Global manufacturing employment rises at record pace

Source: ISM

Feb 15, 2011

At 57.2 in January, up from 55.6 in December, the JPMorgan Global Manufacturing PMI rose to a nine-month high. The PMI has remained above the neutral 50.0 mark, signaling expansion, for 19 consecutive months. Growth of production and new orders continued to accelerate, leading to survey record job creation.

The US PMI rose to an eighty-month high in January, while its counterpart in the Eurozone hit a nine-month peak. The UK PMI rose to its highest level since (UK) data were first collected in 1992. Meanwhile, the China and India PMIs crept higher from December's three-month lows and an expansion was signalled in Japan, albeit only slight, for the first time since last August.

Within the Eurozone, growth was led by Germany, followed by Austria and then the Netherlands. There were also signs that conditions were picking up in a number of the peripheral nations. Ireland's PMI was the highest since April 2000 and Italy's the strongest since June 2006. Spain's reading was the second-best since August 2007. The French PMI signalled that growth had slowed to a six-month low. The downturn in Greece continued.

Manufacturing production increased for the twentieth successive month in January, with growth of output the highest since last April. Amongst the largest industrial regions covered by the survey, rates of expansion accelerated in the US (eight-month high), the Eurozone (fastest since last April), the UK (sixteen-year high and India. Chinese production also rose at a solid clip, albeit the slowest in four months, while Japan saw output increase for the first time since September 2010.

Underpinning robust growth of production was the steepest increase in new orders for a year. International trade flows also strengthened, with the rate of growth in new export business the sharpest since last May.

Employment rose at the fastest pace in the survey history in January. Staffing levels have now risen in each of the past 14 months. Job creation in the US was the fastest since April 1973. Survey record rates of increase were also seen in Germany, the UK and Austria. Jobs growth was the fastest since October 2000 in the Eurozone. Employment rose for the third month running in China and for the first time since July in Japan.

January saw cost inflation pick up sharply to reach a two-and-ahalf year high. Amongst the largest industrial regions covered, rates of increase rose to the strongest since July 2008 in the US and hit record highs in the Eurozone and the UK. Cost inflation also accelerated in Japan, but eased slightly in China.