Operating conditions in the manufacturing sector continued to improve in May as rising workloads led to the first increase in staffing levels for two and a half years.
The NCB Purchasing Managers Index rose for the fourth month in a row to 54.1 last month from 53.4 in April. The latest improvement was the best since September 2007, NCB notes.
Today's survey reveals that rising workloads led to the first instance of job creation in the manufacturing sector since November 2007. It noted, however , that the increase was only slight as a number of firms were still trying to improve efficiencies.
Production in the country's manufacturing industries increased for the third month in a row in May, mainly due to new order growth. Although the rate of new orders growth eased slightly from April levels, NCB said the growth was evident for the third month in a row.
But new export business increased at a much faster pace than total new orders, with companies reporting new business growth from the US and Asia.
The survey showed that input cost inflation accelerated sharply last month, extending the run of increases to five months. The cost of raw materials, including steel, oil and aluminium, all rose in May. As a result, Irish manufacturers increased their output prices for the first time since November 2008.
Purchasing activity rose for the third month in a row, although the increase was modest, NCB noted.
'The PMI rose once again in May on the back of increased output, new orders and - rather surprisingly - employment,' commented NCB economist Brian Devine.
He says the employment sub-index breached the 50 mark for the first time since November 2007, which means that of those firms surveyed more increased their employment levels than cut them. 17.1% of firms increased their headcount last month, while 11.3% cut it and 71.6% held steady.
'Manufacturing sector employment is far smaller than services employment, but nonetheless this is a really positive development,' Mr Devine added.
