Saturday, August 8, 2009

Does the Fed's Economic Stimulus Plan Provide Benefit to Reprographers?

Recently, I had the opportunity to get together with the CEO of a large engineering firm. His firm is not completely "nationwide," but it is one of the larger firms in the U.S. (and they have operations outside the U.S. as well, although the substantial bulk of their business is in the U.S.)

Getting to the gist of his comments about the Fed's Stimulus Plan and its effect on the transportation engineering and construction business (not his exact words, I'm paraphrasing), what's happening is that Stimulus funding is being used to fund transportation projects that were already ready to get underway, construction-wise. These projects were already designed (meaning already printed, whether printing was done in an FM environment or outsourced), but on hold for construction until funding was available. Stimulus funding made funds available, so these projects are be released for construction. MY COMMENT ABOUT THIS: THIS DOES NOT PROVIDE ANY BENEFIT TO REPROGRAPHERS. AND, IF MANY OF THE PROJECTS, NOW BEING PUT INTO CONSTRUCTION, WERE ALREADY DESIGNED, THEN THIS DOES NOT PROVIDE MEANINGFUL RELIEF TO ENGINEERING FIRMS WHO DO TRANSPORTATION ENGINEERING PROJECTS.

One of the biggest problems reprographers faced as the current recession began - and was then exacerbated by the calamity that hit the financial/lending community around the time Lehman Brothers was let fail - was the virtual "shutdown" of lending (financing available) to non-residential developers. When funding dries up, projects dry up. When projects dry up, Architects (and their Engineering consultants) feel that - and feel that in a big way. The same exact thing happens to reprographers; that's the "trickle-down" effect when the real estate development community hits the skids, for whatever reason. Real estate developers are in the driver's seat. When they can't get money, they won't and don't build. When office and retail vacancy rates rise - which is, of course, what happens when companies cut jobs and when consumers don't spend as much money at retail as they did before, development dries up. That's what our reprographics community is experiencing, beyond the tremendous fall-off in residential development. Perhaps some of the Fed's Stimulus funding (our taxpayer dollars) should go towards relaxing the money-financing-lending environment - forcing lenders to lend to developers who are still in a position to go forth with projects.

I invite your opinions!

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