October 23, 2002—The Business and Institutional Furniture Manufacturer’s Association (BIFMA) International recently released the latest quarterly office furniture industry forecast prepared by the economic consulting organization, DRI-WEFA.
The latest forecast anticipates a 20% decline in shipments to a level of just over $8.7 billion for 2002. Modest improvement is expected by mid-next year with a nearly 8% increase in shipments, to a level of $9.4 billion predicted for 2003.
Economic and political uncertainty continue to restrain economic recovery. Continued softness in third quarter furniture orders suggest that the industry’s recovery will be further delayed. A cautious corporate investment outlook and weak office construction will continue to restrain order and shipment volumes in the near-term.
Economic consultants DRI-WEFA believe that corporate profits bottomed out in the fourth quarter of 2001 and have stabilized since then. Continued restraint on hiring suggests that profits will begin to recover sharply in the coming months as companies reap the benefits of growing productivity.
Service sector employment has stabilized over the course of 2002 and is expected to increase toward the end of the year now that total employment has started to grow as well. New office construction will decline through the first half of 2003 before any signs of recovery materialize. This downturn in new construction will provide the primary drag on furniture demand through mid-2003.
For more information, contact BIFMA International.
