Home News Further positive outlook for the MEM industries
Contact Person  Ivo Zimmermann Ivo Zimmermann
Head of Unit
+41 44 384 48 50 +41 44 384 48 50 i.zimmermannnoSpam@swissmem.ch

Further positive outlook for the MEM industries

The Swiss mechanical and electrical engineering industries (MEM industries) posted very good results in 2007: exports grew by 12% to CHF 78 billion, while sales were up 14%. Swissmem member companies expect to see a largely stable market trend in the current year.

New orders received by Swissmem's 290 reporting members showed a marked increase in 2007, up 22.3% on the year-back period. International orders (21.3%) grew as markedly as domestic orders, which were up 25.8% from the previous year. The export ratio at the end of 2007 was 80.5%. In the fourth quarter of 2007, new orders were 14.4% up on the year-back period. Both the international (14.9%) and the domestic business (12.4%) exceeded the previous year's good results.

The MEM industries lifted sales in 2007 by 13.9% year-on-year. Exports were up 13.6% and domestic sales 14.8%. The good economic situation was also reflected in higher employment figures: the companies created 13,706 (+4.2%) full-time jobs within one year, with growth over a three-year period amounting to 31,897 positions (10.4%). In the third quarter of 2007, the MEM industries had 338,785 full-time equivalents on their payroll, while capacity utilization at the end of the year stood at 90.9%, the same as the year-back level.

Marked rise in exports

The MEM industries' global exports totalled CHF 78.1 billion in 2007, an increase of 11.7%. Growth was particularly dynamic in the European and Eastern markets. Exports to the EU grew by 13.4%, while those to the USA (-0.2%) languished at the year-back level. Exports to the key European markets of Germany (14.0%), France (13.2%), Italy (13.5%) and Austria (18.1%) all recorded double-digit growth. Exports to the two largest new EU member states, Poland and the Czech Republic, grew at above-average rates of 34.4% and 22.6% respectively. Marked growth was also achieved in exports to Russia (41.6%) and Hungary (46.8%). Exports to Asia – the second most important export market for the Swiss MEM industries, accounting for 15.2% of the total – rose by 11.1%. Sales to China, which accounts for 3.7% of the Swiss MEM industries' exports, grew by 23.3%.

In 2007, the Swiss MEM industries performed very well thanks to robust growth of the global economy. Despite the current turbulence in the financial markets, the outlook for the MEM industries has hardly changed at all. Capacity is being utilized across the board and the strong level of new orders has secured the earnings situation for the coming months. The companies surveyed expect to see more robust growth stimuli for the next twelve months, particularly from Eastern Europe, China and India.

Political goals for 2008

Both politically and economically, Swissmem is in no doubt that free movement of persons is of key importance not only to the MEM industries, but to the whole of Switzerland as a business location. An open EU labour market has direct benefits for export-focused industry in particular. It simplifies hiring and secondment and is essential to the sector. As the largest industry association, Swissmem advocates not only continuing to allow the free movement of persons, but extending the arrangement to the two new EU member states of Bulgaria and Rumania. Swissmen regards the delaying tactics employed in certain circles as economically damaging and politically reckless since they jeopardize the Bilateral Agreements.

In the education sector, a new law aimed at setting up a single tertiary-education domain is currently in the consultation phase. Swissmem welcomes this goal, but considers that the draft of the law requires a thorough overhaul. The proposed dual-level management structure is far too complex. Swissmem considers it essential that, alongside the priorities of the political organs, business should also be given an opportunity to contribute its experience to the steering committees.

Swissmem largely welcomes the thrust of the Federal Council's proposed policy on climate change. However, Swissmem regrets that the Federal Council has no suggestions as to how to fill any gap in electricity provision. It is therefore a strategic error to rule out the nuclear power option. Provision should be made now to ensure that we continue to have access to sufficient electricity at an affordable price.

Zurich, 27 February 2008

For further information please contact:

Swissmem Communication, Jonas Lang,

Tel. +41 (0)44 384 48 33 / mobile: +41 (0)79 777 41 36

E-mail: j.langnoSpam@swissmem.ch