Latest data confirm the trends observed in the previous months. The dynamic economic recovery in industry and manufacturing continues, while construction industry is still in decline. Industrial confidence and the business outlook continue to improve despite persisting global uncertainty and recent turmoil in Northern Africa.
In December industrial output continued its upward trend and was almost 8% higher than a year ago. However, it was still some 10% below its former peak in early 2008. The sectors initially most affected by the downturn, autos, machinery and equipment, and basic metals are still recovering the most rapidly in the present upswing. On the other hand, output in consumer goods sectors shows little sign of a recovery or even further contraction. Construction output continues to fall, reaching in December its new lowest level since the onset of the crisis. In contrast, data and forecasts for tourism remain positive. Recovery in output of business services is rather moderate, with the exception of a strong growth in logistics.
Extra-EU exports having strongly recovered oscillate around the levels of their former peak. Growth in intra-EU trade, internal demand and private consumption in contrast is less dynamic and lags behind in recovery.
Data on the third quarter of 2010 show employment in manufacturing beginning to stabilise. Since the cyclical peak, jobs have contracted by some 11.8% broadly the same size as the fall in output. Moreover, available evidence suggests that dynamic growth of industrial output allowed for short-term working being largely phased out in industry. The unemployment rate remains at a high level.
Looking at the situation in the Member States, substantial differences can still be noticed, but the recovery is now visible in the vast majority of countries. Particularly strong recoveries have been experienced in Germany, Ireland, Poland, Slovenia and the Baltic states, where annual output growth has exceeded 10%. In contrast, Greece continues to experience reduction of output, whereas Spain has only managed to stabilise its production at rather low levels.