Informations Rapides · 25 July 2024 · n° 177

In July 2024, the business climate in manufacturing industry has sharply darkened Monthly business survey (goods-producing industries) - July 2024

According to the business managers surveyed in July 2024, the business climate in manufacturing industry has darkened. At 95, the synthetic indicator has lost four points and has clearly moved away from its long-period average (100), reaching its lowest level since December 2020. The balance of opinion on the level of the foreign order books, as well as all balances on the evolution of the production (both past and future) have degraded.

In July 2024, the balance of opinion associated with the level of the foreign order books has clearly degraded and has gone back below its long-period average. It has reached its lowest level since May 2021. The one relative to the overall order books has diminished and has gone back below its average too.

All balances of opinion on the evolution of the production have diminished. The one concerning the personal production expectations over the next three months, decreasing since April 2024, has clearly declined. It has moved away from its average again and it has reached its lowest level since July 2023. The balance of opinion relative to the general prospects of production in the industry has also sharply diminished and has reached its lowest level since November 2020. Finally, the balance of opinion on the evolution of the production over the last three months has diminished quite more softly but has moved away from its average too. The economic uncertainty felt by the business leaders has reduced.

The balance of opinion associated with the current level of finished-goods inventories has slightly rebounded but remains below its average.

Concerning the workforce size, the balance of opinion on their past change has increased again while the one on their future change has slightly diminished. Both are well above their average.

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

The share of companies declaring being limited in their production by workforce shortage has sharply diminished but remains above its average. The share of companies declaring sourcing difficulties as a factor limiting their production is stable, above its average. In total, the share of companies declaring supply-side obstacles only is stable: at 25%, it remains above its long-term average. Finally, the share of companies declaring difficulties of demand only has retreated after four consecutive months of increase: at 27%, it remains nonetheless well below its long-period average.

In July 2024, the business climate indicator in the manufacture of food products and beverages is stable. It remains clearly below its long-period average. The balance of opinion associated with the current level of finished-goods inventories has sharply rebounded and has gone back above its average. The balances related to the evolution of the past production and to the level of the overall order books have slightly rebounded but remain below their average.

In the manufacture of machinery and equipment goods, the synthetic indicator of the business climate has diminished a little and has moved away from its average. The balance of opinion on the evolution of the past production has retreated and has gone back clearly below its long-period average. However, the balance on the personal production expectations has increased again and has almost reached its long-period average.

In the manufacture of transport equipment, the synthetic indicator of the business climate has sharply fallen and has gone back to its long-period average, its lowest level since September 2022. It has diminished the most sharply in the sub-sector of “other transport equipment” where the indicator remains above its average, but has reached its lowest level since September 2023: the balances of opinion on the level of the order books, both overall and foreign, have clearly decreased. In the sub-sector of “motor vehicles, trailers and semi-trailers”, the synthetic indicator of the business climate has decreased and has reached its lowest level since August 2022: the balance on the personal production expectations has retreated and the balances on the order books have degraded.

Finally, the business climate indicator in “other manufacturing” has diminished again. At 94, the synthetic indicator is clearly below its long-period average. All the balances of opinion on the production have diminished. However, the one relative to the level of the overall order books has rebounded. The business climate indicator has decreased in all sub-sectors except for the manufacture of basic metals and fabricated metal products and in the manufacture of other industrial products.

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