Material Handling Masters Podcast

This quarterly economic report, published by ITR Economics, features data specifically for the material handling industry to assist MHEDA members plan for the year ahead. The full detailed report is available to members only. Order and download the new report as well as past archived issues (requires member login). Download Full Report Podcast Transcript: Good morning, everybody. This is Eric post. I'm the director of research and development here at ichar economics, and I wanted to welcome you this morning to go over our report for MHEDA for January 2023. A Chart for the US industrial production index that's in your report. And this is a annual average. So 12 months moving average for industrial production. That's three quarters manufacturing activity and about a quarter of Mining and utilities activity. So those three components and what you can see is in the dark blue the actual data the Great Recession the 15 16 oil price collapse covid and then the rise that we've been on here and then in the teal bars, you can see our forecast and as you can see from that forecast, you can see we have a bit more growth here to go but it really starts to flatten out here and then pretty soon we're going to be seeing some decline in US industrial production. That's a change to our Network economic Outlook from the prior report. And I wanted to really start there because as you'll see in a number of the markets for you all when you look at 2024 here, you'll see a lot of negative growth rates. You also see some growth rates that are positive but very subdued compared to what they've been in the past. So 3.7% growth for e-commerce retail sales that series is usually growing a much more rapidly than that. So why are we seeing a bunch of macroeconomic softening happening in 2024? So to answer that question, I wanted to look at interest rates and the answer in a word is the Fed. I guess that's two words, but the Federal Reserve has pushed up interest rates short-term interest rates. And that's the teal line here incredibly quickly an incredibly sharply. Just look at how sharp the slope of this teal line is compared to Prior instances here of even when we raised interest rates rather substantially before the Great Recession nowhere near sharp of Rise as we've experienced in this cycle. And so that has led to what we've been warning of for some time, which is this idea of an inverse yield curve where short-term rates now have surpassed long-term rates. That's the Navy line and anytime that happens you can see there's two times in the history here where that clearly happened first is a sustained period of time that are Circle prior to the o102 recession and prior to the Great Recession. After that occurs, we almost always see a recession. It's about a 80 88% probability or so that once we see this inverse yield curve. We'll see a recession the typical lead time though is not instantaneous. It's not like the yield curve converts today and tomorrow we're in recession. Usually the way it goes is you'll curve inverse today, and we're in recession about a year from now. So that's why when you look again to go back to your forecast for industrial production. We have a little bit more rise left. It's pretty muted. We're definitely in the slowing growth phase here the business cycle. Slowing growth developing to flatness and then developing into this decline. So again, just that the speed and severity of those interest rate hikes by the federal reserver are putting us in that situation where the economy basically cannot handle those interest rate hikes. We've already seen that really clearly that developing some markets like the housing market for example is the most clear example of where really New Home Building for example has taken a big step back home sales of taking a big step back as mortgage rates increase substantially, but we'll be seeing that effect trickle through to othe...

Host Shari Altergott, Chief Experience Officer of The CX Edge talks with John Paxton, CEO at MHI, about the upcoming Promat 2023 show. John discusses the opportunities at the show to see the latest products, learn from expert speakers, network with industry professional, and have fun.  More About PROMAT 2023 Discover the latest solutions to move your business forward as industry-leading innovators showcase their latest manufacturing, distribution and supply chain equipment and systems at ProMat 2023, March 20-23, at McCormick Place in Chicago. For more information or to register, visit www.promatshow.com. MHEDA is excited to participate in Promat 2023. Visit MHEDA at Booth S3795 to pick up a MHEDA Member ribbon, visit with Board Members and MHEDA Staff members and learn about all we have planned for 2023. For more information, visit www.mheda.org/mhi-promat. MHEDA Talks Podcast Stay tuned for more episodes of the MHEDA Talks podcast series when Shari will interview industry thought leaders on issues and trends affecting MHEDA members.

Host Shari Altergott, Chief Experience Officer of The CX Edge talks with Katie Yates, Equipment Distribution Manager at Carolina Handling, about gender differences in the workplace, benefits of a diverse team, women in leadership, the importance of mentors, and more.   Stay tuned for more episodes of the MHEDA Talks podcast series when Shari will interview industry thought leaders on issues and trends affecting MHEDA members.

Host Shari Altergott, Chief Experience Officer of The CX Edge talks with Alex Reed, Chief Commercial Office at Vsimple, about the importance of the customer experience, how that experience is effected by internal processes, how to implement new technologies to improve employee and customer experiences, and more.   Stay tuned for more episodes of the MHEDA Talks podcast series when Shari will interview industry thought leaders on issues and trends affecting MHEDA members.

This quarterly economic report, published by ITR Economics, features data specifically for the material handling industry to assist MHEDA members plan for the year ahead. The full detailed report is available to members only. Order and download the new report as well as past archived issues (requires member login). Download Full Report Podcast Transcript: Hi everyone. I'm Eric post. I'm the director of research and development here at ich economics and really excited to give you a preview and overview of your Makita report for the fourth quarter here. And as we move into the fourth quarter what a year, it has been we've had two quarters of GDP decline real GDP decline in the first half of 2022. And then a quarter of rise in the third quarter that just came out so very bumpy along the flatness line for GDP. We've had significant pullback in the stock market. We've had some increase in interest rates through it all though. The consumer has fared relatively. Well retail sales are doing very nicely up double digits here over a year. We have very low loan delinquency rates. And that doesn't matter whether you're looking at mortgage delinquencies. Very very low loan doing Quincy rates there credit card delinquencies. Those look great and auto delinquencies. Look good too. So people are not over leveraged in their life. They're able to keep up with their debt commitments when you look at wages, excluding transfer payments. Those are at record highs. So plenty to be excited about in the economy plenty to be worried about in the economy too. When you think back to what interest rates we're doing at the beginning of this year and where they are now, it is a big change big big change. We have mortgage rates somewhere. Round sevenish percent give or take depending on the day that you're looking at things. So what's going to happen in the future? Well, when we look at the economy as a whole For industrial production. We're going to see slowing growth pretty significant pullback in growth rates next year and then a bump up in 2024. There's one risk to that Outlook that we are keeping an Eagle Eye on and that is what the Federal Reserve does. Like. I said interest rates have gone up a lot this year about over 300 basis points. And really what matters is do we see a yield curve inversion between 10 month government bonds and stream. Excuse me, 10 year government bonds in three month government bonds. If we see that yield curve invert, it means that it's a more uncertain near term for the US economy and we could see a recession if we see that sustained in version. So what does that mean for the future? I think that really means two things for you. Number one is I would have my base case forecast based upon the assumption that industrial production business spending Material Handling equipment are going to slow quite considerably in the case of material handling equipment even dips slightly next year, but nothing is going to fall apart completely and that's because we have all kinds of Tailwinds. We have all those consumer fundamentals. I've mentioned they're very nice we Have very nice corporate profit that friends over the past bit now, that'll be weakening going forward but there's still a lot of cash out there in businesses Pockets that they can spend they have supply chain problems to fix and that's going to mean investments in B2B and in material and Equipment, they have processes to automate because labor is so expensive that means investments in B2B the material handling equipment. And so when you consider all that reshoring near Shoring they're certainly are plenty of Tailwinds to the economy too. It's just that they're going to be coming up against all of the headwinds that certainly are making the news we can in global economic growth and interest rate increases war and Ukraine and inflationary pressures, by the way. Let's talk a little bit about inflation. What are some bad things there? What are some good things? Well,

Host Shari Altergott, Chief Experience Officer of The CX Edge talks with Rob Polich, VP of Sales & Marketing at Superior Fabrication, about the changing role of marketing, developing go-to-market strategies, focusing on the customer, and more.   Stay tuned for more episodes of the MHEDA Talks podcast series when Shari will interview industry thought leaders on issues and trends affecting MHEDA members.

Host Shari Altergott, Chief Experience Officer of The CX Edge talks with Robin Ritz, Creative Visionary at InCord, about work/life balance including identifying causes of a poor balance, setting boundaries, saying no when necessary, creating a culture that supports a healthy balance, and more.  Stay tuned for more episodes of the MHEDA Talks podcast series when Shari will interview industry thought leaders on issues and trends affecting MHEDA members.

Host Shari Altergott, Chief Experience Officer of The CX Edge talks with John Clark, Director of Marketing at Steel King Industries about market trends in supply chain from market drivers of access to labor to automation.  Stay tuned for more episodes of the MHEDA Talks podcast series when Shari will interview industry thought leaders on issues and trends affecting MHEDA members.

This quarterly economic report, published by ITR Economics, features data specifically for the material handling industry to assist MHEDA members plan for the year ahead. The full detailed report is available to members only. Order and download the new report as well as past archived issues (requires member login).

Host Shari Altergott, Chief Experience Officer of The CX Edge talks with Jeremy Wall, CEO and Co-Founder of GoalMakers about the importance of professional development at all stages of your career and about MHEDA's Master Manager 10-week program. You can learn more and register for the Master Manager program at www.mheda.org/master-manager.  Stay tuned for more episodes of the MHEDA Talks podcast series when Shari will interview industry thought leaders on issues and trends affecting MHEDA members.