In January industrial output continued its upward trend and was almost 14% higher than at the time of the trough in early 2009. However, it was still some 9% 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. Construction output continues to fall, reaching in January its new lowest level since the onset of the crisis. In contrast, data and forecasts for services, including tourism, remain positive. However, the recovery in output of business services is rather moderate.

Extra-EU exports have strongly recovered and oscillate now 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, reflecting less dynamic overall output growth in Europe as compared to the rest of the world.

Data on the fourth quarter of 2010 confirm that employment in manufacturing has been stabilising. Since the cyclical peak in 2008, manufacturing jobs have contracted by some 11.4%, broadly the same size as the current fall in output. The recovery of industrial output allowed for short-term working being largely phased out in industry, but the unemployment rate remains at a high level.

Looking at the situation in the Member States, substantial differences can still be noticed, even if the recovery is now visible in the vast majority of countries. There are an increasing number of countries where annual output growth has exceeded 10%, with Estonia, Lithuania and Slovakia in the lead. In contrast, Greece and Cyprus continue to experience a reduction of output, whereas Portugal and Spain so far only see a bottoming out of output contraction.