Due to some lasting economic and supply constraints, the manufacturing industry is facing a few bumps in its road to recovery.
This event is among the many disruptions that the manufacturing industry is seeing. According to the latest Institute for Supply Management (ISM) report, The PMI (Purchasing Managers Index) took a slight dip from 64.7% in March to 60% in April.
Reasons for this decline include:
- The continued shortage of semiconductor chips that is currently affecting the automobile and consumer electronics market.
- An ongoing aftermath from tariffs on commodities and materials, which makes it more costly to procure materials such as lumber, copper, or steel.
- Labor disruptions caused by worker absenteeism, short-term shutdowns due to part shortages, and difficulties in filling open positions are limiting the manufacturing industry’s growth and ability to fill current orders.
The good news is, demand for consumer goods has exceeded pre-pandemic levels, with more consumer spending on automobiles, electronics, and other products. This has led to a GDP growth of 6.4% in the first quarter of 2021.
Another optimistic outlook for the industry is that for the 8th month in a row, ISM survey respondents indicated that significantly more companies will be hiring than those looking to reduce headcounts.
As they work to resolve material and supply shortages, manufacturing companies are also working to address labor shortages. Companies have implemented a dual strategy of hiring for both long term needs and addressing more immediate demands with engineering consultants and contract workers.
To see how SoloPoint Solutions can help bring in engineering talent to your manufacturing team, contact us today!