Small enterprises are lagging behind in manufacturing industry

Based on the manufacturing sentiment survey firms are feeling moderately well at the time being and their outlook is also moderately good. Both indices are at 57 points – this is somewhat worse than some months before but still better compared to the previous years.
Manufacturing is fuelled by machinery in Hungary and by IT sector in the Euro zone. All sub-divisions have good outlooks for this year, although production forecasts are worsening slowly quarter-to-quarter. Still, the indicator is well above the annual average of the past years. Meanwhile companies reported shrinking inventories besides improving stock of orders. Level of EU export orders has somewhat decreased compared to the previous quarter, although it is still considered to be moderately good. Capacity usage is around 77%.
The most problematic factor of the Hungarian manufacturing industry is polarisation. The difference between small and large enterprises is statistically significant; large firms are in much better situation, while companies having less than 10 employees are operating in much worse circumstances. Both subjective and objective indicators of small companies are worse. Skilled labour shortage is also a problem for the sector and smaller firms are most probably not able to cope with the situation. EU funding (both the public procurements and payment) are really missing from the system which worsens the economic environment for small enterprises.