ConExpo 2017: Making an impact

ConExpo 2017: Making an impact

AEM discusses the findings of an economic impact report, urges passing of infrastructure bill and remarks on the success of the 2017 expo.

March 14, 2017
Kristin Smith
Equipment & Products
The Association of Equipment Manufacturers (AEM), Milwaukee, shared details of a new report titled “The Market Size and Economic Contributions of the Off-Highway Equipment Industry,” during a news conference March 9, 2017, during ConExpo-Con/Agg in Las Vegas.

The report found the equipment manufacturing industry supported about 1.3 million jobs and contributed more than $159 billion to the Gross Domestic Product (GDP) of the U.S. in 2016.

The report was prepared by the research firm IHS Markit, and details the size and reach of the three major sectors (construction, agriculture, and energy) that make up the core of the equipment manufacturing industry.

The report identifies a number of key findings, including:

  • Equipment manufacturers supported more than 1.4 million jobs between the U.S. and Canada in 2016, through direct, indirect and induced employment effects.
  • Equipment manufacturers supported more than $416 billion in sales activity in the U.S. in 2016, and added almost $159 to the GDP of the United States.
  • The top four biggest states for the equipment manufacturing industry in 2016 were: Texas, Illinois, Wisconsin and Ohio.
  • Equipment manufacturers generated over $25 billion in local, state and federal tax revenue in the U.S. in 2016.
  • Equipment manufacturers generated almost $87 billion in total U.S. labor income in 2016.
  • The equipment manufacturing industry supported about 149,000 jobs in Canada in 2016, and contributed about $15 billion (USD) to the economy of Canada.

In addition, IHS estimates of the $31.3 in total sales activity in the U.S., $412.2 billion of that was supported by the off-highway equipment and ancillary products industry’s economic activity. “This occurred through approximately $266.5 billion in direct industry sales activity, such as the sale of equipment like skid steers and combines, which generated additional economic activity as dollars flowed through the equipment manufacturing supply chain,” the reports states.

Jobs supported by off-highway equipment and ancillary products represent nearly 1 percent of the total employment base in the U.S. When added with those supported in the industry supply chain, the number makes up 7 percent of the U.S. manufacturing employment base, the report notes. Of the 424,000 U.S. employees directly involved with firms engaged in the production of off-highway equipment, IHS found 163,000 were tied to the construction equipment industry, 114,000 jobs were tied to the agricultural equipment industry and 148,000 jobs were tied to the mining equipment industry.

Sales activity in off-road equipment makes up 5.1 percent of total manufacturing output in the U.S.

The full report, which can be accessed here, also includes details on the key economic indicators that affect the equipment manufacturing industry, as well as forecasts for the coming years.

“AEM is proud to represent the men and women of the equipment manufacturing industry across our country. This new report helps to put into context the many great contributions of our industry,” said AEM President Dennis Slater. “Our industry is a core part of America’s manufacturing economy, and we are eager to continue to grow, and, hopefully with a significant investment in our infrastructure, help put millions of Americans to work.”

Slater was joined on a panel by Scott Hazelton, managing director, IHS; and AEM Chair Michael Haberman, president, Gradall Industries Inc., New Philadelphia, Ohio.

At the press conference, Haberman and Slater also emphasized their support for a major infrastructure bill to be passed.

Haberman estimated that approximately 73 percent of the equipment manufacturing industry was represented at ConExpo-Con/Agg. “We want to continue to grow,” he said of the industry, adding that he wanted to use ConExpo as a platform to “urge President Trump and congress to follow through on their campaign promises and to pass an major infrastructure bill. This report makes clear a major infrastructure package would be a significant benefit to the equipment manufacturing industry and thus the whole economy of the United States.”

He also advocated for “common sense” reforms to our tax and regulatory burdens allow manufacturers to stay in the U.S. and become more competitive worldwide. He said AEM is working on the state and federal level to lobby to make it easier to export equipment all over the globe as well policies that help the agriculture industry which will benefit equipment sales in that sector. “Lastly we are excited that the Trump administration has already taken steps to encourage energy exploration, and will hopefully help make oil, gas and mineral exploration more profitable [for all businesses] so the equipment industry can also thrive.”

During the press conference, a reporter who characterized ConExpo as a bellwether for the construction industry asked about what this year’s ConExpo indicates. Gradall said, “I think there is a notable difference in the attendees at this show, and the difference is their optimism.”

In a press release issued about the show, Rich Goldsbury, 2017 ConExpo-Con/Agg chair and CEO and president Doosan Bobcat North America & Oceania, said, “This has been one of the best editions of ConExpo-Con/Agg ever. Exhibitors are writing sales at an incredible pace, and attendees clearly came to Las Vegas to buy.”

Dave Foster, vice president for marketing and corporate communications at Volvo CE said of the attendees, "These are not tire-kickers. These are people who are willing to buy multiple machines for work they have now and anticipated growth based on a renewed confidence in the market."

A series of key metrics reflected the improved conditions, which were bolstered by a new pricing strategy intended to reinforce the overall quality of ConExpo-Con/Agg and International Fluid Power Exposition (IFPE) 2017 attendees, according to AEM, including:

  • U.S. buyer attendance jumped over 16 percent from the 2014 show, and total buyer attendance improved by almost 8 percent;
  • Overall contractor and producer attendance grew by 10 percent;
  • Total attendance neared 128,000 for the week;
  • Almost half of all attendees serve in executive positions at their company, and more than 3-in-5 attendees serve in a decision-making role;
  • Almost 26,000 international attendees from 150 countries braved global headwinds including a strong dollar and flagging export markets and composed nearly 20 percent of overall attendance; and
  • Attendees purchased a record-breaking 52,000 tickets for education sessions at the show, a 26 percent increase from the 2014 show. Total ticket sales excluding IFPE jumped by over 27 percent compared to 2014.

At the same time, the technological change revolutionizing these industries was pervasive across the shows’ record 2.8 million-plus net square feet of exhibits featuring a record 2,800-plus exhibitors from the leading U.S. and global manufacturers, from multinational giants to small firms with specialized products, AEM says.

The world’s first 3D-printed excavator, the brand-new Tech Experience and a stellar education lineup anchored a forward-looking vision for construction and infrastructure on display at ConExpo-Con/Agg and IFPE 2017, AEM says.