Data released on Friday showed that Canada's manufacturing sector contracted for the seventh straight month in November. The main reason for this phenomenon is the weakness of the global industry, which directly affects the volume of production and new orders. However, in terms of employment, there have been some positive changes in the Canadian manufacturing industry.
Zhitong Finance learned that according to the S&P Global Canadian Manufacturing Purchasing Managers' Index (PMI), the PMI in November increased from 48 in October6 to 477. This is seasonally adjusted. A PMI below 50 means that the sector is contracting. PMI has been below the 50-point threshold since May, the longest streak of downturns since February 2016.
Paul Smith, economic director at S&P Global Market Intelligence, noted in a statement that the PMI for Canada's manufacturing sector once again demonstrated the broad challenges the country faces at the end of the year. He mentioned that the continued contraction in production and new orders is partly due to the downturn in global industry, which has limited demand and sales. In addition, destocking in the ** chain and tightening customer budgets are also problems faced by the manufacturing industry.
In terms of specific data, the output index rose from 46 in October9 dropped further to 461。The new orders index fell to 454, which is the lowest point since August 2022, compared to 483。
However, in terms of employment, the situation has improved. For the first time since April, the employment index rebounded into expansion territory, from 49 in October9 to 507。Statistics Canada data showed that the Canadian economy added 25,000 jobs in November, although the unemployment rate increased from 57% rose slightly to 58%。In terms of employment growth, manufacturing and construction performed best, while wholesale and retail, as well as finance, insurance, real estate and leasing saw the largest job declines.
Average hourly earnings rose 4 percent from a year earlier, despite some signs of weakness in the job market, a drag on economic growth from high interest rates, and population growth leading to more people joining the labor force8%, suggesting that workers are seeking compensation against high inflation.
At the same time, inflationary pressures are rising. Enter the ** index from 55 in October1 rose to 556. The output ** index reached 548, the highest level since February, compared to 526。
Smith noted that while current inflation is still well below the highs of previous years, merchants and manufacturers are still struggling to pass on costs to customers.