The Sko-Die team is very thankful to our customers and to our suppliers for their support that we received throughout 2018. This year has seen continuing strength of our overall manufacturing sector. These conditions have translated into opportunities for us to grow our business with our valued customers and to advance new opportunities in the market.
With most of the macroeconomic indicators trending positive, signs point to a continuation of a robust manufacturing economy heading in the 2019. As of November, the Purchasing Managers Index notched the 27th straight month of expansion for the Manufacturing Sector. Employment is strong, which is no surprise to any of us that are trying to expand our work force with talented bench strength and next generation talent. General demand and orders are on the rise, so there is reason for optimism headed into 2019. But with that strength brings challenges that we all must consider as we plan for the coming year any beyond.
One such factor that came to the forefront in 2018 is the effect of tariffs imposed on imports of globally produced raw materials and goods and how that plays into the broader discussion about Free Trade. One can hardly deny that we are operating in a Global economy, regardless of whether one transacts directly with any global entities. Perhaps the most relevant discussion should be about how to define Free Trade vs Fair Trade. It seems that endless opinions exist on that topic. Perhaps in 2019, progress will be made to align the goals of Fair Trade and Free Trade towards sustainable policies to benefit the US manufacturing sector as a whole.
We have certainly seen inflationary pressure on materials result of the section 232 Tariffs. The question becomes whether the long-term goals of the implementation of these tariffs in keeping and growing manufacturing jobs here in the USA will be achieved. One consideration is whether applying those tariffs further downstream to the finished goods produced from materials covered under the Tariff is a key to the long-term success of this trade policy. Regardless of where one sides on this topic, there is no doubt that the effect of tariffs and an evolving global trade policy must be woven into the decision process in the domestic manufacturing sector in 2019 and beyond.
From a more regional perspective, 2018 marks the 26th anniversary of the original signing of the North American Free Trade Agreement (NAFTA). One would be hard pressed to find a manufacturing business in the USA that was not affected in some way by this agreement.
Whether the promise of NAFTA materialized is a question that each company and participant in the economy must answer for themselves. What will the next iteration of that agreement bring? Only 2019 will answer that question.
At Sko-Die, we are a domestic manufacturer, proud to begin our 72nd year in business. We are a strong proponent of policies that promote a strong and sustainable domestic manufacturing sector. We are continuing our strategy of investing in our business to position ourselves to meet the growing demand that a strong manufacturing economy drives. We are thankful for the support of all our customers and supply partners in 2018 and look forward to a prosperous 2019 with you.
At Sko-Die we remain…
