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The Italian business culture in the unforgiving current climate

The Bank of Italy’s periodic survey provides a precise snapshot of the country’s business sector

Tough times for businesses. Times in which you need accurate information on the business climate, and an informed production culture which can also take advantage of reliable information. This is what we can learn by reading the ‘Indagine sulle imprese industriali e dei servizi’ (‘Survey on businesses and services’) just published by the Bank of Italy, a unique and reliable document for understanding how the business and services sector performed in 2018 and its prospects for 2019.

According to the Bank of Italy survey, in 2018 there was a significant slowdown in sales among businesses and non-financial private services with at least 20 employees. This was due to the weakening of domestic demand and the unexpected gradual deterioration of the international cycle. In the meantime, the number of businesses that have reduced their prices has fallen and the number that have increased them has risen. Of even greater significance are today’s forecasts for tomorrow. As the Bank of Italy explains, businesses expect sales and price growth to remain weak also in 2019. Nevertheless, the number of people seeking work grew again during the year, and it would appear that spending on investment also grew in 2018. It seems that the construction industry also saw upward growth.

Having said this, despite the undeniably unfavourable climate, the Italian business and services sector is not giving up and is looking for ways to develop. The growth in investments – particularly in mid-size companies – indicates a desire to look ahead and the existence of a business culture that plans for the future in a constructive way. The attention on new technologies does the same, despite all the difficulties involved. It is the farsightedness of virtuous enterprises that stands out in the Bank of Italy’s findings, which, with regard to new technologies, state: ‘The percentage of businesses which declared that they invested in advanced technology in 2018 has grown … however, the amount of spending in this area remained below 5% in half of these companies.’ It goes on: ‘Overall, we can estimate that the adoption of advanced digital technologies represents around 15% of the total spending on investment recorded by the survey.’ There is therefore a long uphill struggle towards a business culture geared towards innovation. But it’s the only way forward.

All in all, despite the detailed figures, the Bank of Italy document is for general consumption.

Indagine sulle imprese industriali e dei servizi(‘Survey on businesses and services 2018’)

Various authors.

Bank of Italy, 2019

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