India's Services Activity Slips Marginally In November, Job Creation Hits Survey Peak. Check PMI Data

Comparatively, the services PMI in October stood at 58.5. This index is based on a single question that looks into how the level of business activity compared with the situation in the preceding month

India’s services activity touched 58.4 in November, inching slightly below the previous month. The seasonally adjusted HSBC India Services Business Activity Index slipped a bit in November, but the expansion rate still remained well above the trend.

Comparatively, the services PMI in October stood at 58.5. This index is based on a single question that looks into how the level of business activity compared with the situation in the preceding month.

Growth of new orders and output declined fractionally in the period under review, however, the Indian economy managed to impress with its performance in November, the survey conducted by S&P Global revealed.

The study showed that current improvement in sales boosted firms’ capacity pressures and promoted job creation as well. Employment growth in the month hit a peak as hiring for permanent and temporary staff continued.

“The only downside to job generation was an intensification of price pressures. Input costs rose to the greatest extent in 15 months, while selling prices increased at the fastest rate in close to 12 years,” the survey noted.

The panellists said that international demand for services improved. New export orders also climbed at a robust rate which was the quickest in three months. Overall employment rose at the fastest pace since the survey first began in December 2005.

Inflation remained sharp and was the strongest seen in 15 months, well above the long-run average, the survey found. The private sector firms in India indicated that demand strength backed the growth of new business and output in the period under review.

The HSBC India Composite Output Index touched 58.6 in November, slipping from 59.1 recorded in October. The larger slowdown in growth was recorded by the goods producing sector, however, the segment managed to pose a swifter rise than that seen in the service economy.

Pranjul Bhandari, Chief India Economist, HSBC, noted, "India posted a strong 58.4 services PMI in November 2024, down only a fraction from the prior month’s 58.5. During November, services sector employment notably grew at the fastest pace ever recorded since this survey began in 2005. The hiring surge reflected the sector’s improving business confidence, growing new orders, and vigorous
international demand. At the same time, high food and labour costs drove up input and output prices to their fastest rates in 15 months and nearly 12 years respectively."