Manufacturing production off to a good start in final quarter
bdlive.co.za - Dec 12th 2017, 14:44
Manufacturing production got the final quarter of a tough 2017 off to a good start, as expected, posting growth of 2.2% for October from a year earlier, after a revised 1.7% year-on-year contraction in September.
Compared with September, manufacturing production was up 0.7%, Statistics SA said on Tuesday.
For the three months to October, output increased 0.8%, with only two of 10 subsectors showing positive growth in that period: petroleum, chemical products, rubber and plastic products, up 4.3%; and? basic iron and steel, nonferrous metal products, metal products and machinery, up 0.7%.
For the year to date, however, manufacturing production has contracted 0.9%.
The sector was one of the main contributors to the 2% growth rate the South African economy posted in the third quarter.
Manufacturing posted growth of 4.3% compared with the second quarter and contributed 0.5 percentage points to the gross domestic product (GDP) growth rate, Stats SA said last week.
"The manufacturing sector has derived some support from the strengthening global demand conditions but growth in the sector is being constrained by weak domestic demand and persistent policy uncertainty, which has weighed on confidence levels," Investec economist Kamilla Kaplan said in her weekly note released on Friday.
Purchasing managers indices (PMIs) have also consistently depicted a sector under pressure, and the November reading on Absa’s PMI, at 48.6 points, was a slight improvement but marked the sixth month in a row that it came in below the 50-point threshold between expansion and contraction.
SA’s economy is out of step with a global recovery, and growth for 2017 has been forecast at about 1% — far below the rate needed to create jobs and tackle a stubborn unemployment crisis.
Manufacturing is a potential job-creating engine for SA, which has one of the highest unemployment rates in the world, and industry body the Manufacturing Circle recently announced a plan to create a million factory jobs within the next 10 years.
Stats SA also released its quarterly employment statistics on Tuesday. The numbers — based on a survey of non-agricultural employers — showed that SA’s economy shed 31,000 jobs in the third quarter, with 5,000 of those coming from the manufacturing sector.
At end-September, the sector employed 1.176-million people.
© BusinessLIVE MMXVII
Inflation eases even more than expected
21/08/2019 - 10:36
Inflation eased more than expected to 4% in July.
Survivor crowned 2019 ABSA Top Ten Pinotage
15/08/2019 - 11:25
Survivor, the unbridled Swartland wine range, has been recognised as one of South Africa’s top Pinotage producers making the cut in the prestigious 2019 ABSA Top Ten Competition.
We need to rethink our food system to tackle climate change
15/08/2019 - 09:19
The way we produce, consume and discard food is no longer sustainable.
Crackdown on informal traders will hurt economy, says refugee forum
13/08/2019 - 09:40
SA’s embattled economy could be strained further if the crackdown on informal traders continues unabated, the African Diaspora Forum (ADF) warns.
Retail boost could steer SA away from a recession
12/08/2019 - 12:37
A rebound in economic growth in the second quarter of the year will likely see SA avert its second recession in two years.