Continued optimism in manufacturing industry

Producers’ confidence in the manufacturing industry has risen to 5.9 in March 2006. This is the highest level for five years. Manufacturing companies are especially more positive about their orders in March. The number of companies who want to reduce staff is hardly any higher than the number who want to employ more people, according to figures from Statistics Netherlands.

Manufacturers especially more positive about orders

Producers’ confidence is a sentiment indicator for the manufacturing industry. The figure is composed of three component indicators: expected production in the next three months, opinions on stocks of finished products and opinions on orders received.

Producers’ confidence was 1.3 points higher in March than in February. This is the third month in a row that it has increased. In the last six months, producers’ confidence has been higher than in the four and a half years before. Manufacturers have not been this positive since December 2000

Dutch manufacturers are mainly optimistic about the orders they have received. Their orders position is better than it has been for the last five years.  They are also more positive about their future production. On the other hand they are less satisfied with their stocks of finished products than last month.

Hardly any staff cutbacks expected

The number of manufacturing companies that expect to have to reduce staff is hardly higher than the number that want to recruit more workers in the next three months: 13 percent and 10 percent respectively. The percentage of companies that want to employ more people is the highest since June 2001.

In March 2006 13 percent of manufacturing companies expect to increase the prices of their products, while 7 percent expect to reduce prices. More companies making semi-manufactured products and investment goods  expect higher prices than  lower prices. In the consumer goods industry, it is the other way around: more companies expect to reduce prices.