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Romania

Industry in Romania faces strong contraction in December 2019 (SNSPA Barometer)

hală, fabrică, întreprindere, industrie

The activity in the industry registered a strong contraction in December 2019, and the decrease in export orders reached a historical record, up to 32 points, the results of the Barometer of Romanian Industry, prepared by the National University of Political Studies and Public Administration and IRSOP, released on Wednesday.

According to the document, in terms of production, the volume decreased down to 40 points, with 10 points below the 50 border between expansion and contraction. At the same time, the stocks were in permanent contraction for the whole last year and remained contracted at 47 points, in December.

On request, the new orders fell from 53, in November 2019, down to 40 in December 2019, and the lack of orders will be felt in the following months.

In this context, the specialized analysis reveals that, in December 2019, the export orders are at a historical minimum of 32 points.

On the other hand, imports of raw materials contracted massively, from 56 in November, to 45 in December.

In terms of labour force, the number of employees remained contracted to 47 points, given that, for almost two years, the employment indicator has signaled the intention of managers to keep instead of increasing the current number of employees. The forecasts for 2020 talk about possible lay-offs, amid repeated declines in activity that culminated in the December 2019 contraction.

According to the same source, the production costs decreased by 64 points in December (from 69, in November 2019), but are still in the growth area, with more than 50 points.

As far as managers' expectations are concerned, their overall confidence indicator in the recovery of the activity over half a year shows a jump to 70 points, from 64 in November.

Starting with 2014, every month, IRSOP and SNSPA ask a sample of managers whether in their company production, orders, stocks, hires and other parameters have increased or decreased compared to the previous month. An index based on the net ratio of responses signals expansion if it exceeds 50 points and contraction drops below 50.

The monthly barometer of the Romanian industry presents the situation on a daily basis and appears in about 20 days from the end of the analyzed month. The report is made on a sample of 300 industrial companies, representing the level of the 15,200 industrial companies with over nine employees in Romania, which generates about 95 per cent of the total turnover in the industry.

The data were collected through direct interviews with the managers of the companies between January 16-20, 2020.

AGERPRES

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