD

PMPA Business Trends August 2019

Posted on by

PMPA Business Trends August 2019

 

“Business Trends Sales Index Up Over Last Month and August 5Year Average- Down Compared to August 2018”

 

With 84 companies responding, the PMPA Business Trends Index for August 2019 continued its rise, at 134, up 2 points or 1.5 percent over last month, up five points or 3.8 percent over June-this year’s low- and up 5 points or 4 percent over the five year average for the index in August. This 134 value is down 9 points or 6.3 percent compared to August 2018, which was tied for highest monthly value in 2018. There were only three months prior to calendar year 2018 where a monthly value came in above 134- March 2105 and 2017, June of 2017. This August value is right at the calendar year average for last year- not a bad spot to be. The 3-month moving average of this sales index continues below the 12-month moving average- indicating that the pace of growth in our industry has slowed. We’ll take slowing growth that is 4% above the prior five years’ average sales for August! Our year to date average remains at 137, up 3 points or 2.3% over 2018’s year-end average of 134. Our sales are up 1 percent year to date.

 

VIEW/DOWNLOAD

CRIBSHEET – #79 Shop Visitor Checklist

Posted on by

August 2019  |  Craftsman’s Cribsheet #79

Shop visits are an inevitable part of business today. We have more visitors coming through our shops now than ever before: an auditor to validate a process, a customer representative to ensure you really do have machines, a calibration of testing equipment or community members to learn about potential careers. Here is a checklist to make sure your visitors and your shop have covered everything regarding hazards, safety, security and rules for proper dress and behavior.

 

VIEW/DOWNLOAD