IRELAND’S MANUFACTURING sector continued to expand in March, but the pace of growth slowed last month, new data has shown.

The NCB manufacturing purchasing managers’ index fell to 55.7 from 56.7 in February, as output and new orders expanded at a slower pace.

Employment in the sector was among the strongest aspects – respondents said they were taking on new workers at the fastest pace in 11 years. The employment subindex rose from 53.4 in February to 54.7 in March, the strongest reading since June 2000.

Output showed growth for the 13th month in a row and although it was lower at 57.8 from a reading of 60.9 a month earlier, NCB said the pace remained “substantial”.

New orders, although expanding, fell to 57.9 in March from 59.2. Exports continued to driven the manufacturing sector, a situation that is expected to continue for the year.

Firms cited improved demand from European firms as new export orders outperformed new business slightly, at 59.2.

“Exports had a stellar year in 2010 increasing by 9.4 per cent and we expect them to grow by a further 6 per cent in 2011,” said NCB chief economist Brian Devine. “Despite this, GNP still fell by –2.1 per cent and we expect another decline of –1.4 per cent in 2011.

“It seems like an insignificant fact in light of the banking sector issues but if it weren’t for the exporting sector, the economy would be in far worse shape.”

Firms also felt the impact of rising oil prices, with input cost inflation at a record 80.9 in March. NCB said almost 58 per cent of respondents said their input costs had risen.