In October, the Philippines manufacturing sector saw a solid increase in new order volume, contributing to further expansion. The manufacturing purchasing managers index (PMI) recorded a reading of 52.9, a slight decrease from the 53.7 reported in September. This figure remains above the critical threshold of 50, which indicates expansion within the industry. The latest survey indicated that strong demand led to an uptick in new orders, enabling manufacturers to boost their output significantly.
The PMI has consistently stayed above the 50 mark since January 2023, signaling ongoing growth in the sector. Factory managers in the Philippines responded to the rising orders by hiring at the fastest pace in six years. Improved demand trends facilitated a notable increase in workforce numbers, marking a significant surge in job creation reminiscent of mid-2017 levels. Despite the positive hiring trend, challenges emerged as manufacturers encountered supply-chain issues.
Supply chains were reported to be under strain, with vendor performance declining significantly—the second-worst performance since December 2022. Key issues included raw material shortages and port congestion, which hampered the flow of goods. The increased demand and hiring came alongside rising production costs, driven by surging material expenses and the depreciation of the Philippine peso, which escalated import costs.
Some companies opted to reduce purchases due to soaring material bills. On a brighter note, optimism within the manufacturing sector grew in October. Approximately half of the surveyed managers expressed a positive outlook for the upcoming year, despite the prevailing challenges. The PMI data was compiled from responses received from 400 manufacturers between October 10 and October 24, reflecting the pulse of the industry during this period..