Industrial output and employment down in 2014

The Brazilian industry closed out 2014 stricken by lower levels of production and employment, and a raise in idle capacity, according to figures from the Industrial Survey, published today (Jan 27) by the National Industry Confederation (CNI).

The study shows that, in December last year, the evolution index for production stood at 38.3 points, compared to the previous December's 40.2. The rate for the number of employees, in turn, was reported at 44.2 points last December, thus lower than the 46.4 points observed in December, 2013.

With indicators below 50 points—on a scale from zero to a hundred—CNI describes the sector as on the wane, both for output and employment. Rates for December 2014 are the lowest since January 2010, the beginning of the historical series.

Data from the survey further reveal that the average use of installed capacity was seen at 68%—the figure for a December since 2011. Nonetheless, according to CNI representative Marcelo Souza Azevedo, the indicator stood at 50.5 points in 2014.

The survey also discloses that the financial situation facing companies has deteriorated in the last quarter of 2014, as seen through the rate on financial situation (46 points) and the index on satisfaction with operational profit (40.6 points), driven by the hikes in raw material prices. Easy access to credit has also reported a lower index: 36.8 points.

The scenario, as ascertained by CNI in the survey, is a sign of “insatisfaction”. The tax burden is mentioned by 59.7% of respondents as the main problem challenging business in the last quarter of 2014, followed by shortage in demand (38.5%).

CNI's study was conducted from January 5 through 15, and covers 2,186 companies—874 of which small, 788 medium, and 524 large-scale enterprises.

Translated by Fabrício Ferreira