Three-quarters of United States equipment manufacturers say COVID-19’s impact on the economy is still very negative, according to a survey released last month by the Association of Equipment Manufacturers (AEM).
Equipment manufacturers—an industry that represents 12 percent of the U.S. manufacturing sector—are adjusting to the changing economic conditions, but continue to face decreased demand and disrupted supply chains. Six out of 10 executives say that the federal government has not done enough to support the industry.
“The COVID-19 pandemic continues to negatively impact equipment manufacturers and the 2.8 million men and women of our industry,” said Dennis Slater, president of AEM. “We have seen some improvements to the operations and financial outlook for our member companies, but the industry still faces a long road back to normal. Even as our industry continues to help build, feed, and power our country, far too many of our member companies are running out of time.”
Equipment manufacturers, suppliers, and distributors have largely remained open and continued to supply the equipment necessary to keep the country moving forward. However, eight out of 10 executives have indicated that they will not be able to re-hire workers laid off earlier this year.
This was the second recent survey of presidents, CEOs and owners of leading equipment manufacturers conducted by AEM, completed as more states are opening back up.
“While it is very encouraging that equipment manufacturers are adjusting to the new normal and re-opening all of their facilities, the impact of this unprecedented crisis is far from over and will be felt for a very long time,” Slater said. “Equipment manufacturers have not received the support they need from the federal government, and it is therefore imperative that they take immediate and aggressive steps to support our industry.”
The survey was conducted from May 28 to June 15 with 102 respondents. Additional key findings include:
- Three-quarters said the impact of the COVID-19 pandemic on the overall economy is still very negative, while just under half said the impact on the industry is equally bad.
- One-third said they plan to lower their financial outlook by up to 30 percent over the next 30 days; one in eight respondents said they expect to reduce their outlook for the rest of the year by up to 30 percent.
- Executives said that employee health and well-being, lack of new orders, and continued supply chain challenges are the three biggest issues they face as they re-open their facilities.
- More than one-third said they have furloughed up to half of their employees, while roughly one in five indicated that they have laid off as many as 10 percent of their workforce.
- For equipment manufacturers who have furloughed workers, nearly a third said they would not bring anyone back to work. For those who laid off workers, eight out of 10 said they will not rehire them based on current market conditions and challenges.
- More than eight out of 10 respondents said they would like to see a significant investment in infrastructure to help keep equipment manufacturers in business.
- A majority of respondents said that the equipment manufacturing sector is not getting the support it needs from the federal government.
