MANILA – The country’s manufacturing score in March this year posted growth as production volume and purchasing activity continue to rise, the IHS Markit manufacturing purchasing managers’ index (PMI) report said.
The report released Monday shows that Philippine manufacturing PMI in March pegged at 52.2, but lower than its score in February at 52.5.
Indices above the neutral score of 50 indicate growth of the sector, while below 50 reflect deterioration.
“The Philippines manufacturing sector ended the first quarter on a positive note with a modest expansion recorded in March. Promisingly, output volumes rose despite a moderation in a new order growth,” IHS Markit Shreeya Patel said.
The report added that subdued foreign client demand was mainly brought by restrictions abroad due to rising coronavirus disease 2019 (Covid-19) cases.
Hiring activities of manufacturers continue to fall for 13 consecutive months, but employment contraction last month was the softest since March 2020, IHS Markit said.
“Employment levels fell only marginally with anecdotal evidence suggesting that this was mostly voluntary, and not due to cost-cutting efforts at firms,” Patel added.
Philippines-based manufacturers said they face supply chain pressures such as longer lead times for inputs and delivery.
The report said firms are expected to increase their inventory to minimize future shortages due to delays.
Meanwhile, price pressures are also rising.
“A key area of concern, however, continues to be rising price pressures. Material shortages were often blamed for the higher costs incurred by firms. A sustained increase in client demand, however, allowed some firms to partially pass on rising expenses,” Patel said.
Outlook production for the next 12 months remained in positive territory, IHS Markit survey showed.
However, businesses were less optimistic in March than in February.
“The degree of optimism posted below the long-run trend, suggesting that the global pandemic continues to weigh on expectations,” the report added. (PNA)
