Month: December 2022
Published December 28, 2022
Our shops have had two extraordinarily strong years of sales and production. Our January sales performance was unexpectedly high- up 13 percent over December and 12 percent over the five-year average for January. Our indicator outperformed both Industrial Production and New Orders for Manufactured Durable Goods. Sentiment indicators were positive for Lead times, Employment and Profitability. Our positive sentiment indicators combined with record sales in January suggest optimism going into February 2023.
If you are not currently participating in PMPA’s Monthly Business Trends reporting, you are missing an excellent peer benchmark and a tool to provide you with confidence for your business decisions. Contact Veronica Durden to sign up.
Published December 26, 2022
Published December 19, 2022
Published December 14, 2022
Published December 12, 2022
The 2023 Holiday Time-Off surveys have been compiled and calculated, and the 2023 Holiday Time-Off Reports are attached. Our thanks to the 75 member companies who completed and returned a survey. Please remember that the results of the survey indicate which 2023 holidays those companies plan to offer their employees off with pay. It does not indicate which, if any, holidays they may offer off, without pay.
The 2023 Holiday Time-Off Reports will be available for reference throughout the year on the Reports page of the PMPA website.
Published December 5, 2022
Published December 1, 2022
Manufacturing is the fourth largest segment of the U.S. economy. Counted by itself, manufacturing in the U.S. would be the eighth largest economy in the world. Manufacturing created 11% of value added to the U.S. GDP in 2021. In 2020, U.S. manufacturing output was $2,345 billion. Manufacturing directly accounts for 8.6% of the U.S. workforce (about 12.2 million people), 60% of U.S. exports, 55% of patents and 70% of research and development (R&D) spending, according
to the National Association of Manufacturers (NAM) and a McKinsey & Company analysis of U.S. Bureau of Economic Analysis (BEA)and U.S. Bureau of Labor Statistics.
However, manufacturing relies on inputs from other sectors in the U.S. and global economies: energy from fuels and utilities; materials from mines and mills; machines, tools and equipment for production; packaging and freight services for our raw materials and final products; accounting; and other services. All of these are important inputs to manufacturing success. Purchases of these inputs by manufacturers lead to an enhanced final demand in the broad economy. This is called the economic multiplier and the U.S. B.E.A. calculates that one dollar’s worth of final demand in manufacturing results in an additional $2.68 of total impact to the overall economy. Manufacturing investment leads growth.
In the U.S. Midwest, we tend to think that manufacturing is just another word for metalworking. In fact, chemicals, computer and electronic products, and food, beverage and tobacco products are the top three manufacturing sectors
by dollar output. Aerospace and other transportation equipment, motor vehicles and parts, and machinery are segments that we serve — and these all have greater sales than our sector.
Fabricated metals, classified as NAICS 332000, is the name of the industry in which our precision machining/
contract manufacturing shops are classified. It is the seventh largest sector in manufacturing — in 2019, fabricated metals products output was $161.2 billion.
Precision machined products (our industry segment) is classified as NAICS 332721. In 2018, which is the latest data available from the U.S. Census, our industry sales were $20.8 billion, or almost one-eighth of the output of the fabricated metals industry. Our top 10 largest markets served, according to 2018 U.S. Census data, are shown above.
Manufacturing is important. It is the fourth largest segment of the U.S. economy. Arguably, nothing in our economy would function without the critical technologies that our precision machined components enable — machinery, mobility, aerospace and medical. I am fond of quoting Lothar Horn, CEO at PMPA technical member company Horn USA, who stated, “No car runs, no aircraft flies and no hip replacement is fitted by a doctor without precision tools having previously been in use.”
Precision tools are skillfully employed by precision machinists at precision machining contract manufacturing shops like yours. What you make matters. Your decisions on part quality and acceptance make a difference. A difference that matters. We make parts for “can’t fail” applications. Applications where critical human safety is the expected outcome — and one that we take for granted every day. Our production may be just one-eighth of the seventh largest manufacturing industry, which is itself the fourth largest sector of the U.S. economy. But, every day, people live well because we are the hands of the physician, the enablers of mobility and transportation, and the suppliers of essential and critical infrastructure to keep our economy thriving. Economics may be a dismal science, but this peek into the economy of manufacturing makes me proud of our performers, their talent and their accomplishments. Precision machinists — we make the things that make a difference. About $20 billion worth each year!
Miles Free III is the PMPA Director of Industry Affairs with over 50 years of experience in the areas of manufacturing, quality and steelmaking. Miles’ podcast is at pmpa.org/podcast. Email Miles
Published December 1, 2022
The manufacturing workforce is a challenge. That is not news. That fact is decades old and, with our current economic environment and unemployment at a record low, it is probably not likely to change anytime soon. If you search online, you will find article upon article with ideas of how to retain a skilled workforce (yes, I write articles on it, too) and all the perks which can be offered. But with all those ideas, how do you choose the ideas that are best for you?
A Slew of Ideas
Here is a list of ideas (in no particular order) I have accumulated through discussions with PMPA members and articles I have read:
• Free snacks/free coffee
• Flexible schedules
• PTO awarded for good attendance
• Mini golf course on the roof
• Monthly fun days (lunches with activities)
• Bonuses
• Salary incentives
• Employee of the Month with parking spot
• Indoor golf simulator
• Decked out breakroom with video games
• Sponsor fantasy football league
How to Choose?
It is obvious you can’t do everything on that list (if you build the mini golf course, please send me an invite.) And just because you can do something doesn’t mean you should do something. Find a good fit. You know your employees. If you don’t know them well enough, then talk to them. What motivates them? What would they consider a perk? Remember, the people you currently employ are also the type of people you are looking to recruit and incentives play a large part in recruitment.
You don’t have to go big — I’m always amazed at what people will do for a free T-shirt or food — but find a great fit. Do you have people with school-age children? They may appreciate the flexible schedule over a breakroom with video games. Many of the incentives also promote team building (fun days and fantasy football league.) In addition to considering what would motivate your employees, you need to take into account the budget, available space and schedule. You need to find a balance and be flexible. It’s the old chicken and the egg dilemma. The company exists to make parts. You can’t make parts without employees. Studies show that happy workers are good workers (Oxford University’s Saïd Business School, 2019), so finding that balance is worth it. In short, determine your objective, nd a perk or perks that t into your culture, budget, schedule and space, then make it happen. The perk for the company? Happy, productive workers who stay.
Carli Kistler-Miller, MBA has over 25 years of experience with
communications, event/meeting planning, marketing, writing and
operations. Email: gro.apmp@rellimc — Website: pmpa.org.