Informations Rapides · 26 August 2021 · n° 211

In August 2021, the business climate in the industry has been virtually stable at a high level Monthly business survey (goods-producing industries) - August 2021

According to the industry business managers surveyed in August 2021, the business climate has been virtually stable compared to the previous month. At 110, it is lying at its highest level since May 2018, well above its long-term average. Three balances of opinion have significantly driven, in opposite directions, the variation in the business climate this month. On the one hand the balances on past production and personal production expectations have pulled it upwards. On the other hand, the balance on the overall order books have curbed its progression.

In August 2021, the manufacturers' balance of opinion on past production has improved distinctly and has further exceeded its long term average. Likewise, the balance of opinion on personal production prospects over the next three months, already well above its average, has clearly grown this month. Its increase has been notably underpinned by the manufacture of transport equipment, where this balance has strongly grown for the second month in a row.

Nevertheless, business leaders have dampened their optimism regarding the overall production outlook in the good producing industries. The related balance of opinion has shrunk for the second month in a row, though it remains much higher than on average.

Manufacturers keep on assessing favourably the trend in their workforce size: the balance on the past change in workforce has been stable, above its average, while the balance on the expected change has somewhat increased again.

The balance of opinion on the overall order books has quite markedly fallen back this month but remains above its average. However, the balance on foreign order books has been slightly on the rise. It has been increasing since November 2020 and last month went back above its average for the first time since the beginning of the health crisis.

The balance of opinion on the finish-goods inventory compared to its normal level has bounced back in August. This increase means that fewer manufacturers than last month have considered the level of their inventory to be lower than the seasonal normal. Nevertheless, in the branch of machinery and equipment goods, this balance has decreased and reached its lowest level since the series started (January 1990).

Finally, the business leaders have slightly raised their expectations on prices. The balance on the expected trend in selling prices, which had dropped last month after several months of sustainable growth, has straightened a little in August.

In August 2021, the business climate in the branch of machinery and equipment goods has sharply improved and has reached 121, a level unseen since September 2000. In this branch, the balances on order books have been noticeably dynamic this month.

On the other hand, in the manufacture of food products and beverages, the business climate has clearly shrunk for the second month in a row. It has been especially impacted by the decrease in the balances on past production and foreign order books. Nonetheless, at 110, the branch’s business climate still lies well above its average level.

In the manufacture of transport equipment, the situation seems clearly less favourable than in the rest of the manufacturing industry, even though its business climate hastimidly improved in August. On the one hand, the business climate of the motor vehicles, trailers and semi-trailers branch has recovered a little, driven by the pronounced rise in the balance on personal production prospects. On the other hand, the business climate has been virtually stable at a low level in the other transport equipment branch.

Finally, the business climate has somewhat declined in the so-called « other manufacturing » branch but remains at a very high level. In this branch, the variations are uneven. The business climate of the wood, paper and printing branch has markedly clouded over, as well as in the branches of chemicals and of rubber and plastic products. Conversely, the business climate in the other manufacturing industries, whose main activity is the repair and installation of machinery and equipment, has sharply bounced back.

The business climate in manufacturing in July 2021 has been revised downwards by one point due to the inclusion of late responses from some companies.