State’s exports tracking with sluggish national trend


The latest quarterly indicators on economic growth from around the globe confirm the world economy has lost its momentum.

In the third quarter of this year in the Euro Area — the 17-member club of the European Union that uses the euro as its currency — economic growth stalled led by declines in France and Italy.

In Japan, economic growth slowed down substantially in the third quarter to 1.9 percent from 4 percent in the first half of the year. Although China and India are still considered the main engines to worldwide growth, the speed of their expansion has decelerated amid weakening demand for their products from Europe, Japan and North America.

Weaker economic growth translates to joblessness and stagnation in incomes, sodemand for goods — both domestic and foreign — fades. As a result, exports slow down and export-related jobs wane. In September, U.S. exports of goods dropped for the third month in a row, led by declines in foreign sales of industrial supplies and materials, consumer goods and capital goods.

At the state level, the latest export numbers show shipments abroad from Michigan’s exporting companies dropped to $4.72 billion in September, $252.6 million or 5.1 percent less than in August. Like national exports, the state’s export numbers are adjusted for seasonal variation, a statistical process that smoothes monthly performance for factors such as the number of days in a month and holidays.

How are Michigan's exporters doing compared with the same time last year? In September, state companies sold abroad $176 million — or 3.9 percent more goods than in September 2012.

September’s state exports for the most part were driven by manufactured goods, which accounted for 84 percent of all state exports. Foreign sales from Michigan's manufacturers decreased in September by 9 percent from the previous month to $3.96 billion, adjusted for seasonal variation.

On an annual basis, shipments abroad from state factories were $178.2 million, or 3.9 percent, higher than in September of last year.

Exports of non-manufactured goods went up 22.1 percent in September to $765.8 million, adjusted for seasonal variation. This group of shipments abroad consists of agricultural goods, mining products and re-exports, which are foreign goods that have entered the state as imports and are exported in substantially the same condition as when imported.

Worldwide, in the first nine months of 2013 merchandise exports, seasonally adjusted, increased a mere 1.7 percent, according to data compiled by the World Trade Organization based on 70 monthly reporting countries, which account for more than 90 percent of world trade.

For the United States, so far this year exports of goods, seasonally adjusted, rose by a meager 0.8 percent in comparison to the first nine months of last year.

How do Michigan’s companies measure up in export growth to other states, the national average and the worldwide average so far this year? Michigan ranked 13th in export growth among states during the first nine months of 2013. Compared with the same period in 2012, foreign sales from Michigan's companies, seasonally adjusted, increased by an annual rate of 4 percent.

What are the future prospects for Michigan exports? According to the latest business survey conducted by the Institute of Supply Management, the nation’s supply executives are optimistic about the prospects of growing export markets at the end of 2013 and early 2014.  The Tempe, Ariz.-based research institute reported their export orders index rose in October.

The latest reading also indicates export orders in October went up faster than in September. This is good news for Michigan's exporting companies as more export orders imply higher production and more jobs in the future.

From the pool of respondents of the largest U.S. corporations that sell their products overseas, 19 percent reported greater export orders, 76 percent reported no change in export orders from October’s levels, and only 5 percent reported smaller export orders.

Evangelos Simos is chief economic adviser of the consulting and research firm e− He can be reached at

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