Looking Up

By Andrew Paparozzi
In January 28, 2010

Various closely watched indicators of future economic performance are clearly trending upward. The Conference Broad Leading Economic Index™ rose 1.1% in December on top of a strong 1.0% gain the previous month. The LEI has now risen for nine consecutive months. The Institute for Supply Management™ reported that activity in the manufacturing sector rose in December for the fifth consecutive month, with the PMI rising to 55.9%—the highest reading since April 2006. The Institute’s index for non-manufacturing activity (NMI) was at 50.1% in December; the third reading out of the last four indicating growth (a reading above 50.0%).

Not all industries are showing growth, with print being among those not yet in positive territory. Nonetheless, NAPL’s Printing Business Index™ has clearly moved off the bottom, with a December 2009 reading of 35.3 up from a record low of 21.1 in March of 2009. We’re still a long way from positive territory—a reading above 50.0—but conditions are definitely improving.  Printers not yet seeing at least some stabilization should quickly determine why. For more detail on the PBI and other recent industry data see NAPL’s Printing Business Conditions: January 2009 and the State of the Industry posts at NAPL’s Performance Indicators website.

Indicators are pointing to a recovery for both the economy and print. As for the economy, the upward pattern displayed by the consensus forecast from Blue Chip Economic Indicators of price-adjusted GDP growth in 2010—2.8% this January up from 1.8% in April 2009—suggests the risks to the economic forecast currently may be to the upside. In other words: Growth this year may hit the 3.0% level or more. But don’t expect economic growth to make everything right. As we digest President Obama’s State of the Union address, uncertainty is still a major issue for large and small businesses alike. And even when some clarity begins to emerge on several fronts and recovery gains a firmer foothold, keep this in mind: Market share is being redistributed and no one is guaranteed participation in recovery. What actions is your company taking to come out on the right side of redistribution?

Andrew Paparozzi        Joseph Vincenzino        Kong Lue Wang

Andrew Paparozzi

Epicomm's Andrew Paparozzi, Vice President/Chief Economist, is well-known for his accurate and thoughtful discussions on the economy and US commercial printing industry. A foremost author and speaker on economic business trends in the printing industry, Paparozzi heads Epicomm's Printing Economic Research Center.

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