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Slovenia: Significant Decline in Business Confidence

Published: October 28, 2013; 18:38 · (Vindobona)

Sentiment indicator lower than in the previous month In October 2013 (-13 percentage points) the sentiment indicator was 1 percentage point lower than in September 2013 (-12 percentage points).

Slovenia: Significant Decline in Business Confidence / Picture: © Vindobona.org

Compared to October 2012 it increased by 10 percentage points and was 11 percentage points below the long-term average.

Manufacturing confidence indicator lower than in the previous month In October 2013 the manufacturing confidence indicator (-5 percentage points) was 2 percentage points lower than in September 2013 when it stood at -3 percentage points. Compared to October 2012 it increased by 11 percentage points and was 2 percentage points below the long-term average. Among the situation indicators, the stocks of finished products indicator and the export order books indicator increased, the production indicator and the overall order books indicator decreased, while the assured production indicator remained the same as in the previous month. All expectation indicators decreased compared to the previous month.

The indicators that are observed four times a year mostly increased: The current capacity utilisation was 78.4%; 0.1 of a percentage point higher than in July 2013. 51.3% of enterprises the capacity utilisation was higher than 81%. In October 2013 the indicator of assessment of current production capacities according to expected demand in the next 12 months went down by 2 percentage points compared to July 2013. All indicators of competitive position increased compared to July 2013. In October 2013 the new orders indicator was the same as in the July 2013 (-4 percentage points). The most important factor limiting production in October 2013 was insufficient domestic demand; 50% of enterprises were faced with this limitation. It was followed by insufficient foreign demand (39%), uncertain economic conditions (35%), financial problems (31%) and unpaid bills (19%).

Retail trade confidence indicator higher than in the previous month In October 2013 the retail trade confidence indicator (9 percentage points) was 4 percentage points higher than in September 2013 when it stood at 5 percentage points. Compared to October 2012 it increased by 21 percentage points and was equal to the long-term average. Among the situation indicators, the selling prices indicator and the volume of stocks indicator decreased, while the sales indicator increased. The business situation indicator remained stable. Among the expectation indicators, the expected business situation indicator and the expected employment indicator increased, while expected orders and selling prices expectations decreased. The expected sales indicator remained stable. The most important factors limiting the enterprises in retail trade were low demand (57%), high costs of labour (53%) and competition in own sector (48%). On the other hand, 8% of enterprises experienced no limits in their activity.

Construction confidence indicator lower than in the previous month In October 2013 the construction confidence indicator (-17 percentage points) was 1 percentage point lower than in September 2013 when it stood at -16 percentage points. Compared to October 2012 it increased by 25 percentage points and was 1 percentage point above the long-term average.Among the situation indicators, the technical capacity indicator and the employment indicator increased, the business situation indicator and the price indicator decreased, while the assessment of building activity indicator, the overall order books indicator and the assured work in hand indicator remained the same as in the previous month. The expectation indicators mostly decreased in comparison with the previous month, except the expected price indicator, which remained the same as in the previous month. The most important factor limiting the enterprises in construction was competition in own sector (39%). Other important factors were high cost of labour (36%), high cost of material (35%), insufficient demand (32%) and high financial costs (30%).

Services confidence indicator higher than in the previous month In October 2013 the services confidence indicator (-13 percentage points) was 1 percentage point higher than in September 2013 when it stood at -14 percentage points. Compared to October 2012 it increased by 7 percentage points and was 28 percentage points below the long-term average. The situation and expectation indicators mostly decreased compared to the previous month, except the demand indicator and the expected employment indicator. The expected demand indicator remained the same as in the previous month. The most important factor limiting the enterprises in services was insufficient demand (49%), followed by financial constraints (39%), other limitations (12%) and shortage of labour force (2%). On the other hand, 17% of enterprises experienced no limits in their activity.

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