BERLIN – German manufacturing remained firmly entrenched in contraction territory in November as companies struggled with weak demand and competitive pressures, highlighting continued challenges for Europe’s biggest economy. This was revealed in a survey on Monday.
The HCOB German Manufacturing Purchasing Managers Index compiled by S&P Global was flat at 43.0, unchanged from October.
This final figure is slightly lower than the preliminary figure of 43.2, and remains well below the 50 points that separate growth from contraction.
The rate of decline in production and new orders slowed slightly, with the latter hitting a six-month low, but declines in employment, production prices and export sales accelerated.
Cyrus de la Rubia, chief economist at the Hamburg Commercial Bank, said: “The situation in German industry looks quite difficult. Almost every day we receive reports that manufacturing companies are planning large-scale layoffs.” “It’s been a long time coming, and people are feeling the pinch.”
Employment in the sector has been cut for the 17th consecutive month, with the pace of layoffs accelerating to near a 49-month record in September. Nearly 29% of companies reported workforce reductions, reflecting continued efforts to adjust workforce levels to lower workloads.
Despite these challenges, business confidence improved slightly, turning positive for the first time in three months, although it remains low by historical standards.
“This may be due to the collapse of the coalition government and the expectation that the new government will eventually deliver a real economic turnaround, including lower energy prices and debt brake reform,” Dell’Albia said. Probably.”
Germany is expected to hold a snap election in February after the ruling coalition government collapsed last month over a dispute over spending.
“Overall, the manufacturing recession appears to be extending into the new year,” he said.
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