LONDON (Reuters) – The widespread contraction in manufacturing activity in the euro zone eased slightly last month but did not return to positive territory, leading factories to reduce their workforce for the sixth consecutive month, shows an investigation published Friday.
The final S&P Global/HCOB PMI for the manufacturing sector, from a purchasing managers’ survey, came in at 44.2 last month after 43.1 in October and an initial estimate of 43. 8.
The threshold of 50 separates growth and contraction of activity.
The production component, which is included in the calculation of the composite PMI index which will be published on Tuesday, rose to 44.6, against 43.1 previously.
“The month of November was not the prettiest, and this not only concerns the weather but also the situation of the manufacturing sector in the euro zone,” commented Cyrus de la Rubia, chief economist at Hamburg Commercial Bank.
“Of course, almost all sub-indexes have recovered somewhat. However, the improvements are mostly tepid, lacking the momentum needed to indicate an upward trend,” he added.
Sub-indexes covering demand, exports and order backlogs all recovered but remained firmly below the 50 threshold.
Overall demand fell for a 19th straight month, even as the new orders index rose to a six-month high from 39.0 to 41.5. The survey suggests that plant managers do not expect a significant rebound given that workforces have been reduced again.
The employment index fell to its lowest level since August 2020, when the COVID-19 pandemic was still prevalent.
(Written by Jonathan Cable; Claude Chendjou, edited by Blandine Hénault)
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