Manufacturing on sharpest rise since 2007
Published 02/06/2010 | 05:00
EMPLOYMENT in manufacturing grew last month for the first time in two-and-a-half years, according to the monthly survey of managers.
Output and activity increased at a faster-than-average pace for the second month in a row in May.
"The cyclical recovery in Ireland continues to gain momentum," said Brian Devine, senior economist at NCB Stockbrokers, which sponsors the survey.
The good news from Ireland matched performances in Britain and the USA, but output growth across the eurozone slowed to a level not seen since the collapse of Lehman Brothers in 2008, a key survey showed today.
Germany recorded a significant slowdown in its manufacturing growth rate, according to a similar survey.
The overall index for for Irish manufacturing activity rose to 54.1, where anything over 50 represents growth. It was the sharpest increase since September 2007.
The reported growth in employment came as a surprise. Seventeen per cent of firms increased employment, with 11.3pc cutting it and 71.6pc holding jobs steady.
"Manufacturing sector employment is far smaller than services employment, but nonetheless this is a really positive development," Mr Devine said.
"The multiplier effects from increased manufacturing employment will aid the recovery in the more domestically orientated services sector."
Export orders are growing strongly and the pace quickened in May, with the index reading 59.2. The new orders index eased back for the second month running due to fragile domestic demand, but are still growing, supported by exports.
The British survey showed that manufacturing activity held steady in May after accelerating to a 15-year high in April. UK industry has been growing since July of last year, but the survey shows signs of accelerating price pressures.
The US manufacturing sector grew for the 10th consecutive month in May, with an index of 59.7 indicating rapid growth.
The Institute for Supply Management said its survey of managers showed continued strength in new orders and production, despite the rate of growth slowing slightly from April, when the index topped the 60 mark.