Rich Rovito, WMEP Content Specialist

By Rich Rovito

Wisconsin manufacturers remain on a path of improvement although the pace of recovery appears to be slowing, the latest COVID/Economic Crisis Manufacturer Pulse Survey conducted by WMEP Manufacturing Solutions shows.

WMEP has released the results of its fourth survey of Wisconsin manufacturers since the start of the coronavirus pandemic in March. The survey’s aim is to assess how companies in the industrial sector are responding to Covid-19 and the corresponding economic crisis.

The latest survey reveals that the state’s manufacturers continue to show signs of progress in overcoming challenges tied to the pandemic when compared with previous survey responses from April, May, and August.

“We wanted to see how this is changing over time, most importantly how is Wisconsin manufacturing recovering from the COVID-19 economic crisis,” WMEP Vice President of Consulting Services George Bureau said.

In the October survey, 59% of the 134 manufacturers from across the state that responded to the survey indicated that their business was down “greatly,” “significantly” or “somewhat,” compared with 67% in August and 77% in May when examining their current state of business to where it stood under normal circumstances.

Photo of George Bureau

George Bureau Vice President Consulting Services

“This corresponds to the healing that Wisconsin manufacturing has done,” Bureau said.

Although business conditions are improving for many manufacturers, the struggle continues for some.

“We still have companies that are down significantly or down greatly,” he said.

About 18% of respondents indicated that their business is “down greatly” from its normal state, compared with 22% in August, 31% in May and 37% in April.

“This does suggest that the rate of recovery has slowed somewhat,” Bureau explained.

As in prior surveys, a small portion of respondents indicated that their business is up considerably compared with normal circumstances.

“Believe it or not, we do have manufacturers that are up over 30 percent versus where they would normally be at this time of year,” Bureau said.

In the October survey, about 2% of respondents indicated that their business was up greatly, compared with 13% in August.

“This is another data point that shows that the rate of recovery is slowing,” Bureau said.

About 85% of the survey respondents are classified as small to mid-size manufacturers, ranging in size from fewer than 20 employees to as many as 250. The survey targeted manufacturing leaders across the state from companies in a wide range of industrial categories.

Manufacturers from the three major population centers – Milwaukee, Madison and the New North region of Northeast Wisconsin – are heavily represented in the survey due to the manufacturing hubs in those areas but industrial firms across the state also responded.

“We feel very confident that the breadth of geographies is very well represented,” Bureau said.

The survey found that the economic recovery among Milwaukee area manufacturers is “very slow,” he said.

“We see a faster recovery in the New North and the Greater Madison area is at a higher level compared with normal,” Bureau said.

As part of the survey, manufacturers were asked to assess how strong demand will be for their products and services over the next six months. In response, 53% stated that they expect demand to increase (up from 48% in August), 24% believe there will be no change and 16% expect a decline. The remaining were unsure.

“That’s a good news story,” Bureau said. “We are seeing more companies report that they expect to see an increase in demand for their products.”

Companies expecting a decrease in demand will likely experience increased pressure, he said.

“These companies are very much hurting right now,” he said.

A little more than one-third of manufacturers surveyed expect profits to increase, while about 28 percent are anticipating a decrease.

“It’s very likely we will see continued pressure on cost controls, especially non-labor,” Bureau explained.

The survey also showed that manufacturers are taking various steps to keep their workplaces free of COVID-19, including routinely performing temperature checks on employees, enforcing social distancing, staggering work shifts and break times, reducing movement within their factories and requiring face coverings, among others.

Some companies are even providing bonuses for maintaining a COVID-free environment.

“I want to give a shout out to Wisconsin manufacturers for being innovative in protecting health and safety,” Bureau said.

An area of concern in the most recent survey arose from the number of manufacturers who have had to shut down all or parts of their operations for a period due to active COVID-19 cases.

“That number was negligible until the most recent survey,” Bureau said. “We now have 10% of manufacturers that have reported partial shutdowns of some sort.”

Some survey respondents also indicated that finding and retaining key employees is once again becoming a top issue, much like it had been prior to the pandemic.

“Finding and keeping employees is starting to reinsert itself,” Bureau said. “It’s an indicator of recovery but it’s also an indicator of a long-term demographic trend that we all have to recognize and deal with.”

WMEP plans to repeat the survey again in January to evaluate how the manufacturing environment continues to change.

“The weeks ahead will be challenging for some more so than others but keep in mind that we are moving in the right direction,” Bureau said.

  • Fourth Economic Crisis/COVID-19 Wisconsin Manufacturer Pulse Survey 10-27-2020 – Presentation Link.
  • Fourth Economic Crisis/COVID-19 Wisconsin Manufacturer Pulse Survey 10-27-2020 – Webinar Recording Link.