After a slight recovery during the fourth quarter of 2011, the economic sentiment within the information economy has again tarnished slightly during the first quarter of 2012. The Economic Sentiment Indicator for the Information Economy drops by 3.2 points to 58.4 points during the first quarter. But, with a value of more than 50 points, it still indicates a positive development. This is the finding of the economy survey conducted by the Centre for European Economic Research (ZEW) in Mannheim, Germany, in March 2012 within the information economy sector.
The sub-indicator of the current business situation decreases clearly by 20.5 points and reaches a value of 47.4 points during the first quarter of 2012. Thus, the positive development of the business situation during the last quarter of 2011 does not continue. Contrary to that, however, the sub-indicator of the business expectations for the second quarter of 2012 increases by 16.1 points to 71.9 points. The economic situation in the information economy is thus likely to improve again during the second quarter of 2012.
The economic sentiment in the ICT sector generally corresponds to the sentiment within the whole information economy. The slight decrease of the sentiment indicator by three points reflects two oppositional and strong developments of the respective sub-indicators. On the one hand, the sub-indicator of the current business situation drops clearly by 27.9 points to 43.7 points. On the other hand, the sub-indicator of the business expectations increases by 29.6 points to 89.5 points for the second quarter of 2012. All in all, the ICT companies are optimistic concerning the near future. This is also illustrated by the overall indicator with a value of 62.5 points. The strong decrease of the business situation indicator stems from the ICT service providers. The share of companies registering increases in sales in the current survey drops by 42 percentage points compared to the previous quarter and amounts to only 18.5 per cent. In contrast, about 72 per cent of the ICT service providers report smaller sales volumes compared to the previous quarter, and about nine per cent report constant sales volumes. Whereas the ICT hardware manufacturers expect stable sales volumes and a steady demand situation for the second quarter of 2012, nearly 86 per cent of the ICT service providers expect an increase in sales and demand during the second quarter.
The economic sentiment indicator in the media sector drops by 17.7 points to 37 points. This decrease of sentiment is mainly caused by a heavily deteriorated assessment of the current business situation. The respective sub-indicator drops clearly by 36.8 points to 33 points, since the media companies mainly registered decreasing sales and a regressive demand situation during the first quarter of 2012. The indicator for the business expectations for the next quarter drops slightly by 1.4 points. With a value of 41.5 points, it indicates only cautious expectations concerning the economic development within the second quarter of 2012.
The sentiment indicator for the knowledge-intensive service providers registers a fractional decrease by 0.9 points during the first quarter of 2012 and reaches a level of 58.9 points. Thereby, the downward trend of the economic sentiment of the knowledge-intensive service providers continues, but the indicator is still at a high level. While the business situation indicator drops by 9.9 points to 54.2 compared to the previous quarter, the sub-indicator of the business expectations increases by 8.3 points to 64.1 points for the second quarter.
The Economic Sentiment Indicator for the Information Economy is composed of the four components sales situation, demand situation, sales expectations and demand expectations (each in comparison with the previous and following quarter). They are equally taken into account for the calculations. Sales situation and demand situation form a partial indicator reflecting the business situation. Sales expectations and demand expectations form a partial indicator reflecting the business expectations. The geometrical mean of the business situation and the business expectations amounts to the value of the Economic Sentiment Indicator of the Information Economy. The sentiment indicator can adopt values between 0 and 100. Values above 50 indicate an improved economic sentiment compared to the previous quarter, values smaller than 50 indicate deterioration compared to the previous quarter.
About 8,000 businesses with a minimum of five employees participate in the quarterly survey conducted by ZEW. The companies surveyed belong to the following business sectors: (1) ICT hardware, (2) ICT service providers, (3) media, (4) law and tax consultancy, accounting, (5) public relations and business consultancy, (6) architectural and engineering offices, technical, physical and chemical analysis, (7) research and development, (8) advertising industry and market research, (9) other freelance, academic and technical activities. Combined, all nine sectors make up the economic sector of the information economy. The ICT sector consists of ICT hardware and ICT service providers. The last six sectors make up the knowledge-intensive service providers. An overview of the ZEW economy survey is available online at www.zew.de/konjunktur(German only).
To ensure that the analyses are representative, ZEW projects the answers of the survey participants with the sales value of the businesses with regard to the entire sector of the information economy. The phrasing "share of the businesses" thus reflects the share of sales of the businesses.
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