In Italy, manufacturing production continues to go through a difficult period: in April, the index adjusted for days worked recorded a drop of 4,2% on an annual basis; this is the twentieth consecutive negative variation. The decline accrued in almost all sectors, except in pharmaceuticals, electronics and electrical appliances. The April figure only confirms a period of long crisis experienced by the sector, which has never embarked on a real recovery path since the beginning of the last recession. Compared to April 2008, total production fell by 26,6%, the greatest drops were recorded in means of transport (-38,9%), in electrical equipment (-37,5%), in the production of non-metallic minerals (-34,6%) and in that of metals (-34,1%).
A more contained decline was observed in the food sector (-7,2%), even if it has mostly accrued in recent months; pharmaceuticals, the only sector bucking the trend, records production levels 2,1% higher than those of the first few months of 2008. The depth of the recessionary phase in the entire sector is also demonstrated by the number of consecutive months of negative (annual) variation: 20 for the entire sector, for means of transport and non-metallic minerals; 19 for metals and other industries; 14 in the case of coke and refined petroleum products. In the other sectors, the series of the last two years has been interrupted for at least a month with a positive sign (or no change), but overall the prevalence of negative signs is clear.
However, the situation of the sector in Italy falls within a rather difficult European framework. Assuming the value of the seasonally adjusted manufacturing production index for April 100 to be 2008, this, in the corresponding month of 2013, was equal to 89,3 for all EU-27 countries and 87,7 for the euro area alone. In the latter group of countries, the lowest values are recorded in Greece (where production levels stand at 69,4), Spain (72,1) and Italy (74,2). Slightly better is the position of France (83,6, a value moreover on the rise compared to the previous months) and in Germany, where the activity of the manufacturing sector is only 2,3% lower than pre-crisis levels. Outside the euro area, however, the trend is more varied and generally very good for the countries of Eastern Europe, in particular for Poland, where manufacturing production is approximately 15% higher than the levels at the beginning of 2008 , and above all for Romania, which already in October 2010 had completely recovered the pre-crisis levels and today records production levels 23% higher than those before the great recession.
The continuation of the period of difficulty in the manufacturing sector and more generally in industry determines a gradual impoverishment of skills and production structures which in turn lead to a reduction in production potential. Estimating such a loss is not easy since it is a phenomenon that is not directly observable. In the economic analysis it is possible to obtain it from the degree of utilization of the plants, assuming that the latter reflects the ratio between actual production and potential product.
The measurement thus obtained is not perfect, but it does allow for trend indications over long periods, such as the one characterizing the current phase. A recent survey shows how the two recessions have eroded part of the production capacity in many European countries. In Italy the estimate is of a loss of around 15% between the pre-crisis peak and the fourth quarter of 2012. For Spain the loss is even greater (17,4%), while for France it is estimated at -10,5 %. Germany continues to be the exception, where there was an increase in manufacturing potential of 2,2%, although this is distributed very unevenly across the various sectors. In our country, all sectors contributed to the decline with the exception of beverages, in which a slight increase was observed. The largest declines were seen in motor vehicles and trailers, wood, textiles and non-metallic minerals.
Pharmaceuticals are also estimated to have lost around 6% of production capacity. The French situation is similar to the Italian one: also in this case all sectors record losses in production potential (with the exception of chemicals), and in particular textiles, clothing, motor vehicles and coke and refined petroleum products. The German case is different not only because, as has been said, the potential has increased on average during the years of crisis, but above all because it is the result of an increase in only six sectors. During the period, in fact, they would have lost a (sometimes substantial) portion of their production potential, above all textiles-clothing, non-metallic minerals, furniture, chemicals and paper; however, the average figure is positive thanks to a substantial increase in potential in the motor vehicle sector followed by a less marked increase in the food, pharmaceutical and metal product manufacturing sectors.
The loss of productive potential is not necessarily permanent. It tends to rise again with the recovery of productive activity; the problem is related to timing. For example, it has been estimated that given the loss of production potential at the end of 2012, assuming that a recovery phase immediately brings the use of production capacity back to 80% (historically considered full use in Italy) and assuming a similar quarterly growth in production to that recorded in the period between the two recessions, it would take about six years to rebuild the potential of 2007. These are rather restrictive assumptions that lead us to imagine much longer recovery times.
However, the hypothesis that part of the loss of internal potential may turn out to be permanent due to a shift of part of the productive activity outside the national borders in the case of manufacturing alone does not seem supported by the numbers. Between 2007 and 2010 (the only period for which a comparison is possible) the percentage of foreign manufacturing companies controlled by Italians out of the total manufacturing companies resident in Italy grew (from 1,3 to 1,5%). as well as the weight of employees abroad (from 16,3% to 18,7%); however, in both cases the increase is due to a decrease (in absolute value) of firms and workers higher in domestic manufacturing than in that of foreign subsidiaries, which also occurred. However, the data available do not allow us to verify whether similar considerations are valid in terms of added value achieved.
At the end of 2012, the added value of Italian manufacturing reached 217,9 billion euros, a value which, albeit down, allows us to consolidate our second position among the countries of the euro area. However, our share drops to 16,2%, from 17% in the previous year and above all from 18,6% in 2000. Compared to the EU-27 total, the portion of Italian manufacturing comes to represent 12,3% (13,1, 2011% was the 527,6 share). With 38,6 billion euros of added value, Germany confirms itself as the leading producer country in Europe, with a market share that in the euro area rose from 39,1% to 2012% in 27, and in the EU-29,9 stands at 13,5%, a value that is also growing. For France, the 10,3% share in the euro area remains constant from the previous year, while that of the EU total remains at XNUMX%.
The scenario at the top therefore does not undergo significant changes, even if the gradual estrangement of Germany from the rest of the countries is evident; greater movements, although also slow in this case, are observed in Eastern European countries. Poland, for example, with a market share of 3,4% in the EU has almost doubled its weight since 2000, and today boasts a production higher than that of Austria (3%) and similar to that of the Netherlands ( 3,9%). Romania also sees its share increasing, even if the values are still low: 1,6% in 2011 (latest data available) from 0,5% in 2000; while the Czech Republic remains stable at 1,9% from 1% in 2000. For Eastern European countries, the sector still represents an important portion of the economy today and in general higher than the European average (equal to 15,3 ,15,8 and 24,7% respectively); in Romania and the Czech Republic the weight of manufacturing is equal to 2011% of the total economy (data as of 23,2), in Hungary it is 22,1%, in Slovakia it is 18% while in Poland it stands at around XNUMX%.
The situation is more varied among the main European economies: in Germany manufacturing now accounts for 22,3% of the total added value, a share identical to that of the beginning of the 2009s which only experienced a slight decline during the 19,5 crisis (at 10%). In France, the sector now accounts for 2000% of the total added value due to a gradual decline which has accumulated around 5 percentage points since 10,7. France is therefore behind the United Kingdom, a country where the gradual decline in the sector's weight has stopped at 13,3%. For Spain (a country with a manufacturing traditionally less heavy than the European average) the share of the total economy fell to XNUMX%.
Outside Europe, the manufacturing scenario is increasingly dominated by emerging countries: in the 2011-2012 average, China is confirmed as the first country in the world for market share, with 21,4%, a value that has increased fivefold in the space of twenty years thanks to an average annual growth of the sector equal to 12,4, 15,4%. In second place is the United States (21,8%) which at the beginning of the 2,4s, with a share of 0,8%, produced more than five times the value of Chinese manufactured goods. In twenty years, however, the advantage gradually decreased, until it disappeared, due to a growth that in the first decade did not go beyond 2000% per annum, which decreased to 2012% between XNUMX and XNUMX. The country however, he has not given up on relaunching the sector.
The data indicate, for example, an acceleration of the insourcing process: between 2010 and the first months of 2013, manufacturing jobs increased by 521 units, a phenomenon that had not occurred in the previous phase of economic expansion (2003-2007). Although it is still too early to state that this is a trend reversal and that the United States will be able to recover the disadvantage with China, the presence of a series of factors which play in favor of this recovery must nevertheless be underlined: the support to the made in America declared by the Obama administration, which made it one of the strong points of the 2012 presidential campaign; the shale gas revolution; the increase in labor productivity in the United States and labor costs in China.
The shale gas revolution has led to a sharp reduction in the price of natural gas in the country (in the first months of 2013, one million Btu of gas cost $3,7 in the United States and about $10 in China), which has significantly reduced production costs, especially in the most energy-intensive sectors such as the manufacture of metal products. Furthermore, in some manufacturing sectors, especially those producing durable goods, between 2000 and 2011 there was a significant increase in the average annual productivity of labour: +5,6% in electronics, +4,3% in means of transport, +2,6% in mechanics, +1,2% for metal products. The increase in productivity in China in the same period was greater, but not as much as in other destination countries of American relocations. Finally, although still very low in absolute terms, labor costs in China grew by 15% between 2011 and the first months of 2013; thus the ratio of the average American wage in manufacturing to that of China has risen to one to seven, from one to nineteen in 2006.
After China and the United States, Japan holds the highest share of manufacturing output in the world: 9,6% (down by almost ten percentage points since the beginning of the 6,1s), while Germany in fourth place (with 2011%) loses almost three points in the same period. In the 2012-3,1 average, Italy maintains its seventh position with 2,2%, losing 0,7 percentage points in twenty years by virtue of an average annual growth of -29,9%. In general, among the top twenty producers in the world, the share of the BRICs rises to 7,6% from 2040% twenty years earlier; in the absence of valid policies to support the sector by advanced countries, which enable them to catch up with the Bric, with the growth rates of the last twenty years China, India, Brazil and Russia will be able to produce by 80 about XNUMX% of the value of manufactured products in the world.
