DUBLIN, (Reuters) - Irish manufacturing growth slowed in September, and employment in the sector failed to expand for the first time in over three years, a survey showed on Monday, as factories grappled with the fall-out from Britain’s vote to leave the European Union.
The Investec Manufacturing Purchasing Managers’ Index slipped to 51.3 from 51.7 in August, but remained above the 50
mark that separates expansion from contraction for the 40th straight month.
The employment sub-index slipped to 49.9 from 52.8, its first contraction - albeit a very mild one - since May 2013.
”The rate of decline here was only minimal, but with the backlogs of work index showing a ninth successive monthly
depletion in outstanding business, we would not be too optimistic about the prospect for a near-term return to job creation,” Investec Ireland Chief Economist Philip O‘Sullivan said.
Some panellists indicated that departing staff had not been replaced, while others reported lowering staffing levels in
response to recent weakness in new orders, the survey’s authors said in a statement.
Europe’s fastest-growing economy, Ireland is considered to have more to lose than any other EU member from Britain’s
decision to quit the bloc, which both countries joined 43 years ago. Exporters have been hit by the fall in the value of
sterling since Britain’s June 23 vote.
There were some positive signs in the survey, with new export orders returning to growth after two months of decline.
But the rate of growth in overall new orders slowed slightly and a contraction in stocks of purchases deepened.
”All in all, the (survey) does little to change our narrative ... that working capital management (joined in September by a more cautious approach to hiring) points to well-founded caution on the part of Irish manufacturers as we
head into the year-end,” O’Sullivan said.
Detailed PMI data are only available under licence from
Reporting by Conor Humphries; Editing by Hugh Lawson