Austria‘s manufacturing sector has ended 2024 with a ‘sharp and accelerated drop in output’, the latest edition of the UniCredit Bank Austria Manufacturing Purchasing Managers’ Index (PMI) has found.
The index fell to 43.3 in December, indicating a continued downturn in the country’s manufacturing sector, which was driven by a reduction in both output and new orders.
‘Another difficult year’
‘Latest PMI data showed a marked deterioration in manufacturing business conditions across Austria in December, bringing to an end another difficult year for the sector,’ UniCredit Bank Austria said in a statement. ‘Rates of decline in both output and new orders reaccelerated after having slowed midway through the final quarter of the year, while there was another notable drop in factory employment.
‘Moreover, the outlook for 2025 was bleak, with slightly more firms expecting a fall in output over the next 12 months than those anticipating a rise.’
The contraction was notable across all industrial sectors, while employment in factories decreased as firms scaled down staffing levels due to weaker demand and lower production needs.
‘Output was generally scaled back in line with new orders, which likewise registered a sharp and accelerated rate of contraction at the end of the fourth quarter. Reports from surveyed firms
highlighted a range of factors weighing on demand, including a lack of appetite for investment, delayed decision-making and customer insolvencies,’ the bank noted.
Consumer demand
Weaker consumer demand, coupled with lower production requirements, also led producers to reduce stock levels yet further during December, however the rates of depletion of both pre- and post-production inventories was slower than in November.
Elsewhere, input costs decreased, however the rate of decrease was modest compared to recent periods. Average factory gate prices fell at a more solid pace, albeit again at a softer rate of decline than in November.
Commenting on the future outlook, the bank added, that ‘December’s survey indicated a deterioration in business expectations across the Austrian manufacturing sector. Although the decrease in confidence was only slight, it was significant in that it meant sentiment towards future output was back in pessimism territory.’ Read more here.
