Investment Prospects in the Manufacturing Sector: A Cause for Concern
L'INS has published a fascinating survey on the investment prospects in the manufacturing sector, which represents the backbone of our exports and employment. The survey covers 1,026 companies, a representative sample.
To understand the presented statistics, it's essential to note that they represent opinion balances, which correspond to the difference between the weighted percentage of positive responses and the weighted percentage of negative responses to a question. This is the ratio of the number of "+" and "-" responses to the number of respondents.
The survey revealed that investment has been on a downward trend during the first half of 2024, with an opinion balance of 1% in the first half of 2024, compared to 5% in the second half of 2023. This is the same level as in the second half of 2020, during the peak of the health crisis. Even more concerning, expectations for the second half of 2024 are only 7%, compared to 13% for the first half of the year.
By sector, the agri-food and mechanical and electrical industries stood out until the end of June 2024, with opinion balances of 15% and 14%, respectively. For expectations, the prospects for the textile, clothing, and leather industries are the most gloomy, with a negative balance of -9%. The industries for construction materials, ceramics, and glass also show a negative balance of -2%. For the rest, optimism prevails, with a balance of 15% for the chemical industries, 12% for the mechanical and electrical industries, and 9% for the agri-food industries.
These figures are a very bad sign for growth and job creation. Therefore, we should not expect a real recovery in the coming quarters. Companies will continue to limit their investments to replacement investments without really expanding their activities. The industry needs more unprecedented and massive support to accompany it in recovering its competitiveness, integrating new technologies, and transitioning to clean energy.
