The weakening growth demonstrates the lower economy and the stagnation of job-markets cooling down the domestic growth and demand in the territory.
HSBC's flash India Composite Purchasing Managers' Index (PMI), compiled by S&P Global, fell to 58.9 this month, down from 59.7 in November. Although the reading remains comfortably above the 50-mark separating growth from contraction, it represents the softest activity since February.
The shortage was mostly reported in the goods-producing sector, where the industry's health improved at its slowest rate in two years. Manufacturing PMI slid to 55.7 from 56.6. The services activity index dipped to 59.1 from 59.8, reflecting softer growth in the dominant sector.
Recruitment stalled
The recruitment of employees stalled at its weakest speed since 2024. Companies admitted that the current workforce is sufficient to meet the demands of the present work required and the staff levels remained untouched.
The pause in hiring and giving a rise to unemployment reflects a sharp dip in optimism. The business spark is vanishing and dim dropping for a third consecutive month to its lowest in July 2022.
Inflationary pressures
The decline in the service centre overshadowed the aspirations of the working youth and future growth.
"Firms were helped by inflationary pressures remaining muted as the year drew to a close," said Andrew Harker, economics director at S&P Global Market Intelligence, as quoted by Reuters.
The selling prices skyrocketed the market at factories easing the weakest since March. This hiring pause and economical upsurge entered into a challenging phase heading into 2026.
