Irish manufacturing weathers second lockdown as output expands in November

Cork Harbour, Cork, Ireland. 26th November, 2020. Container vessel Aila leaves Cork Harbour on route to Dunkirk in France. This new service provides exporters with a direct link to the continent from Ireland and removes any fears of uncertainity with Brexit. Picture: David Creedon / Anzenberger

Irish manufacturing weathered the second lockdown to boost output and jobs in November, an encouraging sign that international demand is strengthening after the severe Covid-19 crisis, according to the latest purchasing managers' survey. 

The AIB Purchasing Managers' Index (PMI) also showed that manufacturers were the most upbeat about their prospects since the onset of the crisis, although some of the growth may be down to stockpiling ahead of Brexit.       

The Irish PMI index is closely watched because a large number of multinational manufacturers, including pharma and medical device makers, are based here producing for European and US markets. Expansion of manufacturing in Ireland can mean that world demand is recovering from the worst crisis for the global economy in over 10 years.                                            

At 52.2 in November, the overall Irish index was up from 50.3 in October, where any reading above 50 indicates expansion for manufacturing. 

"It was the third-highest reading since April 2019, which is impressive considering that the Irish, as well as some other European economies, were back in lockdown in November," the survey found. 

"The impact of the imminent end to the Brexit transition period manifested itself in some stockpiling, with purchases of inputs rising and a sharp jump in the stocks of inputs," it said.   

Meanwhile, Capital Economics said that world trade was over 90% of its way back to its pre-virus level. 

"As long as industry remains relatively unscathed by renewed restrictions in Europe and the US, trade flows should stay resilient in the coming months," said its senior global economist Simon MacAdam. 

He said the improved outlook for tourism "means that a recovery in air travel "will facilitate a stronger recovery in air freight" because more planes will be flying.