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Industrial production fell to historic lows and employment plummeted 14% in January

Industrial production fell to historic lows and employment plummeted 14% in January

The Industrial production recorded a record drop and the employment plummeted 14% in January, according to the latest report from the UIA Study Center. This is the largest decline since the series has been measured.

In January, production stood at 29.9%the lowest level in the series and suffered a drop of 6.9 percentage points (pp) compared to the same month last year.

The Industrial Performance Monitor (MDI index) once again marked contraction levels below 50% for the seventh consecutive survey.

In the first month of the year, recorded the lowest levels of the series in the production and sales variableswhich demonstrated a worsening of difficulties in the industrial production networkwith special impact on SMEs.

Likewise, the drop in production and sales resulted in more companies with difficulties in meeting payments.

Industrial employment plummeted 14,3% due to the fall in production

As a result of the drop in production and sales, it also marked a negative trend the employment serieswhich until now was mostly stable, registering a collapse in employment in 21% of the companies surveyed.

For the second consecutive month, more companies reduce their employment level (21%) than those that increase it (7%). “The difference has widened and a change in trend is evident,” the UIA report noted.

The diffusion index, percentage of companies with increases minus those that register falls, was located at negative 14.3 pp and reached its minimum value.

deterioration of employment.PNG

In this scenario, the companies surveyed by the UIA considered that “Their economic situation is worse than a year ago” and “they expect the impact of the quality of consumption, public works and the lower activity of other companies.”

Although, the expectation for next year is more optimistic, “Approximately 50% of companies expect the economic situation of their company, the sector and the country to improve”.

More than half of SMEs suffered a drop in production

Within the SME segment surveyed by the UIA, 61% of companies registered a drop in production while only 8% registered increaseswhich shows a worse scenario compared to the same month last year.

Likewise, employment levels also deteriorated. 20% of companies reduced the number of personnel, compared to 7% that increased it.

Investing confidence of companies fell

Fewer and fewer companies believe that it is a good time to invest: only 30% have confidence in the purchase of machinery and equipment, minimum of the series.

investment.PNG

Industrialists consider that development of long term projects It is the main reason to invest, despite the situation.

Source: Ambito

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