MILWAUKEE — The American economy is inching closer to a recession and Wisconsin manufacturers are beginning to brace for one.
Wisconsin Manufacturers & Commerce (WMC) held a breakfast event on May 20 at the Pfister Hotel in Milwaukee to highlight important issues facing manufacturers this year.
“I think the odds of us going into a recession in the near term — 12 months — is pretty high because the Fed has never been able to address inflation at this level without inducing some sort of recession to cool things down,” WMC CEO Kurt Bauer said in an interview with the Milwaukee Business Journal. “Whether it’s mild, whether it’s severe — I don’t know.”
Bauer said manufacturing executives in Wisconsin aren't worried about a recession through the end of this year because they have amassed a backlog of orders they are still striving to fill. According to our partners at the Milwaukee Business Journal, manufacturers are still struggling with supply-chain shortages and workforces that slowed production. The panelists said supply-chain challenges will continue into 2023 and beyond.
Panelist John Mellowes, CEO of Charter Manufacturing Co., believes certain segments will perform better despite "some form of a recession." According to the Milwaukee Business Journal, those include ones with strong demand such as automotive, oil and gas, and on-shoring-related enterprises.
Panelist Carolyn Salzer, head of logistics and industrial research in the Americas for Cushman & Wakefield, said her company’s experts predict “some form of a mild recession in 2023," the Milwaukee Business Journal reports.
Panelist Doug Fisher, a supply-chain expert and associate professor emeritus at Marquette University, sees a recession.
“The big thing is hard landing or smooth landing?” he said. “If it’s a hard landing, all bets are off.”
As for the supply chain, Fisher said there is no quick fix and there will be no "return to normal."
“It’s going to be a decades-long effort,” he said.
Concerns include the Covid-19 shutdowns in Shanghai and other Chinese cities, and the uncertainty of the impact the war in Ukraine will have.
According to the Milwaukee Business Journal, Fisher said American manufacturers and businesses are seeking supplies closer to home or in countries other than China.