RV suppliers and manufacturers have described the industry downturn that first reared its head last June and has been picking up steam since using words such as ‘rebalancing,’ ‘equilibrium,’ and ‘recalibration.’
Except for an uptick last July, the slide has been consistent over the past year, sounding alarms of a potential looming recession.Though there have been no massive layoffs in the industry, insiders say manufacturers and suppliers have been able to adjust so far by eliminating overtime shifts
It’s an important question in Elkhart County because its factories produce the majority of the nation’s RVs and employ tens of thousands of people in the region.
“If this is a rebalancing, I don’t know what a recession is,” said Michael Hicks, an economist at Ball State University. “This (RV shipments) is one of the better indicators of a business cycle that we have.”
According to an informal analysis of previous RV downturns, an annual shipment slide of 5 percent or more is followed the next year by a recession. That’s why the health of the industry is sometimes used to forecast what’s ahead for the economy.
Though still low by historical standards, Elkhart County’s seasonally unadjusted unemployment rate has been trending higher since October and stood at 3 percent in June — still below the unemployment rates for Indiana and the nation, though.
But Hicks said it is common for unemployment to trail a recession as employers are typically reluctant to eliminate employees, especially when the positions have been as hard to fill as they have in the RV industry.
Though there have been no massive layoffs in the industry, insiders say manufacturers and suppliers have been able to adjust so far by eliminating overtime shifts, extending holiday breaks or shortening the workweek, among other things.
According to the RV Industry Association, through the first six months of the year, shipments have dropped to 216,581, a 20.3 percent decline compared to the same period last year.
Copyright © 2024, South Bend Tribune