Page 38 - Plastics News September 2023

FEATURE

US Plastics Industry Slowdown Has Hit Bottom, Says Pineda

he chief economist of the Plas- Report. winds as well as tailwinds affecting the
Ttics Industry Association pro- Plastics industry routinely outper- plastics industry. Contributing to the
jects a return to growth in 2024. headwinds, which have been buffeting
forms overall manufacturing
By the time 2023 comes to a close, Despite the inevitable down cycles, companies since the fourth quarter of
real plastics shipments probably will the underlying trend for the plastics 2022, is the high cost of capital. Pineda
have decreased by 3% compared industry continues to be growth ori- cited some publicly traded companies
with 2022 and employment will have ented. In fact, it historically outpaces in the plastics sector that have seen
fallen by 2.2%, according to Perc the manufacturing sector as a whole, double-digit increases in interest ex-
Pineda, PhD, chief economist at the noted Pineda. For example, plastics penses. Weaker household spending
Plastics Industry Association (PLAS- shipments rose by 1% between 1997 and an abundance of inventory in the
TICS). To put those negative numbers and 2022, whereas total manufactur- retail sector since December 2022
in perspective, however, it’s worth ing shipments fell by 0.1% during the have affected consumption of plastic
noting that the value of shipments same time period. Added value — the products.
— shorthand for sales, according to contribution of the plastics industry to Positive impact of reshoring
Pineda — increased 2.6% in 2022 the overall economy — grew 4.4% in At the same time, there are unmis-
and 1.8% in 2021. More importantly, the last five years while total manufac- takable tailwinds in this slightly baf-
2024 promises to put the plastics in- turing eked out a modest 1.1% gain. fling economy: Reshoring will have a
dustry back in the black, with employ- And between 2012 and 2022, employ- positive impact in the medium term,
ment forecast to rise 1.2% and real ment in the plastics industry increased said Pineda; personal consumption
plastic shipments growing 1%. Pineda 1.3% each year, compared with 0.7% for non-durable goods appears to be
shared his observations and projec- for manufacturing, said Pineda. relatively stable; and automotive pro-
tions during an executive briefing yes- duction is robust and will continue to
terday in conjunction with the release In presenting his outlook for the in- be in 2024.
of PLASTICS’ 2023 Size and Impact dustry, Pineda referenced the head-

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