Development of the industry - 1. quarter of 2006

Development of the industry in the Q1 2006 was highly dynamic as for all indicators (growing were: production, employment, labour productivity as well as volumes of new orders). The main factors of high industrial growth were:
-          growth at new production capacities, especially of foreign investors (industry of transport equipment and electrical engineering industry);
-          revitalization in the branch of energy engineering in relation to solution of issues of energy security;
-          high growth in the branch of manufacture of wood.
 
In Q1 2006, there were 2 more working days in comparison to the Q1 2005.
 
 
Production
 
The year-on-year industrial production index reached 115.4% in the Q1 2006 (113.9% working days adjusted). The following contributed most to the growth of industrial production: ‘manufacture of transport equipment’ (its contribution to the industrial growth in total was +6.8 percentage points; the branch grew by +36.9%); ‘manufacture of electrical and optical equipment’ (contribution of +2.6 p.p.; growth by +24.0%); and ‘manufacture of basic metals and fabricated metal products’ (contribution +1.7 p.p.; growth by +12.0%). On the contrary, industrial production decreased in: ‘manufacture of coke and refined petroleum products’ (contribution –0.1 p.p.; decrease by –2.3%); ‘manufacture of textiles and textile products’ (contribution –0.1 p.p.; drop by –2.5%), and ‘mining and quarrying, except of energy producing materials’ (contribution –0.02 p.p.; fall by –3.3%).
 
In Q1 2006, industrial production increased in the following main industrial groupings: consumer durables (+37.9%), capital goods (+31.2%), intermediate goods (+10.6%), consumer non-durables (+4.1%), and energy (+2.9%).
   
 
Sales
 
In Q1 2006, sales in industry were higher by +16.2% year-on-year (constant prices); after working days adjustment it was +15.1%. The following contributed most to the growth of sales in industry: ‘manufacture of transport equipment’ (its contribution to the industrial growth in total was 7.1 percentage points; the branch grew by +36.9%); ‘manufacture of electrical and optical equipment’ (contribution of +3.2 p.p.; growth by +23.1%), and ‘manufacture of basic metals and fabricated metal products’ (contribution of +1.5 p.p.; growth by +12.4%). Sales in industry decreased in: ‘manufacture of coke and refined petroleum products’ (contribution –0.3 p.p.; drop by –11.7%), and ‘manufacture of textiles and textile products’ (contribution –0.1 p.p., decrease by –3.8%).
         
               
Direct exports
           
Direct export sales of industrial enterprises increased by +16.3% at constant prices (+13.0% at current prices), and their share in total sales of industrial enterprises stood at 48.7%. The biggest constant price growth occurred in ‘manufacture of wood and wood products’ (+34.5%), ‘electricity, gas and water supply’ (+28.5%), ‘manufacture of machinery and equipment’ (+27.5%), and ‘manufacture of transport equipment’ (+27.3%). The biggest decreases were recorded for ‘manufacture of coke and refined petroleum products’ (-6.3%), and ‘manufacture of textiles and textile products’ (-3.7%).
 
Direct export sales index was influenced by changes in organization of trade. These changes (growth of export of production via trade organizations) caused a decrease in the direct export sales index in the Q1 2006.
 
After elimination of those changes, the year-on-year direct export sales index for the industry in total will be 117.2% at current prices (120.7% at constant prices) and for ‘manufacture of electrical and optical equipment’ 118.1% at current prices (120.7% at constant prices).
  
 
Foreign-controlled enterprises
 
Sales in industry implemented by foreign-controlled enterprises grew by +26.3% at constant prices (+23.3% at current prices), and their share in total sales at current prices stood at 58.9%.
 
In Q1 2006, there were 1,971 foreign-controlled enterprises operating in the industry; they employed more than 469 thousand employees with the average monthly nominal wage of CZK 20,108 (i.e. by 11.6% more than the average monthly nominal wage for the industry in total). 


Employment
 
In Q1 2006, employment in the industry increased by 26.8 thousand persons, i.e. by +2.4%. It increased most in the following industries: ‘manufacture of rubber and plastic products’ (+8.6%), ‘manufacture of transport equipment’ (+7.7%), and ‘manufacture of basic metals and fabricated metal products’ (+6.2%). Employment dropped most in: ‘manufacture of textiles and textile products’ (-8.0%), ‘electricity, gas and water supply’ (-5.6%), and ‘manufacture of leather and leather products’ (-4.9%). The average registered number of employees in industry was 1,144.7 thousand persons. Besides that number, other 30.2 thousand working in industrial organizations were employed by public employment offices and other companies, mostly in the following branches: ‘manufacture of transport equipment’ (8.6 thousand persons), ‘manufacture of electrical and optical equipment’ (6.0 thousand persons), and ‘manufacture of basic metals and fabricated metal products’ (5.5 thousand persons).     
 

Wages
 
In Q1 2006, average monthly nominal wage in the industry reached CZK 18,016 and was +6.1% up year-on-year. The highest level of wages (the average monthly nominal wage per employee) was recorded for: ‘manufacture of coke and refined petroleum products’, ‘electricity, gas and water supply’, and ‘mining and quarrying of energy producing materials’. The lowest level of wages was in: ‘manufacture of leather and leather products’, ‘manufacture of textiles and textile products’, and ‘manufacturing, n.e.c.’    
 

Labour productivity
 
In Q1 2006, labour productivity in the industry went up by +13.4%, growing faster than the average monthly nominal wage. The highest labour productivity increase was reported for ‘manufacture of transport equipment’ (+27.2%), ‘manufacture of wood and wood products’ (+18.5%), and ‘manufacture of machinery and equipment’ (+17.6%). Unit wage costs dropped by –6.4%.  

 
New orders (selected industries)

In Q1 2006, new orders worth CZK 429.2 billion were signed and their volume was +22.7% up on the Q1 2005. The growth was ascertained in: ‘manufacture of motor vehicles’ (+42.3%), ‘manufacture of machinery and equipment’ (+33.7%), and ‘manufacture of radio, television and communication equipment’ (+31.4%). The decrease was recorded for: ‘manufacture of other transport equipment’ (–17.3%), ‘manufacture of wearing apparel; dressing and dyeing of fur’ (-8.7%), and ‘manufacture of pulp, paper and paper products’ (-4.1%).
 
In Q1 2006, new non-domestic orders worth CZK 279.9 billion were signed and their volume was +19.0% up on the Q1 2005.  Increases in the volume of new non-domestic orders were ascertained in: ‘manufacture of machinery and equipment’ (+44.1%), ‘manufacture of chemicals, chemical products and man-made fibres’ (+35.9%), and ‘manufacture of radio, television and communication equipment’ (+31.9%). New non-domestic orders decreased in: ‘manufacture of other transport equipment’ (-25.7%), and ‘manufacture of wearing apparel; dressing and dyeing of fur’ (-14.3%).
 
 
 
Source:   News release - 26 April 2006; Industrial production - Eurostat
               News release - 26 April 2006; Industrial new orders - Eurostat
               http://europa.eu.int/comm/eurostat/