PMI falls as shaky economy takes toll on private sector

Johannesburg - The Standard Bank Purchasing Managers' Index (PMI) fell to a 14-month low of 47.9 in September from 49.3 in August as the weak economy took its toll on companies.

The survey, compiled by Markit and published on Monday, showed a continued contraction in output from South African private firms and lower new orders in September.

The employment subindex fell below the 50 mark that separates expansion from contraction for the first time since May 2015 and was the second-largest contributor to the decline in the overall index.

"We expect employment in the manufacturing, mining and construction sectors to be particularly impacted by lower commodity prices and slower domestic and global economic growth," said Kuvasha Naidoo, an economist at Standard Bank.

South Africa's economy is beset by constraints including electricity shortages and labour unrest, and contracted in the second quarter, the first decline in a year.