One year of COVID-19: a two-speed manufacturing recovery
The most recent data, covering the last three months of 2020, confirm that manufacturing is gradually recovering across the world, following a major drop during the first half of the year due to COVID-19. However, the pace of recovery is unequal. While manufacturing production in some countries, such as China, has already reached and exceeded its pre-crisis production level, in other countries, the upturn continues at a more gradual pace.
VIENNA, 10 March 2021 – The latest UNIDO World Manufacturing Report, covering the most recent official data on the state of manufacturing across the world, shows that production in this sector grew by 2.4 per cent in the last quarter of 2020 compared the same period of 2019. This annual growth rate in positive territory confirms that global manufacturing production regained its pre-crisis level during the last quarter of 2020, after the collapse observed in the first half of the year.
However, the report also shows how the recovery is moving at two speeds. China quickly bounced back and, with a year-on-year growth rate of 9.4 per cent in the fourth quarter, this country has already returned to its pre-crisis growth trajectory. Other emerging and developing economies have also reached their output levels before the onset of the pandemic, although growing at a more subdued pace. Industrialized economies, on the other hand, remain on negative ground, probably affected by the new wave of coronavirus infections that forced the re-introduction of stricter containment measures in the last months of 2020. Since the end of last year, many countries have embarked on vaccination campaigns, although it remains unclear how soon they will lead to a substantial easing of the ongoing restrictions and a boost to economic activity.
The two-speed recovery was not only observed at the country level. The UNIDO report also reveals that a similar trend can be observed among industrial sectors. In the fourth quarter of 2020, higher technology sectors were recovering at a faster pace. While the output of low-technology industries still registered a negative growth rate of 1.8 per cent in the fourth quarter of 2020, medium-high- and high-technology industries were rising by 4.0 per cent. Within the last group, sectors such as computers, electronics and optical products, electrical equipment, chemical products and pharmaceuticals have now registered positive growth for the last two quarters.
With the release of data for the fourth quarter of the year, it is now possible to complete the picture for 2020 and the impact of the global outbreak of COVID-19 throughout the entire year. The data confirm the significant decrease in global manufacturing production, with a decrease estimated at 4.1 per cent in 2020. This is the largest yearly drop observed since the global financial crisis of 2009. However, even if this is an important contraction, it is a not as negative as initially expected, due to faster rebounds in production in some Asian economies and a more limited contraction in industrialized economies.
The full report is available here. It presents the most recent trends of global manufacturing at country, regional and industry level.
All data and analysis are based on seasonally adjusted data. Data can be downloaded through the UNIDO data portal or consulted in official UNIDO publications. For more information, please contact UNIDO Statistics.