Trend Talks: Year in Review

The U.S. gear manufacturing industry is poised to enter a new era of strength in 2016 due to growth and developments over the past year.

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In 2015, we saw strides being made in several areas, including an increase in research and development efforts paired with a demand for more funding and technological investments. There have also been new and revised standards created and implemented by AGMA, ANSI, and ISO.

One example of such a standard is the revised ISO 9001 for quality management systems that was published earlier this year in September. According to the organization, ISO 9001 is one of ISO’s most recognized standards with more than one million certificates worldwide. It provides requirements to assist companies in demonstrating that they offer their customers consistent, high-quality products and services. The 2015 edition featured several important evolutionary changes, the most prominent of which allows the latest version to follow a new, higher level of structure to make it easier to use with other management system standards such as ISO 14001.

This standard also provides the tools that companies may need to streamline their processes and become more efficient. According to ISO, ISO 9001 can be used by all types of organizations, no matter their size of operations, and it has inspired a series of documents for sector-specific applications including those in the automotive and medical sectors. Standards are reviewed every five years by specialized technical committees dedicated to a particular subject to determine if a revision is necessary to keep it current and relevant to the markets it serves.

Another development we’ve seen in the past year is an increased demand for more skilled workers and available training. The industry as a whole is experiencing a period of transition where gear heads who have been involved in gear manufacturing for decades are preparing to retire, and younger people, most of whom are fresh out of college, are stepping forward. One of the best ways for the older generation to pass along their knowledge and expertise is to have the younger generation serve on technical committees and make the development of standards possible. The AGMA continues to seek out people to serve on its 23 technical committees, and it offers educational and training opportunities.

Investment in workforce development can also be a strategic advantage for a company’s success. SME has research to support that companies which invest in training their workforce will be more competitive and profitable across the market. Tooling U-SME is an industry leader in manufacturing training. For more than 80 years, it has worked with manufacturers to build training programs and support workforce development initiatives.

Investing in training can bring growth to the industry, which remains a recurring top priority. What was once post-recession cautiousness has metamorphosed into confidence and more ambitious business goals, and optimism is high.

According to the 2015 Guide to Manufacturing Software from Infor, recent studies show that nearly 40 percent of businesses have reported an increase in total orders. Domestic order volume is at an all-time high since 1995, and export orders have grown by 17 percent. This growth is great news for the job market.

The guide also projects that more than half of the current number of manufacturers plan to hire new employees over the next year in addition to increasing their spending on operations according to a report from the PwC’s Manufacturing Barometer. This report found that manufacturers’ top three priorities for increased spending capabilities are: new product or service introductions, research and development, and information technology.

Technological investments have definitely paid off in 2015, and that trend is expected to continue. Manufacturing.net recently reported that software is increasing efficiency and production in manufacturing. Investing in solutions like this is one way to overcome operational challenges, keep the workforce up-to-date on the latest technology, and secure growth.

In the Global Gear Manufacturing Market 2015-2019 report, analysts forecasted that the global gear manufacturing market — which, according to the report, can be segmented into three areas: the worm gear, the bevel gear, and the spur gear — would grow at a compound annual growth rate (CAGR) of 5.33 percent over the period of 2014 to 2019. The report was prepared based on in-depth market analysis with inputs from industry experts and mentions several companies including Eaton and Curtis Machine Company.

The report covers the Americas as well as the market’s projected growth in the coming years. It also includes a discussion of key vendors operating in the market.

According to an analyst from the report, “A major trend emerging in this market is the increased demand for spur gears in industries such as agriculture, aerospace, mining, pulp and paper, automotive, textile, and industrial engineering. Many manufacturers offer customized, industry-specific gears to meet the specific needs of end users. They offer various types of gears in different sizes, shapes, designs, and speed ratios according to the specific requirements of industrial applications.”

Also according to this report, one of the key drivers in the gear manufacturing market is an increased demand for gears in the oil and gas industry, which would lead to the installation of new production plants that would require gears to perform oil and gas extraction processes.

With companies responding to industry demands and investing in software, standards, and employees, 2016 should prove to be promising for gear manufacturing.