Business tendency, Slovenia, July 2017

In July 2017 confidence in construction and in services higher than in June

Compared to the previous month, in July 2017 confidence in construction and services increased, while in retail trade and manufacturing it decreased.

  • 25 July 2017 at 10:30
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  • final data

Manufacturing confidence indicator slightly lower than in the previous month
In July 2017, the manufacturing confidence indicator was 1 percentage point (p.p.) lower than in June 2017. Compared to July 2016 it increased by 4 p.p. and was 9 p.p. above the long-term average.
The values of the situation and expectation indicators mostly decreased at the monthly level. The biggest drop was observed in the export order books indicator (by 7 p.p.) and the overall order books indicator (by 6 p.p.). The latter pushed the confidence indicator down, but this was partly offset by the improvement of the expected production indicator (by 5 p.p.).

Shortage of labour force in manufacturing
In July 2017 the current capacity indicator was 85.5%, 0.1 p.p. lower than in April. As in April, in 66% of enterprises the capacity utilisation was over 80%. Their assessment of current production capacities according to the expected demand did not change either compared to April.
On the other hand, the competitive position worsened; on the domestic market by 4 p.p. and on markets outside the EU by 3 p.p., while it remained unchanged on markets inside the EU.
The most important factor limiting the production was shortage of skilled labour (stated by 35% of enterprises). The importance of this factor is increasing, as it was stated by only 22% of enterprises in July 2016. The situation is reversed in the case of the insufficient domestic demand; in July 2017 it limited production in 22% of enterprises and in July 2016 in 35% of enterprises. 20% of enterprises were limited by the insufficient foreign demand, while 26% of enterprises experienced no limits in their activity.

Retail trade confidence indicator lower than in the previous month
In July 2017 the retail trade confidence indicator was 10 p.p. lower than in June 2017. Compared to July 2016 it increased by 3 p.p. and was 12 p.p. above the long-term average.
The values of the situation and expectation indicators mostly decreased, except the volume of stocks indicator, which also had the greatest impact on the decline of the confidence indicator. The expected sales indicator also increased, but only by 1 p.p.
The most important factor limiting the enterprises in retail trade was competition in own sector (58%), followed by high costs of labour (40%) and low demand (30%). On the other hand, 11% of enterprises experienced no limits in their activity.

Construction confidence indicator higher than in the previous month
In July 2017 the construction confidence indicator was 4 p.p. higher than in June 2017. Compared to July 2016 it increased by 30 p.p. and was 37 p.p. above the long-term average.
The values of the situation indicators mostly decreased, except the overall order books indicator, the assessment of building activity indicator and the prices indicator, which increased. The values of the expectation indicators mostly increased, except the order books expectations indicator.
The most important factor limiting the enterprises in construction was competition in own sector (47%). Other important factors were high cost of labour (32%), high cost of material (29%), shortage of skilled labour (29%) and insufficient demand (17%). 13% of enterprises experienced no limits in their activity.

Services confidence indicator slightly higher than in the previous month
In July 2017 the services confidence indicator was 1 p.p. higher than in June 2017. Compared to July 2016 it increased by 3 p.p. and was 15 p.p. above the long-term average.
Among the situation indicators the demand indicator and the capacity utilisation indicator increased, while the business situation indicator and the employment indicator remained stable compared to the previous month. The values of the expectation indicators mostly decreased. The value of the expected employment indicator decreased the most (by 9 p.p.).
The most important factor limiting the enterprises in services was insufficient demand (33%), followed by financial constraints (25%), shortage of labour force (14%) and other limitations (12%). On the other hand, 26% of enterprises experienced no limits in their activity.

Chart 1: Monthly changes in the value of confidence indicators, Slovenia, July 2017
Chart 1: Monthly changes in the value of confidence indicators, Slovenia, July 2017
Source: SURS
METHODOLOGICAL NOTE
Data are seasonally adjusted.
When making use of the data and information of the Statistical Office of the Republic of Slovenia, always add: "Source: SURS". More: Copyright.