In July 2016, the business climate in manufacturing has recovered slightlyMonthly business survey (goods-producing industries) - July 2016

According to the business managers surveyed in July 2016, the business climate in industry is slightly more favourable. The composite indicator has won 1 point. At 103, it is above its long-term average (100).

Informations rapides
No 187
Paru le : 21/07/2016
Prochaine parution le : 26/09/2017 at 08:45 - September 2017

According to the business managers surveyed in July 2016, the business climate in industry is slightly more favourable. The composite indicator has won 1 point. At 103, it is above its long-term average (100).

Graphang1 – Business climate in industry - Composite indicator

The turning-point indicator is now in the zone indicating a short-term economic uncertainty.

Graphang2 – Turning-point indicator

  • How to read it: close to 1 (respectively −1), the indicator points to a favourable short-term economic situation (respectively unfavourable). Between −0.3 and +0.3: uncertainty area.

A rally of the opinion on past activity

In July 2016, the balance of opinion on past activity has bounced back (+11 points) and returns above its long-term average. However, that on personal production has fallen back (−6 points) and becomes below its long-term average.

Business managers in manufacturing are a few more optimistic than in June on general production prospects in the sector (+2 points). The corresponding balance remains above its long-term average, as has been the case since February 2015.

In July, balances of opinion on order books are virtually stable above their mean.

Finally, fewer industrialists than in June consider that finished-goods inventories are above normal: the corresponding balance has decreased by 1 point and gets back its long-term average.

tableau1 – Industrialists' opinion on manufacturing activity

Balance of opinion, in %
Industrialists' opinion on manufacturing activity
Manufacturing industry Ave.* April 16 May 16 June 16 July 16
Composite indicator 100 105 104 102 103
Past activity 4 10 13 –1 10
Finished-goods inventory 13 9 11 14 13
Global order books –18 –10 –13 –13 –12
Export order books –14 –5 –8 –9 –10
Personal production expectations 5 9 7 9 3
General production expectations –9 –1 5 1 3
  • * Long-term average since 1976.
  • Source: INSEE - Monthly business tendency survey

The slight improvement of the business climate in the industry stems from the manufacture of food products and beverages. In the other sectors, the business climate is stable.

In the manufacture of food products and beverages, the business climate has improved

In the manufacture of food products and beverages, the business climate has increased by 3 points in July. Its level (107) is significantly above its long-term average it has exceeded since April 2016. Its improvement is mainly due to the balances of opinion on past activity, on finished-goods inventory and on global order books.

In the manufacture of machinery and equipment goods, the business climate is stable

In the manufacture of machinery and equipment goods, the business climate is stable slightly below its long-term average. The balances on past activity and on global order books have increased, by that on export order books has deteriorated.

On a sub-sector level, the composite indicator has recovered in electrical equipment (+5 points) but remains above normal. In computer, electronic and optical product industry, the business climate has fallen back albeit remaining above its mean level; it has reached its lowest level (102) since February 2015. In the machinery and equipment sector, the business climate, already below its long-term average since September 2011, has decreased slightly (−2 points).

The business climate in the manufacture of transport equipment remains considerably above its mean

In the manufacture of transport equipment, the business climate is stable at 106, considerably above its long-term average. On the one hand, the balances on export order books and on past activity have increased; on the other hand, the balances on production prospects and on global order books have fallen.

The business climate is stable in the manufacture of motor vehicle, trailers and semi trailers, and it is virtually stable in the manufacture of other transport equipment. Both are above their long-term average.

The business climate is stable above normal in “other manufacturing”

In overall “other manufacturing”, the business climate remains slightly above normal. The balances of opinion on past activity and on global order books have improved, but those on production prospects and on export order books have worsened.

The business climate has recovered in “other manufacturing industries” and has reached its long-term average. It is stable or virtually stable in other sub-sectors, always above normal excepted in chemicals.

tableau2Climats – Business climates in a sector-based approach

Standardised indicators: average = 100 and standard deviation = 10
Business climates in a sector-based approach
NA* : (A17) et [A38 et A64] Weights** (%) May 16 June 16 July 16
(C1) Man. of food products and beverages 21 104 104 107
(C3) Machinery and equipment goods 11 99 98 98
[CI] Computer, electronic and optical products 3 106 107 102
[CJ] Electrical equipment 3 95 92 97
[CK] Machinery and equipment 5 97 97 95
(C4) Man. of transport equipment 15 106 106 106
[CL1] Motor vehicles, trailers and semi-trailers 7 107 106 106
[CL2] Other transport equipment 8 104 103 104
(C5) Other manufacturing 46 104 102 102
[CB] Textiles, clothing industries, leather and footwear industry 2 107 108 108
[CC] Wood, paper, printing 5 100 105 104
[CE] Chemicals and chemical products 9 103 97 98
[CG] Rubber and plastic products 7 106 103 102
[CH] Basic metals and fabricated metal products 11 101 104 104
[CM] Other manufacturing industries 9 104 97 100
  • * NA: aggregated classification, based on the French classification of activities NAF rév.2.
  • ** Weights used to aggregate sub-sector's balances of opinion.
  • Source: INSEE - Monthly business tendency survey