West Michigan’s economy entered 2026 on soft footing with continued weakness in regional manufacturing activity even as national indicators show improvement. That’s according to new survey data included in the latest West Michigan Current Business Trends report from Grand Valley State University (GVSU).
Brian Long, Director of Supply Management Research at GVSU, said, “This is our third ‘down’ month, but some signs indicate that this many have been a one-off month. After looking at the fairly positive national and international purchasing surveys, it is easy for West Michigan to be disappointed at being left out of the January rally.”
Long said February could come in close to flat or even modestly positive. He added, “Michigan still has the fifth highest unemployment rate in the country, and 2026 does not look like it will be a banner year, at least at this point.”
The latest survey of purchasing managers shows the region’s Index of New Orders held at negative 11 in January, the same level as December and still below the zero mark that signals growth. While the Production and Purchases indexes both improved to negative five, organizers say those numbers still reflect contraction at a time of year that typically brings stronger post-holiday momentum.
According to the survey, several key West Michigan industries are driving the slowdown. The office furniture sector continues to adjust to long-term shifts in workplace demand, while some automotive parts suppliers are working to replace expected electric vehicle-related contracts that have not materialized as planned. Aerospace firms remain comparatively stable, but supply chain managers report continued margin pressure from tariffs and difficulty passing higher costs along to customers.
That regional softness contrasts with national manufacturing trends. The Institute for Supply Management reported its composite index rose to 52.6 in January — the first expansion reading in more than two years — with growth in both production and new orders. A similar S&P Global index also showed expansion. Still, analysts noted production may be rising faster than demand, contributing to higher inventories.
Survey organizers say West Michigan’s economy remains only marginally soft, but the performance of its manufacturing-heavy base — particularly furniture and auto-related suppliers — will be key to whether the region follows the national rebound later this year.
