Decrease in employment, increase in stocks and growth in debts at Belarusian industrial flagships

    Large and medium-sized industrial enterprises of the Republic of Belarus provided reports for 2021.

    For 11 months of 2021, industrial production has increased by 6.7%. But this is due to the first half of the year and it is related to the effect of a low base for the crisis of 2020. Let’s take a look: in the 1st quarter, industrial output rose by 9.2%; in the 2nd quarter – by 11.6%. However, in the 3rd quarter, production increased by only 2.9%. The last quarter of 2021 started off weak. In October, industrial production decreased by 0.1%; in November it increased by 2.7%. That is, so far the 4th quarter for industrialists is on average worse than the 3rd quarter.

    As of December 1, the level of warehouse stocks in money terms turned out to be higher than as of the same date in 2020 – BYN 5.469 billion against BYN 5.282 billion. And it is known that large stocks of unsold products are temporarily washed out working capital of companies.

    In 2021, the number of dismissed employees at the industrial flagships exceeds the number of hired employees. According to statistics agencies, for 10 months large and medium-sized companies in the industry fired 130.9 thousand people, and hired 121.1 thousand people. Thus, the net outflow of personnel from the flagship companies amounted to 9.8 thousand people. Over 10 months, the average number of employees decreased by 1.4% against the level of 2020, and separately for October, 2021 – by 3.8%. For the flagships of the manufacturing industry, employment rate decreased even more – by 1.7% and 4.4%, respectively.

    The financial state of the industry flagships describes the return on sales. Over 10 months, the average return on sales in the industry was 9.9%. However, the median profitability is significantly lower. This can be seen by the rate of organizations with profitability below zero (loss on sale) and companies with profitability between 0 and 5%. Following the results of 10 months, there were 17.8% of the industry leaders in the first group; in the second group – 31.2%. It turns out that 49% of the industrial flagships had profitability of up to 5%. This means that the industry median was slightly above this mark. Only 7.6% of the industrial flagships showed profitability of 20% or more and only 2.3% – from 30% or more. On average in the economy, these rates were 8.5% and 4.1%.

    By November 1, the total debts of the industrial flagships exceeded BYN 91.3 billion. Since the beginning of 2021, the liabilities of industrialists have grown by 18.4%. For 10 months, the industry leaders allocated BYN 42.4 billion to repay bank loans and borrowings (+ 10.7% by 2020). For these purposes, industrialists spent the equivalent of 32.2% of their proceeds (the average for the economy is 26.7%).