Italy

Despite a complex market situation, companies in Italy are trying to maintain the right operational focus.

The balance sheet for this year’s January-October period will be little better than for the first three quarters of 2024 when exports dropped by 0.7%. While European data are not expected to be spectacular given the negative trends in Germany, the extra-EU figures published by Istat throw more sand into the gears of the “Made in Italy” branding: an annual drop of 1.1% has been caused largely by double-digit declines for the USA and the Middle East which the brilliant 33% surge for Turkey failed to offset. Over the first 10 months of 2024, however, exports to non-EU countries were still moderately positive with a year-on-year increase of 0.8%.

In November, Italy’s core inflation (net of energy and fresh food) climbed from +1.8% to +1.9% while inflation net of energy goods increased from +1.9% to +2.2%. Goods prices reversed from -0.5% to +0.4% while those for services edged up slightly from +2.7% to +2.8%.

Graduates in electronics and information engineering, holders of fashion diplomas and those qualified in the wood sector have proved to be the most difficult skills to source in 2024, with “unavailability” rates of up to 70%. The most sought-after are those in possession of a qualification/diploma in professional education and training: industrial and service companies are looking for, respectively, 2 million and 100,000 of them, but finding half these numbers seems to be difficult enough.

Moody’s expects Italy’s growth to “remain moderate below 1% this year” on “weak domestic demand and exports” owing to Germany’s slowdown. Italy currently has a stable outlook.