City Background – Louisville, KY

PMPA’s Management Update Committee meets in Louisville, KY to plan MU 2023.

 

 

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

May 13, 2022

ISM

The  April ISM  Manufacturing Purchasing Managers’ Index (PMI) logged its lowest month since July 2020. While the index shows modest continued expansion, it dropped 1.7 percentage points from its March Value. Indexes for New Orders, Production, Prices, Backlog and Employment were all down. Link: https://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/pmi/april/

 

Manufactured Goods

New Orders for Manufactured Goods in March increased by $11.8 billion- that’s 2.2 percent- according to the US Census. New orders, as well as Shipments, have been up 22 of the last 23 months. Shipments increased at about the same pace, up 2.3 percent, or $12.6 billion.  

Durable Goods

New Orders for Durable Goods increased in March by $3.0 billion, or 1.1 percent, up five  of the last six months. Transportation equipment led the increase up $2.0 billion or 2.6 percent. Manufactured Non Durable Goods  increased $8.8 billion, or 3.2 percent, led primarily by Coal and petroleum products- $7.6 billion or 11.9 percent proving that it is demand for energy driving the current round of cost increases that we are seeing as manufacturers.- and as consumers “paying at the pump.” 

 

US Census link: https://www.census.gov/economic-indicators/- Click on Press Release  under “Manufacturers’ Goods.”

Gas Prices

Kiplinger reports that both unleaded gas and diesel prices are unlikely to go down soon.  The Russian-Ukraine crisis spiked prices to a national average of $4.33 per gallon in March, but regular summer travel enhanced by COVID-fatigued vacations may cause the price to beat that March high. All those transportation vehicles that use diesel are going to be more expensive to operate – diesel hit an all-time high at $5.18 this month. Natural gas is also expected to go up as demand increases.  Europe is buying excess liquified gas from the US to reduce reliability on Russian supplies. If the exports continue, natural gas prices may increase. 

 

 

PODCAST -NFL Teams, Street Gangs & Your Workforce

TIP OF THE WEEK – Seven of top 25 high paying jobs

 

 

 

 

City Background – Milwaukee, WI

PMPA’s National Technical Conference will be held at The Pfister Hotel in Milwaukee, WI on May 1-3, 2022

 

 

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

April 28, 2022

What is Happening with Steel Scrap

The recent bearish trend in Steel scrap came ahead of this weeks Stock Market Correction and has many members scratching their heads. If the process for steel and stainless are going up, why isn’t the price We get paid for steel scrap following suit?

Answer- Geopolitics- impacting supply and demand

Scrap oversupply in April was evident and is responsible for the lower volumes and lower prices for scrap.

But why the oversupply?

According to our sources- Turkey, who is usually the big buyer for US Scrap Steel exports  is currently taking advantage of low cost Steel semi finished products from Russia, now available at Fire sale prices. Russian Steel exports have not yet  been placed under sanction.

So the Turkish mills  save the melting and casting costs by purchasing semi- finish for further processing.

That’s why nobody want s to pay you what you think your chips are worth.

 

Philadelphia Fed Manufacturing Business Outlook Survey

The Philadelphia Federal Reserve Bank’s reports that “Manufacturing activity continued to expand in the region, according to the firms responding to the April Manufacturing Business Outlook Survey. The survey’s indicators for current general activity, shipments, and new orders declined from last month’s readings but remained positive. The employment index and both price indexes edged higher and remain elevated. The future indicators for general activity and new orders fell sharply, but overall the firms continued to expect growth over the next six months. Raw material costs increased  10-12.5 percent while Energy climbed 7.5-to 10 percent in April. Link: https://www.philadelphiafed.org/-/media/frbp/assets/surveys-and-data/mbos/2022/bos0422.pdf

 

Chicago Fed National Activity Index

The Chicago Fed National Activity Index (CFNAI) moved down to +0.44 in March from +0.54 in February. Three of the four broad categories of indicators used to construct the index made positive contributions in March, but two categories deteriorated from February. Manufacturing industrial production was the strongest contributor, it  moved up 0.9 percent in March after increasing 1.2 percent in February. Link: https://www.chicagofed.org/research/data/cfnai/current-data

 

 

PODCAST – What’s in a Name? Pride.

TIP OF THE WEEK – A Better Definition for Quality

 

 

 

 

City Background – Milwaukee, WI

PMPA’s National Technical Conference will be held at The Pfister Hotel in Milwaukee, WI on May 1-3, 2022

 

 

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

April 22, 2022

Total Industrial Production

Total industrial production advanced 0.9 percent in March and rose at an annual rate of 8.1 percent for the first quarter. Manufacturing output gained 0.9 percent in March; the output of motor vehicles and parts jumped 7.8 percent, while factory output elsewhere moved up 0.4 percent. In March, the jump in motor vehicle production contributed to increases of 3.9 percent and 5.2 percent for consumer durables and transit equipment, respectively.

 

Manufacturing Output

Manufacturing output rose 0.9 percent in March and was 4.9 percent above its year-earlier level. For the first quarter, factory output advanced at an annual rate of 5.4 percent. In March, the indexes for durable and nondurable manufacturing increased 1.3 percent and 0.4 percent, respectively

 

Capacity Utilization for manufacturing

Capacity utilization for manufacturing increased 0.6 percentage point in March to 78.7 percent. The factory operating rate was above its long-run average of 78.1 percent for the first time since August 2018.

Link: https://www.federalreserve.gov/releases/g17/Current/g17.pdf

EV on Rise

High gas prices have increased the demand for electric vehicles.  For precision machining shops serving the automotive industry, keep an eye on expanding EV production. According to Forbes.com, EV auto sales are expected to increase by 37 percent this year. And Industry Week reports that a Japanese EV battery firm plans to build a 2 billion dollar plant in Kentucky, Toyota is building a 1 billion dollar EV battery plant in North Carolina and new Vietnamese electric car company is building an assembly plant in North Carolina.

 

PODCAST – OSHA’s Latest Stats

TIP OF THE WEEK – Choosing a Heat Treater

 

 

 

City Background – Milwaukee, WI

PMPA’s National Technical Conference will be held at The Pfister Hotel in Milwaukee, WI on May 1-3, 2022

 

 

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

April 15, 2022

Inflation Alert – PPI

Inflation Alert- as if you didn’t know.

The Producer Price Index for final demand increased 1.4 percent in March, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This rise followed advances of 0.9 percent in February and 1.2 percent in January. On an unadjusted basis, final demand prices moved up 11.2 percent for the 12 months ended in March, the largest increase since 12-month data were first calculated in November 2010.

Leading the March increase in the index for final demand goods, diesel fuel prices jumped 20.4 percent. The indexes for gasoline, fresh and dry vegetables, jet fuel, iron and steel scrap, and electric power also moved higher.

Steps to take- Keep a sharp eye on the commitments that you are making when doing contract review and quoting new work.

https://www.newyorkfed.org/survey/empire/empiresurvey_overview

CONSUMER PRICE INDEX – MARCH 2022

The Consumer Price Index for All Urban Consumers (CPI-U) increased 1.2 percent

in March on a seasonally adjusted basis after rising 0.8 percent in February,

the U.S. Bureau of Labor Statistics reported today.

The all items index continued to accelerate, rising 8.5 percent for the 12months ending March, the largest 12-month increase since the period endingDecember 1981. Energy focus:The energy index rose 32.0 percent over the past 12 months with all major energycomponent indexes increasing. The index for gasoline rose 48.0 percent over the last yearand the index for natural gas rose 21.6 percent. The index for electricity rose11.1 percent for the 12 months ending March. In March the gasoline index rose 18.3 percent and accounted for over half of the all itemsmonthly increase; other energy component indexes also increased. The food indexrose 1.0 percent and the food at home index rose 1.5 percent.  Attention Managers, Sales and estimators: Are you accounting for 32% escalating energy costs in your Quotes and pricing?

https://www.bls.gov/news.release/cpi.nr0.htm

FOMC Monetary Policy Statement

Empire State Manufacturing Report issued by The New York Federal reserve Bank Wednesday  reported that “Manufacturing activity declined in New York State for the first time since mid-2020.”  

The report’s general business conditions index fell fifteen points to -11.8, its lowest level since May 2020, early in the Pandemic.

New orders and shipments declined modestly, while unfilled orders increased. Delivery times continued to lengthen substantially, and inventories expanded.

“The delivery times index climbed eleven points to 32.7, pointing to a substantial increase in delivery times, and inventories rose at the fastest pace in years.”

https://www.newyorkfed.org/medialibrary/media/survey/empire/empire2022/esms_2022_03.pdf?la=en

 

Why Climate Change Will Affect the Supply Chain

Link to Business Insider Article

 

PODCAST – Mastery Program Tour 2 Overview

TIP OF THE WEEK – Yield Loss Due to Bar End Remnants

 

 

 

City Background – Milwaukee, WI

PMPA’s National Technical Conference will be held at The Pfister Hotel in Milwaukee, WI on May 1-3, 2022

 

 

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

April 8, 2022

Manufacturing Employment

Manufacturing Employment rose by 38,000 in March 2022, adding a total of 102,000 employees in the first Quarter of 2022, according to the BLS.

Employment in durable goods industries rose by 22,000, with gains in transportation equipment (+11,000) and electrical equipment and appliances (+4,000)

Since February 2020, manufacturing employment is down by just 128,000, or 1.0 percent- could catch up by end of year if trend continues.

https://www.bls.gov/news.release/pdf/empsit.pdf

 

GDP Growth in USA

The Bureau of Economic Analysis reported that GDP in the Fourth Quarter of 2021  increased at an annual rate of 6.9 percent. In the third quarter, the rate was 2.3 percent. The increase in real GDP primarily reflected increases in private inventory investment, exports, PCE, and nonresidential fixed investment. According to the chart- Contributions to Percent Change in Real GDP by Industry Group,  Non- durable Goods Manufacturing contributed 0.62 percent to the percent change in GDP, while Durable Goods Manufacturing contributed 0.58 percent. Taking both into account, Manufacturing  made up 1.2 percent of the 6.9 percent GDP increase, or 17.3 percent of the change.

https://www.bea.gov/sites/default/files/2022-03/gdp4q21_3rd.pdf

 

Factory Orders

New orders for manufactured goods in February, down following nine consecutive monthly increases, decreased $2.7 billion or half a percent to $542.0 billion, the U.S. Census Bureau reported today. This followed a 1.5 percent January increase. Shipments, up twenty-one of the last twenty-two months, increased $3.1 billion or 0.6 percent to $541.0 billion. This followed a 1.4 percent January increase. Unfilled orders, up thirteen consecutive months, increased $5.4 billion or 0.4 percent to $1,288.5 billion. This followed a 0.9 percent January increase. Our takeaway, orders may be softening slightly, but our shops are still busy and working on Backlog.

https://www.census.gov/manufacturing/m3/prel/pdf/s-i-o.pdf
 

PODCAST – The Lie of National Security and Tariff Agreements with EU, Japan and Great Brittan

 PODCAST – Thriving with you in 2022: NTC

WEEKLY TIP – Audit Certifications

 

 

 

City Background – Detroit, Michigan

PMPA’s Mastery Program will visit Detroit, MI March 30-31, 2022.

 

 

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

March 25, 2022

Economic News- Manufacturing Focus from February

Every talking head in the universe is dwelling on the FOMC 25 basis point  hike. Here’s what you need to know:

Producer Price Index in February

The Producer Price Index for final demand increased 0.8 percent in February, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This rise followed advances of 1.2 percent in January and 0.4 percent in December 2021. (That is 2.4 % in just three months!) On an unadjusted basis, final demand prices moved up 10.0 percent for the 12 months ended in February. Up 10 percent in 12 months.

Final demand goods  logged their largest advance  since June 2009 with February 2022 jumping 2.4 percent.

Ignore these at your peril.

Link: https://www.bls.gov/news.release/pdf/ppi.pdf

Industrial Output and Manufacturing

Total industrial production rose 0.5 percent in February to a level that is 103.6 percent of its 2017 average. Manufacturing output increased 1.2 percent after having been little changed in each of the previous two months. The indexes for durable and nondurable manufacturing moved up 1.3 percent and 1.1 percent, respectively, Capacity utilization for manufacturing increased 0.9 percentage point in February to 78.0 percent, 2.5 percentage points higher than its pre-pandemic level but 0.1 percentage point below its long-run average.

Link: https://www.federalreserve.gov/releases/g17/Current/g17.pdf

New Residential Construction Activity

Why would we call this manufacturing focus news? If you have been paying attention at any of the ITR [presentations, we know that New Residential Construction is a leading indicator for Light vehicle  sales as tradesmen upgrade their trucks and vans.

New Residential Construction Activity rose 6.8% to 1,769,000 units at the annual rate in February, the fastest pace since June 2006.

Link: htps://www.federalreserve.gov/releases/g17/Current/g17.pdf

 

PODCAST – Workforce is Still Biggest Challenge

WEEKLY TIP – SWOT for Recruitment & Retention

 

 

 

City Background – Detroit, Michigan

PMPA’s Mastery Program will visit Detroit, MI March 30-31, 2022.

 

 

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

March 18, 2022

New York Fed Manufacturing Survey

“Business activity declined in New York State for the first time since early in the pandemic, according to firms responding to the March 2022 Empire State Manufacturing Survey. The headline general business conditions index fell fifteen points to -11.8, its lowest level since May 2020. New orders and shipments declined modestly, while unfilled orders increased. Delivery times continued to lengthen substantially, and inventories expanded.”

Link to NYFED Survey: https://www.newyorkfed.org/survey/empire/empiresurvey_overview

FOMC Monetary Policy Statement

The most important rate in the world is the cost of money.

“The federal funds rate1 is the FOMC’s main policy rate. Changes in the federal funds rate trigger changes in other short- and medium-term interest rates, the foreign exchange value of the U.S. dollar, and other asset prices that influence households’ and businesses’ spending and investment decisions.”- Chicago Fed https://www.chicagofed.org/research/dual-mandate/the-federal-funds-rate

Today, the FOMC announced “The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. With appropriate firming in the stance of monetary policy, the Committee expects inflation to return to its 2 percent objective and the labor market to remain strong. In support of these goals, the Committee decided to raise the target range for the federal funds rate to 1/4 to 1/2 percent and anticipates that ongoing increases in the target range will be appropriate. In addition, the Committee expects to begin reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities at a coming meeting.”

Chairman Powell had already  preannounced a quarter point hike to Congress. This was no surprise, and disappointing to many who thought that the current round of inflation needs stronger medicine.

With Consumer prices  up 0.8% in February  (Food up 1% Energy up 3.5% and Gasoline up 6.6%)  there is no denying the need to take strong action against inflation.

Producer prices  up 0.8% in February- up 10.0% over last 12 months. This is the rate that affects our shops, and will ultimately drive higher the price of goods purchased by the consumers.

One can  use the average of the CPI and the PPI to indicate the current level of inflation across the entire economy. With CPI up 7.9% over the past year, and PPI up 10.0% we are experiencing inflation of 8.95% over the past year.

PPI link: https://www.bls.gov/ppi/

CPI link: https://www.bls.gov/cpi/

FOMC Statement Link: https://www.federalreserve.gov/newsevents/pressreleases/monetary20220316a.htm

FOMC Projections Link: https://www.federalreserve.gov/monetarypolicy/fomcprojtable20220316.htm

Job Openings

  • Latest JOLTS report shows there were 855,000 job openings in manufacturing in January. The number of jobs available continues to exceed pre-pandemic levels. Over the past 10 months, job openings in the sector have averaged 873,000, including the record 943,000 in July.
  • Total quits in the manufacturing sector rose from 322,000 in December to 331,000 in January, a new record. That is approximately 2.6% of the manufacturing workforce.
  • JOLTS Link: https://www.bls.gov/news.release/pdf/jolts.pdf

 

PODCAST – Interview with Jeff Ohlemacher

TIP OF THE WEEK – Titles Matter

 

 

 

City Background – Cleveland, Ohio

PMPA’s Northern Ohio Chapter will meet for a social event on March 22, 2022.

 

 

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

March 4, 2022

PMPA Business Trends Report – January

January 2022 continues the positivity as our PMPA Business Trends Sales Index outperforms the FED’s Industrial Production and Manufacturing indexes. Lead times are as high this report as they were last January in 2021- you know how that turned out. There are plenty of issues in the larger world to give us pause, but the consensus of your peers, as given by their data, is one of continued positivity and performance for our precision machining shops in the quarter ahead.

New Orders

According to the Institute for Supply management, their February Purchasing Managers Index showed the US economy growing for the 21st consecutive month, and increased one point over the January value. Their New Orders Index was up 3.8 percentage points compared to January, Clearly, your quoting department has got a lot busier these days, too. https://www.prnewswire.com/news-releases/manufacturing-pmi-at-58-6-february-2022-manufacturing-ism-report-on-business-301492024.html

Russia-Ukraine 

Will the Russian invasion on the Ukraine affect our industry?  For materials that we source from Europe, both Russia and Ukraine are important suppliers of energy, as well as ingredients for metals like stainless steel, which is already in short supply. Russia is our second largest supplier of titanium, and a top five supplier of aluminum. 60 % of Ukraine’s exports to US are crude iron and products made from iron and steel. The United States are Ukraine’s 8th largest export buyer. 

State of the Union

In the State of the Union, President Biden asked the House and Senate to pass the Bipartisan Innovations Act, also known as the America Competes Act.  According to Franklin Partnership, this act very important for precision machining and could prove the most important manufacturing policy bill since 2014. Although still in negotiations, the hope is that it will pass by Memorial Day. 

Manufactured Durable Goods

New orders for manufactured durable goods in January increased $4.3 billion or 1.6 percent to $277.5 billion, the U.S. Census Bureau announced today. Durable Goods Orders is the market indicator with the best correlation to PMPA member shipments, PMPA  research has shown.  We know you are busy,  new durable goods orders have jumped 14.1% over the past 12 months, with core capital goods orders growing 10.5% year-over-year.  

Click on press release for Advance Report Durable Goods at : https://www.census.gov/economic-indicators/

 

PODCAST – Yield Loss in your Shop

TIP OF THE WEEK – Steel Defects

 

 

 

City Background:

Detroit,MI – Mastery Program Tour 2 will visit March 30-31, 2021

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

February 25, 2022

Contract Review is Critical

According to a frontpage story in Automotive News, automaker Stellantis has issued new terms which place all risk on suppliers for “foreseeable disruptions.”  Although we are unsure as to how your shop is supposed to take steps to ensure that no freighters get stuck in the Suez Canal, you CAN pay attention to the terms of sale when dealing with your OEM customers. Terms like this could put you out of business so contract review is critical.

Production Update

Manufacturing Production  rose just 0.2 percent in January, up slightly after a 0.1 percent decline in December. Not bad  considering tariffs on raw materials, supply chain bottlenecks workforce shortages and ongoing government orders related to Covid Variants.

Link: https://www.federalreserve.gov/releases/g17/Current/g17.pdf

Total Industrial Production

Total Industrial Production climbed 1.4 percent in January, it’s highest value since December 2018.

Inventories

U.S. total business end-of-month inventories for December 2021 were $2,206.7 billion, up 2.1 percent (+/- 0.1 percent) from last month.

This is in contrast to total US Business Sales  which were $1,717.2 billion, down 0.7 percent (+/- 0.1 percent) from last month.

National Technical Conference 2022

Registration is now open for the nation’s biggest conference on precision machining – the National Technical Conference being held May 1-3 in Milwaukee. View the 27 info-packed sessions including GD&T, tools, materials, job print layouts, 3D printing, Cobots, ID Issues, CNC Swiss, Macros and more.

 

 

PODCAST – New Year Resolution

TIP OF THE WEEK – Market Insights

 

 

 

City Background:

Detroit,MI – Mastery Program Tour 2 will visit March 30-31, 2021

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

February 18, 2022

Management Update 2022

Our Management Update Conference was held in New Orleans last weekend.  PMPA members were happy to be networking face to face again, and the energy was high. The theme of the conference focused on their number one concern these days – employee recruitment, hiring and retention. Members went home with lots of ideas and resources. Next up…the National Technical Conference in Milwaukee, Wisconsin May 1st through 3rd.

Account for Inflation

the Bureau of Labor Statistics reported a skyrocketing Producer Price Index of 9.7% for the 12 months ending in January. What does this mean for your shop? Inflation has reduced your buying power by 10% over the last year.  What is 10% of your budget?  Be sure to account for inflation.

 Bureau of Labor Statistics https://www.bls.gov/news.release/ppi.nr0.htm

US Manufactured Goods Exports soared  in 2021

The US Census  reports that  exports of US Manufactured Goods rose over 18 percent from $953 billion in 2020 to $1.1 trillion in 2021, before seasonal adjustments.

For the year exports of industrial supplies and materials were up $169.6 billion; other industrial machinery increased by $11.1 billion; Civilian Aircraft increased by $7.7 billion, and Automotive vehicles, parts and engines increased $15.7 billion.

For the month of December 2021, Consumer Goods exports increased by $1.2 Billion; Capital Goods increased by $900 million, and automotive vehicles, engines and parts increased $800 billion.

Link: https://www.census.gov/foreign-trade/Press-Release/current_press_release/ft900.pdf

 

PODCAST – Lean Your Customer List

TIP OF THE WEEK – Honing & Lapping

 

 

 

Recorded in New Orleans at PMPA’s Management Update 2022.

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

February 11, 2022

Labor Force Participation Rate Rises to 62.2%

Its highest level since March 2020- Pre COVID-19. Among the details- Manufacturing Employment rose by 13,000 in January, non-farm payrolls increased  by 467,000 beating consensus. Average Hourly earnings for production workers in manufacturing rose 5.2% year over year in January. Link to BLS News Release : https://www.bls.gov/news.release/pdf/empsit.pdf

Job Openings and Labor Turnover December 2021

According to the latest release of the JOLTS report, For the ninth month in a row, Job openings in manufacturing exceeded 800,000 at 856,000.

Link: https://www.bls.gov/news.release/pdf/jolts.pdf

Productivity Increased 6.6% in Fourth Quarter 2021

BLS Productivity and Costs Preliminary Averages were released  with non-farm business sector Labor productivity rising 6.6 percent, as output increased 9.2 percent and hours worked increased 2.4 percent, on a seasonally adjusted basis. Unit labor costs in the non farm sector increased 0.3 percent in the fourth quarter. Over the last four quarter, Unit labor costs increased 3.1 percent.

Link: https://www.bls.gov/news.release/pdf/prod2.pdf

 

PODCAST – Business Trends 2021 Review

TIP OF THE WEEK – Three Phases of Annealing

 

 

 

City background:

New Orleans, LA where PMPA’s Management Update will be held Feb 10-13, 2022

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

February 4, 2022

Business Trends Report – December 2021

The PMPA December 2021 Business Trends Sales Index came in at 138, highest December value ever, and unseasonably high. That 138 was 10 points or 7.8 percent higher than December 2020’s value, and 22.5 percent higher than the five- year average for the index for the month of December.  While  December sales were down 6 points or 4.1 percent from November’s levels, they still contributed to a strong finish, resulting in the Calendar year average sales to be 1141. This 141  exceeded our April 2021 prediction of 137 for the year. A surprisingly positive reading considering the events of the year- ongoing uncertainty due to Covid-19, tariffs, and supply chain difficulties.

If you are not currently participating in PMPA’s Monthly Business Trends Reporting, you are missing a great peer benchmark and a tool to provide you with confidence for your business decisions. Contact Veronica Durden to sign up.

gro.apmp@nospohv

Business Trends Report – December 2021

REAL GDP

According to the Bureau of Economic Analysis, Real gross domestic product(GDP) increased at an annual rate of 6.9 percent in the fourth quarter of 2021 (table 1), according to the “advance” estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased2.3 percent. Link: https://www.bea.gov/sites/default/files/2022-01/gdp4q21_adv.pdf

The U.S. economy rebounded very strongly in 2021, with real GDP coming in at 5.7%. Compare that to the 3.4% decline in 2020. The current forecast for 2022 is ~4.3% growth

New Orders for Durable Goods

New Orders for Durable Goods fell 0.9% from a record $270.1 billion in November to $267.6 billion in December, according to the Advance report from the US Census. The decline in the headline number was due to decreases in aircraft and parts orders.  However, excluding transportation equipment, new durable goods orders increased 0.4% in December. New orders have jumped 12.7% over the past 12 months, or 11.9% with transportation equipment excluded. Link: https://www.census.gov/economic-indicators/ Click on “Advance Report Durable Goods”

ISM January 2022

Institute for Supply Management’s Purchasing Manager Index for January showed continued growth for the broad economy, while noting a slight decline for manufacturing. The January PMI index came in at 57.6 percent, a decline of 1.2 percentage points from its December reading of 58.8 percent. The reading remained well above 50 percent, indicating continued growth in the overall economy. According to the report, “All of the six biggest manufacturing industries — Machinery; Food, Beverage & Tobacco Products; Transportation Equipment; Computer & Electronic Products; Chemical Products; and Petroleum & Coal Products, in that order — registered moderate to strong growth in January.”

https://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/pmi/january/

Speaking of Precision Podcast – Safety in the Precision Machining Industry for 2022

LISTEN TO PODCAST

 

WEEKLY TIP

A Heads-up on Lead

A Heads up on lead.  Leaded materials are reported to be in short supply and, with many of these materials sourced from overseas mills, tariffs are adding to the price. Go to PMPA.org Final Cut of the Week or Knowledge Centers to download the latest information on lead in precision machining workpieces and options as the supply chain continues to be an issue

READ ARTICLE

 

 

City background:

New Orleans, LA where PMPA’s Management Update will be held Feb 10-13, 2022

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

January 28, 2022

OSHA’s Emergency Temporary Standard for Vaccines, Masks and Testing has been withdrawn.

Known as the Vaccine and Mask  Mandate or ETS, it applied to  employers with 100 or more employees. It was initially overturned in the 5th circuit, reconsidered by the 6th  circuit, and stayed by the US Supreme Court.

On Monday, January 24, 2022, OSHA scheduled the Federal Register publication of its withdrawal notice to be printed on January 26, 2022. The summary states “OSHA is withdrawing the November 5, 2021, emergency temporary standard (ETS) which was issued to protect unvaccinated employees of large employers (100 or more employees) from the risk of contracting COVID–19 by strongly encouraging vaccination.” The withdrawal will be effective on January 26, 2022.

Link https://public-inspection.federalregister.gov/2022-01532.pdf

 

PMPA Comments on OSHA ANPRM for Heat Injury and Illness in Outdoor and Indoor Work Settings

 

Our comments to OSHA’s Assistant Secretary Douglas Parker focused on the 80 degree threshold, the overly broad , one -size- fits- all standard, and asked that OSHA exclude indoor manufacturing from the regulation.

We provided data from our survey of almost 50 shops, showing only a single heat related incident in an approximate 29 million employee hours of work over the last five years. You can find the ANPRM and comments  on the proposed standard  at Heat Injury and Illness Prevention in Outdoor and Indoor Work settings ANPRM, Docket ID No. OSHA-2021-0009

 

Latest Federal Reserve Manufacturing Indicators  provide mixed but positive outlook.

The Chicago fed National Activity Index decreased slightly in December, led by declines in production related indicators. However the Index 3 month moving average remained in positive territory.

 

The Empire State Survey  for January reported the first contraction in manufacturing since June 2020,  with Business activity levelling off  in New York State. New orders declined slightly, while shipments held steady. Delivery times continued to lengthen, and unfilled orders increased.

 

The Philadelphia Fed’s Manufacturing survey showed rebounding in general activity , shipments and new orders for manufacturers in January.

 

PMPA Listserves continue to provide our members with authoritative answers to their most pressing problems.

List serve activity this week hosted a number of contributions on controlling thread diameters for parts that are plated. Another popular conversation involved tool failure modes. Where do you turn for authoritative, trusted, and relevant  advice regarding problems your team faces in the shop?

The PMPA Manufacturing and Technical Listserve is where our members go to get timely and trusted answers.

 

WEEKLY TIP

Reminder to stay in our lanes- Engineering Scope

With materials becoming more difficult to find and in short supply, our customers are turning to our shops for assistance in determining substitutes. Unless your ISO/ TS Scope includes “design Responsibility, we urge you to be cautious about making “recommendations.” You are certainly within your rights to tell your customer what materials are available, and how moving to them will affect price.  But you do not want to become the “designer of Record” for the part or application. Make it clear that you are providing information about available materials, not engineering design or consulting- those are not in your scope.

 

 

 

 

City background: Clearwater, Florida where PMPA Strategic Planning will be held in January.

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

January 21, 2022

Omicron & Manufacturing

PMPA member, Michael Tamasi from Accurounds and Steven Tamasi from Boston Centerless were featured in US News and Wall Street Journal respectively this week regarding the latest obstacle in workforce.  As Omicron spreads, employees are calling off because of infection or exposure which forces creative scheduling to get the jobs completed.  According to the labor department, the U.S. economy added 199,000 jobs last month, and the jobless rate dipped to 3.9% from 4.2% in November which indicates an already tight supply of workers. PMPA members are encouraged to join us in New Orleans in three weeks where the entire conference focuses on workforce.

https://money.usnews.com/investing/news/articles/2022-01-10/omicron-becomes-latest-speed-bump-for-shorthanded-u-s-factories

https://www.wsj.com/articles/omicron-workers-manufacturing-sick-covid-11641832497

 

Producer Prices Slow their Gain In December

Producer Prices for final demand goods rose just 0.2% in December for final demand goods and services, the slowest monthly gain since November 2020. Over the past 12 months, producer prices for final demand goods and services jumped 9.8% (seasonally adjusted), just shy of November’s record 9.9%. Core producer prices increased 6.9% year-over-year in December, the same pace as in November and remaining an all-time high. On an unadjusted basis, final demand prices moved up 9.7 percent in 2021, the largest calendar-year increase since data were first calculated in 2010. The index for final demand goods moved down 0.4 percent in December, the first decrease since falling 2.8 percent in April 2020.

Link to BLS Release: https://www.bls.gov/news.release/pdf/ppi.pdf

Production

Industrial production declined 0.1 percent in December with losses of 0.3 percent for manufacturing from November, dropping back  from November’s 0.6% increase, which was the highest since December 2018. At 101.9 percent of its 2017 average, total industrial production in December was 3.7 percent higher than it was at the end of 2020 and 0.6 percent above its pre-pandemic (February 2020) reading.

 

Manufacturing production declined 0.3 percent in December but was up 3-1/2 percent over the past 12 months; in the fourth quarter, factory output rose nearly 5 percent at an annual rate. The index for motor vehicles and parts stepped down 1.3 percent in December and was about 6 percent lower than its year-earlier level. Excluding the motor vehicle sector, factory output dipped 0.2 percent, with similarly sized decreases for durables and nondurables.

Link to Federal Reserve News Release: https://www.federalreserve.gov/releases/g17/Current/g17.pdf

 

New York Manufacturing Survey

The New York Federal Reserve’s Empire State Manufacturing Survey reported on Wednesday that “Business activity Abruptly leveled off in New York State in January.” According to the report, new orders declined slightly;

Delivery times continued to lengthen, and unfilled orders increased. A moderate increase in employment and hours of workweek were reported.

Plans for capital and technology spending were strong. Looking ahead, firms remained optimistic that conditions would improve over the next six months.

 

 

City background: Clearwater, Florida where PMPA Strategic Planning will be held in January.

PMPA shares important precision machining information you may have missed while  you were making essential parts. 

January 14, 2022

Manufacturing New Orders

The US Census Bureau Reported that New orders for manufactured goods in November increased $8.4 billion – or 1.6 percent – to $531.8 billion, which has been up for eighteen of the last nineteen months. This followed a 1.2 percent October increase.

Shipments, also up eighteen of the last nineteen months, increased $3.5 billion or 0.7 percent to $527.0 billion. This followed a 2.0 percent October increase.

Unfilled orders, up ten consecutive months, increased $9.1 billion or 0.7 percent to $1,260.1 billion. This followed a 0.3 percent October increase.

Link: (click on Manufacturers Orders) https://www.census.gov/economic-indicators/

Trade Statistics – Goods Exports

According to the US Census Bureau and the US Bureau of Economic Analysis, Average exports of Goods Increased $3.7 billion to $218.3 Billion in November. November Exports were $224.2 billion, up $0.4 billion from October report.

Year to Date, Exports increased $354.4 Billion or 18.2 percent. Never the less, The goods trade deficit soared to a record $98.99 billion in November, and the goods and services deficit increased $174.6 billion, or 28.6 percent, from the same period in 2020.

Manufacturers like us did our part- Exports increased $354.4 billion or 18.2 percent. Link: (click on Manufacturers’ Goods) https://www.census.gov/economic-indicators/

OSHA ETS

What we’re watching: The U.S Supreme Court is deliberating on the OSHA Emergency Temporary Standard for Vaccination and Mask Mandates Affecting Employers with 100 or more employees.

PMPA has signed on to written comments to OSHA asking for removal of ambiguity and to deescalate the risk to employers doing their best efforts in good faith. PMPA members will get the decision and our analysis via our CEO, HR and Corporate ListServes.

November ISM PMI Report

November ISM PMI report showing 18th consecutive month of growth for the overall economy. The report was up 0.3% from October. New orders, Production, and employment indexes all showed monthly increases. https://www.ismworld.org/supply-management-news-and-reports/reports/ism-report-on-business/pmi/november/

 

TIP OF THE WEEK – Bar Straightness