Informations Rapides · 23 August 2024 · n° 204

In August 2024, the business climate in manufacturing industry has clearly rebounded Monthly business survey (goods-producing industries) - August 2024

According to the business managers surveyed in August 2024, the business climate in manufacturing industry has clearly rebounded. At 99, the synthetic indicator has gained four points and has gone back to its June level, just below its long-period average (100). The balances of opinion on the personal production expectations and on the level of the foreign order books have rebounded and mainly explain this resurgence of the climate, despite the clear fall of the balance on the past production.

In August 2024, the balance of opinion on the personal production expectations has clearly rebounded and has gone back above its long-period average. The one relative to the general prospects of production in the industry has also rebounded but remains below its average. However, the balance of opinion on the evolution of the production over the last three months has diminished again and has reached its lowest level since July 2020. The economic uncertainty felt by the business leaders has reduced again.

The balance of opinion associated with the level of the foreign order books has clearly rebounded and the one relative to the overall order books more softly. Both have gone back above their average.

The balance of opinion associated with the current level of finished-goods inventories has retreated and has moved away from its average. It has reached its lowest level since February 2022.

Concerning the workforce size, the balances of opinion on their change, both past and future, have decreased; the one relative to the future change in the workforce size has kept on decreasing since a bit more than one year. These two balances remain nevertheless well above their average.

The balance of opinion related to the expected trend in selling prices over the next three months has retreated and has gone back below its average.

The share of companies declaring being limited in their production by workforce shortage is stable, above its average. The share of companies declaring sourcing difficulties as a factor limiting their production has diminished slightly and has kept on moving closer to its average. In total, the share of companies declaring supply-side obstacles only has diminished slightly: at 24%, it has also moved closer to its long-term average. Finally, the share of companies declaring difficulties of demand only has slightly increased after the fall in July: at 28%, it is nonetheless well below its long-period average.

In August 2024, the business climate indicator in the manufacture of food products and beverages has clearly improved. At 97, it has moved closer to its long-period average and has reached its higher level since March 2023. All of the balances of opinion have positively contributed to this evolution of the climate. In particular, the balance of opinion on the overall order books has increased for the third month in a row and has moved closer to its average.

In the manufacture of machinery and equipment goods, the synthetic indicator of the business climate has diminished again and has moved away from its average. At 94, it has reached its lowest level since November 2020. The climate has degraded in all of the sub-sectors, especially in the manufacture of computer, electronic and optical products where the indicator remains nevertheless above its average. In the two other sub-sectors, the indicators of the climate have moved away from their average.

In the manufacture of transport equipment, the synthetic indicator of the business climate has sharply rebounded and has clearly moved away from its long-period average. It concerns especially the manufacture of “other transport equipment” where the balances of opinion on the level of the order books, both overall and foreign, have reached unobserved levels since the beginning of these series (February 1990). The clear increase of the balance of opinion on the personal production expectations has also contributed to this evolution of the climate. However, the balance of opinion on the evolution of the past production has sharply fallen. In the sub-sector of “motor vehicles, trailers and semi-trailers”, the synthetic indicator of the business climate is almost stable, below its average: the balance on the evolution of the production over the last three months has retreated while the balance on the level of the overall order books has rebounded.

Finally, the business climate indicator in “other manufacturing” has slightly rebounded. At 95, the synthetic indicator is below its long-period average. Concerning the sub-sectors, it has increased in most of them, especially in the "textiles, clothing industries, leather and footwear industry", but it has decreased clearly in the manufacture of basic metals and fabricated metal products and more softly in the manufacture of other industrial products.

The business climate in manufacturing industry of July 2024 has not been revised (after rounding).