Economic Overview

June 2015

•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.

According to EU forecasts this will continue in 2015 and 2016.

Source: AMECO

4

Increased GDP volume is expected in almost all European countries in 2015.

However, less than 1% growth in five countries.

Only 0.5% in Greece which has lost 25.6% since the crisis.

5

The economic growth is forecast to pick up further in 2016.

At least 1% GDP increase in every country if the predictions materialise.

6

The annual production value was just above the pre-crisis level in the EU in 2014.

Spain has lost 4.9%, Italy 8.7% and Greece 25.6%.

7

Big differences with respect to GDP per capita in Europe.

Four countries below 8,000 euros per year.

The EU average was 27,300 euros in 2014.

8

A bit more equality when differences in purchasing power are eliminated.

9

Industry (NACE B-E) accounted for 19% of total value added in 2014.

B= Mining, oil and gasC= ManufacturingD= Energy supplyE = Water supply

Source: Eurostat, National Accounts.

10

The total employment was reduced by 7 million from 2008 to 2013.

It will take another 2-3 years before we again see the level of 2008.

Source: AMECO

11

Employment still below pre-crisis level in the EU 28 and EA 19.

Turkey most positive with 29.4% increase since 2007.

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Industry (NACE B-E) accounted for 16% of employment in the EU28 last year.

B= Mining, oil and gasC= ManufacturingD= Energy supplyE = Water supply

Source: Eurostat, National Accounts.

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Big differences between the countries.

Long hours and little part-time work in Poland.

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The average number of yearly working hours lower than in 2007 in most countries.

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Big differences between the countries.

Spain and Greece both over 24%.

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Unprecedentedly high levels of unemployed people under 25 years old.

Spain and Greece over 50%. Only two countries below 10%.

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A slight growth in productivity in the EU since 2007.

Nine countries above 10%.

Highest increases in new EU member states and Spain.

18

Nominal wage increases have exceeded real labour productivity growth in all countries except Greece, Cyprus and Ireland since 2007.

19

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

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Germany had a surplus in its foreign trade of 215 billion euros last year.

France and UK had deficits of 162 million between them.

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The Netherlands exported goods and services worth 180 billion euros more than it imported from other EU member states last year.

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Germany has the highest trade surplus with countries outside the EU.

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Industry

EU average 19% when mining, petroleum production and energy supply are included.

Norway on top because of big oil and gas sector.

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Manufacturing sector has greatest relative significance in the Czech Republic, Hungary, Slovenia and Germany.

EU average is 15%.

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Industrial production in the EU28 seems to be levelling out.

Source: Eurostat, Short-term business statistics.

27

Most positive developments in new EU member states

Stagnation in Germany.

Down in EU 28 and EA 19: 8-9%.

Four countries have lost more than 20%.

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Biggest reduction in the mining sector & clothes’ production sector since 2007.

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Industrial employment in the EU 3.9 million lower than in 2008.

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Germany has 8 million jobs in industry.

8 countries above one million, also Romania and the Czech Republic.

Poland is now number 3 (no data for Turkey).

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Almost all countries are in the red. Industrial employment heavily under pressure.

Germany is the only positive exception.

Reduction in Spain close to 30%.

Average drop in EU and EA higher than 10%.

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

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Increase in seven countries, but not very dramatic.

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In EU 28 the real labour productivity per hour in the industry has gone slightly up since the onset of the crisis.

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Big variations with respect to wages per employed person (total gross wages divided by number of employees).

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The lowest average gross wages in industry are just over 3 euros per hour.

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Wage increases highest in the east and south east since the crisis.

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Low inflation rates in most countries since the onset of the crisis.

Highest growth in Turkey and Iceland.

EU average only 15.4% in eight years. Even lower in the euro zone.

39

Exceptionally low inflation in 2014.

Only 0.4% in EA19.

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Growth in most countries, but in Cyprus, the UK and Luxembourg real wages per hour in industry have actually fallen since the crisis began.

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Gross wages and salaries have increased faster than production in almost all European countries since 2007.

The average increase in EU 28 was 19.2%.

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The picture is diverse.

Germany, Italy, France and Spain are among the countries with increased RULC since 2007.

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Industrial companies have increased their producer prices in most countries since 2007 (by more than 20% in nine countries).

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