There was a time when many manufacturers and metal fabricators viewed the future as either “bullish” or “bearish”. We all like to think we are positive by nature, but after the harsh economic lessons of a decade ago, more of us who have been traditionally positive about the future now tend to use words like “ cautiously optimistic” or view the future with “measured optimism.”
It is neither realistic or beneficial to always have on rose-colored glasses or have a Pollyanna attitude toward the future of the metal fabrication industry. It can, however, pay dividends to be prepared and to push forward with optimism. That appears once again to be true for 2019.
There are positive trends in metal fabrication that should continue to positively move our industry forward, including technology. Education is seeming to swing more towards skills-based learning and STEM education continues to make an impact. The jobs outlook is good in our industry and the economy, while worth keeping a close eye on, seems to continue to push forward. All of this combines to lead us at Wiley Metal to have a “cautiously optimistic” attitude as we head into 2019.
Positive Trends Making a Impact in Metal Fabrication
One of our final articles for 2018 focused on some of the positive economic and technological trends that were positively impacting metal fabrication and manufacturing heading into 2019. These include the move toward increased use of technology, that could literally track the DNA of a product from its raw material through its in-service use and reliability. We touched on artificial intelligence (AI) and its current and potential use in robot partners to help us accomplish more. The article discussed the reasons for a robust recreational vehicle industry and how that was having a positive impact on metal fabricators like Wiley Metal who are heavily involved in that industry. We even talked about the increasing demand for steel and aluminum and how the volatility in these markets have made us more proficient is raw material acquisition.
If we continue to be proactive in our production and management strategies, there are a lot of reasons to be positive about the 2019 outlook for metal fabricators. The key may be in reminding ourselves that our industry rarely stays status quo. Every day we are either gaining market share or losing it. Staying diligent in our efforts can keep us on the right side of that equation. Complacency seldom wins.
Positive Economic Momentum Heading into the New Year
One of the major reasons to be cautiously optimistic about 2019 is the positive economic energy metal fabrication companies have heading into the new year. 2018 was as close to a boom for metal fabricators as anything seen in well over a decade. Of course, it is somewhat natural when that happens for fabricators to begin worrying about a bust. There are no real solid predictions for any such economic busts to come in 2019. Even with an ongoing trade war and some small signs of concerns in the distance, the GDP is anticipated to grow by somewhere between 2.5% and 3.5%. Metal fabrication should mirror that growth.
Another cause of optimism is strength in the automotive manufacturing sector. Consumers are still buying cars, fueled, in part, by the strong economy and emerging automotive technology that has made our cars the next smartphones. Aerospace and energy, but large industries affecting metal fabrication also continue to perform well. Indicators measuring manufacturing capacity utilization hover around 80%, a number that shows strength and optimism in the economy.
As far as concerns about tariffs, they have largely been mitigated by a strong dollar and growth within the industry. There certainly were some supply and demand issues early but most have found their way through them. Perhaps the most confidence-building factor in the outlook for metal fabricators is the longer term outlook that appears robust beyond 2019 and into the next five years.
While there is economic momentum heading into 2019 not seen in years, it will still pay metal fabricators to peek out from the rose-colored glasses occasionally and make sure there is a plan “B”.
Progress in the Skills-Gap
Manufacturer’s and metal fabricators have bemoaned the skills gap for year after year. We too have discussed ways to adjust to the lack of qualified employees. We addressed everything from keeping retiring employees on staff longer to shadow and intern programs. We’ve even talked seemingly endlessly about recruiting Millennials and what they are looking for in an employment situation.
It appears more and more that the skills gap will be addressed by two major factors. The continued introduction of AI and technology in the workplace and a slow, but seismic shift in education focus. STEM Education, the focus on science, technology, engineering, and mathematics has only been in place in some schools for a few years. It is leading, however, to more family discussions about career and training choices. High school graduates are looking at alternatives to be saddled with tens-of-thousands of dollars in students loans. Many have parents who still owe their own student loan debt. There is more emphasis on personalized-based learning and competency-based learning as opposed to “seat time” for students. States like New Hampshire, Michigan and Ohio are implementing policies that allow for seat-time waivers, more individualized educational practices, 21st Century skills and the ability to demonstrate subject competency through community service, internships, educational travel, and online learning. Even individual school districts are instituting plans and creating schools targeted to teaching and training students at their own pace in subjects that interest them.
Will this resolve the “skills gap” issue in 2019? Not likely. But what has been a problem known within our industry for years is now getting more mainstream discussion. Parents and schools alike are recognizing the value of providing children with a career path, as opposed to a seemingly never-ending education path that leads to years if not decades, of debt. There is reason to be optimistic.
Yes, We are Cautiously Optimistic
At Wiley Metal and at metal fabricators throughout America, we are cautiously optimistic about 2019. The previous year has provided solid momentum, and we continue to grow in our management capabilities and the use of technology. While we, like many, continue to struggle finding qualified people to fulfill our expanding needs, we are implementing new strategies and recruiting techniques to help us meet the needs of our partner clients.
Perhaps most importantly, we are sensing an optimistic attitude and approach from our customers. We recognize that as we continue to look for ways to keep them competitive and successful, we too shall enjoy some of the fruits of that success. While it is safe to say 2018 has been an “interesting” year in metal fabrication, it has been also been a successful one. We are optimistic about continuing that success into and throughout 2019.
What are your goals for 2019? Do you have an idea or concept that you are ready to move forward with? Connect with us and let’s discuss how we can work together. Let’s make things happen in the New Year, together.