November PMPA Business Trends- A Return To Seasonal Normal

Posted on by

The PMPA Business Trends Report Sales index for November plummeted 23 points from 132 to 109, a drop of almost 17%. Here are 5 reasons why we are unconcerned by what most would call a panic-worthy drop.

That drop tells us more about October's record than it does about November sales — That drop tells us more about October’s record than it does about November sales

The November value of 109 actually “just happens to be” the arithmetic average of the index for the last 4 Novembers.
The drop is more about the record high in October than it is about a low November.
Sentiment for Lead Time remains level for the next three months- our shops know their capacity and see it remaining the same.
Sentiment for future Profitability, Employment, and Sales all increased in November despite the drop in actual sales.
November and December are typically weak sales months for our industry. January sales will likely be “gangbusters” as our customers return to work after end of year tax inventory and holiday shutdowns.

By the way, the average length of first shift hours scheduled was 43.5 hours, just a half an hour short of 44 hours- which means average shop in our industry was just short of working 10% overtime as a regular schedule- despite that “huge drop” in sales.
The outlook for precision machining is looking strong according to the 87 respondents in our survey and report.
PMPA Business Trends Report for November 2014

NLRB Action This Week Will Hurt Manufacturing Employees and Employers

Posted on by

Washington, D.C. – The Precision Machined Products Association (PMPA) today strongly criticized the release by the National Labor Relations Board (NLRB) of a rule which restricts the rights of employees and drives a wedge between employers and employees.

On Friday, December 12, the NLRB released the “Ambush Election” rule, which limits the amount of time employees have to consider whether or not to join a union to as little as 10-14 days, down from an average of 56 days. The new rule, which takes effect April 14, 2015, also requires businesses to supply unions with the phone numbers and email addresses of employees ahead of an election, exposing workers and their families to unwanted calls at all hours. In a legal challenge supported by PMPA, the U.S. District Court for the District of Columbia previously struck down a nearly identical version of the rule.
“While we are disappointed with the NLRB’s actions, we are not surprised,” said Miles Free, co-Interim Executive Director of the PMPA. “This rule continues a disturbing trend by the NLRB to drive a wedge between employers and employees. The current system is already working and employees need time to weigh their options and understand what is at stake,” continued Mr. Free.
Regardless of a company’s size, actions like this sends a ripple effect throughout the manufacturing supply chain. Prior to the courts rejecting the NLRB’s earlier attempt, the U.S. Congress, whether under control of Republicans or Democrats, repeatedly refused to act on this proposal in legislative form.

Opponents of the most recent Ambush Election rule are exploring their legal options and expect to take action in the courts in the near future to challenge the NLRB’s authority to take this restrictive action.

Ductility- As Measured By Tensile Testing

Posted on by

The ability of a material to deform plastically without fracturing, is called ductility. In the materials usually machined in our shops, ductility is measured by determining the percent of elongation and the percent reduction of area on a specimen during a tensile test.
Our earlier post about Ductility showed how ductility can impact our shops. In this post, we will describe how we can measure ductility and use it to predict behavior based on values reported on certs and test reports.
The percent elongation and percent reduction of area values shown on our test reports and material certifications from our material suppliers indicate the ductility of the material tested.
In the tensile test, a cylindrical specimen is gripped securely and subjected to a uniaxial load and elongated until it breaks. At the end of the test, the pieces of the fractured specimen are fitted back together again and the change of length between the two gage marks put on the specimen before testing is determined. The change is then expressed as a percentage of the original gage length.

Fractured specimen fitted back together then measured

The percent reduction of area is determined by measuring the minimum diameter of the broken test specimen after the two pieces are fitted together and the difference is expressed as a percentage of the original cross sectional area prior to the test.

The differences in measurements after tensile test are used to calculate the % elongation and % reduction of area

A minimum of 12% elongation is recommended for consistent, trouble free thread rolling applications.
Rolled threads are stronger, so having the ductility to thread roll is important. However, too much ductility makes it difficult to get the chip to separate by cutting.
Low ductility can be problematic for cold deformation manufacturing processes such as thread rolling, cold forming, swaging, staking and crimping.
This is the designer’s compromise: if it is good for cutting, it is probably not very good for rolling.

HSC online Graphic of test specimens
Yost made in USA vise photo credit

November ISM Report-Manufacturing Sustains its Strength

Posted on by

” Economic activity in the manufacturing sector expanded in November for the 18th consecutive month, and the overall economy grew for the 66th consecutive month, say the nation’s supply executives in the latest Manufacturing ISM^® Report On Business^®.”

Manufacturing sustains expansion in November 2014

” “The November PMI^® registered 58.7 percent, a decrease of 0.3 percentage point from October’s reading of 59 percent, indicating continued expansion in manufacturing. This is consistent with a 5.1% annualized rate of change in inflation adjusted GDP.”
This was above expectations and indicates a sustained expansion of manufacturing.
In other good news for our manufacturing shops – ISM’s Miscellaneous Manufacturing; Fabricated Metal Products; Electrical Equipment, Appliances & Components; Plastics & Rubber Products; Machinery; Transportation Equipment; and Primary Metals respondents reported growth in November.
“The New Orders Index registered 66 percent, an increase of 0.2 percentage point from the reading of 65.8 percent in October. The Employment Index grew for the 17th consecutive month, registering 54.9 percent, a decrease of 0.6 percentage point below the October reading of 55.5 percent.”
These are all positive indicators for manufacturing.
Materials impact in November
Inventories of raw materials registered 51.5 percent, a decrease of 1 percentage point from the October reading of 52.5 percent. The Prices Index registered 44.5 percent, down 9 percentage points from the October reading of 53.5 percent, indicating lower raw materials prices in November relative to October. This is a major change from the strength of the prices index in the recent past.
How this relates to our precision machining shops:
The PMPA Business Trends Index for October increased a whopping 13 points (10.9%) from 119 to 132. This is the highest value for our index, ever. While this was an unexpected show of strength for our industry, we did confirm our data and noted that over 40% of respondents reported double digit sales increases for October.
The ISM PMI indicator’s strength in November leads me to believe that our shops will also report stronger than expected results in our November Business Trends Report.
How is your shop dealing with the unexpected strength in demand for your products?
ISM November Release
Calculated Risk Blog PMI Graph

Thanksgiving- A Time to Recalibrate

Posted on by

We have many blessings in our lives, the love of family, friends chief among them.

Thanksgiving is a time to share with family and friends.

Most of us enjoy an unparalleled material well-being, and a lifestyle of modern convenience that is the envy of the world.
Thanksgiving provides us the chance to recognize and thank the engineers, machinists, and entrepreneurs who have designed and built these modern technologies that keep us safe, comfortable, and make our modern lifestyle possible.
Precision machined components enable almost all modern technologies to function safely and efficiently. It makes me smile to understand where all this behind the scenes technological “magic” is sourced.
Thanks to the machinists who make them, the engineers that design them, and the investors who tool up their shops to be able to produce them.
Thanksgiving is also about recognizing how our loved ones contribute to our ability to produce our highly engineered components. How they help us keep in mind what “Safety Critical” really means. How they make sure we have what we need when we arrive on the job. And have a reason to return home, all body parts intact. Now is a great time to recognize the contributions of our loved ones to our success.
I am thankful for the blessings of my family and friends.
I am grateful to live in a time where technology makes my life more about the joy of my family’s company than about battling forces to merely survive. Technology works, thanks to machinists.
In our shops, we have calibration routines to help us assure that our output is to spec and acceptable.

We have calibration routines at work; how do we calibrate our lives at home?

Thanksgiving is a day for us to recalibrate and reflect on the blessings that collectively we share.
Happy Thanksgiving!
Vintage Thanksgiving Dinner photo credit
Calibration photo credit

What Does Ductility Mean?

Posted on by

Ductility arrives in our shops as indicated by burrs

Ductility can also mean long stringy chips that can form a dreaded “birds nest” engulfing the tool and work piece.

Test text — Birds nest chips present a very real danger to operators. Ductility can hurt!

Long necklace chips are another sign of ductile materials in machining.

long continuous chips resulting from ductile material can be controlled to keep them away from work piece and tool — Long continuous chips resulting from ductile material can be controlled to keep them away from work piece and tool.

Short chips curled into “sixes and nines” showing a bit of heat discoloration are typical of less ductile materials and dutile materials machined at proper parameters using chip breakers and high pressure coolant delivery.

Note the touch of heat discoloration shown on the chip as well. — Chips that look like sixes or nines showing a bit of heat discoloration are desired for safe practice.

In our machining practice we would prefer materials that are “crisp” rather than ductile.
In order to successfully deal with ductile materials, strategies such as chip control features on inserts, wiper style inserts, through tool coolant, interrupted cuts, chip breakers, and high pressure coolant can be considered.
Dialing in the appropriate feeds, speeds and depth of cut are crucial too.
Birdsnest photo courtesy Garage Journal
All other photos by author.

Where The Jobs Are- USA Today

Posted on by

Titled “More High Schools Teach Manufacturing Skills” the article confirms that ” U.S. high schools that have launched or revived manufacturing programs in recent years to guide students toward good-paying jobs and help fill a critical shortage of skilled machinists, welders and maintenance technicians.”
Here are a couple of points that they make that are worth sharing:

There is a glaring imbalance in the labor market. Despite high unemployment since the recession, manufacturers still struggle to fill hundreds of thousands of job openings.
Manufacturing is dogged by an outdated image
Manufacturing is “Actually, “you’re working with computers and robots that are doing what you used to do by hand. That requires a skill set (in math and science) above what was required a generation ago.”
Community colleges also are turning out more prospective employees but not keeping up with demand. Nationwide, community colleges awarded 1,557 associate degrees or certificates in manufacturing last year, according to the American Association of Community Colleges. That’s up from 616 in 2005 but below the nearly 1,600 doled out in 2000.

In addition, the USA Today piece has some informative graphics and video clips.

But the best takeaway from this piece is a quote from a student whose engagement with the manufacturing class has improved his grade performance and motivation:
“With this class, I have the motivation…It’s a way out, I don’t want to be working at McDonald’s.”
Thank you USA Today for this positive story.

OSHA Reporting Requirements for Employers Go into Effect January 2015

Posted on by

A new wallet card issued by OSHA will help your supervisors understand the changes to Injury and Illness Reporting Requirements that go into effect in January 2015.
Get the card here as a printable pdf

What are the new requirements?

“Under the final rule, employers must report the following events:
    1. Each fatality resulting from a work-related incident, within 8
hours of the death. This requirement applies to all fatalities
occurring within 30 days of a work-related incident. See Sec.
1904.39(a)(1) and (b)(6). This is the same as the current regulation
and the proposed rule.
    2. Each in-patient hospitalization resulting from a work-related
incident, within 24 hours of the hospitalization. This requirement
applies to all in-patient hospitalizations occurring within 24 hours of
a work-related incident. See Sec. 1904.39(a)(2) and (b)(6). Under the
proposed rule, employers would have been required to report all in-
patient hospitalizations within 8 hours, for hospitalizations occurring
within 30 days of a work-related incident. Under the current
regulation, employers are required to report, within 8 hours, in-
patient hospitalizations of three or more employees, for
hospitalizations occurring within 30 days of a work-related incident.
    3. Each amputation resulting from a work-related incident, within
24 hours of the amputation. This requirement applies to all amputations
occurring within 24 hours of a work-related incident. See Sec.
1904.39(a)(2) and (b)(6). Under the proposed rule, employers would have
been required to report all amputations within 24 hours, for
amputations occurring within 30 days of a work-related incident. Under
the current regulation, employers are not required to report
amputations.
    4. Each loss of an eye resulting from a work-related incident,
within 24 hours of the loss of an eye. This requirement applies to all
losses of an eye occurring within 24 hours of a work-related incident.
See Sec. 1904.39(a)(2) and (b)(6). The proposed rule would not have
required employers to report losses of an eye, and the current
regulation also does not require them to do so.”- Federal Register

These requirements go into effect January 1, 2015
Get the wallet card and review the upcoming changes with your team now.

October 2014 ISM PMI-Manufacturing Remains Robust

Posted on by

“The October PMI® registered 59 percent, an increase of 2.4 percentage points from September’s reading of 56.6 percent, indicating continued expansion in manufacturing. The New Orders Index registered 65.8 percent, an increase of 5.8 percentage points from the 60 percent reading in September, indicating growth in new orders for the 17th consecutive month. The Production Index registered 64.8 percent, 0.2 percentage point above the September reading of 64.6 percent. The Employment Index grew for the 16th consecutive month, registering 55.5 percent, an increase of 0.9 percentage point above the September reading of 54.6 percent. Inventories of raw materials registered 52.5 percent, an increase of 1 percentage point from the September reading of 51.5 percent, indicating growth in inventories for the third consecutive month. Comments from the panel generally cite positive business conditions, with growth in demand and production volumes.”- Bradley J. Holcomb, Institute for Supply Management^® (ISM^®)

Outstanding October
Sixteen of eighteen manufacturing industries reported growth in October.
We were especially pleased to see New Orders up 5.8 points to 65.8.
The October ISM PMI numbers reflected the PMPA’s Business Trends results for September:

“The PMPA Business Trends Index for September increased 2 points (1.7%) from 117 to 119. This is the highest value for

September in the 5 years since the recession’s low of 83. September 2014’s 119 is 7 points, or 6.25% higher than the value for

September 2013. (On PMPA’s recently completed Shop Hourly Wage Survey, we determined that sales had increased 6% year over

year for those shops reporting in both 2013 and 2014.) The Sales Index average, year to date, is 121.9, up 4.9 points from the 2013

calendar year average. Six of the eight months this year have had an index value higher than that of the prior year. “

PMPA member companies continue to report strong sales and increasing lead times as the North American manufacturing economy continues to show its strength.

Now is a great time to be engaged in precision machining as advanced manufacturing continues to grow here in North America.

Graph courtesy Calculated Risk Blog

Precision Plus Training Initiatives Featured in STEM Magazine

Posted on by

Precision Plus, Inc. is featured in the latest issue of Wisconsin STEM Pathways Magazine.
The article, entitled Companies in the Classroom–Putting the Classroom in the Workplace, chronicles the company’s two year journey from a concept to the reality of having an internship and a apprenticeship program for high school and college students, as well as a fully equipped classroom within its facilities.

PMPA member companies recognize the challenge of finding a skilled workforce.
That’s why companies like Precision Plus, Inc. are actually doing something about it.
And why we are active working locally and nationally to make a difference and change the conversation about skills and careers and economic success.
Congratulations to Precision Plus, Inc., for leading the way to create the skilled workforce our industry needs.
To download a PDF of the complete article, click here.
The Precision Plus Inc. Blog
Precision Plus Website