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Indonesia factory activity hits record high for 3rd month in row
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Women factory workers in Indonesia have the right to take menstrual leave by law. However, in reality, the implementation of this rule is far from expected. (ANTARA/Rosa Panggabean)
I
ndonesia’s Purchasing Managers’ Index (PMI) rose to a record high for the third consecutive month in May, compelling manufacturers to hire new workers for the first time since the pandemic struck the country.
Business consultancy IHS Markit wrote in a press release on Wednesday that Indonesia’s PMI reached 55.3 in May, up from 54.6 in April, the highest reading ever recorded since the company started measuring the PMI in April 2011.
The PMI gauges factory activity based on a monthly survey of 400 local manufacturers. A PMI above 50 indicates expansion, while a PMI below 50 indicates contraction.
“Companies signaled robust demand and output improvements, while the first increase in employment in 15 months was also an encouraging sign,” said IHS Markit economics associate director Jingyi Pan.
Manufacturers had not hired new workers in April, leaving employment levels unchanged and order backlogs on the rise, even though activity was already rising that month, wrote IHS Markit in a previous statement.
Read also: Indonesia posts record manufacturing PMI for 2nd month in row
According to Statistics Indonesia (BPS) data, Indonesia’s unemployment rate stood at 6.26 percent in February, which is still higher than the average 5 percent of the past few years.
