Producer confidence in the manufacturing industry has risen strongly in October, to 4.3, its highest level since January 2001. Manufacturers in particular are positive about expected production in the last quarter of this year, according to figures from Statistics Netherlands.
Companies in the commercial services sector are also optimistic. In the fourth quarter of 2005 they expect a further increase in turnover and orders. More than a quarter of them expect to increase employment in the fourth quarter.
Production increase expected in fourth quarter
Producer 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 and opinions on orders received.
In the manufacturing industry, producer confidence is 3.0 points higher in October than it was in September. This is the third month in a row that confidence has shown a considerable improvement. Producer confidence has not been this high since January 2001.
Dutch manufacturing companies are particularly positive about production in the last quarter of this year in October. This is especially the case for manufacturers of consumer goods.
Manufacturing industry expects employee cutbacks
The increase in producer confidence has not led to plans to increase the workforce. On the contrary, 15 percent of manufacturing companies expect to have to cut back staff in the coming months, while only 7 percent expect to increase employment. These percentages have been fairly steady for the last one and a half years.
Commercial services expect more orders and more turnover
More than 40 percent of companies in the commercial services sector expect more orders and a higher turnover in the fourth quarter of 2005. This is a slightly higher percentage than in the third quarter, and refers especially to the group other business services.
Business services expect to take on more staff
More than one quarter of companies in the business services sector intend to employ more people in the fourth quarter of 2005, while one in twelve expect to have to discharge workers. This is in line with the preceding two quarters. Business services companies have been extremely positive about the development of employment in their sector for four quarters in a row now.