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Manufacturing Perks Up

Dec 30, 2009

I am sure that many of you have a subscription to the Tool and Pipe Journal, but for those who may have missed it, I highly recommend this article on the outlook for manufacturing. More good signs for Manufacturing.  It highlights some of the leading indicators that may bring some sunshine in 2010.  In summary:

  1.  The PMI, an index compiled by the Institute for Supply Management, broke through 50 percent in August. It was a huge relief. It had been below 50, indicating decreasing manufacturing activity, for nearly 18 months.
  2.  The economy as a whole is doing better now than it has in more than a year. According to the Bureau of Economic Analysis, gross domestic product (GDP) finally started growing again in the third quarter of 2009.
  3. The uptick in GDP seems to be driven by two trends. First, consumers are spending a bit more on durable goods.
  4. Second, although it's a grim situation, more than 88,000 businesses have gone under since the start of 2008; those that managed to survive the downturn are busier than they otherwise would be because many of their competitors are gone.
  5. Many consumers cut back on spending for months, and now they're opening their wallets again. Second, quite a few are purchasing homes.

  6. According to the Department of Labor, the number of claims for unemployment insurance is still growing, but slowly.

Downsides? Yes, two big ones remain. Personal bankruptcies continue to rise (373,000 in the third quarter), as do home foreclosures, which hit an all-time high (937,840) in the third quarter of 2009.

Start 2010 with an Executive Company Physical - a free 20 page benchmark study to help plot a new profitable and cash rich course for your company. Contact David Kirkup at B2B CFO on 404 348 0326 or dkirkup@b2bcfo.com.

 

 

More from David Kirkup…

About the Author

David has over two and a half decades of business experience and is a proven financial management expert. Working in Europe and the USA, David has served as Divisional CFO at a number of Fortune 500 corporations: including Reuters, Marsh & McClennan, Zurich Insurance and ADP as well as numerous small and mid size companies. As part owner of a small software company, he was heavily involved in the marketing efforts and ultimate sale of the company. As CFO with a national PEO firm he dealt with the credit and financial issues facing hundreds of small business clients. David also spent 5 years in Bermuda managing captive insurance companies.

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