Montana Manufacturing & Forest Products: 2014 Outlook. Todd A. Morgan, CF

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Eleanore Sims
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1 Montana Manufacturing & Forest Products: 2014 Outlook Todd A. Morgan, CF

2 U.S. Manufacturing 2013 estimated over 12.6 million workers. Annual worker earnings are rising. Value of output per worker is increasing faster than many other sectors. Wood & paper products Electrical equip. & appliances Furniture Rubber & plastic Motor vehicles Chemicals Apparel Machinery Petroleum & coal products Food, bev. & tobacco Fabricated metals Computers & electronics

3 Montana & U.S. Manufacturing Employment MT workers 28,000 US workers 21,000,000 24,000 18,000,000 20,000 15,000,000 Montana U.S. 16,000 12,000,000 12, ,000,000 Source: BEA-REIS SA-25N

4 Montana Manufacturing Better than the average sector! Sector of Montana economy earnings per employee ($1,000) GSP per employee ($1,000) GSP per employee growth All sectors % Manufacturing % Mining % Construction % Retail trade % Professional, scientific, and technical services % Health care and social assistance % Accommodation and food services % Government %

5 Montana Manufacturing 2013 Labor Income by Sector Other 18% Chemicals, Petroleum & Coal 21% Nonmetallic Minerals 8% Sales: ~$14 billion Employment: ~22,150 Machinery 7% Labor Income: ~$1.12 billion Computers, Electronics & Appliances 3% Food & Beverage 14% Sources: BEA-REIS; Census Bureau; and BBER estimates Metals 13% Wood & Furniture 16%

6 Lewis & Clark County Manufacturing 2011 Labor Income Petroleum & Coal Prods. 3% Wood & Furniture 7% Fabricated Metals 2% Other Durable Goods 39% Labor Income: $38.5 million $42.4 million Employment: ~900 Food & Beverage 12% Other Nondurable Goods 37% Sources: BEA-REIS; Census Bureau; and BBER estimates

7 Cascade County Manufacturing 2011 Labor Income Food & Beverage 47% Labor Income: $61.6 million 2011 $66.2 million Employment: ~1,050 Furniture 5% Other Durable Goods 12% Sources: BEA-REIS; Census Bureau; and BBER estimates Other Nondurable Goods 29% Printing & Related 7%

8 Missoula County Manufacturing 2011 Labor Income Wood & Furniture 24% Food & Beverage 19% Labor Income: $93.9 million 2011 $94.4 million Employment: ~2,150 Other Nondurable Goods 8% Chemical 12% Other Durable Goods 37% Sources: BEA-REIS; Census Bureau; and BBER estimates

9 Yellowstone County Manufacturing 2011 Labor Income Petroleum & Coal 61% Chemicals 4% Labor Income: $269 million 2011 $288 million Other Durable Goods 14% Employment: ~3,450 Other Nondurable goods 3% Metals 8% Food & Beverage 10% Sources: BEA-REIS; Census Bureau; and BBER estimates

10 Gallatin County Manufacturing 2011 Labor Income Plastics & Rubber 3% Printing 3% Textiles 2% Other Nondurable Goods 11% Non-metallic minerals 9% Wood & Furniture 7% Labor Income: $123 million 2011 $124 million Employment ~2,700 Food & Beverage 10% Metals 11% Computers & Electronics 10% Other Durable Goods 33% Sources: BEA-REIS; Census Bureau; and BBER estimates

11 Butte-Silver Bow County Manufacturing Labor Income: $46.5 million 2011 $44.1 million Employment: ~700 Sources: BEA-REIS; Census Bureau; and BBER estimates

12 Flathead County Manufacturing Wood & Furniture 44% 2011 Labor Income Labor Income: $154 million 2011 $163 million Employment: ~3,000 Computers & electronics 5% Other durable goods 35% Fabricated Food Metals 5% 3% Other nondurable goods 8% Sources: BEA-REIS; Census Bureau

13 Fergus County Manufacturing Labor Income: $12.8 million 2011 $ 15.0 million 2012 Employment: ~400

14 Hill County Manufacturing Labor Income: $3.4 million 2011 $2.5 million 2012 Employment: ~120

15 Manufacturing Miscellany MMEC & MSU report assisting growth & overcoming barriers MT Manufacturing Council subsidiary of MT Chamber of Commerce MT Photonics Industry Alliance formed MT Outdoor Industry Assoc. forming Made in MT Food & Gift Show March 2014 Manufacturing & Trade Day May 2014

2013-2014 Montana Manufacturers Survey annual survey conducted in November open-ended

16 Montana Manufacturers Survey annual survey conducted in November open-ended & multi-choice questions current & coming year 170 firms participated response rate ~80%

17 Montana Manufacturing 2013 Recap Better than 2012 for many firms Employment down at 20% of firms, up at 30% Many firms reported increased production, sales, and profits Few firms reported curtailments 50% of firms did make major capital expenditure in 2013

18 Montana Manufacturers Outlook Trend Employment Sales Production 0.25 Overall

19 Montana Manufacturing Employment Outlook 0.90 Wood, paper & furniture Chemicals, petroleum & minerals Food & beverage Machinery

20 Montana Manufacturing Outlook by Sector 0.90 Wood, paper & furniture Chemicals, petroleum & minerals Food & beverage Machinery

21 Montana Forest Products Percent of Firms 80% Overall Outlook Outlook for 2012 Outlook for 2013 Outlook for % 60% 57% 49% 40% 32% 37% 20% 11% 11% 15% 6% 0% Better than last year Same as last year Worse than last year

22 Montana Forest Products Industry 2014 Forecast U.S. homebuilding to improve, will boost wood product demand. Markets are expected to be better but more volatile. Output & sales should increase. Employment & worker earnings should also increase. Timber availability could be the major constraint for Montana mills.

23 Montana Manufacturing Outlooks by City/Region 0.80 Helena 0.70 Great Falls Missoula 0.60 Billings Bozeman 0.50 Butte Kalispell State

24 Helena Area Manufacturing Outlook Percent of Firms Outlook for 2013 Outlook for % 50% 40% 42% 33% 33% 25% 20% 17% 0% Better than last year Same as last year Worse than last year

25 Great Falls & Havre Area Manufacturing Outlook Percent of Firms Outlook for 2013 Outlook for % 40% 41% 38% 47% 46% 20% 12% 15% 0% Better than last year Same as last year Worse than last year

26 Missoula Area Manufacturing Outlook Percent of Firms Outlook for 2013 Outlook for % 50% 50% 40% 32% 39% 20% 12% 11% 0% Better than last year Same as last year Worse than last year

27 Billings Area Manufacturing Outlook Percent of Firms 60% 53% Outlook for 2013 Outlook for % 42% 32% 47% 20% 15% 11% 0% Better than last year Same as last year Worse than last year

28 Bozeman Area Manufacturing Outlook Percent of Firms 60% 52% Outlook for 2013 Outlook for % 40% 39% 30% 20% 21% 7% 0% Better than last year Same as last year Worse than last year

29 Butte Area Manufacturing Outlook Percent of Firms 80% Outlook for 2013 Outlook for % 69% 64% 40% 27% 20% 15% 15% 9% 0% Better than last year Same as last year Worse than last year

30 Kalispell Area Manufacturing Outlook Percent of Firms 60% 56% Outlook for 2013 Outlook for % 40% 42% 44% 20% 0% Better than last year Same as last year Worse than last year 4% 0%

31 Lewistown Area Manufacturing Outlook Percent of Firms Outlook for 2012 Outlook for % 67% 60% 47% 40% 38% 33% 20% 15% 0% Better than last year Same as last year Worse than last year 0%

32 Montana Manufacturing Forecast for 2014 Positive outlook statewide and across sectors. Continued improvements anticipated. Modest growth expected in statewide employment & worker earnings. Health insurance costs and work comp rates remain major concerns.

Montana Manufacturing & Forest Products: 2013 Outlook. Todd A. Morgan, CF

Montana Manufacturing & Forest Products: 2013 Outlook Todd A. Morgan, CF U.S. Manufacturing Approaching 12.5 million workers. Annual worker income is rising. Value of output per worker is increasing. Electrical