24 July 2019

2019- n° 185

In July 2019, machinery and equipment are used less intensively in the manufacturing industry Quarterly business survey (goods-producing industries) - July 2019

In July 2019, the balances of industrialists' opinion on overall and foreign recent demand trend have dropped. They have reached their lowest level since January 2015 and July 2014 respectively. Both stand below their long-term average. Regarding the expected demand trend, the balance of industrialists’ opinion on overall demand has slightly recovered after having sharply dropped in April 2019. The one on foreign demand is stable, slightly below its long-term average.

In July 2019, industrialists report that they have used their machinery and equipment less intensively. At 83.4%, the production capacity utilisation rate has continued its gradual decline after having reached in January 2018 a ten-year peak.

Nevertheless, slightly more industrialists than in April consider that they could not produce more if they received more orders: production bottlenecks affect one third of businesses. This share had reached in October 2018 its highest level since 2000. The proportion of industrialists indicating difficulties of supply exclusively has lost two points but remainswell above its average. The share of industrialists reporting difficulties of demand exclusively has slightly increased again, but remains well below its average.

In July 2019, less industrialists than in April 2019 have reported an increase in their workforce size rather than a decrease in the last three months. They are also fewer than in April to foresee job growth rather than job cuts over the next three months. However, both corresponding balances stand significantly above their long-term average.

The share of industrialists experiencing hiring difficulties is stable at 47 %, its highest level for almost twenty years.

According to industrialists, selling prices in the manufacturing industry have slightly decreased in Q2 2019 (–0.5% after a slight increase in the previous quarter). Business managers foresee a stability in Q3 2019 .

Only 11% of the industrialists have experienced cash-flow problems – this share has been virtually stable since January 2016 and remains below its long-term mean (14%).

Less industrialists than in April report an improve in their competitive position for all three markets (domestic, EU and outside the EU markets). The corresponding balances have slightly decreased. However, the balance regarding the national market remains above its long-term average. Industrialists are also more pessimistic on general export prospects: the corresponding balance has fallen back slightly above its long-term average.