Products Finishing

SEP 2018

Products Finishing magazine is the No. 1 industrial finishing publication in the world. We keep our readers informed about the latest news and trends in plating, painting, powder coating, anodizing, electrocoating, parts cleaning, and pretreatment.

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52. 52 SEPTEMBER 2018 — PFonline.com MICHAEL GUCKES, MBA Chief Economist Gardner Intelligence Michael has performed economic analysis, modeling and forecasting work for nearly 20 years among a wide range of industries. mguckes@gardnerweb.com GARDNER BUSINESS INDEX: FINISHING Finishing Industry Holds Gains in July FINISHING INDEX NEW ORDERS AND PRODUCTION (3-month moving average) 1/13 7/13 1/14 7/14 1/15 7/15 1/16 7/16 1/17 7/17 1/18 7/18 The Finishing Index fell more than six points in July. Despite this steep drop, however, the Index is only modestly lower than one year earlier and is well above its lifetime average reading of 50.8. New orders growth slowed more quickly than production during the month, which may in part explain the contraction in backlogs. Registering 52.5 for July, the Gardner Business Index: Finishing indicated sharply slowing growth during the month. Although the latest reading is six points lower than June's, any reading above 50 still indicates expansion over the prior month. No components of the index were higher in July, which would indicate faster expansion, however, the index is coming off an unprecedent growth streak. Gardner Intelligence's review of the underlying data for the month reveals that supplier deliveries was the index's best-performing component. However, the remaining five components, which are used in the average-based formula for the overall finishing index, all moved significantly lower. Supplier deliveries and production lifted the index higher, while backlogs and exports both contracted. New orders growth slowed more quickly than production during July, suggesting that finishers used backlogged orders to sustain current levels of production. Backlog growth since the fourth quarter of 2017 has expanded faster than at any other time in the history of the index. Thus, if the current situation is only temporary, finishers should be able to maintain constant production levels even if new orders experience a temporary slowing. Employment readings across all of the manufacturing sectors that Gardner tracks have been moving lower in recent months. We believe these are not indicative of weak demand for labor, but more likely evidence of the difficulty that all manufacturers are having in finding available labor for hire. Stay ahead of the curve with Gardner Intelligence. More information about the Finishing Index can be found at gardnerintelligence.com. 65 60 55 50 45 40 52.5 n New Orders n Production 1/13 7/13 1/14 7/14 1/15 7/15 1/16 7/16 1/17 7/17 1/18 7/18 70 60 50 40 Index takes a pause on expansion aƞer a blistering first half.

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