From low to lower: EU industrial production declined 2% in 2024

(CN) — Over the course of 2024, industrial production decreased nearly 2% throughout the European Union, according to data published by Eurostat on Thursday.

“The index of industrial production measures the evolution of the volume of production for industry excluding construction, based on data adjusted for calendar and seasonal effects,” the agency said in a statement, calling the industrial production index a vital short-term indicator “to identify turning points in the economic development at an early stage and to assess the future development of GDP."

The 2% average decline comes after a year of fluctuation, with a 0.4% increase in November 2024, followed by a 0.8% decline in December.

The report marks the EU’s lowest industrial production rate in three years, culminating in a 6% decrease in overall industrial production since 2022. Production decreased drastically in March 2020 as Covid-19 spread around the world, but rebounded within the year.

“In 2020, the Covid-19 crisis and the resulting containment measures, such as lockdowns, resulted in a massive reduction in industrial production, especially for durable consumer goods and capital goods. In the subsequent months industrial production largely recovered,” Eurostat said. “In the summer of 2022 the trend in industrial production changed.”

Two sectors of EU industrial production increased last year. Non-durable goods, like food and beverages, increased a little more than 8% last year. The EU also reported a 0.6% increase in energy production.

Capital goods — goods used to produce other goods rather than purchased by customers — represented the EU’s greatest decline in production, with a 7.5% drop through 2024. Production of intermediate goods — steel, wood, glass and the like — and durable goods — cars, appliances, things built to last — also declined.

With a 9.5% drop last year, Austria reported the greatest annual decrease in industrial production, followed by Italy and Hungary. At the same time, Malta reported the greatest increase in production at 14.4%, followed by Ireland and Lithuania.

While production has dropped, Eurostat reports industrial producer prices remained down throughout 2024, about 4% lower than in 2023. Industrial production prices reached a record high in late 2022, largely driven by rising costs of energy following Russia’s invasion of Ukraine. Industrial production prices have since trended downward as EU policy sought to stabilize energy supplies.

In addition to reporting increases in industrial production last year, Ireland also reported the greatest increases in production costs at 11.1%, followed by Bulgaria and Denmark. Overall production remained quite stable in Slovakia, which also reported the largest decrease in overall industrial production costs at 17%, followed by Luxembourg and France.

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