What a year!

Assessing all I've seen and heard over the past year leads me to one conclusion—2004 is the year we've all been waiting for, economically, since the manufacturing industry began to decline in 2001. Looking at the numbers broadly, U.S. manufacturers' after-tax profits reached $82.4 billion in second-quarter 2004 (the most recent quarter for which data is available)—a level higher tha...

12/01/2004


Assessing all I've seen and heard over the past year leads me to one conclusion—2004 is the year we've all been waiting for, economically, since the manufacturing industry began to decline in 2001. Looking at the numbers broadly, U.S. manufacturers' after-tax profits reached $82.4 billion in second-quarter 2004 (the most recent quarter for which data is available)—a level higher than any attained even in 2000 (the highest level reached that year was $77.4 billion in the first quarter), according to the U.S. Bureau of the Census. That's a huge jump from the $7.8 billion low in after-tax profits, fourth-quarter 2001. Census Bureau numbers aren't the only ones pointing out that 2004 has been very, very good to manufacturing. The Institute for Supply Management's (ISM) Purchasing Managers Index (PMI) stood at 56.8 in November. This rate, issued on Nov. 1 for October 2004, represents the 17thconsecutive month of economic growth in the manufacturing sector. Any number higher than 50 on this index indicates expansion in the U.S. industrial sector. Other numbers in ISM's business survey show continued growth in manufacturing employment (54.8), production (58.9), and new export orders (56.6). Concern had been expressed by some that increasing inventories over the past year could lead to problems in the near future, with supply overriding demand; however, manufacturers' inventories are contracting (48.2) while customer inventories are seen as "too low" (43.5), which could signal a near-term ramp-up in production to stabilize the situation.

Expansion in the manufacturing sector can also be seen in indicators tracked by the Federal Reserve. For third-quarter 2004, total industrial production increased at an annual rate of 2.9%, and manufacturing output rose at a 4.4% rate. Capacity utilization for total industry stood at 77.2%—2.3 percentage points above its 2003 level. Furthermore, U.S. Bureau of Economic Analysis data shows that domestic industrial equipment capital spending has been increasingly steadily during the year, after severe cut backs following the downturn of 2001-2002.

Major public companies in the controls and automation space also fared well this year. According to an FTN Midwest Securities Corp. second-quarter 2004 report, Rockwell Automation's control sales grew 13%, Emerson Process Controls base sales grew 7%, Baldor Electric sales grew 18%, Siemens Automation and Drives' sales grew 7%, and Groupe Schneider sales base increased 10%.

Control Engineering subscribers are also reporting a sense of optimism. In an online survey conducted in late August/early September 2004, 56% of respondents noted improvement in their perception of the engineering job market in the U.S.

Personally, I'm bullish on 2005 being an even better year for the industry and our readers. Have a great holiday season.

David Greenfield, Editorial Director

dgreenfield@reedbusiness.com





No comments
The Engineers' Choice Awards highlight some of the best new control, instrumentation and automation products as chosen by...
The System Integrator Giants program lists the top 100 system integrators among companies listed in CFE Media's Global System Integrator Database.
The Engineering Leaders Under 40 program identifies and gives recognition to young engineers who...
This eGuide illustrates solutions, applications and benefits of machine vision systems.
Learn how to increase device reliability in harsh environments and decrease unplanned system downtime.
This eGuide contains a series of articles and videos that considers theoretical and practical; immediate needs and a look into the future.
Big Data and IIoT value; Monitoring Big Data; Robotics safety standards and programming; Learning about PID
Motor specification guidelines; Understanding multivariable control; Improving a safety instrumented system; 2017 Engineers' Choice Award Winners
Selecting the best controller from several viewpoints; System integrator advice for the IIoT; TSN and real-time Ethernet; Questions to ask when selecting a VFD; Action items for an aging PLC/DCS
This digital report will explore several aspects of how IIoT will transform manufacturing in the coming years.
Motion control advances and solutions can help with machine control, automated control on assembly lines, integration of robotics and automation, and machine safety.
This article collection contains several articles on the Industrial Internet of Things (IIoT) and how it is transforming manufacturing.

Find and connect with the most suitable service provider for your unique application. Start searching the Global System Integrator Database Now!

Future of oil and gas projects; Reservoir models; The importance of SCADA to oil and gas
Big Data and bigger solutions; Tablet technologies; SCADA developments
SCADA at the junction, Managing risk through maintenance, Moving at the speed of data
Automation Engineer; Wood Group
System Integrator; Cross Integrated Systems Group
Jose S. Vasquez, Jr.
Fire & Life Safety Engineer; Technip USA Inc.
click me