Indonesian manufacturing grew in February 2025, reaching its highest point in 11 months.

S&P Global reported that Indonesia's manufacturing index, measured by the Purchasing Manager's Index (PMI), reached 53.6 points in February 2025. This score indicates expansion, exceeding the 50-point threshold.

This figure represents a 1.7-point increase from January 2025's 51.9 points, marking the highest score in the past 11 months, according to S&P.

S&P attributes this significant increase to a healthy goods-producing sector and solid improvements in factory operating conditions.

"The core of the February increase is the acceleration of rising demand for Indonesian goods," wrote S&P Global in a report cited on Tuesday (March 18, 2025).

New orders increased for three consecutive months, with the strongest growth rate since March 2024. The report from panel research members also indicates increased market activity, supporting the creation of new jobs.

Citing *Katadata*, Saleh Husin, the Deputy Chairman of the Indonesian Chamber of Commerce and Industry (Kadin) for Industry, attributes the score increase to anticipation of a sales surge ahead of Ramadan and Eid al-Fitr 2025.

"The rise in the February 2025 PMI is due to the anticipation of increased sales in the coming months, such as Ramadan and Eid al-Fitr. This has driven an increase in raw material stocks and production activity since January 2025," Saleh told *Katadata* on Tuesday (March 4, 2025).

However, Saleh acknowledges that layoffs in the manufacturing sector continue, particularly in the textile and electronics industries. The Ministry of Manpower recorded a 20.16% increase in layoffs throughout 2024 compared to the previous year, adding up to 13,080 people.

(See also: Indonesian Manufacturing Business Expands Again in Early 2025)

The Center of Reform on Economics (CORE) Indonesia offers a different perspective, stating that PMI data does not directly correlate with layoff figures.

CORE Indonesia's Executive Director, Mohammad Faisal, explains that PMI data reflects monthly changes, while layoffs are the cumulative impact of long-term issues. This highlights a disparity between local industries, specifically between capital-intensive and labor-intensive industries.

He notes that the February PMI increase benefited capital-intensive industries like food and beverages more. While overall industry performance remains in expansion, the aggregate growth masks contractions in labor-intensive industries, including the layoffs in the textile industry.

"Labor-intensive industries are relatively struggling, but capital-intensive industries are experiencing improved performance. This serves as a warning to the government that increased industrial performance doesn't always translate to increased job absorption," said Faisal.

(See *Katadata*: Reasons for the Surge in Manufacturing PMI Amidst Layoff Wave)