National Report Regional Network - February 2004

Summary

• Developments in output and employment are positive for the entire manufacturing sector. Increased household demand and consumption are making a positive contribution to domestically-oriented manufacturing. The export industry reports that growth is stronger now than last autumn.
• Although most types of export-oriented businesses report positive developments, some industries are experiencing problems with global competition. For example, the shipbuilding industry has considerable problems winning new orders. The domestically-oriented shipbuilding industry is also struggling.
• Growth in demand for corporate services is accelerating. This is also the case for building and construction. Residential construction and public sector projects in particular seem to the driving forces. In both sectors, developments are positive in all regions.
• There is still solid growth in retail trade and the household service sector.
• Despite the improved cyclical situation, few private sector enterprises have plans to increase investment. Wholesale and retail trade and the public sector are the only sectors that are planning moderate increases in investment in 2004.
• Employment does not appear to be rising in pace with the increase in demand and activity. Building and construction and wholesale and retail trade report moderate growth in employment, whereas there is no growth in employment in manufacturing, the service sector and the public sector.
• Annual wage growth is expected to be 3 per cent for manufacturing, 3.5 per cent for service industries and 4 per cent for the public sector.
• Selling prices are reported to be stable or slightly rising. Due to intense competition and customer power, the possibility of adjusting prices is perceived to be very limited. A moderate rise in profitability is reported throughout the private sector.