Troubling Numbers for the Trade Show Industry

Author: David McMillin       

All good things must come to an end. After 25 consecutive quarters of year-over-year growth for the exhibition industry, the economists at the Center for Exhibition Industry Research (CEIR) received the first dose of negative news with a 0.4-percent decline in the CEIR Total Index for the fourth quarter of 2016. While trade-show organizers may be worried about the dip in the overall performance of the industry, it’s not time to sound an alarm.

“We believe it’s a short-term issue,” Cathy Breden, CEO of CEIR, told PCMA. “There are signs that companies are hiring, and there are also indications that wages have increased. Consumer confidence increased in February. All the underlying fundamentals that our economists believe are essential to a healthy exhibition industry are still there.”

The CEIR Total Index measures 14 different sectors, and Breden highlighted that the most recent measurement reflects challenges in just three of the sectors: Industrial/Heavy Machinery and Finished Business Inputs, Raw Materials/Science, and Consumer Goods/Retail Trade. Other sectors such as Food, Communications and Information Technology, and Sporting Goods, Travel, and Amusement all posted “robust year-on-year gains.” Breden pointed out that CEIR economists consider the Building, Construction, Home, and Repair sector as “almost the beginning of the food chain” for the industry, and the sector posted a 5.2-percent gain throughout all of 2016. “Companies are willing to invest, and people are buying homes,” Breden said. “That’s a great sign.”

All Eyes on D.C.

At the 2016 CEIR Predict Conference  — held in Washington, D.C., two months before the U.S. presidential election — Chad Moutray, chief economist at the National Association of Manufacturers, and Bob Costello, chief economist and senior vice president at the American Trucking Association, shared concerns about opposition to open-trade policies. Now, with the Trump administration’s comments on the Trans-Pacific Partnership (TPP) and the North American Free Trade Agreement (NAFTA), organizations are paying even closer attention to the conversation in the nation’s capital. “Based on what we’re hearing from political economists,” Breden said, “the Trump administration will wind up renegotiating agreements rather than backing out of them entirely.”

Breden also cited immigration issues as a potential disrupter for business. But “on the flip side,” she highlighted that some of Trump’s plans could have a significant positive impact on the country. “If there is some type of infrastructure stimulus plan,” she said, “that could create a lot of new opportunities.”

As the industry waits to see what develops in Washington, D.C., economists are working on the CEIR Index Report, which will provide a complete view of 2016 performance and a forecast for the next three years. “We’ll be able to see a more accurate picture of the future soon,” Breden said. “We are hopeful this is a temporary downturn, and the industry will rebound.”

Interested in understanding how your trade show stacks up against the rest of the industry? Check out CEIR’s Event Performance Analyzer to see how your net square feet, number of exhibitors, professional attendance, and overall revenue compare with your competitors.

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