As a 55 year veteran chief executive, communicator and active member of PHCP industry associations, I have been able to achieve a panoramic view of our $100 billion-plus industry by staying in constant touch with its shakers and movers.
Although my more than 100,000 readers extend to every aspect of global economics, "The World Report" columns keep what's critical to you, the PHCP industry participants, constantly in mind.
Each month I will wrap up the important events impacting all facets of the distribution channel, and give you my insight as what to look forward to.
I hope you'll find these monthly communications informative and look forward to comments and inquiries from you. As your industry associate, I look forward to this interaction on a continuous basis.
As we kick off this initial update, our overall PHCP industry is looking at a strong upward turn in the pipe-valve-fitting sector, while beset by continuing weakness in residential new construction. However, even in the face of the lowest level of annualized housing starts since records were first established in 1963, PHC contractors are finding additional work availability in maintenance, upgrading and energy preservation.
As homeowners are less prone to sell existing residences, but are increasing their inherent values by such energy saving systems as solar panels, and investing in the latest plumbing, heating, and air conditioning innovations to reduce upkeep and eventually create more saleable entities as the current depressing housing cycle ends.
A most remarkable trend that has manifested itself this year is the switch to rentals. A vast number of homeowners today find ownership no longer an asset, which is reflected in the record number of foreclosures that have recently reached an all-time peak.
With home prices depressed, and mortgage payments increasingly difficult to meet, the mortgage interest rate deduction has lost its attractiveness. This has instigated a surge in rentals, creating a shortage of supply in metropolitan high rises, as well as single homes in most parts of the country.
Another factor primarily impacting the pipe-valve-fitting sector is "back to America." This has been a bonanza for the comeback of the American manufacturing sector. It has been spurred by the unexpected acceleration in exports, primarily from a variety of construction machinery, mill supplies, automotive components, and aircraft, as well as the vacuum created by a plunge in export shipments from Japan, which has also hobbled several American manufacturers dependent on Japanese components. Although not often mentioned, the U.S. ships out more military equipment than the rest of the world combined.
However, the greatest impetus for American companies that stand behind their products, either domestically or abetted by off shore product components is that an American-owned company is responsible for the performance of products in case of shortcomings.
Despite the increasing yoke of financial regulations, the worrisome impact of Obamacare, and the aftermath of the post-debt ceiling relief act, privately-held manufacturing and service enterprises, chief employers of the U.S. labor pool, are reporting the best 1st quarter results since 2007.
We'll be watching these trends carefully and will keep you updated on ever-changing events as they occur.
