The morale of the bosses resists in France but the industry sends worrying signals


Posted Nov 24, 2022 10:12 AMUpdated Nov. 24, 2022, 10:20 a.m.

For the moment it holds. Despite a difficult economic context, still marked by the war in Ukraine, the energy crisis and the threat of economic recession, the business climate remains stable in France. The indicator that summarizes it, calculated by INSEE from the responses of business leaders in the main market sectors, remained at 102 in November, for the third consecutive month. It is therefore still “slightly above its long-term average (100)”, notes INSEE.

But this stability hides disparities. Thus, the institute notes a growing concern among business leaders in the industry sector, reflected by a drop in the business climate indicator in this sector compared to October (101 against 103 last month). The economic situation is deteriorating, “business leaders being less positive about their recent activity and their order books,” notes INSEE.

Same state of mind among managers in the building sector where the business climate is deteriorating (113 against 115 in October), “mainly due to the decline in the balances of opinion relating to activity, both past and expected”, explains the institute. Business leaders are still just as numerous (69%) to declare “obstacles limiting their production”, in particular recruitment and supply difficulties.

In services, the business climate indicator is also deteriorating (104 against 106 a month earlier), “under the effect of a slight deterioration in the business expectations of the business leaders surveyed”.

Conversely, the business climate in wholesale trade, measured bi-monthly, has improved markedly (to 102 against 97 in September). “This improvement is mainly due to the marked increase in the balance of opinion concerning deliveries received from abroad and, to a lesser extent, by the increase in that relating to past sales”, indicates INSEE.

In retail trade, the indicator remains below its long-term average, at 97, but it is stabilizing compared to the previous month. “This stability masks contrasting variations in the balances of opinion, down in particular for ordering intentions and up in particular for the general outlook for activity”, concludes the institute.

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