The Ai Group Australian Industry Index fell -2.4 pts to -16.0 in September 2025, with manufacturing (-13.2) and construction (-12.3) both in contraction, reflecting weak demand, labor shortages, and intensified price competition.

• The Australian manufacturing PMI jumped 7.6 pts to -13.2, offsetting a sharp decline in the Australian construction PCI, down -12.4 pts to -12.3. However, the longer-term trend measure shows construction still stronger than manufacturing.

• Activity/Sales declined -3.2 pts to -15.8, as project delays and weak demand weighed on output.

• Employment fell -1.2 pts to -11.2, with firms citing skill shortages and wage pressures.

• New Orders edged down -0.8 pts to -13.7, signaling subdued forward demand, while Input Volumes slipped -2.1 pts to -13.5.

• Input Prices dropped sharply -17.6 pts to 27.2, the lowest since August 2020, indicating easing cost pressures.

• Sales Prices also fell -6.7 pts to 6.4, reflecting intensified competition and import-driven pricing pressure.

• Average Wages eased -1.9 pts to 32.0, marking a two-year low but still elevated relative to historical averages.

• Capacity utilisation weakened further to 77%, below the long-term range of 79–82%, consistent with ongoing labor and supply-side constraints.