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

According to the business managers surveyed in July 2017, the business climate in industry is stable. At 109, it is significantly above its long-term average (100).

Informations rapides
No 189
Paru le : 25/07/2017
Prochaine parution le : 26/09/2017 at 08:45 - September 2017

According to the business managers surveyed in July 2017, the business climate in industry is stable. At 109, it is significantly above its long-term average (100).

Graphang1 – Business climate in industry - Composite indicator

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

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.

The balance of opinion about general production expectations has reached its highest level since December 2000

In July 2017, the balance of industrialists' opinion on their past activity is virtually stable while that on personal production expectations has slightly fallen back. However, both remain significantly above their normal level.

Furthermore, business managers are much more upbeat than in June on general production prospects for the sector. The corresponding balance has improved further and has reached its highest level since December 2000, significantly above its long-term average.

In July 2017, the balances of opinion on global and export order books are stable, significantly above normal.

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

tableau1 – Industrialists' opinion on manufacturing activity

Balance of opinion, in %
Industrialists' opinion on manufacturing activity
Manufacturing industry Ave.* April 17 May 17 June 17 July 17
Composite indicator 100 108 109 109 109
Past activity 5 17 14 11 10
Finished-goods inventory 13 6 5 6 5
Global order books –18 –6 –5 –2 –2
Export order books –14 –1 –2 –1 –1
Personal production expectations 5 12 16 13 10
General production expectations –9 1 7 16 21
  • * Long-term average since 1976.
  • Source: INSEE - Monthly business tendency survey in industry

Revisions

The business climate in manufacturing in June 2017 has been revised from its first estimation last month, from 108 to 109, mainly due to late answers from businesses that have been taken into account.

Slight sectoral variations offset each other

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

In the manufacture of food products and beverages, the business climate has edged down but remains significantly above normal

In July, the business climate in the manufacture of food products and beverages has decreased by three points albeit remaining at a level, 110, significantly above normal. This decline mainly comes from a decrease in the balance of opinion on global order books.

In the manufacture of machinery and equipment goods, the business climate has increased by one point and has returned to its highest level since March 2008

In the manufacture of machinery and equipment goods, the business climate has increased by one point and has returned to its May's level, that is its highest level since March 2008, significantly above normal. This slight increase comes from a rebound in the balance of opinion on past activity.

The business climate has slightly improved and remains at its highest level since June 2011 in electrical equipment. It is virtually stable in the computer, electronic and optical product industry and stable in machinery and equipment.

The business climate has improved in the manufacture of transport equipment

In the manufacture of transport equipment, the business climate has increased by three points and has reached a level, 108, significantly above its long-term average. This increased mainly comes from a rebound in the balances of opinion on global and export order books.

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

In “other manufacturing”, the business climate is slightly less favourable

In overall “other manufacturing”, the business climate has decreased by one point after having reached its highest level since June 2011. At 107, it remains significantly above normal. This slight fall comes from a decline in the balances of opinion on past activity and on export order books.

In particular, the business climate has worsened in basic metals and has fallen back below normal in “other manufacturing industries”. It is virtually stable in clothing-textiles. However, it has improved further in wood-paper and has reached its highest level since November 2000. It has improved again in rubber and plastic products, where it remains at its highest level for more than six years, and in chemicals.

Graphang4 – 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

tableau2 – 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** (%) May 17 June 17 July 17
(C1) Man. of food products and beverages 22 106 113 110
(C3) Machinery and equipment goods 11 110 109 110
[CI] Computer, electronic and optical products 3 115 113 114
[CJ] Electrical equipment 3 106 106 107
[CK] Machinery and equipment 5 108 107 107
(C4) Man. of transport equipment 15 105 105 108
[CL1] Motor vehicles, trailers and semi-trailers 7 106 105 109
[CL2] Other transport equipment 8 103 104 104
(C5) Other manufacturing 46 107 108 107
[CB] Textiles, clothing industries, leather and footwear industry 2 104 102 101
[CC] Wood, paper, printing 5 105 112 115
[CE] Chemicals and chemical products 9 107 109 110
[CG] Rubber and plastic products 7 108 110 112
[CH] Basic metals and fabricated metal products 11 105 107 105
[CM] Other manufacturing industries 9 102 100 97
  • * 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