Office Furniture Orders Indicate Economy's Growing

Grand Rapids, MI, September 5, 2007--Office furniture orders rose 9% in July, bucking a trend toward slower growth for the second straight month, according to industry data released on Wednesday.

The Business and Institutional Furniture Manufacturers Association said July orders increased to $930 million from a year earlier. Shipments rose 12% to $920 million.

"The statistics were stunningly strong," Raymond James analyst Budd Bugatch said in a research note. "While bears may argue that the risk of a recession is elevated due to collateral damage from housing, subprime and the reluctance of the Fed to ease monetary policy, the primary macroeconomic drivers of office furniture consumption remain supportive of continued expansion."

Despite the surprise growth in June and July, Bugatch sees overall industry growth at 3% to 6%.

Order growth through the first seven months of 2007 was just above 7%. Shipments are up 6%.

The furniture manufacturers' association compiled its July report from 40 companies, which account for about 73% of the industry's volume.