PH Ends 2024 with Stronger Manufacturing Growth

The Philippine manufacturing sector closed 2024 on a high note, with growth accelerating to levels last seen in April 2022, driven by stronger output and new orders. According to S&P Global’s latest survey, the Philippines Manufacturing Purchasing Managers’ Index (PMI) rose to 54.3 in December, up from 53.8 in November, marking the joint-strongest reading since November 2017.

Key Highlights of the Report

• Output and New Orders: Growth reached its highest level in 32 months, fueled by strong underlying demand, product diversification, and new client acquisitions.
• Exports: New export orders increased for the first time in five months, signaling renewed international demand.
• Purchasing Activity: Firms expanded purchasing to meet production needs, benefiting from moderated inflationary pressures.
• Inflation: Cost burdens and output charges rose at historically muted rates, contrasting with the sharp increases seen in November.

Employment and Efficiency

While manufacturing firms reported a slight drop in employment—ending a three-month streak of job creation—they managed to handle workloads efficiently, leading to the most significant backlog depletion in 13 months.

S&P Global Market Intelligence economist Maryam Baluch noted:

“While production efficiency allowed manufacturers to stay on top of tasks at hand, it also led to a slight drop in employment. However, this could be a temporary blip, especially if demand remains resilient as anticipated throughout 2025.”

Outlook for 2025

The report signals optimism for the Philippine manufacturing sector heading into 2025, with resilient demand trends and moderated inflationary pressures providing a favorable environment for sustained growth.

Official government data on manufacturing performance, under the Monthly Integrated Survey of Selected Industries (MISSI), will be released on February 7, 2025.