Services - 3. quarter of 2004

 Sales in measured services grew by 1.9% y-o-y , which was by 2.8 points less than in the 2nd quarter of 2004. Development of some kinds of services significantly depends on the number of working days, which was by 3 days lower than in the 3rd quarter of 2003. That was one of the factors affecting the growth rate slowdown; another was a high comparing base of 2003. After working days adjustment and seasonal adjustment, sales rose by 3.0% y-o-y (+3.8% in the 2nd quarter).

 While sales in all basic services aggregates – total retail trade, transport, post and telecommunications and selected market services – were higher than in the 3rd quarter of 2003, total retail trade (which accounts for nearly three-fifths of the total), for example, recorded the lowest growth since 1999. Also the rate of growth of transport, post and telecommunications, just like that of selected market services, slowed considerably down, compared to preceding quarters of 2004.

In terms of quarter-on-quarter comparison, seasonally adjusted constant price sales increased by 0.4%, which was particularly affected by total retail trade (+1.5%); sales in transport, post and telecommunications and in selected market services dropped (-0.1% and -2.6%, respectively).

The y-o-y growth of sales in the automotive segment in the 3rd quarter was moderate. The underlying reason was lower ‘sale and repair of motor vehicles’ in July (due to 3 working days less) and September (caused inter alia by a high comparing base of 2003 – the demand grew in September 2003, as legislative changes were being prepared aimed at the cancellation of VAT deduction when a “field car” was purchased). Thanks to growing goods transport by road, ‘sale of automotive fuel’ was up 3.5% (the highest growth rate if compared to preceding quarters of 2004). Retail trade sales rose slightly less than in preceding quarters (and almost twice slower than in 2003). Sale of food, beverages and tobacco increased by 1.8% (the rate was set by ‘non-specialised stores with food, beverages and tobacco predominating’), sales in stores with non-food goods grew faster (+2.6%), even though sales in non-specialised stores within this group of stores stagnated. ‘Sale of textiles, clothing and footwear in specialised stores’ has risen for the sixth successive quarter, and the 3rd quarter of 2004 saw the highest y–o-y growth since 1997 (+13.6%). Also ‘electronics, furniture and household articles and appliances’ sold well (but not as much as in the 1st half of the year), the growth reached 5.4%. Conversely, ‘other retail sale in specialised stores’ fell by 0.1%. Sale of ‘pharmaceutical and medical goods, cosmetic and toilet articles’ grew by 4.2% (like in the 1st half of 2004). Although ‘sale via mail order houses’ was up 8.9% in the 3rd quarter, this sale in the 1st-3rd quarters dropped (–3.3%).

The fall in hotels and restaurants was affected by trend in ‘restaurants, bars and canteens and catering’. The decrease started in May when VAT rate in this segment was raised and reached 7.7% in the 3rd quarter. On the other hand, sales in ‘hotels, camping sites and other provisions of short-stay accommodation’ grew by 4.8%.

 

Sales in transport grew less dynamically than in preceding quarters (+4.9%). The rate of growth decreased in all important kinds of transport: sales in ‘transport via railways’ recorded even a drop of 1.1%, in ‘transport by road’ grew by only 2.7% and in ‘air transport’ by 1.7%. The trend of volume indicators (number of passengers, number of person-kilometres) in air transport proved a high growth of outputs. However, sales went up less, which suggests that travellers preferred less expensive air tickets. ‘Supporting and auxiliary transport activities' reached the highest increase among all kinds of transport (+8.8%), but this increase was largely affected by higher sales of goods by some enterprises classified as supporting activity. The only kind of transport where sales rose markedly was ‘water transport’, but its share in total sales is insignificant. The cause was low water in preceding year. The y-o-y growth rate in post and telecommunications has decelerated since the 2nd quarter of 2003. Sales in ‘telecommunications’ were up by 2.5%; lower ‘postal services’ by 1.2% were mainly influenced by fewer working days.

 

Sales in computer and related activities dropped by 1.5% in the 3rd quarter of 2004, as against a record-breaking rise in preceding quarter. The growth of the most important activity in terms of volume – ‘software consultancy and supply‘ came to an end and the fall in sales in the areas of ‘database activities‘ and ‘maintenance and repair of office, accounting and computing machinery’ increased. Other business activities raised their sales by 2.2%. Predominantly sales in ‘legal, book-keeping and auditing activities and tax consultancy‘ and in ‘architectural and engineering activities‘ set the dynamics. The growth of sales in ‘labour recruitment and provision of personnel‘ continued; it reached double-digit figures in each quarter of 2004, but its effect on the whole CZ-NACE division was very small because of its low volume. A stable trend kept on also in ‘industrial cleaning‘ where sales have gone up since 1997. On the other hand, sales in ‘miscellaneous business activities n.e.c.‘ dropped; so did sales in ‘investigation and security activities‘, for the first time since 1998. Other service activities recorded lower sales (-4.5% y-o-y). A slight increase in sales of ‘washing and dry-cleaning of textile and fur products‘ could not offset a massive fall in ‘hairdressing and other beauty treatment‘ (-7.2%), which is more important in terms of volume.¹

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¹CZ-NACE 50, 52, 55, 60, 61, 62, 63, 64, 72, 74, 93 – Services
CZ-NACE 50, 52, 55 – Total retail trade
CZ-NACE 50, 52 – Retail trade incl. automotive segment
CZ-NACE 50 – Automotive segment
CZ-NACE 52 – Retail trade
CZ-NACE 60, 61, 62, 63, 64 – Transport, post and telecommunications
CZ-NACE 72, 74, 93 – Selected market services