PH factory production maintains a downward trend – Manila Bulletin

Philippine manufacturing output maintained a downward trend in November, but moved slowly towards stabilization amid new signs of recovery momentum, the latest monthly IHS Markit survey revealed.

The Philippines Purchasing Managers Index (PMI) rose from 48.5 in October to 49.9 in November, registering just shy of the neutral value of 50 that separates expansion from contraction.

Shreeya Patel, an economist at IHS Markit, said the country’s manufacturing sector showed promising signs of renewed recovery momentum in November as the main PMI figure approached the expansion level.

The November PMI showed considerable easing in the recession in the manufacturing sector after production increased for the first time since June, as external demand improved markedly compared to October.

“It is encouraging that companies posted the slowest decline in employment in the current sequence of nine months of decline despite a sharp decline in backlogs,” Patel said.

However, he said the road to recovery may not be easy.

“The health of the sector is based on the number of COVID-19 cases and the impact the virus has on the world economy. While the development of the vaccines looks promising, it is not yet clear when the restrictions will arrive.

full ending, ”Patel said.

Although production levels increased, job losses persisted at a solid pace. IHS Markit said this is anecdotal evidence suggesting that companies had sufficient capacity to fulfill new incoming orders, and pressures to save costs led to further cuts in the workforce.

For the 12-month outlook, IHS Markit said that local manufacturing output remained positive in November.

“Recent vaccine developments raised hopes that the virus will spread over the next year. That said, sentiment moderated from October, and was still subdued in the context of historical data, ”said IHS Markit.

Among six in the Association of Southeast Asian Nations, the Philippines was tied with Vietnam, but trailed behind Singapore, Thailand and Indonesia, whose ratings were all above the 50 threshold.

The Philippines PMI is also slightly below the ASEAN regional average 50, but better than Malaysia (48.4) and Myanmar (43.2).