Fewer March work days spell drop in industrial output
Declining output in the vehicle, electronics, food and machinery segments dragged down unadjusted industrial production in Hungary in March, a second, more detailed reading of data from the Central Statistical Office (KSH) reveals.
In March 2018, the volume of industrial output declined by 2.4% compared to last year’s high base, the KSH reported, confirming the headline figure in the first estimate on May 8. Based on working day-adjusted data, however, output grew 1.9%, the large discrepancy between raw and adjusted data being partly due to the fact that there were two fewer working days in March 2018 than in March 2017.
Industrial output – according to the seasonally and working-day adjusted index – was below the previous month’s level by 0.7%.
The volume of industrial export sales declined by 4.1% year-on-year. Within export sales in manufacturing, exports of transport equipment (representing 36% of the total) fell by 4.0%. In the manufacture of computer, electronic and optical products – the other significant subsection, accounting for 15% of manufacturing exports – export sales volume decreased by 2.6%.
Industrial domestic sales grew by 8.0%, within which domestic sales of the manufacturing sector were 3.1% higher compared to the same month of the previous year.
Within industry, production declined by 3.0% in manufacturing (representing a decisive weight of 95%), while growing by 46% in mining and quarrying (carrying little weight).
Output of the energy industry (electricity, gas, steam and air-conditioning supply) increased by 6.8%, mainly as a result of much colder weather compared with the previous year (the March 2018 average temperature was 5.5°C lower than the average in the corresponding month of 2017).
Output down across board
Production declined in nine of the 13 subsections of manufacturing, to which the high base effect in March of the previous year also contributed, in addition to the fewer working days.
The production of transport equipment, representing 29% of manufacturing output, decreased year-on-year by 2.6%. The manufacture of parts and accessories for motor vehicles rose by 3.3%, while the manufacture of motor vehicles fell by 8.0%.
The manufacture of computer, electronic and optical products, accounting for 12% of manufacturing, decreased by 4.0%. Of the two dominant groups of products in this segment, the manufacture of communications equipment rose by 24%, while the manufacture of consumer electronics dropped 14.1%.
The manufacture of food products, beverages and tobacco, accounting for 10% of manufacturing, declined by 2.4% compared to March of the previous year.
The production of machinery, accounting for 6.4% of manufacturing output, dropped at the highest rate of 16.3%, mainly due to a significant fall in the manufacture of engines and turbines.
With a 3.8% increase in the number of employees, the labor productivity of industrial enterprises with five or more employees was 6.0% lower in March 2018 than in March 2017.
Of the territorial units of Hungary, industrial output grew year-on-year only in Budapest and Pest County (by 0.8% and 3.6%, respectively). In other regions, production volume decreases of between 0.1% and 6.0% were recorded, the lowest being observed in Western Transdanubia.
The total volume of new orders in the observed subsections of manufacturing declined by 5.0% compared to the same month of 2017. New domestic orders rose by 7.4%, while new export orders dropped 6.8%. The total stock of orders stood below the level of March 2017 by 6.7%.
Production up 2.5% in first quarter
In January–March 2018, compared to the first quarter of 2017, industrial production rose by 2.5%. The volume of export sales (representing 63% of all sales) declined by 0.2%, while that of domestic sales (accounting for 37% of all sales) rose by 5.9%.
The labor productivity of industrial enterprises with five or more employees decreased by 1.3% in Q1 2018, along with a 3.7% increase in the number of employees.
Of all Hungaryʼs regions, industrial output declined year-on-year only in Western Transdanubia (by 0.9%). The largest volume growth (7.5%) was measured in Southern Transdanubia and Central Hungary, while volume increases of between 0.6% and 3.8% were recorded in other regions.
The KSH will publish a first estimate of April industrial output data on June 6, followed by a second, more detailed estimate on June 13.
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