For the first time in five quarters, the moderate upturn in the fourth quarter of 2012 raised hopes of a reversal in the business trend for the MEM industries. Sadly, however, the reversal failed to occur in the first quarter of 2013. During the first three months of 2013, Swissmem reporting companies experienced a drop in new orders of 0.8% compared to the same quarter last year. In particular, domestic orders declined by a substantial 7.1%.
Sales performance during the first quarter of 2013 was also negative, receding by a total of 3.9%. Once again, sales declined more steeply in Switzerland (-7.8%) than abroad (-2.4%). Looking at the index values for recent years shows that sales by the MEM industries have been stagnating since the beginning of 2010. This applies to both large companies and SMEs, although the larger companies tend to have produced better figures than the SMEs.
Despite this, there has been a slight year-on-year increase in new orders from abroad for three quarters now. This indicates that the MEM industries’ efforts to compensate for their currency-related disadvantages are slowly starting to bear fruit. The slight weakening of the Swiss franc against the euro over re-cent months is also helpful. The recessionary trend in the EU, the MEM indus-trie’s chief market, could be the main reason why the hoped-for growth stimuli have failed to materialize.
Capacity utilization and exports continuing to shrink
The weak growth in incoming orders is affecting capacity utilization in the MEM industries, which fell from 83.6% in the fourth quarter of 2012 to 82.2% in the first quarter of 2013. This puts is substantially below its longstanding average of 86.2%. According to KOR, however, capacity utilization rose to 83.4% again in April.
Exports by the MEM industries declined by 5.5% in the first three months of 2013. All regions contributed to this negative result. Exports to Asia, the EU and USA fell by 9.4%, 4.5% and 3.8% respectively. However, export perfor-mance in the individual product categories reveals significant differences. Mechanical engineering (-9.2%) and metal (-9.0%) exports were heavily down, while the decline was less pronounced in electronics and electrical engineering (-4.6%). By contrast, exports of precision instruments increased by 2.7%.
Despite the disappointing performance in the past three months, the compa-nies in the MEM industries expect the business situation to improve. 42.1% of companies surveyed anticipate a rise in new orders – primarily from abroad – over the next 12 months.
Good operating structures more essential than ever
Since no growth stimuli have been forthcoming for some considerable time, it is all the more important to avoid imposing additional strain on industry. In addition, restricting the freedom of the labour market in the way being de-manded by various popular initiatives (e.g. the "1:12" and "minimum wage" initiatives) would impair the competitiveness of the heavily export-oriented MEM industries. Furthermore, political and administrative bodies should avoid adding further regulation to the economy. The Swiss MEM industries need operating structures that promote entrepreneurial initiative to support their efforts to regain their international competitiveness and return to a growth trajectory.
Zurich, 21 May 2013
For further information, please contact:
Ivo Zimmermann, Head of Communications
Tel.: +41 (0)44 384 48 50 / mobile: +41 (0)79 580 04 84