Hope springs eternal in AMBA's spring survey

April 28, 2011

Business continues to grow, and that's fueling optimism in the economy, according to the American Mold Builders Assn. Spring 2011 quarterly survey of its members. Survey respondents reporting that current business conditions are Excellent rose a full 5 percentage points to 20%, from the 15% reporting excellent business conditions in the Winter 2011 survey. This is the fourth consecutive quarter that respondents have indicated current business conditions are excellent.

Current business conditions were "Good" for 54% of respondents, down 2 percentage points from the Winter 2011 survey. This may be a result of so many reporting "excellent" business conditions.  "Fair" business conditions exist for 22% of the respondents compared to 20% of the respondents in the Winter survey. Those reporting "Poor" business conditions dropped 2 percentage points to 4% from 6% in the Winter survey. For the fifth consecutive survey, no one reported "Bad" business conditions.

Projections of their company's business over the next three months - the second quarter of 2011 - reveal that the majority of respondents expect their businesses to Increase Substantially (8% compared to 6% in the Winter survey) or Increase Moderately (52%, a full 10% higher than the Winter survey). Respondents expecting business to "Remain the Same" came in at 39%, a negligible 1% drop from 40% in the Winter survey, indicating that business is fairly steady. Respondents expecting business to "Decrease Moderately" dropped significantly once again to 4 percentage points, down from 11% in the Winter survey and from 15% in the Fall 2010 survey. None of the respondents expect business to "Decrease Substantially."

When asked to compare their company's current level of business with that of three months ago, responses indicate some movement in a positive direction:

  • Quoting activity once again ticked Up by one percentage point to 38% of the respondents to the Spring survey; the Same for 49% (up 8% from Winter's survey) of the respondents, down from 49% in the Fall 2010 survey; and Down for 14%, a significant drop from the 22% to the Winter 2011 survey.
  • Shipments are Up for just 37% of the respondents, compared to 33% in the previous quarter's survey; stayed the Same for 49% of respondents (the same as the Winter survey); and were Down for 14% of the respondents, compared to 18% in the Winter survey.           
  • Backlog is Up significantly for 44% of the respondents, compared to 33% of respondents in the Winter survey. Backlog is the Same for 26% of the Spring survey respondents, down from 49% in the Winter survey; and Down for 30%, just a 3% drop from the Winter survey. At the recent Amerimold trade show in Rosemont, IL, an informal survey of the moldmakers there revealed that most are seeing a significant backlog that will carry them through the summer.
  • Profits in the Spring survey are Up for 30% of the respondents, a nice uptick from 24% in the Winter survey.  Profits are the Same for 53% of the respondents, down just 3% from the Winter survey. Profits are Down for 17% of the respondents, a drop from the 20% of the respondents to the Winter 2011 survey.
  • Employment levels are also confirming that responding companies are much busier in the Winter 2011 quarter, with employment once again trending Up for 36% of the Spring survey respondents, compared to 30% of respondents in the Winter survey. Employment numbers remained the Same for 56%, compared 62% in the previous survey. Employment is Down for only 8% of the respondents, the same as the Winter survey. This continues on a significant "positive" trend for the last four quarters.
  • Shop hours remain steady at 48 hours in the Spring survey. For design and engineering employees, hours are down by one to 47, compared to 48 in the Winter 2011 survey. The current number of shop employees jumped to 25 compared to 22 in the Winter survey; but design and engineering employees remain at 5, the same as the previous two surveys.

Respondents indicate they are hiring shop employees, with 46% reporting they have hired in the past 3 months, and hired an average of 2 employees. Finding skilled employees is becoming a bigger problem for mold manufacturers, with 82% reporting that it has been "difficult to find skilled machinists/moldmakers."

When asked to explain this shortage, 77% responded that "many have left the trade" as the primary reason; 35% cited "other shops hiring again - more competition for the skilled people" still available; and 88% said a lack of people "entering the trade make it tough to find young people to train." [Respondents could respond to more than one reason.]

Responding to the questions about hiring, one respondent commented that "good people are never easy to find. Another remarked that "Thos who are available are lower quality of experience and skills."  And still another respondent said, "Many seasoned people cannot make the transition to our fast pace and use of technology."

AMBA Spring 2011 survey results


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