Ireland’s Manufacturing Sector Experiences Contraction After Six Years
Ireland’s manufacturing sector slid sharply into contraction during March, experiencing the worst decline in factory activity because of the coronavirus pandemic impacting supply chains and demand. The AIB IHS Markit manufacturing PMI reading fell to 45.1 in March from 51.2 in the previous month, falling below the 50-threshold indicating contraction.
This was the weakest reading for this index seen since May 2009. New orders witnessed a sharp contraction, with its sub-index reading falling from 52.3 during February to 38.2 in March.
New export orders contracted at the fastest pace since April 2009 due to the coronavirus pandemic. Employment in the Irish manufacturing sector also declined for three out of the last four months, with the pace of reduction being the fastest seen since July 2009.
According to AIB’s chief economist Oliver Mangan, “The PMI data confirm that there was an abrupt and steep fall in manufacturing in March.” He also cautioned that the numbers could get worse until the pandemic subsides and the economic activity resumes.
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