Statistics South Africa reported that the economy grew by an adjusted 0,5% in the second quarter to 1,4% in the third quarter.

Mr Langenhoven said that the latest restated and rebased manufacturing data showed stagnation in the sector’s growth rates since 2010. The 2010 data reflected recovery after a contraction of 10,6% in 2009. Annual expansion slowed down from 5,9% in 2010 to 2,9% in 2011, 1,9% in 2012 and 0,7% 2013, with the three quarters of 2014 contracting by 0,2%. It is only now that manufacturing production has recovered to the same level as in 2008.

“However, the volatility is something to behold. In 2012 seasonally-adjusted quarterly growth fluctuated between +6% and -1,2% and between +12,3% and -8% in 2013. 2014 simply recorded contractions to different degrees: quarter one was -6,4%, quarter two was -4% and quarter three was -3,4%. These are, indeed, very concerning trends,” Mr Langenhoven said.

He said that a similar trend was evident from figures for the metals and engineering sector: there was a contraction of 21% in 2009, recovering by 4,3% in 2010, then growth slowed to 4,1% in 2011 and 0,2% in 2012, before improving by 2,6% in 2013.

Mr Langenhoven said that an estimated further contraction of 2% was evident over the first three quarters of 2014, leaving metals and engineering production still 12% below the 2008 peak.

“Coinciding indicators such as capacity utilisation and employment numbers confirm the difficult trading conditions within the sluggish domestic economy (demand from mining, construction and the auto sector) and tentative world economic recovery,” said Mr Langenhoven.

He added that recovery was only likely to be seen towards the middle of 2015, if the typical lag of 12 to 18 months holds between confidence recovering and productive activity following suit.

“The trends in the main confidence indicators measured by the Bureau for Economic Research’s manufacturing survey and the business activity sub-index of the Kagiso/BER Purchasing Managers’ Index have shown lower turning points in their respective troughs. General business conditions for the economy, also measured by the BER and released a few hours ago, show the same fragility,” Mr Langenhoven concluded.