2015: Manufacturing to bring growth across the EU

Orgalime estimates that the engineering industry’s total turnover value in the European Union reached more than €1800 billion in 2014. The number of employees stood at more than 10.3 million people of which 1.25 million working in installation and repair services. 

Whereas 2013 ended with negative turnover growth in the fourth quarter, 2014 started off very well. All subsectors showed strong growth in the first quarter of the year. However, the overall economic climate then deteriorated, mainly due to geopolitical tensions. This resulted in a poor performance in the second quarter. The third and fourth quarter of the year showed some recovery, but not near the growth levels reached in the first quarter. 

In total, these developments resulted in a modest growth of 1.7% in 2014 as a whole for the European engineering industry. 

Commented Sandro Bonomi, President of Orgalime, “For 2015, Orgalime economists foresee a modest improvement in the overall business climate for the industry in 2015. Growth is expected to continue and increase in strength to 2.1%. This is still below the long-term average growth of around 3%, but better than last year. For 2016, credible economic forecasts predict a further increase of global and European growth. However, the prolonged low inflation in the euro area and geopolitical concerns, such as trade relations with Russia, may negatively affect the expected growth. Therefore, the EU needs to promote geopolitical and financial stability with firm measures.”

The engineering industry accounts for over a quarter of the turnover and a third of the exports of the EU manufacturing industries. There are no EU member-states where the engineering industry is expected to contract, but there will be differences in growth rates between countries. 

Moreover, there are no large differences in growth rates in 2015 among the industry’s most important sectors: electrical, electronics and instruments engineering at 1.9%, mechanical engineering at 2.2% and fabricated metal goods, the best at 2.4%. Trade (intra and extra-European) will grow by an estimated 2.0%. Investment will grow by an estimated 4.4%. 

Concluded Adrian Harris, Director General of Orgalime, “There are risks that Europe cannot control such as uncertainties on our export markets, but the euro exchange rate level is certainly of help today. Our industry, with its rapid technological evolution through digitalisation, remains the cornerstone for sustainable long-term economic growth. We therefore need policymakers both European and national to continue their newfound supportive approach towards manufacturing industry. We expect to see existing political commitments translated into action, with the resulting growth in the economy and employment”.

For further comments, please contact:
Mr Adrian Harris Director General, ORGALIME, Brussels +32 2 706 82 42 adrian.harris@orgalime.org
Mr Kasper Buiting, Chair of Orgalime’s Economists Working Group, Zoetermeer, +31 79 353 13 18 kasper.buiting@fme.nl
Ends

Notes for the Editor: more in download

Published
29 May, 2015
Category
Press release
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