Automotive strikes hamper growth

Before the slump in 2008/09 due to the global recession, manufacturing performed well, recording annual growth rates of 2,9%, 4,6% and 4,2% for 2005, 2006 and 2007 respectively. The recovery after the recession from 2010 to 2012 was sluggish, and 2013 showed anaemic annual growth of 1,3% to date. Factory output remains far from the levels achieved at the end of 2007 and beginning of 2008.

Manufacturing production slumped in September 2013, recording a year-on-year growth rate of -3,3% from a subdued 0,2% year-on-year growth in August 2013. This was the lowest growth rate recorded since July 2011, when strikes in key industries forced factory output to slump to -6,0% year-on-year. Figure 1 illustrates the performance of the manufacturing sector from 2005 to 2013.

Figure 1 – Manufacturing production, seasonally adjusted and trend

Latest: August & September 2013

During August and September 2013, a strike in the automotive industry adversely affected total factory output. Manufacturing of motor vehicles was the worst affected, decreasing by 47,3% and 69,9% year-on-year in August and September 2013 respectively, followed by parts and accessories (-3,9% and -46,0% year-on-year in August and September 2013 respectively). Figures 2 and 3 illustrate the slump in production levels.

Figure 2 – Index of motor vehicle production: 2011 – 2013

Figure 3 – Index of parts and accessories production: 2011 – 2013

Seasonally adjusted total manufacturing production fell by 3,8% month-on-month in August 2013 and by 4,7% in September 2013. Apart from the woes of the automotive sector, each of the ten manufacturing divisions contracted month-on-month (seasonally adjusted) in September 2013.

Manufacturing & GDP:

The manufacturing industry, as measured by its nominal value, contributed 10,7% to the economy in the second quarter of 2013. Figure 4 shows manufacturing’s declining contribution to GDP from 2006 to 2013. The poor August and September 2013 manufacturing output resulted in a seasonally adjusted annualised decrease of 8,3% for the third quarter of 2013 compared with the previous quarter. GDP results for the third quarter of 2013 will be published on 26 November 2013.

Figure 4 – Contribution of manufacturing to GDP: 2006 – 2013

Download Manufacturing: Production and sales, September 2013

Posted on November 8, 2013 Facebook Twitter Linkedin

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