Despite stronger production, manufacturers continued to cut jobs, with employment falling at a faster pace than in July.

BERLIN, Sept. 1 (Xinhua) -- Germany's manufacturing sector showed signs of resilience in August, with output and new orders rising at a faster pace even as employment continued to decline, a survey showed Monday.

The final S&P Global/HCOB Purchasing Managers' Index (PMI) for German manufacturing rose to 49.8 in August from 49.1 in July, just below a preliminary estimate of 49.9. It was the highest level since mid-2022, when the index first slipped below the 50.0 threshold that separates growth from contraction.

The improvement was driven by stronger output and new orders, which grew for a third consecutive month. However, export sales fell slightly for the first time in five months.

Despite stronger production, manufacturers continued to cut jobs, with employment falling at a faster pace than in July. Official data last week showed the number of unemployed in Germany had topped 3 million for the first time in a decade. A report by consultancy EY said the industrial sector had shed more than 114,000 jobs over the past year, including around 51,000 in the auto industry.

"The ability to expand production despite mounting challenges is a testament to the sector's resilience," said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank. But he warned that the industry faces risks from possible disruptions in trade with key non-EU partners and pressure on competitiveness from a stronger euro.

Germany's economy contracted by 0.3 percent in the second quarter, as weak exports and sluggish investment continued to weigh on growth.