Wednesday, July 24, 2024

Business confidence grows more in Andalusia than in Spain as a whole

July 9, 2021
Business confidence grows more in Andalusia than in Spain as a whole

The Harmonised Business Confidence Index, which measures companies’ expectations regarding the economic situation and the evolution of their businesses, increased by 13.3% in Andalusia in the third quarter of 2021 compared to the previous quarter, thus registering the highest increase in 2020, according to data published by the Andalusian Institute of Statistics and Cartography (IECA). This percentage is one point above the national average, which has seen a rise of 12.3%.

With this rise, this indicator accumulates five consecutive quarters in positive, after the advances of 0.7% and 11.2% in the third and fourth quarters of 2020 and 0.4% and 4.7% in the first and second quarters of 2021, respectively. The rebound in the third quarter reflects an improvement in the perception of the economic and business situation as a result of the easing of the restrictions on activity imposed by the COVID-19 pandemic.

According to the IECA, all sectors showed positive growth in confidence in the third quarter compared with the previous quarter, with transport and hotels and restaurants showing the greatest increase (24.2%). They are followed, at some distance, by commerce, with 13.7%, and other sectors, with 13.2%. Construction rose by 9.3% and industry by 9.2%.

The Harmonised Business Confidence Index is constructed from two indicators, the situation indicator, which reflects how the business fabric has perceived its activity in the previous months; and the expectations indicator, which refers to its future forecast on the evolution of its business in the following months.

For the third quarter of 2021, 20.9% of establishments in Andalusia are optimistic about the future evolution of their business, while 25.9% are pessimistic, resulting in a balance of expectations (difference between favourable and unfavourable opinions) of -5 points. In the case of the situation, the balance is -11.6 points, because 29.7% of entrepreneurs consider that their business has performed worse than expected, compared with 18.1% who have seen a better performance.

By employment bracket, all show an increase in business confidence for the next three months, with the largest increase in the range with a workforce of between 10 and 49 employees, which is 19.6% higher than in the previous quarter. This is followed by 0 to 9 employees (11.5%), 200 to 999 (11.1%), and 50 to 199 (10.9%).

On the other hand, the IECA also reports on business confidence by provinces, with all of them showing positive quarter-on-quarter variation rates. The province of Malaga is the best performer, with 20.5%. It is followed by Granada (15.5%), Jaén (14.8%), Cádiz (13.4%), Córdoba (12.5%), Huelva (11.6%), Almería (10.6%) and Seville (10.2%).