Kuwait's non-oil economy displayed a positive but moderated growth trajectory in June compared to May, according to the latest S&P Global Kuwait Purchasing Managers' Index (PMI). The headline figure dipped slightly to 51. 6 from 52. 4 in May, but remained comfortably above the 50. 0 threshold that indicates expansion in business activity.
This moderation in growth suggests a potential settling after a period of strong gains. However, there are positive signs beneath the surface. New business orders continued their upward trend for the seventeenth consecutive month, indicating sustained demand within the non-oil sector. This ongoing customer interest appears to be translating into increased staffing levels, with Kuwaiti non-oil companies reporting the strongest rate of employment growth ever recorded in the survey's history.
"Firms were still unable to make a dent in their backlogs of work, " remarked Andrew Harker, economics director at S&P Global Market Intelligence. "This backlog suggests that they may need to expand hiring further in the months ahead to keep pace with incoming orders. "
The unfulfilled backlog highlights potential capacity constraints within the non-oil sector. Businesses are likely to prioritize increasing their workforce to address these limitations and ensure they can meet customer demands. This focus on staffing bodes well for Kuwait's overall employment picture, potentially leading to a sustained period of job creation.
While the PMI data indicates a slight slowdown in the non-oil sector's growth momentum, the continued rise in new orders and the record-breaking employment growth paint a more optimistic picture. The Kuwaiti economy appears to be finding a new gear, one fueled by domestic demand and a growing workforce within the non-oil sector. This shift has the potential to lessen Kuwait's dependence on its historically dominant oil industry and foster a more diversified and resilient economy.