Economy KOF survey shows slight recovery in business situation

The business situation of Swiss companies has recently improved slightly. However, the business situation indicator surveyed by the KOF has been moving sideways since spring. A stable upswing for the Swiss economy is therefore not in sight.

In October, the business situation index improved to 11.5 points from 10.7 points in September, as reported by the KOF Swiss Economic Institute at ETH Zurich on Tuesday. This value is the balance of the answers "good" minus "bad" in a survey of around 4,500 companies.

The KOF explained that the index had thus made up for part of its last decline. Overall, however, it is moving sideways. In addition, the development of the various sectors is so inconsistent that no broad-based buoyancy can develop.

The upward trend is being driven by manufacturing and services, while the situation in wholesale has deteriorated. The construction industry, project management, the retail trade, financial and insurance service providers and the hospitality industry were also more cautious.

Expectations with regard to business development over the next six months are very heterogeneous, writes the KOF. And they are slightly more cautious overall than before.

Shortage of labor is easing

According to the KOF, company reports of labor shortages are easing in some sectors of the economy. For example, in other services, manufacturing, financial and insurance services and project planning offices. In the hospitality, construction and wholesale sectors, however, the tense situation has hardly changed.

Companies' wage expectations have recently remained stable: they continue to expect wages to rise by an average of 1.6% over the course of the year.

Here too, however, the trend is uneven. Wage increases are likely to be comparatively low in the construction and retail sectors, for example. Employees in the manufacturing and hospitality industries, on the other hand, are likely to see a more significant wage increase.

SDA