Industrial Survey indicates that employment is growing again in RS

The Industrial Survey of RS, released this Tuesday by the Federation of Industries of the State of Rio Grande do Sul (FIERGS), shows a better scenario for the sector in February 2024, with expansion in production and employment indices – which do not growing since September 2022 –, and lower idleness. Rio Grande do Sul businesspeople consulted in the survey reveal more optimism for the next six months. “There is an expectation of an increase in demand, including exports, and employment”, says the president of FIERGS, Gilberto Porcello Petry, warning, however, that despite this, the research did not change the willingness to invest of industrialists in Rio Grande do Sul, who continue unlikely to make investments in the next six months. The negative note of the month was the accumulated excess stocks.

Industrial production in Rio Grande do Sul grew from January to February, but it was only the fourth expansion in the last 12 months. The production index reached 52.5 points, revealing that the pace was just above the common high for the month, whose historical average is 51.5. Values ​​above 50 denote an increase in production in relation to the previous month.

The main news from the survey was the generation of jobs after 17 months. The number of employees index reached 51 points in February, surpassing the 50 mark, which expresses an increase in employment compared to the previous month, for the first time since September 2022. Since 2011, the beginning of the series, this was the second longest sequence , 16 months, with no advancement in employment in the industry in Rio Grande do Sul. The longest, lasting 40 months, lasted from April 2014 to July 2017.

In February, the industry in Rio Grande do Sul used 70% of its installed capacity (UCI), three percentage points above January, but 0.6 percentage points below the average for the month. The UCI index in relation to the month’s usual figure registered 43.5 points, the highest level in 11 months. It shows that it is still well below the usual level, given by 50 points, despite being closer.

The main concern detected by the Industrial Survey is in relation to stocks of final products, which increased again in February after two consecutive months of decline, and reached levels higher than those desired by companies. The evolution index was 52.1 points, and inventories compared to planned reached 51.6. Above 50, the first denotes an increase compared to the previous month and the second indicates inventories higher than expected by companies.

Expectations
For the next six months, all expectation indices increased compared to February in the survey carried out with 172 companies, 38 small, 57 medium and 77 large, in the period between March 1st and 11th. The result denotes greater and more widespread optimism among businesspeople, who expect an increase in demand (index went from 54.6 in February to 56 points in March), employment (from 52.4 to 52.8), purchases of raw materials (from 53.9 to 54.9) and exports (from 51.1 to 53.5 points).

Even with the greater optimism revealed by the Survey, businesspeople are no longer willing to make investments in the next six months. The intention to invest index remains stable at 54.2 points, which reveals a moderate degree of intention, but above the historical average of 51.3. In March, 58.2% of companies stated that they intended to invest in the following six months.