The Audiovisual and Integrated Experience Association (AVIXA) has published its latest monthly Pro AV Business Index, with the numbers unsurprisingly showing that sales and employment numbers are less than stellar.
The index tracks trends for both sales and hiring, with the core number being 50. A number over 50 indicates an uptick, and below 50 means a decrease.
Global growth, says AVIXA, continued at a snail’s pace in September, as the AV sales index (AVI-S) measured 51.3. The data on this month’s index serves as reminder of the complexity involved in the global economy. The international nature of the AV community means that even as some areas gain ground against COVID-19, others are often losing it. The comments this month also highlight the growing influence of economic troubles.
Optimism for recovery from COVID-19 may grow, but potential AV buyers face financial difficulties and are cautious about investments. Another headwind is equipment: USB cameras and streaming hardware are available, but require increased lead time to acquire.
I can attest it took FOREVER to get my back-ordered webcam.
The spectre of a second wave of lockdowns has increased this past month. Much of Western Europe is experiencing an increase in COVID-19 cases, which has spurred growing restrictions on business and consumer activity. As of this writing, Madrid is unfortunately once again on lockdown, and parts of France and the Netherlands are facing restrictions similar to those implemented in the spring. Business leaders must note that government restrictions are not the only way COVID-19 hurts the economy.
Consumers respond to their perceived risk irrespective of what is legal. For example, expect rising case counts in the U.S. Midwest to slow that region’s recovery.
As an optimistic illustration of what is still possible when COVID-19 is well controlled, InfoComm Beijing took place in person from September 28 to 30. The trade show drew more than 30,000 attendees, about 75% of the 2019 attendance — a remarkably strong showing given the context. 2020 has been a brutal year for live events and it’s easy to lose hope, but this event shows that demand to gather for shared group experiences remains strong. When the virus is controlled, live events will come roaring back.
Data on projects and recovery shows a divergent picture of recovery for the AV community. In September, 32.4% of AV providers reported that the bulk of their projects had resumed — up substantially from 8.8% in early July. However, expectations for a full recovery have worsened. In July, 37.0% thought it would take at least until the second half of 2021 for revenues to get back to their 2019 level. Now 44.0% of providers expect it will take that long.
The AV employment index (AVI-E) ticked up slightly to 51.7 this month amid mixed signs on economy-wide employment. As it is greater than 50, the AVI-E mark means that AV payrolls expanded slightly in September. Payroll expansion is arguably a more positive indicator than month-to-month sales as companies only add jobs when they anticipate a durable expansion of demand, while sales may bounce around significantly during an uncertain climate.
In the macroeconomy, employment showed a continuation of previously cited trends: the U.S. unemployment rate continued to decline while initial jobless claims remained stubbornly high. While the improving unemployment rate is encouraging, many signs point to slowing momentum. Factors such as economic stimulus, the U.S. election, and the pandemic make ironclad prediction impossible, but don’t be surprised if the unemployment rate stalls out or even climbs again before the end of the year.
The international billings index approximately reached the no-net change mark of 50 in September, with the month’s preliminary moving-average reading coming in at 49.8.2 This further closed the gap to North America, which is now on a streak of three months of modest growth. Given the expanding second COVID-19 wave in Europe, there is skepticism surrounding whether this convergence trend will continue.
For now, it looks likely that the international side may retreat slightly from this month’s neutral score.
Dave Haynes is the founder and editor of Sixteen:Nine, an online publication that has followed the digital signage industry for some 14 years. Dave does strategic advisory consulting work for many end-users and vendors, and also writes for many of them. He’s based near Halifax, Nova Scotia, on Canada’s east coast.