Commercial Printing--Slowdown Slated for '99?
BY ERIK CAGLE
Could it be that the honeymoon is really over for commercial printers?
Not that there was a matrimonial union of printers and the almighty dollar recently, but one could call it a hot date. The industry enjoyed 4.6 percent sales growth overall in 1997, riding the heels of a national economy that enjoyed low cost inflation.
|1999 Regional Outlook for Print Sales
The chart estimates total print sales for 1998,
and print-sales growth for both 1998 and 1999.
Total is in millions and projected growth has not
been adjusted for inflation. Sales growth shown
is over the previous year.
|Chart courtesy of NAPL Economic Research Center.|
The economy stood at 51⁄2 percent growth in the first quarter of this year, and around that time Asia stepped in with a bucket of ice cold, recessional-temperature water. The growth dipped to 1.6 percent in the second quarter, according to Andrew Paparozzi, chief economist for the National Association of Printers and Lithographers (NAPL), and the performance of the economy indicated our industry wasn’t insulated from the ripple effects caused by Asia’s economic turmoil.
“Around May, things started to change. We started to notice that some key indicators we follow, such as work-in-process, began to decline,” Paparozzi notes. “They started to slip, and that wasn’t surprising because that’s when we started to see the economy and business activity overall start to slow.
“About that time, we started to see some significant slowing in important measures of real printing industry activity, particularly hours worked,” he adds.
While sales figures as a whole for 1998 will check in around 61⁄2 to 7 percent, according to Paparozzi, it won’t be an accurate indicator of the direction the commercial printing industry will take in 1999.
“What we’ve seen is the start of a slowdown, which we think will continue through 1999,” Paparozzi declares. “That’s not showing up quite as much in sales figures, because right now sales figures are being supported by price increases, but it is showing up clearly in things like hours worked.”