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UBS SME barometer: Industrial companies still under pressure

Zurich Media Switzerland

The barometer for small and medium-sized industrial companies fell from -0.16 points in October 2016 to -0.38 points in January 2017. The barometer for large companies saw a bigger 0.33-point drop to -0.56 points. In contrast, the economic situation for service providers in both business groups (SMEs and large companies) has improved slightly.

Zurich, 9 March 2017 – The small 0.22-point drop in the SME barometer in January was primarily due to fewer incoming orders and lower production levels compared to the previous month. Optimistic expectations about future production levels went some way toward preventing a bigger decline. Fewer incoming orders and lower production levels also contributed to the slump in the business group for large companies. In addition, large companies have a far less optimistic view of the future economic situation. The month's barometer values of -0.38 of a point for SMEs and -0.56 of a point for larger concerns are below their long-term averages. The ever cautious economic outlook is the most likely reason why industrial companies in both business groups still assert that their current employment levels are too high.

A glimmer of hope for service providers

While the large service companies rated their economic situation in January as being much better than in the middle of last year, SMEs' assessment remains unchanged. Better earnings and increased demand probably contributed to the more optimistic view of large service companies. Although industrial companies in both business groups still consider employment to be very high, service providers rated it as just right, regardless of their company size.

Large retailers cautiously optimistic

Though most retailers assessed their business situation as still poor, both SMEs and large companies managed to put the brakes on the downward trend. Large companies in particular appeared optimistic about future revenues, but less so when it came to price behavior. SMEs, however, expect to see sales prices stabilize in the second quarter.

Trend reversal for large companies in the tourism industry?

Large companies in the tourism industry rated their economic situation as good for the first time since the exchange rate floor was lifted in January 2015. This improvement is corroborated by the majority of the sub-indicators. As a result, revenues improved from a year ago, earnings rose for the first time since the end of 2014, and demand even increased slightly. It is still too early to pronounce a trend reversal or a long-term recovery for large tourism companies given the ongoing currency tensions. And yet, SMEs in the tourism industry found themselves in an uncomfortable economic situation. They rated their economic situation since 2010 as poor, as returns last increased at the end of 2014, and demand has also fallen year-to-date.

Weak earnings in the construction industry

While the business situation for SMEs in the construction industry continued to stabilize, it improved sharply for large companies. This slightly more optimistic view was based on a trend reversal revealed by numerous sub-indicators. However, the brighter mood is in no way related to earnings as they continued to deteriorate, for both large companies and SMEs in the construction industry. Architectural and engineering firms also rated their business situation as somewhat stable; both business groups reported minor increases in orders. SMEs in the industry are also struggling with weak earnings.

UBS SME barometer

UBS SME barometer

Calculation of the UBS SME barometer
The UBS Industrial Barometer is based on the industry survey conducted by the KOF each month (excluding the construction industry). It is calculated as the first main component of 17 subindicators for the entire industry, divided into SMEs (up to 200 employees) and large companies (more than 200 employees). It is scaled so that its mean value is zero and its variance is 1.


SME barometer - industry


SME barometer - services

The data is seasonally adjusted. Survey responses are evaluated using a diffusion index: the result represents average of companies reporting a positive or a negative trend. It therefore does not represent a percentage rate of change.


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UBS Switzerland AG


Media contact
Sibille Duss, UBS Chief Investment Office WM
Phone +41-44-235 69 54,

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