- The global manufacturing sector is in the worst shape since summer 2009
- This is due to slowing economic growth and the deepening eurozone crisis
- Conditions deteriorated in Asia and the eurozone but picked up slightly in the US and UK
The global manufacturing sector is in the worst shape since the summer of 2009 as slowing economic growth and the deepening eurozone crisis take their toll on the world's factories.
Purchasing managers' index surveys released on Monday indicated global manufacturing activity weakened slightly last month to the lowest level since June 2009, when the world economy was emerging from recession. However, the fortunes of manufacturers diverged depending on their location: conditions deteriorated in Asia and the eurozone but picked up slightly in the US and UK.
The JP Morgan PMI of global manufacturing fell slightly from 50.2 in August to 49.9 in September.
Chris Williamson, chief economist at Markit, which compiles the PMI surveys, said: "Generally, the conditions in global manufacturing are getting worse, with the eurozone seeing the steepest deterioration [and] increasing signs of weakness in Asia".
The surveys come as politicians and central bankers race to resolve the eurozone sovereign debt crisis amid fears that uncertainty about the region's fate is hampering the global economic recovery.
Manufacturing activity in the US rose slightly faster than economists expected, according to the Institute for Supply Management survey, lifting hopes that the world's biggest economy can avoid slipping back into recession. Carmakers in the US reported strong sales for September, as consumers replaced old vehicles, credit conditions eased and the supply of Japanese vehicles recovered.
Activity also rose slightly in the UK, confounding economists' expectations that the sector would shrink. In both the US and the UK, rising production coincided with a drop in backlogs of work, which economists said suggested the pace of expansion might not be sustainable.
In the eurozone, the manufacturing sector shrank for the second month in a row, with new orders falling at their fastest pace since June 2009. Economists at Barclays Capital said this was "consistent with a deepening industrial recession". German manufacturers were the strongest in the region while those in Greece, Spain and Ireland suffered most.
PMI surveys in Asia showed a fourth successive monthly fall in activity in Taiwan, while manufacturing in India slowed to its weakest level for two and a half years. Conditions also worsened in Japan. Official PMI figures for China, published at the weekend by the National Bureau of Statistics, showed a slight improvement in activity.
Manufacturers continued to hire more people in the US, Germany, Japan and several other countries, while there were job losses in China, the UK and India, among others.