In June 2017, the business climate in manufacturing is virtually stable significantly above normalMonthly business survey (goods-producing industries) - June 2017

According to the business managers surveyed in June 2017, the business climate in industry is virtually stable. At 108, it is significantly above its long-term average (100).

Informations rapides
No 164
Paru le : 22/06/2017
Prochaine parution le : 26/09/2017 at 08:45 - September 2017

According to the business managers surveyed in June 2017, the business climate in industry is virtually stable. At 108, it is significantly above its long-term average (100).

Graph 1 – Business climate in industry - Composite indicator

The turning-point indicator remains in the zone indicating a favourable economic outlook.

Graph 2 – 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.

The balance of opinion about general production expectations has reached its highest level since June 2007

In June 2017, the balance of industrialists' opinion on their past activity has declined further, that on personal production expectations has also fell back. However, both remain significantly above their normal level.

Furthermore, business managers are much more upbeat than in May on general production prospects for the sector. The corresponding balance has improved further and has reached its highest level since June 2007, significantly above its long-term average.

In June 2017, their opinion on global order books has slightly improved while that on export order books is unchanged. The corresponding balances are significantly above normal.

Finally, almost as industrialists as in May consider that finished-goods inventories are below normal: the corresponding balance remains below its long-term average.

Table 1 – Industrialists' opinion on manufacturing activity

Balance of opinion, in %
Industrialists' opinion on manufacturing activity
Manufacturing industry Ave.* March 17 April 17 May 17 June 17
Composite indicator 100 106 108 109 108
Past activity 5 9 17 14 10
Finished-goods inventory 13 7 6 5 6
Global order books –18 –9 –6 –5 –3
Export order books –14 –5 –1 –2 –2
Personal production expectations 5 11 12 16 13
General production expectations –9 3 1 7 17
  • * Long-term average since 1976.
  • Source: INSEE - Monthly business tendency survey in industry

Warning: In the survey of June 2017, the weights used to aggregate the responses of the business managers have been updated. The seasonal coefficients as well as the parameters of the composite indicator have also been updated. As a result, the set of results previously published in this survey is subject to slight revisions.

Slight sectoral variations offset each other

In June, the virtual stability in the business climate in industry especially comes from a slight decrease in machinery and equipment, offset by an improvement in food products and beverages and in “other manufacturing”.

In the manufacture of food products and beverages, the business climate has improved and has returned to its highest level since July 2011

In June, with a rise of 7 points in two months, the business climate in the manufacture of food products and beverages has returned to its highest level since July 2011. At 111, it is significantly above normal. All balances of opinion have contributed to this improvement, in particular that on past activity, which has bounced back.

In the manufacture of machinery and equipment goods, the business climate has decreased by one point after having reached its highest level since March 2008

In the manufacture of machinery and equipment goods, after having reached its highest level since March 2008, the business climate has decreased by one point but remains, at 109, significantly above normal. This slight decrease comes mainly from a decline in the balances of opinion on past activity and on export order books, which still remain far above normal.

In the computer, electronic and optical product industry as in machinery and equipment, the business climate has slightly decreased. However, it is stable at its highest level since June 2011 in electrical equipment.

The business climate remains above normal in the manufacture of transport equipment

In the manufacture of transport equipment, the business climate is stable at 105, above its long-term average. On the one hand the balance on past activity has recovered, on the other hand those on personal production expectations and on global order books have diminished.

The business climate is stable in the manufacture of motor vehicles, trailers and semi-trailers while it has slightly increased in other transport equipment.

In “other manufacturing”, the business climate has slightly improved

In overall “other manufacturing”, the business climate has increased by one point and has returned to its highest level since June 2011 (108), significantly above normal. This slight improvement comes from a further increase in the balances on order books and on general production expectations. It is partly offset by a decrease in those on personal expectations and past activity.

The business climate has sharply recovered in wood-paper and has reached a ten-year high. It has improved in rubber and plastic products and in basic metals to its highest level since more than six years. It has slightly increased in chemicals. However, it has fallen again in clothing-textiles. It is virtually stable in “other manufacturing industries”.

Graph 3 – Business climates in a sector-based approach

  • Legend: (C1): Manufacture of food products and beverages - (C3): Machinery and equipment goods - (C4): Manufacture of transport equipment - (C5): Other manufacturing

Table 2 – Business climates in a sector-based approach

Average = 100 and standard deviation = 10 since 1990
Business climates in a sector-based approach
NA* : (A17) et [A38 et A64] Weights** (%) April 17 May 17 June 17
(C1) Man. of food products and beverages 22 104 106 111
(C3) Machinery and equipment goods 11 108 110 109
[CI] Computer, electronic and optical products 3 110 115 113
[CJ] Electrical equipment 3 105 106 106
[CK] Machinery and equipment 5 106 108 107
(C4) Man. of transport equipment 15 106 105 105
[CL1] Motor vehicles, trailers and semi-trailers 7 106 106 106
[CL2] Other transport equipment 8 104 103 104
(C5) Other manufacturing 46 107 107 108
[CB] Textiles, clothing industries, leather and footwear industry 2 110 104 101
[CC] Wood, paper, printing 5 106 105 111
[CE] Chemicals and chemical products 9 111 107 108
[CG] Rubber and plastic products 7 108 108 110
[CH] Basic metals and fabricated metal products 11 103 105 107
[CM] Other manufacturing industries 9 101 102 101
  • * 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 in industry