DECOMPOSED ANALYSIS OF NET TURNOVER USING THE LOG MEAN DIVISION INDEX METHOD: TEXTILE, CLOTHING, LEATHER AND FOOTWEAR INDUSTRIES IN ROMANIA

Abstract

Net turnover is a fundamental indicator in assessing the commercial performance of an economic activity. Analysis of this indicator highlights the level and dynamics of economic activity, both at company and industry level. At the microeconomic level, the analysis allows not only the assessment of commercial performance, but also the substantiation of managerial decisions and the assessment of market position. At the mesoeconomic level, it highlights the size, structure, and trends of the sector, providing a basis for inter-company comparisons, the establishment of sectoral policies, and the importance of the industry in the structure of the national economy.

The main purpose of the paper is to monitor the dynamics of commercial performance at the industry level, namely in the textile, clothing, leather, and footwear (TCLF) industries. In this context, a decomposed analysis of net turnover was performed using the Log Mean Divisia Index (LDMI) method, taking into account three influencing factors: the total number of people employed in the TCLF industries, the structure of the workforce, and labor productivity at the level of each sub-branch. The LDMI method allowed the quantification of each factor's contribution to the change in the analyzed indicator.

The analysis was carried out for the period 2021-2024, using EUROSTAT statistical data. The LDMI method was applied in two variants: additive and multiplicative. The results showed a positive trend for the indicator in 2022 and a negative trend for 2023 and 2024. The contributions of the factors varied: favorable for labor productivity, unfavorable for the total number of employees, and fluctuating for the structure of the workforce.