Informations Rapides · 16 December 2021 · n° 323

In December 2021, the business climate in manufacturing industry has slightly improved Monthly business survey (goods-producing industries) - December 2021

According to the business managers surveyed in December 2021, the business climate in manufacturing industry has slightly improved compared to the previous month. At 111, the composite indicator has gained one point and remains well above its average (100). This increase is explained by the rise in the balances on personal production, past as well as expected. Conversely, the balances on the order books have dragged the climate down. In addition, the balance on the expected trend in selling prices has continued to grow and the uncertainty felt has firmed up whereas it had dampened for several months.

In December 2021, the balances on production have been on the rise. The balance on past production over the last three months has swiftly rebounded after three months of fall. It stands now well above its long term average. Likewise, the balance on expected production over the next three months has steeply grown.

The balance on the level of the finished-goods inventories compared to normal has somewhat risen this month. Nevertheless, this balance remains well below its average; many business leaders still think that their inventories have been lower than usual.

Asked about the overall prospects in manufacturing industry, the business managers have been a bit more optimistic than last month. The related balance has slightly increased and remains well beyond its average.

The balance on the past variation in the workforce size has been virtually stable, the one on the expected variation has improved. Both of them have now exceeded by a lot their respective long-term average level.

The balances on the level of overall and foreign order books have withdrawn, after a clear rise in the previous month. They both remain distinctly above their respective average.

In the same time, the balance on the expected change in selling prices has grown again and has pushed further its highest historical level since the series began (2007).

The balance measuring the degree of economic uncertainty felt has sharply increased in December 2021, after having declined since May 2021. Thus, the business managers have reported on average having more difficulties in anticipating the situation of their enterprise than in the previous months.

Changes in the business climates in the various sub-sectors have been contrasting.

The business climate of the machinery and equipment goods industries has somewhat increased and remains above its average. The balance on expected production over the next three months has even reached there a new high point. Moreover, contrary to the prevailing impression in the manufacture industry, the business managers have not declared to be more uncertain than in the previous month about the upcoming situation of their enterprise.

In the manufacture of food products and beverages, the business climate has lost two points, mainly due to the strong fall in the balance on past production. Nevertheless, the balance on the personal production prospects has strongly increased there too.

In the so called “other industries”, the climate has been stable well above its average. In this sector, the balance on personal production prospects has been virtually stable, at a high level.

Finally, in the manufacture of transport equipment, the business climate has fallen back after two months of growth. It therefore remains morose, at a level lower than its long-term average.

The business climate in manufacturing in November 2021 has been revised upwards by one point, mainly due to the inclusion of late responses from some companies.