Semper International, a placement firm that services the graphic arts and printing industry, has published a study in which it found that despite some growth in Q3, the industry will likely witness some stagnation in the fourth quarter.
“Every sector of the economy has felt the effects of government mismanagement. From sequester to the recent government shutdown, the government’s lack of activity is hurting people,” says Dave Regan, CEO of Semper. “Semper is in the unique position of seeing the pain from both sides of the coin. We see companies struggling to keep their doors open, and we see jobseekers struggling to put food on the table and keep a roof over their heads. We need Washington to step up and provide the stability and incentives businesses need to see to start hiring and investing. It's the only way we're going to get the economy moving again.”
Survey participants include more than 300 small, medium and large printing companies in the U.S.; both clients and prospects of Semper International. While a few Canadian companies were asked, none participated in this survey. Participants provide data on revenue and hiring as well as estimated outlooks on future trends. Data is requested from a random sample and is not screened. Semper has been running quarterly surveys since February 2003.
Key findings from the study include:
Survey Finds Stagnation in U.S. Printing Industry Profitability
• 71% of companies surveyed reported a profitable Q3. This represents a 3 point increase over second quarter.
• 42% of survey respondents reported an increase in revenue over last quarter.
• Looking at the two weeks before the survey was taken, 34% of companies reported an increase in current sales, matching data from the third quarter survey.
• 40% of companies expect sales to increase through the remainder of Q4, 2013 while 36% expect sales to stay the same. Last quarter 56% expected a sales increase and 30% expected sales to stay the same.
• The vast majority of respondents indicated that hiring levels will remain the same or increase, nearly the same as last quarter.
• Just under half of companies reported that healthcare is still the labour cost component that increased the fastest last quarter. Healthcare has remained the fastest growing component of cost for the last 15 quarters. Overtime, the next largest component, rose 12 points from last quarter. This increase in overtime could be an indicator that some segments are so unsure of the economy they are forcing overtime to avoid the hiring process - an expensive bet in the mid-term.
• The greatest competitive threat to printers remains largely unchanged from last quarter. The current economy (52%) is the largest threat, exceeding price pressures from lower cost competitors (19%), and emerging technology (11%).
• Print buyers place the greatest pricing pressure on ink to substrate printing (46%).
• Referrals (40%) continue to be the most popular way to find employees. Use of flexible staffing increased 5 points to 15%.
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