On the morning of November 3, S&P Global released the Purchasing Managers’ Index (PMI) for Vietnam’s manufacturing sector in October. The report highlighted three main points: production and new orders increased strongly and faster; employment and input inventories rose again; and selling prices grew at the fastest pace since June 2022.

Vietnam’s manufacturing PMI jumps

S&P Global noted that Vietnam’s manufacturing sector saw a recovery in growth momentum at the start of Q4/2025. Production and new orders rose strongly and faster, while employment increased for the first time in over a year. Input inventories also rose again, while business confidence reached a 16-month high. Meanwhile, inflationary pressures intensified as both input costs and output prices grew faster than in September.

The manufacturing PMI in Vietnam climbed to 54.5 points in October, a significant rise from 50.4 points in September, signaling a sharp improvement in sector health compared with the previous month. Business conditions strengthened at the fastest pace since July 2024.

New orders increased for the second consecutive month, with a pace stronger than September, marking the fastest rise since July 2024 amid improving customer demand. Export orders contributed to the overall increase in new orders, rising for the first time in a year, albeit slightly.

To meet rising new orders, manufacturers increased production, recording the strongest growth since July 2024. Production has now risen for six consecutive months.

Alongside stronger production in the current survey period, companies are more optimistic about production prospects over the next 12 months. Business sentiment reached a 16-month high, driven by confidence that new orders will continue to rise and expansion plans will proceed.

Rising demand for employment

The S&P Global report indicated that increasing new orders and production requirements also drove employment higher in October, the first increase in over a year. Manufacturers added staff to cope with emerging pressures on capacity.

The rise in new orders and production requirements encouraged companies to increase purchasing activity, marking the fourth consecutive month of growth. Input inventories also rose, the first increase in more than two years. Meanwhile, finished goods inventories fell as companies used stocks to fulfill orders. However, higher production in the month meant inventories declined only slightly, the smallest drop since January 2024.

Input costs rose faster in October, at the strongest pace since July 2024, with around 27% of respondents reporting higher prices amid material shortages. As a result, output prices also increased faster, reaching a 40-month high.

Commenting on the survey results, Andrew Harker, Chief Economist at S&P Global Market Intelligence, said Vietnam’s manufacturing sector accelerated in October, with production and new orders rising significantly. The positive aspect is that the increase was sufficient for companies to hire more staff and boost input inventories.

“Whether these growth rates can be sustained in the coming months remains to be seen. For now, the sector has clearly positive momentum”, Harker added, noting that inflationary pressures are rising. Customers remain willing to accept higher prices and place new orders, but this may change if price growth continues at the current pace.