Posted Jul 21, 2022, 10:29 AM
The morale of business leaders continues to crumble. The business climate deteriorated a little in July, INSEE said on Thursday. The indicator that summarizes it, calculated from the responses of business leaders in the main market sectors, lost 1 point. At 103, however, it remains above its long-term average (100).
“This slight deterioration” is explained by lower “general prospects” in the service sector and by the fact that more and more companies are worried about their order books in industry, explains INSEE. The resurgence of inflation, the slowdown in economic activity, the multiple repercussions of the war in Ukraine and the shortages of labor and supplies are weighing a little on the morale of the bosses.
In services, the associated balance of opinion fell by 3 points but remained above its average. Recruitment difficulties are reaching particularly high levels, underlines INSEE. The balance of opinion for the planned workforce fell for the fourth month in a row.
In industry, the business climate is also darkening. This is explained by a fall in the balance of opinion on the past trend in production (-6 points compared to June). A deterioration is also to be observed in terms of overall order books (-3 points), while the balance of opinion on the expected trend in selling prices has fallen sharply (-18 points), while remaining very high compared at its average.
As for the other sectors, the business climate is relatively stable. That of construction is also changing a little but remains favourable, while that of retail trade and wholesale trade is unchanged. It should be noted that the employment climate recovered somewhat in July 2022, after three consecutive months of deterioration. The indicator gained 2 points and reached 109, well above its long-term average (100).
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