The MHEDA Journal - First Quarter, 2016 - (Page 74)

INDUSTRY CONVENTION SPEAKER FORECAST A Positive 2016 in Store for Material Handling MHEDA Convention Speaker Brian Beaulieu predicts growth in 2016 BY STEVE GUGLIELMO AND BRIAN BEAULIEU I TR Economics CEO Brian Beaulieu will be presenting at the MHEDA Convention on Monday, May 2nd, 2016, from 1:45 p.m. to 3:00 p.m. The MHEDA Journal had an opportunity to speak with Brian about his presentation, "Prosperity in the Age of Decline" and about what 2016 has in store for the economy and the material handling industry. The MHEDA Journal: Based on your research at ITR, what do you expect 2016 will bring to the material handling industry? Brian Beaulieu: The outlook for 2016 is good. The industrial side of our economy in North America is soft right now because of the oil patch and because of a very strong dollar and normal business cycle influences. But the oil patch is going to be stabilizing, the dollar is going to be going the other way against most of our trading partners and the material handling group in particular is one of our stronger sectors because the consumers are alive and well and out there spending money. Goods need to be moved within distribution channels and warehousing. We're very upbeat for this sector and the consumer-based leading indicators are positive for 2016, so we think it's going to be a good year. TMJ: What are some of those leading indicators that MHEDA members should keep an eye on? 74 MHEDA | BB: Keep an eye on housing starts. I know that's not directly related to the material handling industry, but it reflects a demand-pull aspect of the business. I'll be discussing this at Convention, but employment numbers are something to keep an eye on. We've seen some weakness over the past couple of months in that sector so that's something to remain vigilant about. Another important indicator is retail sales. This sector responds well to rising retail sales. And finally, keep an eye on the interest rates. We want to make sure that if rates start going up, it's at a gradual rate. If rates go up The material handling group in particular is one of our stronger sectors because the consumers are alive and well and out there spending money. 100 basis points, which would be 1 full percentage point, that really won't mean much of anything. If they go up 2 full percentage points, people in this industry will begin to see some decisions being deferred or some potential yes's that may turn into no's. And if interest rates go up 3 full percentage points, in this industry we'll start to see some capital expenditure programs delayed and they will feel that. So they need to be looking at the magnitude of the rise that is occurring in interest rates. And of course ITR will be doing that for them but that's one of the keys. TMJ: Do you anticipate rates moving in the near future? BB: I don't think they're going to move soon. There's virtually no inflation to be measured in the economy at this time. I don't think the Fed would have any basis for raising rates in the next one or two quarters. That doesn't mean they won't move. They could preemptively move them, but I don't think there will be an actual reason evident in the economy for at least the next two quarters. TMJ: Do you think the Presidential election will have any impact on the economy in 2016 or 2017? BB: The soonest that the new president could make any kind of influence on our industry would be late 2018 or early 2019. We'll have plenty of forewarning based on their policies whether it will be good or bad. They won't be able to have any immediate impact on our industry for 2017 or even

Table of Contents for the Digital Edition of The MHEDA Journal - First Quarter, 2016

Chairman's Perspective
From the Desk of Liz Richards
Editor's Note
Ask Your Board
MHEDA University Calendar
New Members
Spotlight on Association News
MHEDA Milestones
Index of Advertisers by Product Category
The Last Word

The MHEDA Journal - First Quarter, 2016