Slump in industrial output steeper than even during recession of 1990s

Forest industry decline continued in January: year-on-year figures down 35%

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The downward plunge of Finnish industrial output figures continued in January 2009, and the curve only steepened. According to figures published on Tuesday by Statistics Finland, after adjustments for working days, industrial output was 19.5% lower in January 2009 than it was twelve months earlier.
      This follows a year-on-year decline in December 2008 of just over 16%.
      The slide in recent months has been sharper and steeper than during the worst days of the recession that hit Finland in the early 1990s.
      Then the worst month was in June 1991, when industrial production fell by 14.5% relative to the previous June, reports Kari Rautio, Chief Actuary at Statistics Finland.
     
The figures were universally grim practically across the entire board.
      Nearly half of Finnish industrial output still comes from the metals and engineering industry, which saw a decline of 18.7% compared with January 2008.
      The electrical and electronics industry did manage a slightly better performance, dropping "only" 7.3% year-on-year to 1/2009.
      The chemical industry, meanwhile, was close to the average fall for industrial output as a whole, shedding just over 20%.
      Only the foodstuffs industry produced low single-digit figures, with a drop of 3% recorded from January 2008.
     
At the other end of the spectrum comes one of the traditional pillars of the Finnish economy, now looking very close to structural collapse.
      The forest industry produced just over one-third less by way of paper, pulp and sawn goods relative to last January.
      These numbers came as little surprise to the Finnish Forest Industries Federation, for in December, too, they saw a year-on-year decline of around 30%, and the November numbers were little better, with production off by nearly 20%.
      As well as lower capacity utilisation across the board in manufacturing, the forest industry figures have been made to look still more horrendous by mill closures and paper machine shut-downs carried out in the course of 2008.
     
Finnish industrial output as a whole declined by just under 1 per cent (-0.7%) in 2008, which only serves to underline the dramatic and steepling nosedive that has taken place in the last three months.
      Output actually grew by 7% in January 2008, for example, and the figures remained broadly positive for the first six months of the year. Even in September and October, adjusted output relative to the same month in the previous year remained above water.
      The 0.7% decline during 2008 compares with growth of 4.4% in 2007 and as much as 9.6% in 2006.
      It is also the largest annual drop in output recorded since 1991, when the bottom fell out and industrial production fell by as much as 8.7 per cent during the year.


Previously in HS International Edition:
  Sharp decline in output in November (9.2.2009)

Links:
  Statistics Finland: Industrial output plummeted in January

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