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33420
Growing investments in manufacturing
statistikk
2005-10-28T10:00:00.000Z
Energy and manufacturing;National accounts and business cycles
en
kbar, Business tendency survey for manufacturing, mining and quarrying, actual and expected development, production, employment, new orders, market prices, resource shortage, bottlenecks, capacity utilisation, industrial confidence indicatorBusiness cycles , Manufacturing, mining and quarrying , National accounts and business cycles, Energy and manufacturing
false

Business tendency survey for manufacturing, mining and quarrying, Q3 2005

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Growing investments in manufacturing

The results of the Business Tendency Survey for the third quarter show that the conditions for the manufacturing industry have improved and that a growing number of managers are considering an increase in gross capital investments.

The manufacturing industry experienced a rise in output and capacity utilisation in the third quarter of 2005. Steady growth in new orders from the home market is the main driving force behind this development. Home market prices continue to rise, while there are signs of falling export prices. The level of new orders from the export market is more or less unchanged from the previous quarter. The number of working months covered by the current stock of orders is somewhat higher than the corresponding figure for 2004, and an increasing number of managers report that lack of capacity and shortage of qualified labour are factors that limit production. The average capacity utilisation is estimated to be about 82 per cent.

The general outlook in the short term (Q4 2005) is considered to be better, and a growing number of managers say that they are considering an increase in gross capital investments. The industrial confidence indicator1 is estimated to be 10 (net figure seasonally adjusted). This result indicates a rise in output in the fourth quarter of 2005. For international comparisons, go to EUROSTAT (EU) and The Swedish National Institute of Economic Research (Sweden).

Industrial confidence indicator. Q1 1999-Q3 2005

Intermediate goods: Negative signals from export market

The reports of producers of intermediate goods (pulp, paper and paper products, chemical industry, basic metals and others) show that total output was higher than in the second quarter. There are also signs of rising employment. The growth in total stocks seems to be levelling out, due to a decline in new orders from the export market. Export prices continue to drop, while home market prices remain more or less unchanged. The average capacity utilisation is estimated to be about 84 per cent. Lack of capacity and shortage of qualified labour are still considered to be factors that limit production, but an increasing number of managers also point at lack of new orders from export markets.

The general outlook in the short term is considered to be better. The number of managers that share this opinion has so far been fairly stable in 2005. A further rise in output is expected.

Capital goods: Rising employment

The reports of producers of capital goods (metal products, machinery and equipment, offshore-related activity and others) show that the conditions have improved for many of these sectors. Output and capacity utilisation are higher than in the second quarter, and there are signs of rising employment. An increase in the number of managers that point at shortage of qualified labour as a bottleneck for production confirms this result. A rise in new orders from home and export markets causes total stocks of orders to grow. Home market prices continue to rise, and the drop in export prices seems to be levelling out. Average capacity utilisation is estimated to be about 84 per cent. The number of working months covered by the current stock of orders is somewhat higher than in 2004.

A growing number of managers consider the general outlook in the short term to be better. Expectations of a rise in output, employment and home market prices confirm this view.

Consumer goods: Rising demand at home

The results from sectors producing consumer goods (food industry, publishing, pharmaceutical industry and others) show growth in output and capacity utilisation in the third quarter. An increase in home market demand is the driving force behind this development. Home market prices continue to rise, while export prices remain more or less unchanged. The number of managers that report of a capacity utilisation of 80 per cent or more is more or less the same as in the third quarter of 2004.

The general outlook in the short term is considered to be better. The fact that a growing number of managers are considering an increase in gross capital investment is a sign of optimism also in the medium run.

1The industrial confidence indicator and links to international comparisons are described in the article for Q3 2003.

Assessment of industries in Q3 and the short-term outlook
Industry Prospects Background
Food products, beverages and tobacco + Growth in output and capacity utilisation in Q3. Increase in demand from the home market, while demand from the export market is more or less unchanged. Positive development in prices. The general outlook for Q4 is judged as better, and increases in output and demand are expected. A growing number of managers report that they consider increasing their gross capital investments.
Wood and products of wood ++ The positive development continues in Q3. Many managers report higher levels of production, employment and capacity utilisation. Positive development in home market prices, while export prices are more or less unchanged. New orders from the home market have increased. The general outlook for Q4 is considered better. The positive development in output and new orders are expected to continue.
Pulp, paper and paper products - Negative development with lower levels of production, employment and new orders. Many managers report lower export prices, and there is a sharp increase in the number of managers reporting that weak demand is a limiting factor for production. The general outlook is judged as worse. Expectations of a reduction in new orders from the export market and negative developments in prices support this view.
Basic chemicals + Increases in output and employment. More or less unchanged order level from the export market and lower export prices. The number of managers pointing at lack of demand as a limiting factor for production has increased. The general outlook for Q4 is considered better, and the positive development in output is expected to continue. New orders are also expected to increase. Prices are expected to remain stable.
Basic metals, non-ferrous -(+) More or less unchanged level of production. Lower levels of capacity utilisation, employment and orders received from the export market. Negative development in prices. The general outlook is judged as better, and a rise in new orders from the export market is expected. Output is expected to be more or less unchanged, while prices are expected to decline.
Engineering, total ++ Overall higher levels of production, capacity utilisation and employment. Total stock of orders has increased together with home market prices. There is an increase in the number of managers reporting that lack of qualified labour is a limiting factor for production. Many managers judge the general outlook for Q4 as better. This view is supported by expectations of further growth in output, employment and the stock of orders. Home market prices are expected to rise, while export prices are expected to remain stable.
Metal products ++ The positive development in the industry continues with increases in production, capacity utilisation and employment. New orders received from the home market have increased and prices are higher. The general outlook is considered better by many managers, and there are positive expectations for output, employment and new orders.
Machinery and equipment ++ Growth in output, capacity utilisation, employment and new orders. Home market prices have increased and export prices are more or less unchanged. The number of managers reporting that lack of capacity is limiting production has increased. Many managers judge the general outlook as better, and the positive development in output, employment and prices are expected to continue throughout Q4.
Electrical and optical equipment ++ Higher level of production, capacity utilisation and employment. Growth in new orders both from the home and export market. Many managers report that lack of qualified labour is a limiting factor for production. The general outlook is positive, and the increases in output, employment and new orders are expected to continue in Q4.
Offshore-related activity incl. transport industry included ++ Continued positive development with increases in production, employment, capacity utilisation and new orders. Reduced export prices, while home market prices are higher. Llarge increase in the number of managers pointing at lack of qualified labour as a limiting factor for production. The general outlook for Q4 is considered better by many managers. Output is expected to increase together with increases in employment and stock of orders.
In the column for Prospects a total evaluation of the present situation and expected short-term developments is marked with the symbols + and -. The following codes and constellations are used: ++
+
~
-
--
-(+)
+/-
Very good
Good
Stable
Weak
Quite weak
Weak, but with certain positive indications
A situation where the + and - factors even out.