---
title: "SA manufacturing output rises 1.9% in November, adding to hopes recession has been dodged"
description: "South African manufacturing production rose 1.9% year-on-year in November, adding another glimmer of hope that a recession has been narrowly dodged. The data also suggests that industry is rising to the challenge of chronic power shortages and other problems."
type: "NewsArticle"
publisher: "Daily Maverick"
site: "https://www.dailymaverick.co.za"
section: "RECESSION WATCH"
author: "Ed Stoddard"
author_url: "https://www.dailymaverick.co.za/author/ed-stoddard/"
canonical_url: "https://www.dailymaverick.co.za/article/2024-01-11-sa-manufacturing-output-rises-1-9-in-november-adding-to-hopes-recession-has-been-dodged/"
published: "2024-01-11T20:09:51"
lang: "en-ZA"
word_count: 398
---

# SA manufacturing output rises 1.9% in November, adding to hopes recession has been dodged

> South African manufacturing production rose 1.9% year-on-year in November, adding another glimmer of hope that a recession has been narrowly dodged. The data also suggests that industry is rising to the challenge of chronic power shortages and other problems.

By Ed Stoddard · Published 11 January 2024, 22:09 SAST

## Key points
- Despite numerous challenges, the manufacturing sector in South Africa is staying afloat, with a modest annual growth of 1.9% that exceeded expectations, but a contraction in the three months leading up to November suggests it may hinder the overall GDP if the trend continues, although a slight positive sign emerged with the December data showing a small increase in the Absa Purchasing Managers Index, indicating a possible expansion in production.
- South Africa's manufacturing sector is struggling despite various challenges.
- Annual output rose 1.9%, slightly below expectations, but still indicating potential positive contribution to overall GDP.
- A Q4 contraction could signal a recession, but it is too early to make a clear call.
- The Absa PMI rose in December, suggesting continued expansion in production, highlighting resilience in the manufacturing sector.

## Content

The data, unveiled on Thursday by Statistics South Africa, shows that the crucial manufacturing sector is limping along despite the array of challenges it faces.

On an annual basis, output rose 1.9%, above Bloomberg expectations of 1.5% growth. This was a slowdown from the revised October figure of 2.3% but base effects were at play there, as the crippling Transnet strike occurred in October 2022.

“Data from the productive sectors thus far has not been terrible, suggesting that industry could make a small positive contribution to overall GDP – lowering the odds of an economic recession in Q4 2023. That said, with quite a few major Q4 2023 data releases still due, it remains too early to say what the outcome will be,” Jee-A van der Linde, senior economist at Oxford Economics Africa, said in a note on the data.

![sa manufacturing november](https://www.dailymaverick.co.za/wp-content/uploads/2024/01/bm-ed-Manufacturing-Nov-.jpg)South Africa’s economy contracted 0.2% in the third quarter (Q3) last year, and so a Q4 contraction would signal a recession.

As Van der Linde noted, it is still too soon to make a clear call on this front.

On a monthly basis, the manufacturing production increased 0.8% in November after slipping 0.1% in October – a positive sign.

But in the three months to the end of November, there was a 0.5% contraction, and if that trend continues in December, manufacturing will be a drag on the overall GDP number measured quarterly.

Still, one green shoot has already emerged in the December data. The Absa Purchasing Managers Index (PMI), a key gauge of manufacturing activity, rose 2.7 points in December to 50.9. This means it went from negative territory into positive terrain, but only by a slim margin.

**Read more in Daily Maverick:**[Recession Watch: Absa PMI edges up in December but remains subdued](https://www.dailymaverick.co.za/article/2024-01-09-recession-watch-absa-pmi-edges-up-in-december-but-remains-subdued/)

Pointedly, the PMI business activity index had a nice bounce in December to 51.4 from 46.0.

Thanda Sithole, FNB senior economist, said in a commentary that this signalled “continued monthly expansion in production. This would be positive for the 4Q GDP outcome”.

More broadly, the fact that there is any growth at all in South Africa’s manufacturing sector points to resilience against the domestic backdrop of power shortages and mounting logistics problems, and a global economy that is still not shooting the lights out.

Be it solar panels, diesel generators or logistical solutions, South African manufacturers seem to be making a plan. **DM**