K&B Manufacturing Jobs on the Rebound
According to the Q2 Kitchen & Bath Market Index, more than half of companies in the sector reported a dramatic uptick in employment.
By Robert Isler
In a hopeful sign, 83% of manufacturing firms have brought at least half their employee base back at work, and 54% of firms reported they are back or nearly back to full employment. Furloughs impacted 41% of company workforces in Q2, a noticeable improvement over the 61% in Q1. Only 6% claimed that furloughs still impact all of their employees. At the height of the pandemic in Q1, that number was a staggering 29%.
A reinstatement of employees is usually a sign that demand is increasing, and for kitchen and bath manufacturers, that certainly appears to be the case. Capacity utilization reached 72% in Q2, a marked improvement over the 52% in Q1. Four in 5 now have utilization rates above 60%, compared to less than half in the Q1 survey. To fully appreciate the extent of the comeback, virtually every manufacturer is now operating at over 20% of capacity — which, admittedly, is a very low bar. Yet, in the first quarter, 1 in 5 manufacturers could not even make that standard.
83% of manufacturers have brought at least half their employees back to work, while 54% said they are back or nearly back at full employment.
When asked which factors were most significantly impacting their businesses, showroom closures easily led with 18%. Supply chain disruptions and consumer budget uncertainty were next, at 12% apiece. Labor issues and workforce disruption, at 9%, rounded out the top four.
The uncertainty up and down the supply chain has had a noticeable impact on other business considerations for manufacturers. In Q2, a clear majority, 61%, indicated that they were delaying capital expenditures, with the average manufacturer placing a bit over half of pre-planned expenditures on hold. That’s still substantial, but in comparison with the 86% of respondents who delayed spending in Q1, it’s a strong improvement.