Economic Overview April 2016

Production Productivity Employment, working hours Inflation, output prices Wages, unit labour cost Trade balance Outline (1) Total Economy (2) Industry 2

Total Economy

 Slight improvement in economic growth in the EU in the last two years after a “double-dip” recession.  According to EU forecasts, this trend will continue in 2016 and  Source: AMECO 4

 The economic growth is forecast to pick up in  At least 1.3% GDP increase in every country but two if the predictions materialise. 5

 Increased GDP volumes are expected in all European countries in  At least 0.9 % in every country, but these forecasts might prove too optimistic. 6

 The annual production value was just above the pre-crisis level in the EU in  Spain had lost 3.3%, Italy 8.3% and Greece 26.0%. 7

 Big differences with respect to GDP per capita in Europe.  Four countries below euros per year. The EU average was euros in  No data for Turkey. 8

 A bit more equality when differences in purchasing power are eliminated.  No data for Turkey. 9

 Industry (NACE B-E) accounted for 18.9% of total value added in B= Mining, oil and gas C= Manufacturing D= Energy supply E = Water supply 10

 The total employment in EU- 28 was reduced by 6.8 million from 2008 to  According to forecasts, we will see the level of 2008 again this year (231.2 million). Source: AMECO 11

 The percentage growth for EU-28 will be 1.0% in 2016 according to the latest forecast from the Commission (February 2016).  The highest growth in total employment is expected in Turkey (2.8%). Source: AMECO 12

 The forecast for 2017 is 0.9% in EU-28.  Again we find the highest growth figures for Turkey.  Spain is recovering losses from previous years. 13

 Employment still below pre-crisis levels in the EA- 19, EU-28 marginally above.  Greece lost 16.2% of its employment during these nine years, Latvia 17.2%. 14

 Industry (NACE B- E) accounted for 15.6% of employment in the EU-28 last year. B= Mining, oil and gas C= Manufacturing D= Energy supply E = Water supply 15

 Big differences between the countries.  The average working hours are longest in Poland (not much part- time work).  No data for Turkey, Norway, Switzerland and some others. 16

 The average number of yearly working hours lower than in 2007 in most countries.  No data for Turkey, Norway, Switzerland and some others. 17

 9.4% unemployment in EU-28 last year.  Big differences between the countries.  Spain and Greece both over 22%.  No data for Switzerland. 18

 Unprecedentedly high levels of unemployed people under 25 years.  Greece still over 50%. Only three countries below 10%.  No data for Switzerland. 19

 4.9% growth in productivity in the EU since  Nine countries above 10%. Highest increases in new EU Member States, Ireland and Spain.  No data for Turkey. 20

 Nominal wage increases have exceeded real labour productivity growth in all countries except Greece, Ireland and Portugal since

 Real unit labour cost has fallen in 15 countries since 2007, meaning that the wage share of GDP has gone down and the capital share has grown. 22

 Germany had a surplus in its foreign trade of billion euros last year.  France and UK had deficits of million between them. 23

 The Netherlands exported goods and services worth billion euros more than it imported from other EU member states last year. 24

 Germany has the highest trade surplus also with countries outside the EU. 25

Industry

 EU average 19.1% when mining, petroleum production and energy supply are included.  Norway on top because of big oil and gas sector.  No data for Turkey. 27

 Manufacturing sector has greatest relative significance in the Czech Republic, Hungary, Slovenia and Germany.  The EU average is 15.5%.  No data for Turkey. 28

 Industrial production in the EU-28 seems to be growing and regaining some of the previous losses.  Source: Eurostat, Short-term business statistics. 29

 Most positive developments in new EU member states and Ireland.  Stagnation in Germany. Reduction in EU and EA. Four countries have lost more than 20%.  No data for Switzerland. 30

 Biggest reduction in the mining sector and clothes’ production sector since  Five subsectors have higher volumes that before crisis, pharma plus 28.3%. 31

 Industrial employment in the EU was 3.8 million lower in 2014 than in  The current level is almost as high as in  Slight increase in

 Germany has over 8 million jobs in industry.  8 countries have more than one million, also Romania and the Czech Republic. Poland is now number 3.  No data for Turkey. 33

 Almost all countries in the red. Industrial employment heavily under pressure. Germany only positive exception. Reduction in Spain close to 30%. Average drop in EU and EA higher than 10%.  No data for Turkey, Switzerland, Norway and some others. 34

 All sectors are in the red but MET industries, energy supply and pharmaceuticals have done better than the rest. 35

 Increase in seven countries, but not very dramatic.  No data for Turkey, Switzerland, Norway and some others. 36

 In EU real labour productivity per hour in the industry has gone slightly up since the onset of the crisis. Increase in Romania: 67.3%.  No data for Turkey, Switzerland, Norway and some others. 37

 Big variations with respect to wages per employed person (total gross wages divided by number of employees).  No data for Turkey, Switzerland and some others. 38

 The lowest average gross wages in industry are just over 3 euros per hour.  No data for Norway, Turkey, Switzerland and some others. 39

 Wage increases highest in the East and South East since the crisis. 40

 Low inflation rates in most countries since the onset of the crisis.  Highest growth in Turkey and Iceland.  EU average only 15.4% in nine years. Even lower in the euro zone. 41

 Exceptionally low inflation in  0.0% in EU and EA  Turkey (not in chart) had 7.7%. 42

 Inflation in the EU is forecast to pick up again.  Still far from ECB target of close to 2.0%. 43

 Growth in most countries, but in Cyprus, the UK and Luxembourg real wages per hour in industry have actually fallen since the crisis began.  No data for Norway, Switzerland and some others. 44

 Gross wages and salaries have increased faster than production in almost all European countries since  The average increase in EU-28 was 18.9%. 45

 The picture is diverse.  Germany, Italy, France and Spain are among the countries with increased RULC in the industry since

 Industrial companies have increased their producer prices in most countries since But reductions in most countries since  No data for Portugal, Turkey, Switzerland or Norway. 47