The actual status of the Swiss Textile and Clothing sector
The general situation of the Swiss Textile and Clothing sector is still fragile, reports the umbrella organisation Swiss Textiles. Capacity load is diminishing, but the log of orders has increased. Since 2015 there is a zig-zag course for the embitterment of the business situation. All indicators are still in the negative and the effect of the strong CHF is affecting the labour market
Capacity load in the two sectors is severing and was at the end of the first quarter 2016 at 70.8 %, meaning a drop of 10.7 % year on year. Whereas the capacity load of industrial companies is stabilising at slightly over 80 %, the downward trend in the textile and clothing sector is remarkable.
In May 2016 estimates of sector companies only 9.1 % considered the business situation as good. 34.7 % claimed it as bad, and 56.2 % designated it as satisfactory. The survey in spring provoked somewhat the results as at the beginning of 2016, however in May with a more negative outlook.
Orders on were more positive and reached almost the level of total Swiss industry, but that in turn was slightly declining. In May 46.6 % of the enterprises regarded their log of orders on hold as too low, 45.1 % considered it as normal, and another 11.9 % as good.
Labour in the first quarter of 2016 amounted to 12900, whereas in the same quarter of 2015 13700 people were employed in the two industries, and footwear and leather industries. In March 2016 493 persons were unoccupied, in March 2015 the number was 400, this translated into an increased jobless rate of 4.7 % (3.8 %).
Exports of textiles in the first quarter 2016 amounted to CHF 327 million or 1.9 % less year on year. Clothing exports were increased 10.2 % to CHF 353 million. This growth rate is due to increased returned goods, corrected this means that in real terms clothing exports were declining by 2 % to CHF 184 million.
Major export regions in the first quarter 2016 in textiles were: EU/EFTA with a value of CHF 240.244 million (-0.9 %), Asia CHF 33.266 million (-0.9 %), USA 18.453 million (-3.8 %), Middle East 8.670 million (+30.4 %), Africa 7.659 million (-6.8 %), Central and SouthAmerica 3.053 million (-2.8 %)and Australia/Oceania 0.910 million (-2.7 %.
The export regions for clothing were: EU/EFTA 288.148 million (+15.5 %), Asia CHF 32.115 million (-8.5 %), USA 14.501 million (-18.8 %), Middle East 7.995 million (+14.2 %), Africa 0.673 million (-39.9 %), Central and South America CHF 0.867 million (-35.3 %), and Australia/Oceania CHF 1.405 million (-7.8 %).
A look at individual countries for Swiss textile exports and Europe was declining 0.9 %, however the backlash of demand from Germany in value terms was 3.8 %, exports to France increased by 3.2 %, as well as in Italy by 5.7 % and in Great Britain 2.4 %. Exports to Asia diminished by 0.9 %, these to China had a marked backdrop of 7.1 %. Exports to the USA showed a positive growth but declined in the fourth quarter of 2015 by 3.5 %, however demand from Middle East increased by 20.4 %.
Clothing exports increased to European countries in the first three months of 2016 by 15.5 %, however returned goods increased, therefore the growth rates to Germany (+ 23 %) and Italy (+11.3 %) are to be taken with prudence. Exports to France decreased by 6.4 % and to Great Britain by 7.8 %. A positive exemption were exports to the Middle East, all other continents were declining, the ones to Asia were caused by a backdrop in China (-27.6 %).
Exports of the two sectors according to subsectors:
January – March 2016 January – December 2015
in CHF 1000 Change % in CHF 1000 Change %
Total Textiles 327320 – 1.9 1334233 – 10.4
Spun fabrics 9759 – 8.4 43763 – 5.4
Yarns 41308 – 1.2 158552 – 13.4
Fabrics and Knits 88105 – 4.7 393250 – 9.9
Embroidery, Plush, Tulle 14634 0.5 63753 – 5.8
Home Textiles 32114 – 3.5 133705 – 11.3
Technical Textiles 141400 0.3 551191 – 10.6
Total Clothing 352543 10.2 1347560 0.1
Outer Garments 270597 13.4 1016826 3.1
Under Garments 40962 8.2 153282 – 0.9
Accessories 40984 – 5.8 177453 – 13.6
Regarding order intake, companies are negative in May, even though these were slightly positive in January. At the labour front a positive trend is expected, however the indicator is still negative. In view to prices, these are eroding, but export expectations are tending up.