FT Alphaville " The good news and the bad from the flash China PMIs The good: the closely-watched index components of new orders and new export orders were only just below the 50 mark, as the below chart from Markit Economics shows. The bad: Meanwhile, volumes of work-in-hand (but not yet completed) at manufacturers" plants were largely unchanged compared to March. It is unusual for backlogs not to rise, suggesting that capacity levels are not being tested in the sector. Companies continued to shed jobs on average in April as a result. The PMI Employment Index rose only slightly from March's three-year low, registering the fourth month on-month decline in staff numbers in the past five months. As Alex Hamilton of Markit Economics writes, this kind of employment data might not bode well for Chinese stability, especially with GDP growth slowing: And Hamilton has a point, if you subscribe to the view from China economy expert Nicholas Lardy that a long, slow landing of around 7 per cent GDP growth for several years could be more harmful, in terms of employment and social unrest, than the "hard landing" that is often talked about - and implies a rapid recovery. Anyway, as an added bonus, via Barclays: this useful comparison of the official and the HSBC/Markit Economics PMIs... and how much the two have diverged, especially of late: We've looked into some of the possible reasons for this previously. Related link: A fate worse than a hard landing for China - FT Alphaville This entry was posted by Kate Mackenzie on Monday, April 23rd, 2012 at 8:59 and is filed under Capital markets. Tagged with china, Chinese economy, PMIs.