September 13, 2023
In July, industry reached again negative numbers, car plants also had a lower performance, which was also affected by company-wide vacations
In July, the key sector of the Slovak economy – industry was affected by a slowdown of key manufactures- motor vehicles, steel industry and the persistent negative numbers in the rubber industry. For the second consecutive month, energy sector recorded positive numbers, which overcame the base effect of the declines from 2022 and the beginning of this year. The decline was dampened by a growth in oil refining.
Industrial production of the SR decreased by 5.3% year-on-year in July. It was already the fifth month since the beginning of the year with a slower year-on-year performance. In total, out of 15 monitored sectors of Slovak industry (special industrial groupings)2), up to 10 slowed down year-on-year, including the majority of the decisive sectors. The balance of the first holiday month was affected by the company-wide vacations of some large enterprises.
The result was most significantly influenced by decreases in manufacture of transport equipment by 6.4%. The influence of sectors is expressed through the so-called contributions3), which take into account the rate of an increase/decrease combined with the weight of the sector in industrial structure and enable the hierarchization of the effects of individual sectors, this was an impact of minus 1.70 percentage points (p.p.) on the result of the industry. The negative result was also supported by double-digit decreases in manufacture of basic metals and fabricated metal products by 13.3% (contribution -1.69 p.p.), in manufacture of rubber and plastic products by 12.2% (contribution -1.26 p.p.) and also in manufacture and repair of machinery by 21.3% (contribution -0.81 p.p.).
The industry was protected from a deeper decline by dynamically developing sectors, in particular due to a rise in manufacture of coke and petroleum products by 27.5% (contribution +0.75 p.p.) influenced by the base effect of last year’s lower base, then also year-on-year higher manufacture of electrical equipment by 7% (contribution +0.57 p.p.) and also a slight growth in electricity, gas, steam and air-conditioning supply by 3.8% (contribution +0.39 p.p.).
On a month-on-month basis (compared to June 2023), after taking seasonal effects into account, industrial production decreased by 2.6%.
According to the main industrial groupings, production of durable consumer goods decreased year-on-year by 16.6%, production of capital goods by 10.5% and production for intermediate consumption by 4.9%. Production related to energy was higher by 8.7%, and slightly also production of non-durable consumer goods.
In total, for the first seven months of 2023, industrial production decreased by 2% year-on-year. Out of a total of 15 sectors, 10 still recorded lower performance year-on-year. The most significant decrease was recorded in manufacture of rubber and plastic products by 10.8% (contribution -1.14 p.p.), as well as a quarter decline in manufacture of computer, electronic and optical products (a drop of 27.4% with a contribution of -0.61 p.p.), or an almost 15% decrease in manufacture of wood and paper products (contribution -0.49 p.p.). Significant sector of energy also recorded negative numbers. On the contrary, overall, the most positive impact was a rise in manufacture of transport equipment and also in manufacture of electrical equipment.
The Statistical Office would like to inform the users that together with the publication of data for June 2023, it has revised the monthly data on the number of employees and wages in the sectors of industry and transportation and storage. The data has been revised for the previous period from 2008 based on the supply of new data and the correction of error by reporting units.
Source: Statistical Office of the Slovak Republic
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither Karen Audit nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.
