After a muted performance in the first four months of 2018, the outlook for the manufacturing sector still looks glum. The sector is the fourth biggest of the economy at 13% after financial services, government and the trade sectors. It added 58,000 jobs in the first quarter, according to Statistics SA’s quarterly labour force survey. The Absa purchasing managers’ index (PMI), one of the key trackers of activity in the manufacturing sector, slumped to the lowest level in three months. The June index dropped to below the neutral 50 mark, a clear indication of a contraction in the sector. The move does not bode well for the economy, whose growth in the first quarter waned. Together with the mining and agricultural sectors, a dour manufacturing performance was one of the main reasons for the waning growth. “The fall in South Africa’s manufacturing PMI for June provides further evidence that the slump in the economy seen in the first quarter was followed by further weakness in the secon...
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