Otago's manufacturing base has dragged itself out of a three-month contraction to post some slight expansion for August, due to an improvement in supply and demand.

However, a similar international manufacturing index is sitting at 48.1 points for August, having slumped to a more than three-year low as economies such as China, Australia and the United States slow, and because of declining levels of international trade.

Nationally, the monthly Business New Zealand performance of manufacturing index fell 2.2 points to 47.2, reflecting the lowest activity since November last year, while in Otago two consecutive months of contraction were replaced with 50.9 points.

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FIRST union general secretary Robert Reid claimed the employment figures in the index were the worst since July 2009, and confirmed workers' fears in the textile and wood processing sectors of a "jobs crisis" at hand; citing Goodman Fielder's proposal last week to close 18 of its 53 plants in Australia and New Zealand.

Manufacturing was New Zealand's third largest employing industry, and in the wake of recent redundancies and more on the way, he criticised the Government for not offering more input into monetary policy reform.

"Hundreds of thousands of manufacturing workers deserve better - a better response from the Government that 'there's nothing we can do'," Mr Reid said.

Excerpt from Slight expansion in manufacturing base by the Otago Daily Times.  Click here to read the full story.