Even if turnover growth has not increased to the level attained in the second quarter of 2002, the positive expectations reported by the firms for the third quarter 2003 speak of a better general mood in the market than in the previous year.
This is the result of a business survey among German IT-related service providers that the Centre for European Economic Research (ZEW) and the credit reference agency Creditreform conducted in June and July 2003. 1,200 enterprises participated in this survey. The sector of the IT-related service providers consists of the Information and Communication Technology (ICT) service providers (enterprises of the branches computer services and leasing, ICT-specialized trade as well as telecommunication services) and knowledge intensive service providers (enterprises of the branches tax consultancy and accounting, management consultancy, architecture, technical consultancy and planning, research and development as well as advertising).
The small increase in annual turnover growth in the IT-related services sector results from a positive sales development reported by West-German enterprises. Their annual rate of growth in turnover grew to 2.2 percent in the second quarter of 2003, up from 2.1 percent in the previous quarter. The East-German IT-related service providers, by contrast, continue to develop poorly. Their annual rate of growth remains at -0.1 percent.
The turnover share of those service providers reporting decreasing demand continues to outweigh the share of those enterprises reporting an increase in demand. The trend, however, is positive. The balance of positve and negative demand changes increased from -14 percentage points in the first quarter to -8 percentage points in the second quarter of 2003. For the East-German enterprises the demand balance rose to -15 percentage points. This is the highest demand balance level in over a year for the Eastern German IT-related service providers.
The expectations reported by the IT-related service providers for the third quarter of 2003 are optimistic. Despite the caution which business analysts are exercising with respect to pronouncing an end to the economic downturn of the German economy, the balance of positive and negative expectations is positive with respect to turnover, demand and income development for the entire industry. Only the expectations for future personnel development are pessimistic. The turnover share of those enterprises expecting an increasing trend in employment outweighs the share of those enterprises expecting a decreasing trend in employment.