August 1, 2021

Business confidence falls 1.7%

Business confidence falls 1.7%

The Harmonized Business Confidence Indicator (ICEA), whose publication corresponds to the National Institute of Statistics (INE), it fell 1.7% in the fourth quarter of this year in relation to the previous quarter, its biggest quarterly decline since the beginning of the series, in 2013.

The decrease in confidence in the fourth quarter, which contrasts with the progress made in the two previous quarters, is due both to the worsening of the current situation indicator and the expectations indicator.

Specific, the balance of expectations (difference between the opinions of optimistic and pessimistic businessmen) stood at +2.9 points, below the +7.1 points of the previous quarter.

This is due to the fact that the percentage of business establishments that think that the progress of their business will be favorable between October and December of this year has been placed at 19%, a figure lower than that of the previous quarter (22.8%).

At the same time, the percentage of entrepreneurs who think that their business will go normally has risen from 61.5% to 64.9%, while employers who are pessimistic about the evolution of their business have increased since 15 , 7% from the previous quarter to 16.1%.


On the other hand, the balance sheet (difference between favorable and unfavorable responses with respect to the final quarter) has dropped almost three points, going from +5.9 points in the previous quarter to +3.1 points in the fourth quarter.

This worsening of perception about the current situation is the result ofl Increase in business establishments that think that their business has evolved unfavorably in the last three months and the decline of those who think that it behaved favorably.

Thus, for the quarter already completed (third quarter of 2018), the ICEA shows that 20.7% of business establishments have a favorable opinion on how their business worked in those three months, compared to 17.6% of establishments that have seen an unfavorable evolution in this period and to 61.7% that speak of normality.

The ICEA, which has a quarterly frequency and is comparable at a European level, is drawn up from a representative sample of business establishments.

During the fourth quarter of the year, business confidence declined in all sectors, in all sizes of establishments and in 13 autonomous communities.


Thus, according to Statistics data, the five economic sectors analyzed in this quarter cut back on trust, mainly transport and hospitality (-2.7%) and industry (-2.5%). Next are trade (-1.6%), other services (-1.1%) and construction (-1%).

Regarding the size of establishments, Confidence worsens 2.1% in those with 50 to 199 employees; 1.9% in the 200 to 999 workers; 1.7% in establishments of 10 to 49 employees; 1.6% for those with fewer than 10 workers, and 0.5% for those with more than 1,000 employees.

By communities, business confidence rose in Galicia and La Rioja (+ 1.1%) and in the Canary Islands (+ 0.3%), remained in Aragon and fell in the rest of the regions, mainly in the Balearic Islands (-4.7%). %), Navarra (-4.3%) and Murcia (-3.3%).

For the elaboration of this indicator, the OECD, the German Ifo and, above all, the Japanese Tankan, which is elaborated by the Central Bank of the Japanese country, are taken as a methodological reference.


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