The regional economy is breathing again… but for how long?

The crisis was handled very well thanks to the measures taken by the state (more than 8.5 million euros in PGE granted in Hauts-de-France) and
Growth rebounded by 7% in 2021. Growth projections for 2022 in France are 3.6%.“, explains Cathy Verkin-Wattebled, regional director of the Bank of France. In this way, the French economy has proved resilient. Its evolution with the crisis affecting Ukraine remains to be seen.

Trends are similar in Hauts-de-France with regional activity rebounding in 2021 across most activity sectors. Vigilance remains in place for agriculture. Overview.

Farmers still uncertain about their future

A disappointing year in terms of yields, volumes and results, a difficult 2020 looks set to be swept away by a strong 2021, in particular for the horticultural sectors and in particular for cereals, thanks to resilient global demand.

Results yet to be refined for certain sectors: jaundice affecting plantations, the beet sector remains fragile and is struggling to recover from years marked by sugar mill closures, climate and health hazards. Same for pig production: only 21% of farmers assess their economic situation as “good” or “rather good”. The North, the Oise and the Somme are doing well, but the Pas de Calais and the Aisne are doing poorly.

If the economic situation is considered good or rather good for six out of ten farmers, and a third of them report an improvement in the economic situation compared to 2020, then the impact of the increase in fees on the economic health of farms is the number one concern for nine out of ten farmers.

The trade balance has been tightening for three years with a deficit of 752 million euros : +158 million euros for raw materials, but -910 million euros for processed products“explains Pascal Nempont, Head of Strategy and Forecasting at the Northern Chamber of Agriculture. In other words, for example, a lot of potatoes are grown in Hauts-de-France, which in Pas-de-Calais are turned into French fries to return… to O de France.

Strong industrial recovery

In industry, the total turnover and export turnover increased significantly. © auremar

With revenue growth of 11.2% in 2021 and an outlook for +8.1% in 2022, industry has made great strides despite a reduction in the workforce and less use of temporary workers. Investment increased in all sectors (+20%), except for the production of transport equipment, which received significant investments in previous years.

The year has been very good, with more than three-quarters of industrial companies seeing stability and the sector continues to hire employees, but to a lesser extent.“, continues Katie Verkin-Wattebled. In 2022, activity is expected to rise above the pre-crisis level in all industries: half of regional industries expect their profitability to grow this year.

Optimism and rebound for construction and services

Almost unaffected by the lockdown and the total shutdown of construction sites, the construction industry has recovered well, with total production growth in 2021 (+10.6%) well above previous forecasts. Thereby, 84% of companies remained profitabledespite higher tariffs and more than 29% increase in investment. Another sign of optimism: only one company in fifteen is expecting a reduction in its order book.

In market services, turnover also jumped to +7.7% and 82% of companies maintained their profitability; every second company even increased profitability. The outlook for 2022 remains good with a 4.2% increase in turnover.

Mastery prepares for the future

These are more than 110,000 companies in Hauts-de-France that have found their colors after 2020, marked by store closures and necessary digital adaptation. Every third company invested in food crafts in 2021, which is close to the pre-crisis level. “But they remain highly sensitive to the global economic context and health changes.“, tempers Julien Choquet from the Chamber of Commerce and Crafts. Nevertheless, three-quarters of the companies retained their staffbut only a third invested in 2021. Almost half of the companies have an average economic situation, so the recovery is present, but still timid.

From a more global perspective, the region has surpassed pre-crisis employment levels, with more than 23,190 jobs created compared to 2019 in almost every sector except industry, which continues to lose labor (-2.1%). “There was also a record for business creation (+21%), mostly micro-enterprises for seven out of ten creations.“explains Gregory Stanislavsky, director of research at CCI Hauts-de-France.

However, he points to bottlenecks that raise fears of an impediment to growth: the crisis in Ukraine, as well as increased volumes of raw materials, supply constraints, rising energy prices and transport costs. “The war in Ukraine will deal a serious blow to business and public confidence“, – he assures. Thus, the full recovery of the economy has not yet come …

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