Manufacturing, services record growth while employment contracts

Sri Lanka Purchasing Managers’ Index for Manufacturing (PMI – Manufacturing) recorded an index value of 56.6 in May 2026, indicating an expansion in manufacturing activities compared to April 2026. All sub-index values recorded above the neutral threshold during the month, contributing to the overall increase in the index value. However, respondents continued to highlight the challenging operating environment associated with the Middle East conflict.

The increases in the New Orders and Production sub-indices were mainly driven by the manufacture of food & beverages and textiles & manufacture of wearing apparel sectors.

Meanwhile Sri Lanka Purchasing Managers’ Index for Services (PMI – Services) recorded an index value of 56.9 in May 2026, indicating an expansion in services activities compared to the previous month. Business Activity in the services sector rebounded in May 2026 following a decline in the previous month. The expansion was primarily driven by the financial, professional, and other personal services sub-sectors, while real estate, IT programming, and goods transportation also recorded notable growth.

New businesses increased in May 2026, primarily driven by growth in financial and professional services sectors. The wholesale and retail trade, other personal services, and goods transportation sectors also contributed to this increase.

Employment declined in May 2026 due to contract expirations, retirements, and resignations.