AVIXA economic analyst Peter Hansen isn’t worried that the August 2020 sales and employment numbers in the Pro-AV Business Index both dropped slightly from July and he says you shouldn’t be either. The results still show growth, even if the growth isn’t as relatively high as last month.
The August 2020 numbers show sales dropped from 53.7 to 51.8, while employment dipped from 51.2 to 50.1, indicating it was essentially flat among respondents to the survey during that time period. Both numbers, though, show growth in their segments because they remain above the 50 mid-point.
Hansen describes the August 2020 Pro-AV Business Index results “an unexpected slight slowdown in growth,” saying it “makes us excited to see next month’s results to see if this is a one-month blip or if things are shaky right now.”
He’s not surprised to see the employment numbers remain relatively flat, noting, “businesses are much less likely to adjust their employment levels before sales start to grow significantly.”
“The employment numbers illustrate well a reality we’re facing,” says Hansen. “People are starting to go back to restaurants, do a little bit of shopping, doing a little bit of traveling. That’s bringing a lot of jobs back. That’s a strong positive wave.
Related: The Simple Truth is Pro AV is on the Long Road to Recovery
“Companies have also absorbed a lot of damage. There’s been scarring to the economy and that’s reflected in the numbers as well. Unemployment numbers has averaged about 1 million per week. Even the good weeks we’ve been having during the pandemic would be records in the past. That’s a powerful negative trend,” he says.
“It’ll be a bit of a push and pull to see which trend lasts longer,” says Hansen.
Overall, Hansen says having both the sales and employment numbers above 50 is a good thing.
“It’s not time to be concerned,” he says. “It’s still growing. That’s good news. Don’t overthink it.” While he expected slightly more growth to build upon the momentum of the last several months, “surveys are a random process. If you’re never surprised by the data you’re seeing, you should be a little bit nervous.
“We’re remaining optimistic for the rest of the year about seeing growth in the AV industry accelerate and seeing the index reflect that,” says Hansen.
Beyond the Pro-AV Business Index
September marks the four-year anniversary of the Pro-AV Business Index.
“It’s valuable to have such a long legacy and know what variation is legit and what is realistic to expect,” says Hansen. Because it’s a global index, the trends are different in different parts of the world so that limits some of the seasonality, he says.
One thing that stood out in the August results, says Hansen is that “COVID-19 has a super-complicated effect on AV.
“It pushes AV and pulls AV,” he says. That can be seen in the reformation of how education is being delivered from K-12 to higher education and even in the corporate vertical market, says Hansen.
“It’s a complex situation and AV is very much the solution,” he says. “It shows some of the challenges and the weird environment we’re in right now.”
The second-quarter edition of AVIXA’s Macro-Economic Trends Analysis looks at how people’s preferences change after a crisis such as the coronavirus pandemic, from the Spanish Flu to the Great Depression. The third-quarter META report explores long-term changes the pandemic might cause.
“The message we’re getting is changes tend to reflect the conditions on the ground,” says Hansen. “When the conditions on the ground go back to where they were, those changes disappear for the most part.
“If you preferred an in-person live event before, you’re going to love to do that again when you feel safe and confident you’re not putting yourself and your family at risk,” he says.
“Looking at space usage that’s going to outlast COVID, end users say they’re not making big changes,” says Hansen, noting only 12 percent of respondents say they’re planning for any reductions and a small percentage of those went as high as 10 percent reductions.
