New orders of manufacturing technology totaled $355.6 million in January 2023, down 17% from December 2022 and down nearly 20% from January 2022, according to data released March 13 by the Association for Manufacturing Technology (AMT).

Although orders were down significantly month-to-month, orders in January 2023 were still nearly 17% above what would be expected from a typical January, according to AMT President Douglas Woods. Woods also argued that a decline in new orders could actually benefit the industry given its current state.

“After the historic run of orders placed in the last two years, a mild slowdown in new orders could help to reduce the current backlog and put the manufacturing technology industry in a position to deliver machinery with much shorter lead times when economic activity is anticipated to pick up later in the year,” Woods said in the report.

According to U.S. Census Bureau data, new orders of metalworking machinery exceeded shipments by over $750 million between January 2021 and now. It’s a stark contrast to 2019, when shipments were over $1.2 billion higher than new orders.

“Despite the mild pullback, distributors with machinery in stock or builders with shorter lead times still have several opportunities,” Woods said.

The manufacturing technology industry is poised for continued growth in 2023, according to the report. While orders from contract machine shops remained consistent from January 2022, the popular technologies have shifted slightly, including a significant increase in orders for machining centers with simultaneous 5-axis capability. The construction and mining machinery manufacturing sectors are also likely to be in high demand in 2023 with the new pipeline infrastructure coming to the Permian Basin, which will lead to an uptick in manufacturing technology orders from oil and natural gas mining machinery manufacturers, the report said.