Fear of existence here, full order books there
Delivery bottlenecks and rising procurement prices continue to make it difficult for companies in Lower Saxony to do business – and there seems to be no end in sight.
According to Maike Bielfeldt, General Manager of the Association of Lower Saxony Chambers of Industry and Commerce (IHKN), the order backlog for the local economy is “excellent” and exports are “buzzing”. Industry and many service providers had “plenty of work”. However: “There is a lack of computer chips and skilled workers here.”
For how much longer?
Bielfeldt, who presented the latest IHKN economic climate report in Hanover on Friday, is not sure whether the delivery problems have already peaked or whether it has passed – in her estimation, the whole thing will definitely “last until the end of this year or even until mid-2023 “. Depending on how Corona will play out – especially how the omicron variant of the virus fares in China (known for harsh reactions and closures) and other parts of Asia.
customers have to pay more
For many companies, the ability to deliver depends on the procurement of the preliminary products. According to the survey, two-thirds of companies are currently looking for new suppliers and want to increase stock levels. The strong price increases for material lead to new calculations and, according to Bielfeldt, are passed on to customers by three quarters of the companies.
In the current economic survey at the end of the last quarter of 2021, 67 percent of the companies that responded (2000 were surveyed) named rising energy and raw material prices as a significant risk for their business and 65 percent named the shortage of skilled workers.
Mood a little more subdued
In view of the fourth corona wave and worsening contact conditions, the IHK economic climate indicator for the fourth quarter fell by five points from 111 to 106 points. At least 36 percent (previous quarter: 37) rate their current business situation as good, 50 percent (52) are satisfied and 15 percent (11) say their situation is bad.
expectations lower
The expectations for the coming months are somewhat “clouded”: 18 percent (19) anticipate more favorable business development, 58 percent (60) anticipate business and 24 percent (22) anticipate negative development. According to the IHKN, the overall satisfactory business situation is also reflected in the investment and personnel plans, which were adjusted slightly upwards at the beginning of the year.
Setback for gastronomy and trade
The industry continues to boom. The automotive sector is increasingly coming to terms with the delivery bottlenecks and price increases and is reporting better business development. Expectations have increased noticeably for consumer goods manufacturers alone, who are indirectly affected by the restrictions on the hospitality and retail trades. “The new corona wave is a major setback for retail, the hospitality industry and the affected service providers. That slows down the upswing,” explains the general manager. The climate indicator for hospitality fell from 125 points in the autumn survey to 51 points in the fourth quarter.
Construction: work without end
The construction industry, on the other hand, is doing even better, “the renewed order books are getting thicker and thicker”. However, the lack of staff in particular is slowing down business here, and there are also delivery problems with the material. According to the IHKN, almost all companies in the construction industry are reporting “higher purchase prices, which will continue to drive up construction prices”.
Bielfeldt believes that “we have to get used to rising prices again” and expects growth of “3.5 to 4 percent and 60,000 new jobs” for Lower Saxony this year.
By Ralf Huebner