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September 17, 2021updated 04 Apr 2022 12:26pm

How has the packaging sector recovered from COVID-19 in Q2 2021? – focus

GlobalData looks at industry activity levels in the three months to the end of June, compared to pre-pandemic.

By Patrick Scott

Relatively speaking, the packaging sector emerged as a weak performer in the world economy in the second quarter of 2021.

According to recent research from GlobalData, activity levels in packaging in the three months to the end of June were 13.6% higher than the final quarter of 2019, before COVID-19 decimated economies across the world. Of the 18 industry sectors included in the analysis, packaging ranks 11th in terms of its latest value for COVID activity recovery.

Healthcare saw the highest activity levels in Q2 2021 relative to the last quarter of 2019, with automotive, technology and apparel comprising the rest of the top four.

GlobalData's sector activity metric is derived from a range of the group's research datasets. The composite index uses a combination of company-level data on job advertisements, deals, stock prices and sentiment analysis across financial filings and news reports. The metric takes in a raft of data points that can be used to track how strongly different sectors or industries are performing.

The component parts of the index also give a sense of where companies are over or underperforming. One of the more traditional measures of tracking performance is through the value of company stocks, which are grouped by industry, below, to form a stocks price index. After a dip in Spring 2020, the average sector has been performing above pre-pandemic levels since early August 2020. The extent of recovery, however, varies.

 

As this chart shows, packaging stocks have overperformed the market in the past year. By the end of June this year, stocks in these companies - as tracked by GlobalData - were 46.8% above their starting point in October 2019.

Hiring levels are also useful in determining how confident a company feels about the months ahead. GlobalData's jobs index tracks job openings across thousands of companies on a daily basis, providing an assessment of confidence in real-time and gauge which sectors are feeling COVID's impact the hardest.

The number of job vacancies in packaging is currently at a lower level compared to most other industries, compared to their pre-pandemic norms. By 20 June 2021, the latest date for which data are available, hiring levels were 18.6% higher than prior to COVID's impact. Subsequently, the packaging sector ranks 14th of 18 when it comes to the recovery of hiring levels.

 

In addition to jobs and stocks, GlobalData's composite index also factors deals into account, tracking M&A as well as private equity and venture capital deals on a daily basis. Compared to pre-pandemic levels, the volume of financial deals in packaging has been lower than that of most other industries over the last 19 months.

 

By the end of June this year, packaging deals were 11.9% lower than at the start of October 2019. This places the sector in 14th position out of the 18 industries included in the analysis on current deal volume recovery.

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Verdict deals analysis methodology

This analysis considers only announced and completed deals from the GlobalData financial deals database and excludes all terminated and rumoured deals. Country and industry are defined according to the headquarters and dominant industry of the target firm. The term ‘acquisition’ refers to both completed deals and those in the bidding stage.

GlobalData tracks real-time data concerning all merger and acquisition, private equity/venture capital and asset transaction activity around the world from thousands of company websites and other reliable sources.

More in-depth reports and analysis on all reported deals are available for subscribers to GlobalData’s deals database.

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