The Vietnam Manufacturing Purchasing Managers’ Index (PMI) remains low, according to a report from IHS Markit, indicating poor business conditions in Vietnam’s manufacturing sector.

The PMI was 40.2 in September, unchanged from August. The volume of backlogged jobs has increased rapidly, the qualifications of personnel has fallen, and supply chain disruptions have continued, all as a result of Covid-19.

Along with a sharp decline in new domestic business, many companies in Vietnam’s manufacturing sector indicate that new export orders fell much more sharply compared to August. Increasing delays in the supply chain have caused delivery times to be extended to a new record for three consecutive months. Problems with the supply of raw materials also contributed to increased pressure on purchasing prices as well as higher transportation costs. The decline in recent months in Vietnam’s manufacturing sector has been repeated in September, according to Mr. Andrew Harker, Economic Director of IHS Markit.

In addition, temporary business closures and staff shortages have reduced manufacturing output in Vietnam. Manufacturers have also reduced their purchasing activities in response to lower output requirements. Companies continue to face production capacity constraints, leading to high unemployment and job backlogs after a sustained period of declining output.