Already at a very high level, the business climate in manufacturing further strengthens in November 2017Monthly business survey (goods-producing industries) - November 2017

According to the business managers surveyed in November 2017, the business climate in industry, already at a ten-year high, has increased again by one point. At 112, it has continued to rise above its long-term average (100).

Informations rapides
No 304
Paru le : 23/11/2017
Prochaine parution le : 24/04/2018 at 08:45 - April 2018

According to the business managers surveyed in November 2017, the business climate in industry, already at a ten-year high, has increased again by one point. At 112, it has continued to rise above its long-term average (100).

Graph 1 – Business climate in industry - Composite indicator

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

Graph 2 – Turning-point indicator

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

The balance of opinion on past activity has increased significantly

The balance of opinion on past activity has significantly increased again in November and peaked at its highest since June 2011. The balance on their personal production expectations has edged down but remains well above its long-run average.

Manufacturers are increasingly optimistic about general production prospects for the sector. The corresponding balance, at its highest since August 2000, has improved for the third month in a row.

The balance on global order books, already at its highest point since March 2008, has increased by one point. That on export order books has inched down but remains significantly above average.

Lastly, in November, once again more industrialists consider that their finished-goods inventories are above normal. The corresponding balance remains nevertheless below its long-term average.

Table 1 – Industrialists' opinion on manufacturing activity

Balance of opinion, in %
Industrialists' opinion on manufacturing activity
Manufacturing industry Ave.* Aug. 17 Sept. 17 Oct. 17 Nov. 17
Composite indicator 100 111 111 111 112
Past activity 5 21 12 16 23
Finished-goods inventory 13 4 3 5 7
Overall order books –18 –3 0 0 1
Export order books –14 0 1 1 –1
Personal production expectations 5 14 20 17 16
General production expectations –8 20 23 30 31
  • * Long-term average since 1976.
  • Source: INSEE - Monthly business tendency survey in industry

In the food and beverage production industry, the business climate has improved again

In the manufacture of food products and beverages, the business climate has increased by two points in November. At 113, it stands well above its long-term average. This further improvement mainly comes from an increase in the balance of opinion on past activity.

The business climate is stable in the manufacture of machinery and equipment goods

In the overall manufacture of machinery and equipment goods, the business climate is stable at 110, significantly above normal. In particular, the balance on overall orders has improved, although that on export orders has decreased.

The business climate has improved in electrical equipment while faltering in machinery and equipment and in the computer, electronic and optical product industry.

The business climate has reached a peak since mid-2001 in the transport equipment manufacture

In the transport equipment manufacture, the business climate has improved by one point, to 110, reaching its highest level since June 2001. This is mainly due to the increase in the balances on global order books and on past activity.

The business climate has further improved in the manufacture of motor vehicles, trailers and semi-trailers while it has slightly weakened again in other transport equipment.

The business climate continues to rise in “other manufacturing industries”

In overall “other manufacturing”, the business climate has risen by one point again, peaking at its highest level since April 2007 (111). It has been mainly driven by the increase in the balances on past activity and on personal production expectations.

In particular, the business climate indicator has brightened in clothing-textiles, wood-paper, rubber and plastic products and basic metals. In contrast it has declined again in chemicals and has fallen back in “other manufacturing industries”, while remaining above its mean in both subsectors.

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** (%) Sept. 17 Oct. 17 Nov. 17
(C1) Man. of food products and beverages 22 107 111 113
(C3) Machinery and equipment goods 11 108 110 110
[CI] Computer, electronic and optical products 3 112 113 110
[CJ] Electrical equipment 3 103 106 109
[CK] Machinery and equipment 5 106 109 107
(C4) Man. of transport equipment 15 109 109 110
[CL1] Motor vehicles, trailers and semi-trailers 7 111 112 113
[CL2] Other transport equipment 8 105 104 103
(C5) Other manufacturing 46 109 110 111
[CB] Textiles, clothing industries, leather and footwear industry 2 105 107 112
[CC] Wood, paper, printing 5 113 110 113
[CE] Chemicals and chemical products 9 109 107 105
[CG] Rubber and plastic products 7 114 114 116
[CH] Basic metals and fabricated metal products 11 106 109 112
[CM] Other manufacturing industries 9 104 110 108
  • * 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