CANADA'S LEADING INFORMATION SOURCE FOR THE METALWORKING INDUSTRY

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CANADA'S LEADING INFORMATION SOURCE FOR THE METALWORKING INDUSTRY

CANADA'S LEADING INFORMATION SOURCE FOR THE METALWORKING INDUSTRY

New orders for manufacturing technology cool off in April for U.S job shops

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April is typically a slower month for manufacturing technology orders but this April was disproportianately off, AMT data shows. PHOTO courtesy Haimer. 

]New orders of manufacturing technology in the U.S. totaled $336.7 million in April 2023, according to the latest U.S. Manufacturing Technology Orders Report published by AMT – The Association For Manufacturing Technology.

That made for a 38.7% drop from March 2023 orders and a decline of 34.4% from April 2022 orders. Year-to-date orders totaled $1.72 billion in 2023, 13.6% below the same period in 2022.

“March has traditionally been one of the better months for manufacturing technology orders, so April is typically a ‘down month’; however, this April was disproportionately off,” said Douglas K. Woods, president of AMT. “March 2023 was only 2% down from March in the previous year, yet the decline between March and April in 2023 was over five times larger than the decline in 2022. The momentum of order activity is clearly not as strong through the second quarter as it was last year.”

Job shops, the largest customer segment, decreased their orders by just under 39%, declining slightly more than the overall market from March to April. This is the largest monthly decline in orders from job shops in the U.S. since January 2017.

In addition to job shops, the automotive sector significantly reduced their orders in April 2023 after an exceptional uptick in March. It should be noted that a good portion of the work contract machine shops do is on behalf of the automotive sector, so their parallel decline in orders is not unexpected.

“Consistently high interest rates, ongoing inflation, and the looming threat of a recession have caused businesses to rethink their capital investment strategies,” said Woods. “Job shops, which are the largest consumers of manufacturing technology, are mostly small and medium-sized businesses who are particularly affected by price and interest rate pressures.

In addition to USTMO, several other industry metrics compiled by AMT are showing a slowdown in activity relative to March, Woods added. He said that regardless of what the U.S. Federal Reserve does with interest rates going forward, the outlook on economic activity, coupled May’s USMTO numbers available shortly after, should give a good indication of how hot or cool the summer will be for the manufacturing technology industry.

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