Informations Rapides · 24 August 2023 · n° 208

In August 2023, the business climate in the industry has clearly degraded Monthly business survey (goods-producing industries) - August 2023

According to the business managers surveyed in August 2023, the business climate in the manufacturing industry has clearly degraded. At 96, the synthetic indicator has lost five points and lies at its lowest level since January 2021. The balances of opinion on the order-books and on the past production have mainly contributed to this degradation.

The balance of opinion on the change in production over the last three months has deteriorated: it is at its lowest since August 2020. On the contrary, the balance related to the change in production over the next three months has rebounded; however, it remains below its long-term average. The general production prospects in the industry have been considered relatively stable since June, with a balance of opinion that remains slightly below its average. The economic uncertainty felt by business leaders has diminished compared to last month.

The balances of opinion associated with the level of the order-books, overall and foreign, have distinctly shrunk and both of them have gone back below their long-term average.

The balance of opinion associated with the current level of the inventories of finished-goods has improved again and has moved away from its average.

The balance of opinion associated with the past change in the workforce size has decreased while the one related to the expected change is stable. Both of them remain well above their respective average.

The balance of opinion related to the expected trend in selling prices over the next three months has withdrawn just below its long-term average.

Finally, the share of companies declaring sourcing difficulties as a factor limiting their production is stable, at 22%. The share of companies declaring being limited in their production by workforce shortage has increased for the third month in a row, going from 17% in May to 26% in August. These shares remain well above their respective averages.

In August 2023, the business climate indicator has sharply fallen in the manufacture of food products and beverages, driven down by the balance of opinion on the change in production and order books. At 87, the climate of this sub-sector is the most degraded.

In the manufacture of machinery and equipment goods, the synthetic indicator of the business climate has diminished to its average level (100), at its lowest since December 2020. The balances of opinion on the order-books have mainly contributed to this drop.

The business climate has also deteriorated in the manufacture of transport equipment. It has fallen in the manufacture of motor vehicles, trailers and semi-trailers but remains above its average. In the “other transport equipment”, the climate has fallen sharply due to the decrease in the balances of opinion on global and foreign order books (the latter had risen significantly last month); the balance of opinion on the past production has also decreased. Here too, however, the synthetic indicator remains above its average.

Finally, the business climate in the “other industries”, which is relatively dull, has not deteriorated any further. The synthetic indicator is stable. The balance of opinion on the past production has declined and remains below its average, but those on the expected production and overall order books have rebounded.

The business climate in manufacturing industry of July 2023 has been revised upwards by one point (after rounding), due to the inclusion of late responses.