Foodservice Equipment Reports

The Sky Isn't Falling, Most Likely

In this 24/7 news environment, I’d just like to see a little perspective for once. If you watched or read almost anything purportedly “news” lately, you’d think economic catastrophe was at hand. We’re supposedly all headed down the tubes again. Gosh, how much can we blame on poor Greece or Spain or Germany or politicians everywhere?

OK, so jobs growth in the U.S. has been slower the past few months than it was earlier this year. Consumer confidence measures have been mixed. Europe is a mess, but I think we’ve all figured out that the Eurozone didn’t have the infrastructure it needed to support a joint currency. They’ll fix it or they won’t. Growth in China, India and Brazil is slowing. We have political gridlock in the U.S. that won’t get unblocked until after the election. Oh, woe is us.

Come on! We’re about ready to start working on our forecast for 2013 and beyond. Much of the above is just the Wall Street sheep and cable news echo chamber folks baa-ing in the wind. Not that fear isn’t a potent force, as President Roosevelt explained nearly 80 years ago.

But there is plenty of countervailing good news. Economists have been predicting the jobs slowdown for months, knowing that the very mild winter boosted hiring early this year. Take a moving six-month average, and we have exactly the slow, but positive, jobs growth nearly everyone predicted. While the more volatile Conference Board’s confidence index was down in May, the University of Michigan’s Consumer Sentiment Index reached a four-and-half-year high. Oil and gasoline prices have fallen dramatically, putting a lot of extra spending power in consumers’ pockets.

The National Restaurant Association’s Restaurant Performance Index has remained above the 100 level that signals expansion for six consecutive months. In April, the last month for which we have data as I write this, it stood at 101.6. Sure, it was down a bit, including both capital expenditure markers. But overall, operators remain pretty optimistic about the next six months. Everyone felt the NRA show was very upbeat. Not least, Technomic released a revision of their operator sales forecast for this year in May and revised it up substantially. Anecdotally, many manufacturers saw a bit of a slowdown in orders in April and early May, but have experienced a pick-up since.

By the way, if you read this by mid July, you can still find out what exactly we decide about the forecast by attending our annual FER E&S Market Forecast President’s Preview at the Westin O’Hare in Rosemont, Ill. July 24. Details and registration info are on our website,, under “Events.” Or email Christine Palmer at

We try never to be Pollyannaish about the outlook for this industry. We only hurt people if we’re too optimistic. There’s plenty of downside risk right now. But I think some of the fears are overblown. Do worry, but be happy.

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