All the indicators for the sector remained in contraction apart from employment. Photo: RNZ / Samuel Rillstone
The manufacturing sector improved last month, but remains in contraction for the 11th consecutive month.
The BNZ-Business New Zealand Performance of Manufacturing Index (PMI) rose 3.9 points to 47.3 points from 43.1 in December.
A reading below 50 indicates the sector contracting.
All the PMI's sub-indices remained in contraction apart from employment.
"On the positive side, employment (51.3) was in slight expansion for the first time since February 2023, while new orders (47.7) improved to its highest level since May 2023," BusinessNZ direct Catherine Beard said.
"However, new orders has now remained in contraction for eight consecutive months, which combined with production (42.1) has meant a sector that is still someway off returning to expansion."
NZ senior economist Doug Steel said employment was a stand-out.
"This is at odds with deeply negative production and demand indicators like new orders," Steel said.
"The whiff of more employment in the PMI might reflect better access to staff, with manufacturers reporting in the latest QSBO that labour is easier to find."