Dáil Éireann Debate, Tuesday - 20 October 2015
156. Deputy Micheál Martin asked the Taoiseach the position regarding the Central Statistics Office figures that show manufacturing production fell in August 2015; and if he will make a statement on the matter. [35262/15]
View answerFigures on the trend in manufacturing production are based on the CSO’s Monthly Industrial Inquiry. This inquiry collects data from industrial local units and the results are published in the CSO’s monthly release on ‘Industrial Production and Turnover’.
The results are in the form of an index of production and an index of turnover. The release shows the monthly, quarterly and annual change in the production and turnover index; and it also includes a detailed breakdown by industrial sector.
The production index is regarded as one of the most important measures of economic activity. The main advantages of the production index compared with other indicators are its combination of early availability and its detailed breakdown.
However, the short-term results from the Industrial Production Index are generally more volatile and do not always give a full indication of the trends in industry. It is therefore important to take care when interpreting monthly or quarterly trends in the index. For example, so far in 2015, the monthly change has ranged between an increase of 27.9% and a decrease of 11%. Similarly, the reduction of 1% in August followed an increase of 9.9% in July.
Such volatility reflects the production decisions taken by individual firms which represent a large share of industrial output – for example the product mix, pricing or stock changes taking place at a given time of year. Annual changes in the index are generally more stable and provide a clearer indication of the trend in industrial production.
Comparing August 2015 with August 2014, there was an annual increase of 18.5% in manufacturing production. The breakdown between Modern and Traditional sectors showed an annual increase of 18.4% in the Modern sector and an increase of 4.7% in the Traditional sector.
The Modern sector represents about 60% of the Industrial Production Index. The sector comprises Chemicals and pharmaceuticals; Computer, electronic, optical and electrical equipment; Reproduction of recorded media; and Medical and dental instruments and supplies. This sector accounts for most of the volatility in the short-term monthly results.
The Traditional sector includes all other areas of manufacturing industry, the largest of which is the Food and Beverages sector. The results for this sector are generally more stable, both in terms of the rate of growth and changes from month to month.
