The service sector plays a critical role in driving economic growth and employment across the European Union (EU) and the euro area. Understanding its performance is crucial for assessing overall economic health. This report provides an analysis of service production trends in October 2024, comparing monthly and annual changes, as well as variations across different industries and member states. The insights reveal the sectors and regions driving growth, along with those facing challenges.
Overview of Service Production Growth
Monthly Performance
In October 2024, seasonally adjusted service production recorded modest growth in both the euro area and the EU. Compared to September 2024, production rose by 0.3% in the euro area and by 0.5% in the EU, according to preliminary data from Eurostat. This marked a recovery from September, when the euro area saw a 0.1% decline, and the EU posted a minor 0.2% increase.
Annual Performance
When compared with October 2023, the service sector showed more robust growth. Service production expanded by 1.7% in the euro area and 1.5% in the EU, highlighting a sustained upward trajectory over the past year.
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Performance by Service Industry
Monthly Changes by Sector
The breakdown of monthly performance across service industries revealed mixed results:
- Transportation and Storage: Declines were recorded, with a 0.4% drop in the euro area and a 0.2% decrease in the EU.
- Accommodation and Food Services: Growth was moderate, increasing by 0.6% in the euro area and 0.7% in the EU.
- Information and Communication: This sector stood out with significant growth, rising by 1.3% in the euro area and 0.9% in the EU.
- Real Estate Activities: A notable increase was observed, up by 1.6% in the euro area and an even higher 2.3% in the EU.
- Professional, Scientific, and Technical Activities: Both regions saw growth, with a 0.3% rise in the euro area and 0.7% in the EU.
- Administrative and Support Services: While stable in the euro area, the EU experienced a slight decline of 0.3%.
Annual Changes by Sector
Annual comparisons revealed consistent growth across most industries:
- Information and Communication: This sector led growth, with a 4.0% increase in the euro area and 4.3% in the EU.
- Real Estate Activities: The euro area recorded a 2.0% increase, while the EU saw a 1.5% rise.
- Professional, Scientific, and Technical Activities: Both regions experienced 2.0% growth.
- Administrative and Support Services: Growth was modest, at 0.6% in the euro area and 0.5% in the EU.
- Transportation and Storage: Annual growth was 0.3% in the euro area, but the EU saw a significant decline of 1.6%.
- Accommodation and Food Services: Growth was marginal, with increases of 0.2% in the euro area and 0.6% in the EU.
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Performance by Member State
Monthly Changes
Among member states, the strongest monthly growth was observed in:
- Poland: +3.2%
- Lithuania: +2.4%
- Belgium: +2.0%
Conversely, the largest declines occurred in:
- Greece: -2.8%
- Slovenia: -1.6%
- Malta: -1.1%
Annual Changes
Year-on-year, the standout performers included:
- Luxembourg: +9.0%
- Lithuania: +8.2%
- Estonia: +6.7%
However, some member states faced significant declines:
- Denmark: -10.3%
- Greece: -8.8%
- Romania: -7.7%
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The October 2024 data underscores the resilience of the service sector in the euro area and EU, with overall growth driven by industries like information and communication, real estate, and professional services. However, challenges remain for specific sectors such as transportation and storage, as well as for certain member states experiencing significant declines. The insights highlight the importance of targeted policies to support underperforming areas while capitalizing on the strengths of high-growth sectors. By leveraging these findings, the EU can continue fostering a competitive and dynamic service economy.
Source: Eurostat
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