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Tuesday, 07 August 2012 09:35

GVSU survey shows industrial outlook slips

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GRAND RAPIDS – For the first time in more than three years, the industrial outlook has soured for firms in greater Grand Rapids.

That’s based on the findings from the most recent Institute for Supply Management survey released today by Grand Valley State University’s Seidman College of Business.

According to Brian Long, director of Supply Management Research at GVSU, the survey shows the first negative numbers in the greater Grand Rapids industrial economy since April of 2009.

New orders, the survey’s index of business improvement, slid from +9 to -6, while the production index also dropped from +6 to -5. Still, employment remained positive at +18, however that number is down from June’s +25.

“It is not a surprise to find that automotive parts suppliers are not sailing as high as they were a few months ago,” Long said in a statement. “Although July is a traditionally slow month for automotive, the September-October production schedules do not look as positive as they were once projected to be. As for the office furniture business, conditions are soft for some firms, but most are stable.”

This year’s second quarter GDP growth estimate of 1.5 percent, revised from a first quarter forecast of 2 percent, is well below what is needed to continue recovering from the recession, Long stated. By comparison, the average growth rate between 2004 and 2009 was 3.95 percent.

The local economy could “dance back and forth across the zero growth line” for several quarters before resuming a slow recovery, Long stated.

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