Additive Manufacturing

MAY 2018

ADDITIVE MANUFACTURING is the magazine devoted to industrial applications of 3D printing and digital layering technology. We cover the promise and the challenges of this technology for making functional tooling and end-use production parts.

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Page 20 of 43

MARKET DATA REVIEW 19 E CATEGORY: Economics By Pat McGibbon VP – Strategic Analytics AMT—The Association For Manufacturing Technology The final numbers are in. U.S. man- ufacturing technology orders in 2017 were up 8 percent from 2016, marking the official end of the manufacturing technology market decline. December monthly numbers were down from December 2016, but shipments were up and requests for quotations were larger than usual in De- cember. The start of 2018 was equally upbeat; members noted that January was down from December but up significantly from January 2017. Several members shared that they posted record order levels for January. Many also said that they were having challenges keeping up with demand and that backlogs were climbing. What's happening? The European Union and Asian manufacturing markets and the demand for manufacturing technology lagged the U.S. recovery by about five to six months. Growth in these markets and the export demand they created for U.S. products punctu- ated the big finish to 2017 manufacturing orders. The uptick in manufacturing activity in the European Union and Asia also accelerated tightness in the supply chain from basic materials Great Start to 2018—But Can It Be Too Good? to precision components. The supply of machines, materials and components making their way into the U.S. market has slowed just as U.S. builders and distributors were finally getting some relief from the softness in oil & gas and off-road/construction markets and market share battles earmarked with discounts. Ordinarily growth in the U.S., EU and Asian manufacturing technology markets would be welcomed. However, the rapid growth in all three regions caught the supply chain under capital- ized to keep pace with demand. You can see this in the numbers. In the Cutting Tool Market Report, large spikes in shipments during the fourth quarter to specific states clearly pointed to some of the large industrial supply houses building inventories in advance of expected price increases due to material costs. Similar issues are developing in the machine and ma- chine components area as well. U.S. machine builders are running into increasing delivery delays of key components such as linear guides. One builder shared that when placing their next bimonthly order for linear guides they were told that the delivery would take more than 12 weeks, and their following order would take 6 months or more for delivery. U.S.-based inventories for imported machines are at their lowest levels in years. Just as important as the parts and materials that go into the machines are the people who use manufacturing technology to machine, check and assemble products in both our industry and in our customers' plants. At a recent workshop on critical issues that limit the growth of the manufacturing technology industry, skilled labor was the No. 1 con- straint identified by the participants. The Bureau of Labor Statistics reported Durable Goods jobs openings were at 228,000, up 34,000 positions from December 2016. Members are holding onto their people tightly, though members are increasingly finding that they are competing against their customers for their own people. Many members have become more involved with com- munity colleges, tech schools and local high schools to ed- ucate graduating seniors about the opportunities offered by manufacturing careers. This practice is only going to be more important as we look to shore up our labor pool— and ensure our industry's future competitiveness.

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