the May 2008 Issue in PDF Format - Trade Show Executive

T r e n d i n g & S p e n d i n g
Trade Show Executive’s
Trending & Spending Forecast
Fig. V: Sector Performance
Best Performing Sectors
• Automotive • Manufacturing
• Business Services • Medical
• Entertainment • Hospitality
• Government • Transportation
Mixed Performance
• Apparel
• Sporting
• Construction
Goods &
• Food
Recreation
• Gifts
Improving Sectors
• Retailing
• Technology
Fig. VI: 10 Economic Indicators
Consumer Confidence: The Consumer Confidence Index,
which fell 12 points in February, dropped to 64.5 in March to a
five-year low and suggests further weakening is on the horizon.
Housing Starts: Housing starts were down 36.5% compared to
a year ago and have plummeted to March 1991 levels.
Industrial Production: Industrial production rose 0.3% in
March after dropping 0.7% in February.
Inflation: Core inflation, which excludes volatile food and
energy costs, reached 2.4% in March. It has been at or near the
upper end of the Fed’s comfort zone for several months.
Interest Rate: In March, the Fed cut its Federal Funds rate
by a dramatic three-quarter percentage point to 2.25%, and is
expected to announce another one-quarter percentage point cut
on April 23 to prop up the wobbly economy. It could be the last
interest rate drop for awhile as the Fed now shifts it focus on
heading off inflation.
Job Growth: Bleak news: payrolls dropped in March by
80,000 jobs, the biggest decline since March 2003.
Leading Indicators: The Leading Index increased slightly in
March, after five straight months of decline. Money supply and
interest rates positively impacted the index.
Manufacturing: The ISM Manufacturing Index edged up 0.3
percentage points to 48.6 but remained below the expansion/
contraction line in March for the third straight month.
Retail Sales: Retail sales for March increased 0.2% from the previous
month and 2.0% above March 2007, according to the Commerce
Department, reversing a drop of 0.6% in February.
Unemployment Rate: After improving slightly in February,
the national unemployment rate climbed to 5.1%, with almost 3
million Americans unemployed. The unemployment rate is based
on the percentage of employable people actively seeking work.
An unemployment rate of about 4% to 6% is considered healthy.
Sources: U.S. Department of Labor, Bureau of Labor Statistics; The
Conference Board; The Institute for Supply Management (ISM); U.S.
Commerce Department
Continued from page 14
addition, The Conference Board’s Index
of Leading Indicators rose slightly by
0.1% to 102 in March, which keeps
it in positive territory. Five of the ten
indicators that make up the leading index
increased, including real money supply,
interest rate spread and manufacturers’
new orders for consumer goods and
materials.
B-to-B Media is Retrenching
In news a little closer to home,
B-to-B media companies are responding
to the flagging economy by retrenching.
Major publishers are cutting jobs or
selling. Nielsen plans to eliminate
4,000 employees - about 10% of its
workforce - to address the company’s
$8.25 billion debt. Ziff Davis Enterprise
is going through a major restructuring
and chopping 36 positions, according
to minOnline. Penton Media has frozen
salaries and hiring to reduce costs. These
actions should not come as a surprise
since advertising revenue has been
declining for the past year and the start of
2008 has been dismal.
Trade Shows Holding Up
Trade shows have fared much better,
and so far, are bucking economic trends.
Three examples:
• The Society of the Plastics Industry,
which produces the triennial NPE
International Plastics Exposition, is on
track to stage a record-breaking show
in 2009. In a space draw last month,
exhibitors contracted over 81% of
the space used at the 2006 event,
which spanned over 942,000 net
square feet at Chicago’s McCormick
Place.
• Nielsen’s 2008 International Bicycle
Expo is on track to meet or exceed
last year’s record-breaking 313,000
net square feet of exhibit space after
over 500 exhibitors confirmed exhibit
space and sponsorship packages
during the last two weeks.
• The George R. Brown Convention
Center in Houston hosted an
estimated 137,782 attendees at
30 conventions and corporate
events from January to mid-March,
and another 95,247 visitors at 41
consumer shows. “The attendance
statistics are about 25% higher than
in the same period in years past,” said
Luther Villagomez, general manager.
A Softening in Attendance
However, attendance growth will
continue to come under pressure. The
high cost of transportation and housing
continues to raise concerns. The
hassle factor of traveling was recently
aggravated by Southwest Airlines
grounding 38 jets in March and American
Airlines canceling more than 2,500 flights
in April. In both cases, the aging fleet
of planes was to blame. At Southwest,
cracks in the fuselage of many planes
were discovered. At American, the FAA
discovered wiring issues in almost half
of American’s domestic fleet. Compared
to the rest of the world, especially the
developing countries, U.S. planes are just
old, said Chow. “This may evolve into
a major debacle in the next few years as
airlines facing spiraling fuel costs and a
weak American economy cannot afford to
purchase many new planes,” he said.
With that in mind, Trade Show Executive
is launching an eight-part series that will
spotlight the shows that bucked the trend
and achieved dramatic attendance growth.
Beginning with “NAMM Show Grows by
Tweaks and Bounds” in the June issue,
TSE News Editor Sandi Cain takes a look
at how the International Music Products
Association increased attendance by
turning people down.
How Trade Show Executive Magazine’s
Trending & Spending Was Compiled
Trade Show Executive Magazine’s
Trending & Spending Forecast aggregates
information from numerous sources:
government and business reports;
interviews with industry experts and
economists; and the TSE monthly poll
of its 20-member Economic Forecasting
Board. Unbiased, reliable data—whether
positive or negative—is the foundation of
solid business planning. TSE
16 May 2008 Trade Show Executive www.TradeShowExecutive.com