Is Manufacturing Output at a Standstill?
From the several local manufacturers that I talk to, it seems most everyone is seeing a slowing of incoming orders since the beginning of the year. What seems to be causing this apparent or real slowdown?
Part of it could be the uncertainty of the impact on defense spending due to the sequester and the decision to let it go forward. With a reduction in the federal defense budget, some of that impact will be on reduced purchases of equipment of various types.
Another area of slowdown is the Eurozone region going into or being in a recession. Its importance to the US as we are trading partners to the tune of 25% of our exports go into the Eurozone countries. If they slow, then our exports slow.
My guess is that we’ll see a pickup later this year when some of the federal budget discussions firm up and Eurozone gets back on their feet.