Today's Edition
A.SREENIVASA REDDY (ABU DHABI)
The UAE’s non-oil private sector activity expanded at the quickest pace for 11 months in November as robust market conditions boosted new business, with the seasonally adjusted S&P Global UAE Purchasing Managers’ Index (PMI) registering 54.8, up from October’s 53.8 and above its long-run average of 54.3.
The PMI, a key indicator tracking business activity in the manufacturing and services sectors, showed that the pace of growth remained above its long-run average as firms experienced greater inflows of new work and broadly positive market conditions.
“The UAE non-oil private sector has delivered a robust performance in the fourth quarter so far, with November's PMI indicating the strongest improvement in business conditions in nine months,” said David Owen, Senior Economist at S&P Global Market Intelligence. “The upturn was often linked to strong customer demand and healthy sales pipelines that encouraged firms to expand both their output and staffing.”
“Although employment growth remained moderate overall, it was still the quickest in one-and-a-half years, signalling a partial rebound in labour markets after a relatively muted period,” Owen added.
The S&P Global PMI report says the new business volumes increased in November, with the growth rate reaching its strongest since January.
“Survey respondents pointed to a supportive market environment that facilitated larger client orders and boosted activity across many sectors,” the report said. Firms saw product innovation, market diversification and technology upgrades as key drivers of higher sales.
Overall employment levels grew as firms exhibited a greater willingness to hire during November, particularly as an increase in sales contributed to a sharper rise in outstanding work levels. Although the hiring increase was modest, it was the most pronounced since May 2024, the report said.
Purchasing activity too rose in November, marking the third straight monthly expansion after a brief contraction in August. “Inputs were largely consumed in firms' operations, resulting in a reduction in overall stocks for the fourth time in five months,” the report said.
The November data signalled a quicker rise in both input costs and output charges across the non-oil economy. “The increase in input costs was the sharpest in 14 months, which respondents mostly linked to higher living expenses and improved sales performances that put pressure on wages,” the report said. Total staff expenses rose to the greatest degree since April 2018, the report noted.
Companies also raised their own charges at the fastest pace in three months, though the increase remained modest, the report added.
Expectations for future activity also rose from October’s three-year low. Over 13% of businesses anticipated higher output in the next 12 months compared to current levels, while less than 1% expected a decline. Survey respondents frequently cited strong sales pipelines and a favourable business environment as key factors supporting their optimism.
Dubai PMI
Dubai’s non-oil private sector saw another marked improvement in operating conditions in November with its PMI staying at 54.5.
Non-oil companies reported an increase in staffing numbers midway through the fourth quarter, which was the fastest recorded in 18 months, the report said. Input stocks dropped for the first time since August.
Supply chains improved in November. Overall input costs increased to the greatest extent since February, driven by a pick-up in staff cost pressures. “Firms responded by passing some of these increased costs on to customers, resulting in a modest rise in output charges,” the S&P report said.
