Industrial Production, Employment and Hours worked: Data for fourth-quarter and full-year 2015
February 29, 2016
Bottom line: The trend in industrial production swung from contraction in the first half of 2015 to expansion during the second half of the year. This trend is being led by the high-tech and medium-high tech sectors, but encompasses all four categories (by technological intensity) of industry. As a result, hours worked have increased and the number of jobs in industry has stopped falling, but has not yet begun trending upwards.
These data presage an upward revision in GDP for the fourth quarter and perhaps for full-year 2015. They confirm the recovery in industrial exports, especially of high-tech goods, apparent in the trade data. They also show the Israeli economy entering 2016 in high gear — a sharp contrast to most developed economies.
- When adjusted for seasonal and transient volatility, the industrial production (IP) data, published by the Central Bureau of Statistics on February 21, show that output in all sectors began to expand in the second or third quarters of 2015 and that expansion continued through year-end.
- The medium-tech sectors, led by chemicals, were first to rebound and have seen the strongest recovery (see graph), after a prolonged period of weakness.
- High-tech industries began to recover in the second half of 2015, but continued shedding employees through year-end.
- Sales to the domestic market have been strong, while export sales rose sharply in the last quarter of 2015, after declining slowly through August.
- Hours worked declined very gradually until August, but rose steadily in the final months of 2015.
GRAPH: Indices of manufacturing production, trend data, for industrial sectors defined by degree of technological intensity.
2012 – 2015, monthly, Index bases 2011 = 100