South Africa’s manufacturing output declined in November, official data showed on Thursday, highlighting continued weakness in one of the country’s most important economic sectors amid persistent structural constraints and subdued domestic demand.
Manufacturing production fell by 1.0 percent year on year in November, reversing a revised expansion of 0.4 percent recorded in October, according to Statistics South Africa.
On a month-on-month basis, factory output dropped by 1.1 percent in November, after rising by 1.0 percent in the previous month, underscoring volatility in industrial activity.
The manufacturing sector is a key pillar of South Africa’s economy, accounting for more than 13 percent of gross domestic product and employing hundreds of thousands of people. Its performance is closely watched as a barometer of broader economic health.
The November contraction reflects ongoing pressures facing manufacturers, including weak consumer demand, high operating costs, logistical bottlenecks and lingering energy constraints, despite some recent improvement in electricity supply.
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South African manufacturers have struggled over the past several years with rolling power cuts, known locally as load shedding, which have disrupted production schedules, raised costs and discouraged investment. Although the severity of outages eased toward the end of 2025, businesses say the impact of prolonged disruptions continues to weigh on output and confidence.
Rising input costs, particularly for electricity, transport and imported materials, have further constrained margins. While inflation has moderated from recent peaks, higher interest rates have dampened spending by households and businesses, reducing demand for manufactured goods.
Export-oriented manufacturers have also faced headwinds from slower global growth, particularly in key trading partners in Europe and Asia. Softer demand for commodities and manufactured products has limited production volumes, despite a relatively competitive exchange rate.
Analysts say the month-on-month decline suggests that October’s modest rebound was short-lived, rather than the start of a sustained recovery.
“The data point to a fragile recovery in manufacturing, with activity still vulnerable to both domestic and external shocks,” one Johannesburg-based economist said.
Manufacturing performance varies widely across subsectors, with food and beverages, basic metals and motor vehicles among those most sensitive to changes in demand, energy availability and export conditions.
The automotive industry, a major exporter and employer, has been particularly exposed to global supply chain disruptions and shifting demand patterns, while smaller manufacturers continue to grapple with financing constraints.
The weakness in manufacturing adds to broader concerns about South Africa’s economic outlook, with growth expected to remain modest in 2026. The economy expanded at a slow pace last year, constrained by infrastructure bottlenecks, logistics challenges at ports and railways, and weak private investment.
The government has identified industrialisation and reindustrialisation as key priorities, with initiatives aimed at boosting local production, improving infrastructure and supporting small and medium-sized manufacturers.
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However, progress has been uneven, and business groups have repeatedly called for faster reforms to improve electricity supply, logistics efficiency and regulatory certainty.
The central bank has kept interest rates elevated to anchor inflation expectations, a stance that supports price stability but also increases borrowing costs for manufacturers seeking to expand or modernise operations.
Despite the challenges, some signs of resilience have emerged, including gradual improvements in electricity availability and renewed investment interest in selected sectors such as renewable energy components and agro-processing.
Statistics South Africa’s data for the coming months will be closely watched for signs that manufacturing activity is stabilising or returning to growth.
A sustained recovery in the sector would be critical for boosting employment, improving export earnings and lifting overall economic growth in Africa’s most industrialised economy.
For now, the November contraction highlights the fragile state of South Africa’s manufacturing base and the scale of the task facing policymakers as they seek to revive industrial output in a challenging domestic and global environment.
