December was an uninspiring month for American manufacturing technology. The Association for Manufacturing Technology (AMT) recently released order volume data for the final month of the year, finding that total orders came in modestly lower year-over-year. A slow close, however, wasn’t enough to offset the bigger picture of 2018. Now that the numbers for every month are in, it’s safe to say that last year was a strong one for domestic production tech.
December Swoon
Manufacturing technology orders in December totaled $443 million, which was a 2 percent monthly drop from November and a 6 percent drop from December 2017’s mark. The decrease, while modest, was a departure from historical norms. In the 23 years for which data is available, December orders have dipped below November’s just 4 times.
The fall in orders was felt by most sectors across manufacturing technology. Notable exceptions were seen in the Forging and Stamping industry, along with Government and Defense. The AMT postulated that cross-sectoral anticipation of a government shutdown provided artificial juice to these numbers, but the jump was there nonetheless.
From a geographical standpoint, the Northeast and West carried the load to wrap up 2018. Both posted mid-single digit increases from the month prior. The Northcentral East remained the largest producer of manufacturing tech by order volume, but December 2018 saw the continuation of a trend in which its market share continues to slide. The Northcentral West and Northeast (second and third by volume, respectively) both made further inroads in the period.
2018 Was Still an Excellent Year—Will 2019 repeat?
In spite of the slump experienced by most to end the year, growth in 2018 as a whole was robust. Total manufacturing technology orders came in at $5.5 billion in aggregate, up 19 percent over 2017. Other indicators like the Purchasing Managers’ Index (up 2.3 points in January) and BLS new hires (304,000 in January) are also positive. On the whole, the market looks to be in good shape... with one major caveat.
The AMT said that manufacturing technology executives remain very worried about the U.S.-China trade war. There are major questions about whether the long-term rewards are worth the short-term damage being done to the U.S. industry by the spiking input costs caused by tariffs. Still, however, the overall forecast for the market remains stable, with most analysts calling for single-digit growth in 2019.