Businesses Report Guarded Economic Outlook – Business Outlook Survey in November

In November, businesses downgraded their performance expectations.
The increased intensity of hostilities, renewed power outages due to russian attacks on the energy system, further growth in energy, labor and logistics costs, accelerating inflation, a significant shortage of skilled workers, and seasonal factors restrained economic activity and weakened business expectations.
This is evidenced by the business activity expectations index (BAEI), which the NBU calculates on a monthly basis, apart from the forced break in March–May 2022. In November 2024, the BAEI was 47.2, down from 49.4 in October.
Trading companies were the only ones to report a positive economic outlook thanks to sustained domestic demand and a sufficient supply of goods.
The sector’s index was 51.4 in November, down from 51.9 in October.
Respondents expected an increase in trade turnover and the amount of goods purchased for sale, while also reporting positive expectations about their stocks of goods for sale.
Respondents continued to declare intentions to cut their trade margins.
Industrial companies downgraded their economic outlook for November amid a worsening security situation, power shortages and rising production costs, the sector’s index being 46.7 in November, down from 49.8 in October.
In contrast to the previous month, respondents expected a decrease in the amount of manufactured goods and in the number of new orders for products.
Companies also weakened their expectations about the number of new export orders and the amount of unfinished products.
Conversely, respondents expected a slight improvement in their finished goods stocks, while also expecting an increase in their stocks of raw materials and supplies.
Services companies also downgraded their performance expectations on the back of rising logistics costs, power cuts, and shortages of qualified staff, the sector’s index being 44.8 in November, down from 47.2 in October.
Companies reported dimmer expectations for the amount of services provided and the number of new orders for services.
Expectations about the amount of services that are being provided remained weak.
Construction companies reported the most pessimistic economic outlook due to a seasonal decline in construction of roads and infrastructure and shortages of qualified staff, the sector’s index being 43.6 in November, down from 49.6 in October.
Respondents expected a drop in construction volumes, the number of new orders, and in purchases of raw materials and supplies.
At the same time, respondents remained upbeat, despite downgrading their expectations significantly, about purchases of contractor services, amid stronger negative expectations about contractors’ availability, and slower growth in the cost of contractor services.
With weaker growth in purchase prices, industrial, construction and services companies declared intention to raise their selling prices more slowly.
Only trading companies intended to raise their selling prices slightly.
The labor market situation remained challenging. Respondents across all of the surveyed sectors declared intentions to reduce their workforces, with the strongest intentions reported by services companies.
Background This survey was carried out from 4 November through 21 November 2024.
A total of 504 companies were polled.
Of the companies polled, 44.2% are industrial companies, 27.6% services companies, 23.4% trading companies, and 4.8% construction companies; 29.6% of the respondents are large companies, 28.8% medium companies, and 41.7% small companies.
Out of the surveyed companies, 31.7% are both exporters and importers, 10.1% are exporters only, 18.3% are importers only, and 39.9% are neither exporters nor importers.
The findings presented reflect only the opinions of the respondents (top managers of companies), and should not be considered as NBU assessments.
The monthly business activity expectations index (BAEI) is a tool for conducting latest assessments and detecting trends in economic development.
It is calculated on the basis of surveys of Ukrainian real sector companies.
Monthly business activity expectations indices are calculated on the basis of respondents’ replies.
These indices are as follows: sectoral indices (for each sector of the economy) and a composite index (describes the country’s economic performance over a month).
A value of 50 corresponds to the neutral level.
Index values above the neutral level indicate positive expectations.
Read more about the November 2024 survey in the Monthly Surveys of Companies Subsection of the Publications Section on the NBU’s official website.
The NBU started posting monthly survey results in the open data format.
The results of the next survey (for December) will be published on the first business day of January 2025.