[Asia Economy Beijing=Correspondent Kim Hyunjung] Due to the impact of lockdowns caused by the spread of COVID-19 and global supply chain instability, China's manufacturing Purchasing Managers' Index (PMI) showed a decline for the second consecutive month following the previous month.
On the 30th, China's National Bureau of Statistics announced that the official manufacturing PMI for November was recorded at 48.0, down from 49.2 in the previous month. After rebounding from 49.4 in August to 50.1 in September, the index fell below the baseline (50) in October and showed further weakness this month. The index itself is at its lowest level since the Shanghai lockdown was implemented in May.
The manufacturing PMI is compiled by surveying purchasing managers from over 700 manufacturing companies nationwide on five sub-indices: new orders, production, shipments, inventory, and employment. If the index is above the baseline of 50, it indicates an expansion phase in the economy; if below 50, it indicates a contraction phase.
By company size, the PMI was 49.1 for large enterprises, 48.1 for medium enterprises, and 45.6 for small enterprises, showing that smaller companies are facing worse conditions.
The non-manufacturing PMI for the same month also fell to 46.7 from 48.7 in the previous month, resulting in an official composite PMI, which includes both manufacturing and services sectors, of 47.1. This is not only a sharp drop from 49.0 in the previous month but also the lowest level in seven months. The construction sector showed relatively favorable conditions, with the November construction business activity index at 55.4, continuing an expansion trend for six consecutive months.
Both employment and supply chain conditions worsened due to the zero-COVID policy impact. According to Chinese economic media Caixin, the employment index in November was 47.4, down from 48.3 in the previous month, and the supplier delivery time index was 46.7, continuing a contraction phase for four consecutive months. Some surveyed companies reported delays in supplier delivery times and a decrease in customer orders due to poor logistics and transportation conditions and limited production activities.
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