FAZIT Company Survey – Sentiment of Firms in the State of Baden-Württemberg Cools Down Significantly

In summer 2008, nearly 24 per cent of the firms in Baden-Württemberg assess their business situation as positive. With 23 per cent a nearly equal part currently finds itself within a negative business situation. Thereby, the positive sentiment registered in the two previous FAZIT surveys has cooled down significantly. These are the findings of the sixth FAZIT Company Survey conducted by the Centre for European Economic Research (ZEW) in summer 2008 in the state of Baden-Württemberg.

While positive and negative assessments concerning the current business situation are in balance, there are clear differences between the considered sectors. The positive sentiment of firms in the manufacturing industry is especially marked, just as it has been in the previous survey. About 46 per cent of these companies assess their business situation as positive; further 43 per cent assess the situation as satisfying. Only 12 per cent report a negative business situation.

The sentiment within the banking and insurance sector of Baden-Württemberg has considerably improved. “Here, the extraordinary positive expectations we had the moment of the previous survey have been fulfilled”, says Katrin Schleife, researcher at ZEW. “Only about six per cent of this sector’s firms assess the current business situation as negative, while in the previous survey of autumn/winter 2007 it had been 32 per cent.”

However, the companies of the IT and media sector, the technic service providers, and the transport providers see themselves facing a deterioration of the business situation compared to autumn/winter 2007. While the balance of positive and negative assessments in the IT and media sector is still positive, negative assessments dominate the transport providers and the technical service providers. Considering size, it is especially the great companies that assess their business situation positively, just as it has been in the previous survey.

Concerning the assessment of the development of the business situation over the next six months, companies of the manufacturing industry, as well as the banking and insurance sector do have clearly more positive expectations for the future than companies of the other sectors. A great majority of the firms in the manufacturing sector as well as the banking and insurance sector expects an improved or stable business situation for the next six months, whereas, transport providers and technical service providers rather expect a deterioration of their business situation. With a balance of three percentage points positive business expectations dominate scarcely within the IT and media sector.

All in all, companies in the state of Baden-Württemberg expect an increase of personnel over the next 12 months. On the other hand, it is the transport providers that weaken the overall positive outlook. In this sector, five per cent on balance of the companies want to reduce personnel, while companies of the other considered sectors rather expect an increase of personnel. With a balance of 20 per cent, the positive expectations in the manufacturing industry are revealed especially clearly.

The bigger the companies, the more often they plan to augment personnel. While 92 per cent of the companies with up to four workers expect an unmodified amount of personnel over the next 12 months, at least 52 per cent of the companies with at least 250 workers want to augment personnel. Further 11 per cent of these big companies expect sinking and 38 per cent stable amount of personnel.

FAZIT Company Survey

The “Research Project for Current and Future IT and Media Technologies and Their Use in Baden-Württemberg” (FAZIT) is a non-profit research project fostered/promoted by the federal state of Baden-Württemberg. More than 1.000 firms of Baden-Württemberg from the IT and Media sector (software, data-processing service providers, IT and media hardware, telecommunications, audio-visual media, printing and publishing, advertising and market communication, content service providers), as well as from other sectors that utilize IT and media technologies (chemical industry, mechanical engineering, medical, measuring, controlling technology, car manufacture, transportation, banking and insurance sector, research and development, and technical service providers) participated in the current survey.

Contact

Dr. Katrin Schleife, E-mail: schleife@zew.de