Informations Rapides · 20 April 2023 · n° 99

In April 2023, manufacturers have expected less dynamism in their demand and selling prices Quarterly business survey (goods-producing industries) - April 2023

In April 2023, business leaders have expected their selling prices to slow down during the next three months. They have also considered that the demand in industrial products is less dynamic, both in the past quarter and in the three-month prospects. Production bottlenecks and hiring difficulties remain significant within the industrial sector.

Business leaders’ opinion concerning the change in demand for the last and the next three months has deteriorated in April 2023. The balance of opinion related to the expected change in overall demand has gone back under its long-term average. However, business leaders’ opinion about the change in foreign demand has improved: both balances of opinion on the past and expected change have clearly rebounded and have shifted away from their respective averages.

In April 2023, the share of companies at the limit of their production capacity is stable, at a high level: 44% have deemed that they would not be able to increase their production with their current means if they received more orders. Nevertheless, more business leaders than three months ago have considered their production capacities sufficient given the expected change in orders over the coming months. The associated balance of opinion has increased but remains lower than its average. The production capacity utilisation rate has slightly straightened up: at 82% it remains just under its average level.

The balance of opinion on the expected change in investment over the next three months has clearly rebounded.

In April 2023, hiring difficulties are still strong. 65% of business leaders have declared experiencing it, a slightly higher share than in January 2023 and close to the highest level reached by the series in July 2022 (67%).

Business leaders have considered, on average, that their selling prices have increased by 1.6% since January 2023. For the next three months, they expect a slowdown in their prices: according to them they should grow by 0.6% on average in industry, i.e. the lowest quarterly forecast since April 2021.

The balance on the general prospects of change in hourly wages in industry has also folded back but remains well above its average.

The cash-flow situation of industrial enterprises has been deemed a bit more deteriorated than in January: the associated balance of opinion has moved away from its average.

In the manufacturing industry, less business leaders in April 2023 than in October 2022 estimate an increase of their investments in 2022. This decline is essentially due to the manufacture of transport equipment, where the balance of opinion has strongly dropped, whereas it has increased in the other sub-sectors.

Regarding the change in investments in 2023, manufacturers have made a second judgment on the expected change in their investments, after the one of October 2022. The associated balance of opinion has increased in most of the industrial sub-sectors, except for the manufacture of machinery and equipment goods.