The slowdown in the business sector continues
The decrease in import of inputs reflects pessimism regarding future economic activity
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The Melnick State of the Israeli Economy Index increased by 0.1 percent in January 2023. The slowdown in the business sector continues. The revenue in commerce and services, which reflects domestic demand and especially private consumption, has been falling in the last few months, reflecting weakness of private consumption. The industrial production index, which reflects the supply side of the business sector, remains unchanged in the last month, after a partial correction of the sharp decline that occurred two months ago. The import index, which consists mainly of inputs for domestic production, continues to decrease. The decrease in the import of inputs for domestic production may indicate a future decrease in activity in the business sector. The number of employee posts in the business sector increased at a rate like its decrease in the previous month, so no weakness is recognized in the labor market.
The components of the January index include: no change in the industrial production index in December, after a 3.7% increase in November; a decrease of 1.6% in revenue of commerce and services in December after a decrease of 1.0% in November; a 2.3% decrease in the import index in January, after a 1.6% decrease in December and a 1.2% increase in the number of employee posts in the business sector in November, after a similar decrease in October.
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