First, consider the issues of employment and core PMIs:
So in terms of economic activity, we have moved:
- In Manufacturing from the recovery with mild jobs creation in January 2011 to both employment and output contractions in July 2011.
- In Services, a jobless recovery in January 2011 remains such in July with July reading showing accelerated joblessness and slower growth in output.
Now, in terms of exports-led growth:
While exports performance continues to the upside in both Services and Manufacturing, in both sectors, exports growth is associated with declining employment, not rising. This is now an established trend with both June and July showing jobs declines amidst exports growth in both sectors, in contrast with May, when exports growth in both sectors supported fragile jobs creation.
So far, since January 2008, there were:
- 17 months of jobs-destruction associated exports increases in Services, against just 6 months where jobs creation was associated with exports growth
- 20 months of jobs destruction during coincident exports expansions in Manufacturing, against just one month when jobs creation underpinned exports growth.