Production grew, the number of people employed increased again
Vietnam's manufacturing industry continued to grow slightly in February 2, when both output and the number of new orders increased for the second consecutive month. Sustained growth momentum has helped employment rebound.
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| The number of new orders continued to improve, supporting employment growth in February 2. |
According to S&P Global experts, Vietnam's manufacturing industry continued to grow slightly in February 2 when both output and the number of new orders increased for the second consecutive month. Sustained growth has helped jobs rise again, while business confidence rose to high levels.
Manufacturing Purchasing Managers' IndexTM (PMI) report states: "Vietnam's manufacturing industry achieved a result of 50,4 points in February, up slightly from 2 points in January and above threshold of 50,3 points for the second consecutive month.
The number of new orders increased slightly for the second month, as the number of new orders from abroad improved. However, the growth rate of new export orders has slowed down, and the increase is only slight.
In particular, increases in consumer goods and basic investment goods, but decreases in intermediate goods.
A surge in new orders encouraged manufacturers to increase headcount for the first time in four months, and the increase was the highest in a year. However, businesses tend to only hire new workers temporarily.
With employment rising and as growth in new orders remains low, businesses are able to clear their backlog of work for the first time in three months.
Businesses have used finished goods inventory to meet order requirements, thereby causing post-production inventory to continue to decrease.
One issue that needs to be mentioned is that businesses purchasing input goods continued to encounter extended delivery times from suppliers in February, due to shipping delays.
“Transportation delays coincide with increased transportation costs due to rising oil prices. From there, input costs increased significantly in February, although the level of increase was the lowest since September last year", according to S&P Global PMI.
Notably, producers of basic investment goods experienced particularly sharp increases in input costs. Some manufacturers have transferred the burden of high input costs to customers, thereby causing selling prices to increase slightly after a slight decrease in the previous survey period. The slight price increase reflects the fact that businesses are trying to limit price increases because of competitive pressure.
Plans to expand production and introduce new products contributed to increased business confidence in the middle of the first quarter, and optimism about output also reflected expectations of order growth. new products. Business confidence hit a one-year high with nearly 1% of survey respondents expressing optimism.
Andrew Harker, Director of Economics at S&P Global Market Intelligence said: “The positive factors of the latest PMI survey are that employment rebounded and business confidence reached its highest level in a year. However, overall growth remains relatively weak, and this causes businesses to continue to be cautious in purchasing and maintaining inventory."
