April 2021 TMX Shows Sustained Growth in Industrial Activity

For the third straight month, TMX continues to climb. It’s encouraging data, confirming U.S. manufacturing activity is on the road to recovery.

The April 2021 TMX is up 1.24% in tandem with the SPX rising 4.24%.

TMX Growth Is Slowing

Although TMX numbers continue to climb, the pace is slowing. In February, TMX was up 20%, and in March it continued upward but at about half that pace at 9.5%. Now this month, the pace is not even half of what it was last month.

As well, even with that momentous 20% leap, TMX has not been able to catch up with SPX. There is still a substantial gap between TMX and SPX from when COVID-19 disrupted supply chains across the world. The recovering of the SPX, though at times faltering, has had a more sustained and sharp increase.

Keep in mind, TMX’s three-month upward trend parallels its three months of decline in the autumn and winter. Here’s a quick recap of what we saw the past six months:

• April 2021: 1.24%
• March 2021: 9.5%
• February 2021: 20%
• January 2021: -0.67%
• December 2020: -1%
• November: -6.77%

In January, when stimulus checks were issued, consumer retail sales increased 5.3%. The biggest winner was the electronics and appliances market, which shot up 14.7% that month, but even sectors that had been hit hard by COVID-19, such as the food and beverage industry, saw increases.

This is countered by the fact that while the unemployment rate has fallen overall, new claims are persisting at a historically high rate. The week before nationwide shelter-in-place orders in March 2020, claims were about 200,000. The week ending April 3 this year, new unemployment claims are still more than triple that, at 741,000. Still, it’s a vast improvement compared to the 6.2 million claims for that week in 2020.

As consumers feel more confident in the market, spending will likely increase. The same holds true across industries. While the rate of growth may have slowed for the time being, the outlook for manufacturing is still positive.

[If you’re interested in receiving a free prospecting report that lets you see the companies searching on Thomasnet.com for your products and services, get your Missed Opportunity Report for Manufacturers & Distributors here.]

The Push for Reshoring

From 2000 to 2016, millions of manufacturing jobs in the U.S. were lost to offshoring. Amid the Trump administration and rising costs overseas, reshoring gained speed. When COVID-19 disrupted supply chains around the world, reshoring came into focus. In July 2020, Cathy Ma, Director of User Acquisition at Thomas, reported that, according to a Thomas Industrial Survey, two in three manufacturing companies were seeking to move production to North America.

When President Biden took office in January of this year, he issued a “Buy American” executive order, and then at the end of February he signed an executive order to help secure supply chains by looking at vulnerabilities in the following four categories:

• Active pharmaceutical ingredients
• Critical minerals
• Semiconductors and advanced packaging
• Large capacity batteries.

Companies are following suit in their endeavors to place production on American soil. Across the U.S., we’re seeing manufacturing facilities expand, which has also opened job opportunities across job skills after many people had lost jobs amid shutdowns and bankruptcies during the pandemic.

On March 3, Walmart announced that it would invest $350 billion into manufacturing in the U.S. With this investment, the largest retailer in the world says it believes it will be able to sustain 750,000 jobs.

Vehicles Go Electric

One sector we’ve been keeping our eyes on is the growth of the electric vehicle market. The gains aren’t limited to only the electric car manufacturing industry: it creates opportunities related to parts production, maintenance, charging infrastructure, factory construction, and more.

In the past few months, we’ve tracked stories such as:

• California-based electric vehicle maker Mullen Technologies plans to add 600 jobs in the Memphis area.
• Over in the Phoenix area, ElectraMeccanica, which creates three-wheeled, single-seated electric vehicles, will build its first U.S. factory, which, when operational, will be able to accommodate 500 jobs.
• And in central Tennessee, Microvast, which manufactures batteries for electric vehicles, is spending $220 million to transform a plant previously used for auto parts into a factory for the production of battery cells. This initiative is projected to establish 287 jobs.

On the flip side, according to a recent report, less commuting and business travel amid the pandemic as well as the push for clean energy caused a major decline in oil demand. While it is expected to rebound, it will likely not see its former rate of growth.

We’re Relying on Delivery

Just because we may have EVs, doesn’t mean we want to drive over to shop in stores and dine in restaurants.

As Thomas President and CEO Tony Uphoff noted in a Thomas Industry Update last month, our data from Thomasnet.com shows that sourcing for packaging materials on the platform increased 243% year-over-year. According to the Flexible Packaging Association’s 2020 State of Industry report, the market grew from $164 billion in 2016 to $177 billion in just three years.

Industry is responding to this social trend of package deliveries.

With fewer people sending snail mail these days but receiving more packages in the mail, USPS trucks will be redesigned to accommodate this trend. They’ll also be going electric. This is their first upgrade in three decades.

Meanwhile, Seattle packaging manufacturer PAC Worldwide recently announced its sixth U.S. factory, a Georgia initiative that will create about 400 jobs.

No matter what industry you’re in, you’ll likely be impacted by the rise of e-Commerce. More often, customers want to be able to have packaged goods delivered straight to their door. As a result, there will be needs for trucking, warehousing, robotics for kitting, cybersecurity, and more.

Click here to view original web page at April 2021 TMX Shows Sustained Growth in Industrial Activity