At COVID-19’s onset, both doom and gloom surrounded the global manufacturing industry.
In the US, for instance, 2020 was projected to see an 18.1% decline in revenue due to supply chain disruptions and declining industrial activity.
There’s one other factor that hindered the industry, exacerbated by the pandemic. Namely, the decreased demand for high-value durable goods (e.g., primary metals, industrial machinery, and automobiles proved detrimental).
While PPE and sanitizer manufacturers presented positive outliers during earlier projections, forecasters predicted a 3.9% drop from 2019 in how much manufacturing contributed to the US GDP.
Regardless, the US is only one example. Also, these were merely projections reported on in July. It’s now October, and the Global Manufacturing landscape seems to be on the road to recovery.
To elaborate, JP Morgan recently reported findings that paint a much more positive picture than what seemed imminent when the pandemic initially struck.
Explaining JP Morgan’s Findings
JP Morgan assessed the latest manufacturing reports by examining the following markets:
- United Kingdom
The reports and analysis revealed an increase in both output and new orders. This has been the case for three straight months. Simultaneously, after two years with no activity, new export business finally expanded, painting a brighter outlook for the future.
Moreover, JP Morgan reported that the Global Manufacturing PMI rose to 52.9 in September from 52.4 the month before.
In painting an even more complete picture, the global PMI was at 47.2 in February, which is well below the breakeven point of 50.
September’s 52.9 score even eclipses both the 2019 average (51.7) and the previous decade’s average (52.3).
JP Morgan delved into these results, explaining that this growth reflects a near ten-year high at investment goods producers. New business seemed to also increase due to underpinning higher production volumes.
Plus, new order intakes skyrocketed more rapidly than it has in nearly two-and-a-half years. This outcome stems from the first increase in international goods trade since August 2018.
As per subsector PMI data, the upturn appears to be broad-based. Expansions are most prevalent throughout the consumer, intermediate, and investment goods industries.
There Are Still Setbacks that the Industry Must Manage
While the US and eurozone seemed intent on quick expansion, these efforts were offset in no small part due to China and the UK’s slower growth. Furthermore, ongoing contraction in Japan seemed to contribute to the muddied waters.
Another issue lies in manufacturing employment. Declines have been the recurring theme for 10 straight months.
Despite Employment Decreasing Globally, There’s a Silver Lining
There was a clear silver lining in the declining employment numbers. Compared to the previous nine months, the job cutting in September was marginal, and the slowest it’s been since January. The US and China saw staffing levels increase. Conversely, the sinking numbers in the eurozone and Japan slightly outweighed the other two areas’ rise.
It’s then worth mentioning the stretched global supply chains stemming from the upturn in demand for inputs as economies reopen across the world.
Responding to the Rising Growth in Manufacturing
With more projects now being launched and restarted, employees are needed to complete the work.
Manufacturing organizations should now be on the hunt for workers. There’s a need to catch up and make up for the lost time. Therefore, hiring the most efficient, productive, and talented employees is a top priority.
Fortunately, with an agency such as Kuhn Global Talent, you’ll work with a superior manufacturing recruitment agency that will find the ideal people for any given role.
Call Jim Kuhn for a brief, no-cost consultation on recruiting for your open manufacturing positions across the world.
About Kuhn Global Talent
Kuhn Global Talent is a global search firm, and has effectively completed hundreds of searches since 2011 and provided clients with extraordinary recruiting investment value. Jim’s global business knowledge and cross-cultural agility are particularly valued by U.S.-based companies building leadership teams in the US and other countries, and by non-U.S. companies desiring a cross-culturally sensitive search approach to confidential searches in their home countries and in their U.S.-based affiliates.