South Africa’s manufacturing sentiment deteriorated further in February, with a key purchasing managers’ index (PMI) remaining below the 50-point threshold that separates expansion from contraction, a survey showed Monday.
The seasonally adjusted PMI, sponsored by South African lender Absa, fell to 47.4 points in February from 48.7 in January.
A reading below 50 indicates an overall deterioration in business conditions, suggesting that the sector remains under pressure despite hopes of a recovery at the start of the year.
Absa said the latest data pointed to a loss of momentum after a tentative rebound in production in early 2026.
“The stop-start nature of manufacturing output, also evident in official data, is not conducive to longer-term capacity expansion, investment growth or employment gains,” the bank said in a statement accompanying the survey.
More Read
Most of the PMI’s subcomponents were broadly unchanged from January, but weaker business activity and a further decline in employment weighed on the headline index.
The survey indicated that factories continued to face subdued demand, limiting output and hiring. The employment sub-index remained in contractionary territory, reflecting ongoing caution among manufacturers about adding to payrolls amid uncertain trading conditions.
One bright spot in the February data was a rise in the sub-index tracking expected business conditions, suggesting that some firms are more optimistic about the months ahead.
However, prevailing structural challenges continue to hamper the sector. Manufacturers have reported delays in shipments at South African ports, localised electricity disruptions and weak domestic and external demand as key constraints.
Port congestion and logistical bottlenecks have disrupted supply chains and export flows, increasing costs and delivery times for producers. Meanwhile, intermittent power supply issues, although less severe than during peak load-shedding periods in previous years, remain a risk to stable production.
Manufacturing is a critical pillar of Africa’s most industrialised economy, contributing significantly to gross domestic product and employment. Sustained weakness in the sector can weigh on broader economic growth prospects, particularly at a time when policymakers are seeking to stimulate investment and job creation.
Economists say that improving infrastructure reliability, boosting export competitiveness and strengthening domestic demand will be key to reviving manufacturing momentum.
The February PMI reading suggests that while conditions may not be deteriorating sharply, the sector has yet to achieve a durable recovery.
Further official production data in the coming months will provide additional insight into whether the modest uptick seen at the start of the year can be regained or whether manufacturing will remain constrained by persistent structural and cyclical headwinds.
