Buyers See Rebound by Mid-2002

Thomas Register survey reinforces optimistic ISM's PMI data

Tempe, AZ  January 7, 2002  A majority of industrial buyers believe that the purchasing will recover from its current slump by mid-2002, according to a new survey released today.

The survey, by Thomas Register, found that 58 percent of the polled buyers believe that purchasing will return to normal in the first half of this year, while just 8 percent see the slump continuing into 2003.

This new data comes on the heels of an optimistic report last week from the Institute from Supply Management (ISM, formerly the National Association of Purchasing Management), which showed new industrial orders and production increasing in December even as inventories fell that month.

ISM's PMI, or purchasing manager's index, rose to 48.2 for December from 44.5 in November. A PMI reading below 50 percent indicates declining production, but the month-to-month increase provided hope that the manufacturing sector was on the verge of rebounding into growth.

Commenting on the PMI last week, Norbert Ore, head of ISM's manufacturing business survey committee, said: "While the manufacturing sector continues to decline, the rate of decline has slowed very quickly, giving some hope that recovery may come faster than is generally found in a major downturn."

In the Thomas Register survey, 16 percent of respondents predicted that buying would return to normal in the first quarter of 2002, while 42 percent were looking for a second-quarter recovery.

An additional 27 percent and 7 percent, respectively, foresaw a recovery in the third and fourth quarters of this year.

The December survey was conducted randomly among Thomas Register's pool of 760,000 opt-in online users in conjunction with More than 350 respondents, including manufacturing, engineering, wholesale trade, distribution and government buyers, participated in the survey.