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Manufacturing Industry Surpasses Last Year’s Activity Level, With Jobs and Hours Worked on the Rise, but Payroll and Average Income Falling.
The manufacturing industry remained above the level recorded in the previous year, according to data released by CNI. The Industrial Indicators survey for the month of July highlights that there was growth in both employment and hours worked in the sector. Despite this, there was a decline observed in payroll and average income for workers. This data contrasts with the stability in revenue and the utilization of installed capacity (UCI).
In the context of the industrial sector, the manufacturing industry shows signs of resilience in facing economic challenges. Although job creation and the increase in hours worked are positive points, the reduction in wages and average income raises concerns among analysts. The maintenance of industrial activity at levels higher than last year evidences the sector’s resilience. However, attention is now turning to the possibility of wage improvements in the future.
Performance of the Manufacturing Industry
According to the Industrial Indicators survey by the National Confederation of Industry (CNI), the manufacturing industry had a positive performance in the first seven months of 2024, compared to the same period in 2023.
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Marcelo Azevedo, CNI’s Economic Analysis Manager, highlighted that, even with some variables analyzed, such as industrial activity and average income, showing a drop from June to July this year, the overall outlook is optimistic. ‘The Industrial Indicators for July highlight that the level of activity in 2024 remains above that recorded in 2023,’ he stated.
Indicators Show Improvement
Although some variables have declined from June to July, when comparing the period from January to July this year with the last year, all variables show growth, some significantly. Both variables related to activity, such as revenue and the use of installed capacity, and those linked to the labor market, such as income and payroll, showed noticeable increases, evaluated Marcelo Azevedo.
Employment and Hours Worked on the Rise
Employment in the manufacturing industry rose 0.2% from June to July 2024. This indicator has been gradually increasing since April and has not shown a negative result for ten months. Compared to July 2023, the increase was 2.2%. In the first seven months of 2024, employment in the industrial sector grew 1.7% compared to the same period last year.
Another positive indicator was the number of hours worked in production, which increased 0.9% in July compared to June. In the last nine months, seven of them recorded an increase in hours worked. Compared to July last year, there was a growth of 7.9%, and in the cumulative total for 2024, the increase was 3.4% compared to 2023.
Stability in Revenue and Utilization of Installed Capacity
The CNI survey indicated that the real revenue of the manufacturing industry remained practically stable (+0.1%) from June to July 2024, after seasonal adjustment. Compared to July last year, there was an increase of 15.2%, and in the cumulative total for the year (January to July), growth was 3.4% compared to the same period in 2023. This indicator reached its highest level since January 2021. The Utilization of Installed Capacity (UCI) remained at 79.5% in July 2024, showing an improvement of 1.6 percentage points compared to July last year. The average UCI in the first seven months of 2024 was 0.7 percentage points higher than the 2023 average.
Payroll and Average Income in Decline
In July 2024, the real payroll of the manufacturing industry fell 3.6% compared to June. Since March this year, this indicator has shown significant fluctuations, alternating between increases and decreases. Despite the monthly reduction, there was a growth of 0.9% compared to July last year. In the cumulative total for the first seven months of the year, the increase was 3.4% compared to the same period in 2023.
The real average income also had a drop of 3.7% in July 2024 compared to the previous month. This indicator has followed a similar pattern to payroll in recent months, with fluctuations between highs and lows. Compared to July 2023, the average income decreased by 1.2%, but maintains a positive trend in the cumulative total for the year compared to last year.
Source: CNI Press
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